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MDS in Auction; Northpoint, DirecTV Out

Northpoint Technology Ltd. is skipping the Federal Communications Commission's January auction of spectrum that winning bidders are permitted to use to provide pay TV and high-speed-data services.

Northpoint -- which developed terrestrial technology that shares spectrum allocated to direct-broadcast satellite carriers -- sought exclusive control of the spectrum without charge, but the FCC rejected the request, opting to stage an auction Jan. 14.

The deadline to file an application with the FCC to be an eligible bidder in the MVDDS auction was 6 p.m. Wednesday. MVDDS stands for multichannel-video-distribution and data service.

Northpoint executive Toni Bush confirmed that the company would shun the auction. The company is pursuing legislation to block the auction on Capitol Hill.

MDS America Inc., which also has spectrum-sharing technology, plans to participate in the auction, said Sharif Rabah, the company's marketing manager.

"As far as I know, we are filing to participate in the auction," Rabah said. MDS America want to supply MVDDS equipment on a turnkey basis to other providers and offer service on its own to rural and underserved markets.

DirecTV Inc. spokesman Bob Marsocci said the company would not participate in the auction. However, DirecTV chairman and CEO Eddy Hartenstein told reporters in September that he expected the company to bid.

EchoStar Communications Corp. did not reveal its plans when asked by a reporter. The company said the public could obtain the bidder list from the FCC in due course.

Both DirecTV and EchoStar have fought Northpoint, claiming that spectrum sharing would scramble their signals that are going to millions of paying customers.

The FCC is planning to auction 214 licenses, including one in each of the 210 television markets. Each license is a 500-megahertz block in the 12.2-gigahertz to 12.7-GHz band.

Cable companies may not bid for licenses that significantly overlap with their cable franchise areas. Each license is issued for a 10-year term. Licensees have five years to provide substantial service to the public.