WASHINGTON - An Alaska Native telecommunications company that scooped up one of three valuable licenses for wireless telephone service in New York City's high-demand market is the subject of a challenge to a recently completed government auction.
Alaska Native Wireless is a joint venture of Sealaska Corp. of Juneau; Doyon Ltd. of Fairbanks and Arctic Slope Regional Corp. of Barrow.
Most bids in the Federal Communications Commission auction, which reaped a record $16.86 billion, drew little opposition. But some companies that won licenses specially set aside for small businesses had ties to industry giants, and that has been contentious.
One petition filed by TPS Utilicom asks the government not to grant licenses to Alaska Native Wireless, which won licenses in New York and elsewhere, because of that company's ties to powerhouse AT&T Wireless.
TPS charges that Alaska Native is not eligible for very small business status or special entrepreneur discounts because of its links to AT&T.
A lawyer for Alaska Native Wireless asserted its partnership falls within the commission's rules because AT&T does not have legal or practical control of the company. The company is confident it has met the standards laid out by the FCC for this type of arrangement, the lawyer said.
TPS Utilicom argues the government should not grant licenses to DCC PCS, which also has links to AT&T, on similar grounds.
AT&T declined to comment.
The small companies that partnered with larger industry players have long argued that such arrangements are necessary to give them enough capital to compete in the auction and prevent them from defaulting on their payments, as other small businesses have done in previous auctions.
The January auction included licenses bid on several years ago by NextWave Personal Communications, which later went bankrupt and missed deadlines to pay for the licenses.
The FCC reclaimed the licenses and re-auctioned them. But NextWave has mounted a legal challenge to get the licenses back, saying it can now pay for them.
NextWave also filed a petition asking the government to hold off on granting the licenses won by bidders until its litigation is resolved. The U.S. Court of Appeals for the District of Columbia is set to hear oral arguments as NextWave seeks to get its licenses back.
Several other companies that also had their licenses revoked by the FCC after failing to pay on deadline are still contesting the decision by the commission to cancel those licenses and re-auction them to new bidders, according to the filings.
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