- The Washington Times - Friday, March 15, 2002

Federal regulators will likely allow XM Satellite Radio Inc. to use broadcasting technology that cell-phone providers complain will disrupt services they plan to introduce.
But a decision from the Federal Communications Commission ending the dispute between satellite-radio companies and wireless companies won't come before next week, when a license allowing use of the technology expires. Phone industry sources said they expect the federal agency to let XM, in the District, and Sirius Satellite Radio Inc. use repeaters, which boost the strength of satellite radio signals.
"Probably they will extend [the license to use repeaters] permanently. XM has a product out in the market already, and the FCC won't want to shut down an existing service," said a source at a wireless phone company involved in the lengthy dispute.
XM reported in late January it had more than 30,000 subscribers. Its radio signal was available nationally beginning last November. Sirius, based in New York, introduced service in four cities on Feb. 14 and plans to beam its signal nationally in August.
The satellite companies have a temporary license to use repeaters, which expires Monday. XM and Sirius have asked the FCC to extend the license while the agency drafts a final rule. The FCC has not adopted rules governing the use of repeaters for satellite radio, even though it let companies build the devices.
XM and Sirius beam their signals using satellites. But signals sometimes weaken in urban areas, where buildings can block transmissions, so XM has built 778 repeaters, according to FCC filings. Sirius has built 104.
The potential for problems arises because cell-phone providers and satellite companies operate side by side on the wireless spectrum. Phone companies argue that interference from high-powered repeaters could disrupt high-speed Internet services for wireless phones.
The satellite companies disagree.
While the satellite companies want to operate repeaters at strengths of up to 40 kilowatts, wireless firms want XM and Sirius to keep their repeaters at two kilowatts or less.
Neither party is likely to get what it wants.
"It will be somewhere in the middle," a source at the FCC said.
That could cause the satellite radio companies some problems. XM officials wrote in a regulatory filing this week they will have to build more repeaters if the FCC decides their transmission strength must be lower than 40 kilowatts. XM may be faced with investing in more repeaters, it wrote in the filing. But it wouldn't be threatened with shuttering operations.
"I don't think [the FCC] will cause us any harm," XM Senior Vice President Lon Levin said.
Phone companies argue that a compromise could harm them.
"Anything above two kilowatts, and we're in a mess. The impact of a number in the middle is that we're still going to be splattered. That means the services we attempt to roll out will be badly interrupted in areas where the satellite companies use repeaters," BellSouth Corp. spokesman Bill McCloskey said.
Traditional radio broadcasters also are lobbying the FCC. The broadcasters, who transmit signals over antennas, want the FCC to prohibit XM and Sirius from using its repeater network to beam local programming to subscribers. XM claims it only plans a national radio service, but it got a patent last month on technology to deliver local programming over repeaters.
Broadcasters, whose concerns are driven by the competition for listeners and for advertising revenue, want the FCC to prohibit satellite radio companies from using repeaters to transmit local programming. XM and Sirius should not be allowed to transmit national and local signals because that was not their intent when they got FCC approval for their licenses, said Jack N. Goodman, senior vice president of the National Association of Broadcasters.
"They say they won't [broadcast local programming], and that's fine. But the existence of a patent suggests otherwise," Mr. Goodman said.


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