Sprint - Nextel 2013 Annual Report Download - page 11

Table of Contents
turn, delays our access to some of our 800 MHz replacement channels. Accordingly, we will continue to transition to our 800 MHz replacement channels
consistent with public safety licensees' reconfiguration progress. On May 24, 2012, the FCC revised its rules to authorize Sprint to deploy wireless broadband
services, such as CDMA and LTE, on its 800 MHz spectrum, including channels that become available to Sprint upon completion of the 800 MHz band
reconfiguration program.We anticipate that the continuing reconfiguration progress will be sufficient to support the 800 MHz portion of our network
modernization. In January 2013, we submitted a request for declaratory ruling to the FCC requesting two items: (i) that it declare that Sprint will not owe any anti
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windfall payment to the U.S. Treasury, because we have exceeded the $2.8 billion of required expenditures, and (ii) that the FCC remove the $850 million minimum
for the letter of credit and allow further reductions based on quarterly estimates of remaining obligations. This request for declaratory ruling is pending before
the FCC.
New Spectrum Opportunities and Spectrum Auctions
Several FCC proceedings and initiatives are underway that may affect the availability of spectrum used or useful in the provision of commercial
wireless services, which may allow new competitors to enter the wireless market. While in general we cannot predict when or whether the FCC will conduct any
spectrum auctions or if it will release additional spectrum that might be useful to wireless carriers, including us, in the future, the FCC has taken steps to license
spectrum designated for auction in the Middle Class Tax Relief and Job Creation Act of 2012. In particular, the FCC has initiated three proceedings to auction
the advanced wireless services H Block, advanced wireless services in the 1.7 and 2 GHz bands (AWS - 3), and to reallocate and auction broadcast spectrum in
the 600 MHz Band. We are not participating in the H Block auction.
911 Services
Pursuant to FCC rules, CMRS providers, including us, are required to provide enhanced 911 (E911) services in a two
- tiered manner. Specifically,
wireless carriers are required to transmit to a requesting public safety answering point (PSAP) both the 911 caller's telephone number and (a) the location of the
cell site from which the call is being made, or (b) the location of the subscriber's handset using latitude and longitude, depending upon the capability of the
PSAP. Implementation of E911 service must be completed within six months of a PSAP request for service in its area, or longer, based on the agreement between
the individual PSAP and the carrier. The FCC is currently reviewing the accuracy standards for the provision of wireless 911 services indoors and may impose
additional obligations.
National Security
National security and disaster recovery issues continue to receive attention at the federal, state and local levels. For example, Congress is expected
to again consider cyber security legislation to increase the security and resiliency of the nation's digital infrastructure. In 2013, the President issued an executive
order directing the Department of Homeland Security and other government agencies to take a number of steps to improve the security of the nation's critical
infrastructure. The details surrounding the implementation of this order have not been resolved, however, and we cannot predict the cost impact of such
measures. Moreover, the FCC continues to examine issues of network resiliency and reliability and may seek to impose additional regulations designed to
reduce the severity and length of disruptions in communications. Again, we cannot predict the cost impact of any regulations the FCC adopts.
National Security Agreement
As a precondition to CFIUS approval of the SoftBank Merger, the USG Parties required that SoftBank and Sprint enter into the NSA, under which
SoftBank and Sprint have agreed to implement certain measures to protect national security, certain of which may materially and adversely affect our operating
results due to increasing the cost of compliance with security measures, and limiting our control over certain U.S. facilities, contracts, personnel, vendor
selection and operations. If we fail to comply with our obligations under the NSA our ability to operate our business may be adversely affected.
Tower Siting
Wireless systems must comply with various federal, state and local regulations that govern the siting, lighting and construction of transmitter towers
and antennas, including requirements imposed by the FCC and the Federal Aviation Administration. FCC rules subject certain cell site locations to extensive
zoning, environmental and historic preservation requirements and mandate consultation with various parties, including State and Tribal Historic
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