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Northpoint Looks Good to Go at FCC

Washington-In a controversial step, the Federal Communications Commission is planning to give the green light for Northpoint Technology Ltd. to share direct-broadcast satellite spectrum, according to FCC and legal sources.

The FCC is expected to make a preliminary move on the Northpoint petition before Nov. 29, but whether the FCC would issue the company the necessary licenses by then was still up in the air last week.

"Generally, that is what we understand. I am hearing that's the general situation," said a Washington lawyer who has tracked the Northpoint issue closely.

Northpoint's business plan calls for terrestrial distribution of high-speed data, dozens of cable networks and every local broadcast-TV signal using low-cost transmitters. The company has aggressively lobbied the FCC to gain access to the DBS spectrum at no cost.

The DBS industry is up in arms about Northpoint and still may persuade Congress to override any FCC decision until the agency has hired a third party to test Northpoint's service for compatibility with DBS frequencies.

DBS industry leaders have protested loudly that Northpoint's service will interfere with millions of home dish owners' reception as hopes of robust DBS-cable competition are starting to be realized.

"We obviously will not be pleased if the FCC decides they want to develop a sharing concept," said Andy Paul, senior vice president of the Satellite Broadcasting & Communications Association. "We are not going to be happy about that because the whole issue is interference. It's not competition."

DBS analyst Mickey Alpert, president of Alpert & Associates here, said he would be troubled if Northpoint's service interfered with DBS signals.

"If that happens, the FCC has made a terrible mistake," Alpert said. "That is not a small thing. It's a major thing."

If Northpoint does not interfere, he said, he does not expect the company to siphon off many of the DBS industry's 12 million customers.

"Assuming there is no interference, I think they will be an annoyance. I think DBS will be able to compete with them," he said.

Northpoint insists independent studies have shown that interference would not occur, because its transmitters would beam signals from the opposite direction of DBS transmissions.

According to FCC and legal sources, agency engineers have concluded that Northpoint can share DBS spectrum without degrading existing satellite service.

Under one scenario, the FCC would release an order stating that the DBS spectrum can be shared but would not issue Northpoint any licenses.

At the same time, the agency would release a second order to seek public comment on a range of technical issues associated with sharing, perhaps including a proposal to auction off the spectrum if companies other than Northpoint opt to seek it.

In May, Pegasus Communications Corp. filed with the FCC to use the same spectrum sought by Northpoint.

Under a law passed last year, the FCC is required to deal with the Northpoint issue by Nov. 29, but some agency staffers apparently believe the measure does not require the FCC to issue any licenses by that time.

It was possible the FCC could wrap everything up by Nov. 29, one source said, while another insisted that issues in the further notice would take months to resolve.