Metro PCS 2011 Annual Report Download - page 59

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and public perception of our ability to provide a secure service, which could adversely affect our ability to retain or gain new
customers, expose us to significant liability, sanctions, fines and litigation, increase churn and have a resulting material adverse
effect on our business, financial condition and operating results.
Risks Related to Legal and Regulatory Matters
Our ability to provide service to our customers and generate revenues could be harmed by adverse regulatory action.
Our FCC licenses are major assets that are integral to our ability to provide our services. Our FCC licenses need to be
periodically renewed and are subject to revocation and we may be subject to fines, forfeitures, penalties or other sanctions,
including the imposition of mandatory reporting requirements, license conditions, corporate monitors, forfeiture of existing
licenses, denial of renewal, and limitations on our ability to participate in future FCC auctions, if the FCC were to find that we
are not in compliance with its rules or the requirements of the Communications Act. The licensing requirements we must meet
also are subject to change by the FCC. Many of our licenses are subject to interim or final construction requirements and there
is no guarantee that the FCC will find our construction, or the construction of prior licensees, sufficient to meet the applicable
construction requirements. If the FCC finds that our construction, or the construction of prior licensees, is insufficient, the FCC
could, among other things, find that we are not a qualified licensee and revoke any or all of our licenses, refuse to renew such
licenses, and impose other penalties and sanctions. In addition, a failure to comply with applicable license conditions or
regulatory requirements could result in revocation or termination of our licenses, the loss of rights to serve unbuilt areas and/or
fines and forfeitures, or a refusal to renew the licenses. We have had inquiries from regulatory agencies regarding our
compliance with regulatory requirements and we may in the future receive additional inquiries. We have responded, are in the
process of responding, or will respond to such inquiries. The regulatory obligations we have are complex and are subject to
interpretation. We cannot give any assurance that the FCC will agree with our compliance efforts or that the FCC will not
impose fines, fees, or forfeitures, seek a consent decree, or take other adverse action against us.
We must renew our FCC licenses periodically. Renewal applications are subject to FCC review and public comment to
ensure that licensees meet their licensing requirements and comply with other applicable FCC requirements, rules and
regulations. For all PCS, AWS and 700 MHz licenses, the FCC also requires that a licensee provide substantial service in order
to receive a renewal expectancy. There is no guarantee that the FCC will find our completed system construction sufficient to
meet the build out or renewal requirement. Additionally, while incumbent licensees enjoy a certain renewal expectancy if they
provide substantial service, the substantial service standard is not well articulated and there is no guarantee that the FCC will
conclude that we are providing substantial service, that we are entitled to a renewal expectancy, or will renew all or any of our
licenses, without the imposition of adverse conditions. The FCC recently released a Notice of Proposed Rulemaking seeking to
create consistent requirements for renewal of licenses, consistent consequences for discontinuance of service, and to clarify
certain construction obligations. The proposed changes to the existing renewal and discontinuance of service requirements may
be applied retroactively to existing licenses that will be renewed in the future. If the changed requirements are applied
retroactively to our existing licenses, the FCC may determine that our, or the construction undertaken by prior licensees, or the
actions taken by us, or the prior licensees, relating to the buildout or discontinuance of service does not satisfy such changed
requirements and determine not to renew our licenses. If we fail to file for renewal of any particular license at the appropriate
time, or fail to meet any regulatory requirements for renewal, including construction and substantial service requirements, we
could be denied a license renewal or be subject to a competing application. The FCC also may impose additional regulatory
requirements or conditions on our licenses or our business and may impose a substantial renewal fee to allow a licensee to
continue to use a particular spectrum. Such additional regulatory requirements, fees or conditions could increase the cost of
doing business, could cause disruption to existing networks, and could require us to make substantial investments. Any loss or
impairment of any of these licenses, failure to renew, fines and forfeitures, the imposition of conditions, or other actions by the
FCC could have a material adverse effect on our business, financial condition and operating results.
We may be unable to obtain necessary governmental authorizations and permits on reasonable terms and conditions.
Our ability to operate our business is dependent on, among other things, our ability to obtain a variety of governmental
authorizations and permits in the planning, construction and operation of our networks. Obtaining governmental authorizations
and permits can be very time consuming, time sensitive and require compliance with a wide array of administrative and
procedural rules. Further, constructing cell sites may require zoning and other variances and permits from local agencies which
are subject to public input. Public input on zoning and other variances may be negative which could lead local agencies to
deny permits necessary for us to construct or modify our sites. To remain competitive, we must obtain such authorizations and
permits on a timely basis, at a reasonable cost and on acceptable terms and conditions. If we cannot obtain the necessary
governmental authorizations and permits at all or on reasonable terms and conditions, we may incur substantial costs associated
with finding an alternate, viable resolution, relocating sites and infrastructure, writing off cost and expenses associated with
sites we are unable to use, and we may experience a delay or impairment in the provisioning of our services which could have a