A three-judge panel rejected Sprint's claim that the FCC's Sept. 11 order would cripple the company's wireless network. Sprint, the third-biggest U.S. mobile-phone company, had also argued that the FCC order was ``arbitrary and capricious'' and would harm public safety.
The FCC's decision to uphold the June deadline was reasonable and will lessen interference with public-safety communications systems that use airwaves in the 800-megahertz band, the court said in its opinion.
``We are pleased with the court's decision,'' FCC spokesman Robert Kenny said in an interview. ``We will continue to focus on clearing the spectrum for public safety and resolving the interference issues that America's first responders now face in many regions of the country.''
`Breathing Room'
The FCC will probably grant Sprint ``additional breathing room'' for giving up the airwaves, Stifel Nicolaus & Co. analyst Blair Levin said today in a note to clients.
Still, the company ``lacks any certainty or comfort that it will not have to vacate core operational spectrum in a few weeks and that it should not therefore be devoting resources to a contingency plan,'' Levin said.
Nextel Communications Inc. agreed in 2005 to give up 800- megahertz spectrum worth $2.1 billion and spend $2.8 billion to relocate police and fire departments to those airwaves. In exchange, the FCC agreed to give Nextel airwaves the government valued at $4.9 billion. Sprint Corp. bought Nextel later that year to form Overland Park, Kansas-based Sprint Nextel.
Sprint had spent $1.1 billion to move public-safety systems to the 800-megahertz airwaves as of Dec. 31, the company told the Securities and Exchange Commission in a Feb. 29 filing. Sprint said it may ultimately pay as much as $3.4 billion to move those systems.
Extra Time
The court's ruling disappointed Sprint, which said it is committed to eliminating interference risks its mobile phones pose for public-safety networks.
``However, more than 500 public-safety agencies have requested more time -- in many cases, years'' to move their systems to the airwaves Sprint will vacate, the company said today in an e-mailed statement.
So far, the FCC has waived the June 26 deadline for more than 100 public-safety agencies. Sprint said it has requested FCC waivers to continue using those channels until the public-safety agencies are ready to swap.
If Sprint wins waivers for any of those frequencies, it must, under the FCC's 2007 order, vacate them within 60 days of being notified that a safety agency is ready to use them.
``We believe the FCC is quite serious about moving the rebanding process forward,'' Levin said. ``At the same time, we believe the agency is not aiming to create a situation that causes a service disruption for Sprint.''
Sprint fell 13 cents to $7.89 at 4 p.m. in New York Stock Exchange composite trading. The shares have declined 40 percent this year.
The case is Sprint v. Federal Communications Commission, 07- 1416, U.S. Court of Appeals for the District of Columbia Circuit (Washington).
