Lawmakers Back FCC’s Plan to Favor 3 Firms in Auction

Moving to choke off 11th-hour objections to a license auction plan that would help pay for global trade legislation, lawmakers met Wednesday to blast Pacific Bell and other critics for calling the proposal a “billion-dollar giveaway” in the telecommunications arena.

The bickering stems from a little-known provision in the General Agreement on Tariffs and Trade that would give three media companies that developed a new mobile telephone technology a substantial discount on government licenses needed to offer the service.

A year ago, the Federal Communications Commission agreed to give the three “pioneer” firms free licenses to serve markets in Los Angeles, New York and Washington, but it backed down after several members of Congress objected. The FCC then proposed to give them discounts of about 10%, but the GATT provisions would sweeten that to as much as 50%.

Other entrepreneurs, meanwhile, are expected to pay hundreds of millions of dollars for the mobile licenses when they are auctioned to the highest bidder by the FCC later this year. At least $400 million of the auction proceeds are earmarked to pay for implementation of the GATT treaty.

But critics, including Pacific Bell and Texas businessman Ross Perot, have launched a blistering attack on the discounts won by the three companies: American Personal Communications, which is 70%-owned by Washington Post Co.; Cox Enterprises Inc., and Omnipoint Corp.

In full-page newspaper ads this week, for example, Pacific Bell termed the discounts a “billion-dollar giveaway.”

But the barrage of criticism apparently swayed few lawmakers.

Edward J. Markey, the Massachusetts Democrat who chairs the House subcommittee on telecommunications and finance, said critics are simply “using this one provision as a means to derail the larger (GATT) legislation.”