Digital Audio Radio Service in the 2310-2360 MHZ Frequency Band

After carefully reviewing the comments and information the Commission received following issuance of the Notice of Proposed Rulemaking, concerning service and licensing rules for the Digital Audio Radio Service (DARS) in the 2310-2360 MHZ frequency bands, the Commission reached the following conclusions. The Commission will license satellite DARS. Opponents of the new service have not shown that its potential adverse impact on local radio service outweighs its potential benefits. Based on the record, the Commission finds that an economically viable satellite DARS system will require at least 12.5 MHz of spectrum. Although the Commission has allocated 50 MHz of spectrum for satellite DARS in the S-band (2310-2360 MHz), recently enacted legislation directs the Commission to reallocate 25 MHz of that spectrum for any services consistent with the international allocation and to assign licenses for that 25 MHz by auction. Accordingly, in this proceeding the Commission will designate only two licenses for satellite DARS in the 25 MHz that remains in the part of the S-band allocated for satellite DARS. The Commission will award both satellite DARS licenses using competitive bidding, as it proposed in the NPRM, to resolve mutual exclusivity among the current applicants, under the auction rules they adopt today. The Commission also adopts service rules for satellite DARS licensees, including milestone requirements. Three of the four DARS applicants applied for pioneer's preferences. However, following unanimous recommendations from a panel of satellite experts that no pioneer's preferences be granted for satellite DARS all three applicants have withdrawn their applications. The intended effect of this action is to establish rules and policies for the DARS service in the 2310-2360 MHz frequency band.