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Nextel Finalizes Spectrum Swap

Nextel made its controversial spectrum swap agreement official Monday, agreeing to the terms of the complicated deal hammered out with the Federal Communications Commission (FCC).

Nextel occupies space in the 800-megahertz band, sharing the spectrum with police, firefighters and other public emergency agencies. Public safety officials have complained for years that Nextel's cellular traffic interferes with emergency calls.

Under the FCC plan proposed in July, Nextel will acquire, without bidding, spectrum located at 1.9 gigahertz, which is currently used by public safety agencies and private wireless licensees.

In return, the Reston, Va.-based Nextel will give up the spectrum it presently owns and pay to reconfigure and reband the vacated space for public safety use. The deal for the first-responders and Nextel is valued at $4.8 billion.

According to the FCC, the plan will result in an additional 4.5 megahertz in the 800 band for public safety agencies, the equivalent of 90 additional two-way channels, including 10 channels for public safety/critical infrastructure interoperability.

Calling the spectrum swap the "most difficult, complex, and challenging issue" he has faced in seven years at the FCC, Chairman Michael Powell said in a statement, "Today is a major milestone . . . and I am grateful that it has arrived. As I said last summer, the Commission took a bold action in the interest of homeland security, because lives depended on it, and our police and firefighters deserve nothing less."

Within days of the July announcement, Verizon Wireless called the deal a "multi-billion dollar windfall on Nextel at taxpayer expense." The company also said the FCC action was illegal, claiming the agency is obligated to auction off the spectrum to the highest bidder. Verizon Wireless said it was willing to bid $5 billion for the spectrum.

After months of contentious legal wrangling, Verizon Wireless agreed to drop its objections to the spectrum swap in return for Nextel foregoing trademark rights to the phrase "push-to-talk," "PTT," and all related "push" names in relation to walkie-talkie technology.

"We should see the long-term band reconfiguration solution start rolling out within a few months," Powell said. "We've come quite far since adopting the plan several months ago: the committee to choose the transition administrator was formed, they evaluated applicants and chose an administrator, and the administrator has formulated a plan for the transition and submitted it to the Commission."