Clearwire 2009 Annual Report Download - page 46

We are su
b
ject to extensive regu
l
ation t
h
at cou
ld l
imit or restrict our activities an
d
a
d
verse
l
y affect our
a
bility to achieve our business objectives. If we fail to comply with these regulations, we may be subject
t
o penalties including fines and suspensions, which may adversely affect our financial condition and
r
esults o
f
o
p
erations
.
Our acqu
i
s
i
t
i
on,
l
ease, ma
i
ntenance an
d
use o
f
spectrum
li
censes are extens
i
ve
l
y regu
l
ate
db
y
f
e
d
era
l
, state
,
l
oca
l
an
df
ore
ig
n
g
overnmenta
l
ent
i
t
i
es. T
h
ese re
g
u
l
at
i
ons are su
bj
ect to c
h
an
g
eovert
i
me. In a
ddi
t
i
on, a num
b
er o
f
ot
h
er
f
e
d
era
l
, state,
l
oca
l
an
df
ore
ig
npr
i
vac
y
, secur
i
t
y
an
d
consumer
l
aws a
l
so app
ly
to our
b
us
i
ness,
i
nc
l
u
di
n
g
our
i
nterconnected VoIP telephon
y
service. These re
g
ulations and their application are sub
j
ect to continual chan
g
ea
s
n
ew le
g
islation, re
g
ulations or amendments to existin
g
re
g
ulations are adopted from time to time b
yg
overnmenta
l
or re
g
ulator
y
authorities, includin
g
as a result of
j
udicial interpretations of such laws and re
g
ulations. Curren
t
r
egulations directly affect the breadth of services we are able to offer and may impact the rates, terms and condition
s
o
f
our serv
i
ces. FCC spectrum
li
cens
i
ng, serv
i
ce an
d
ot
h
er current or
f
uture ru
l
es, or
i
nterpretat
i
ons o
f
current or
f
uture ru
l
es, cou
ld
a
ff
ect t
h
e
b
rea
d
t
h
o
f
t
h
e IP-
b
ase
db
roa
db
an
d
serv
i
ces we are a
bl
etoo
ff
er,
i
nc
l
u
di
ng VoIP
t
e
l
ep
h
on
y
,v
id
eo an
d
certa
i
not
h
er serv
i
ces. Re
g
u
l
at
i
on o
f
compan
i
es t
h
at o
ff
er compet
i
n
g
serv
i
ces, suc
h
as ca
bl
e
and DSL providers and incumbent telecommunications carriers, also affects our business indirectl
y.
I
nor
d
er to prov
id
e“
i
nterconnecte
d
” VoIP serv
i
ce, we nee
d
to o
b
ta
i
n, on
b
e
h
a
lf
o
f
our customers, Nort
h
A
merican Numbering Plan telephone numbers, the availability of which may be limited in certain geographic area
s
o
f
t
h
eUn
i
te
d
States an
d
su
bj
ect to ot
h
er regu
l
atory restr
i
ct
i
ons. As an “
i
nterconnecte
d
” VoIP an
df
ac
ili
t
i
es-
b
ase
d
w
i
re
l
ess
b
roa
db
an
d
prov
id
er, we are requ
i
re
d
un
d
er FCC ru
l
es to comp
ly
w
i
t
h
CALEA, w
hi
c
h
requ
i
res serv
i
ce
p
roviders to build certain ca
p
abilities into their networks and to accommodate wireta
p
re
q
uests from law
e
n
f
orcement a
g
enc
i
es. We are a
l
so requ
i
re
d
to comp
ly
w
i
t
h
FCC num
b
er porta
bili
t
y
an
ddi
scont
i
nuance o
f
serv
i
ce
r
ules
.
I
na
ddi
t
i
on, t
h
e FCC or ot
h
er regu
l
atory aut
h
or
i
t
i
es may
i
nt
h
e
f
uture restr
i
ct our a
bili
ty to manage su
b
scr
ib
ers’
use o
f
our networ
k
,t
h
ere
by li
m
i
t
i
n
g
our a
bili
t
y
to prevent or mana
g
esu
b
scr
ib
ers’ excess
i
ve
b
an
d
w
id
t
hd
eman
d
s. To
m
a
i
nta
i
nt
h
e qua
li
ty o
f
our networ
k
an
d
user exper
i
ence, we manage our networ
kb
y
li
m
i
t
i
ng t
h
e
b
an
d
w
id
t
h
use
db
y
our su
b
scr
ib
ers
d
ur
i
n
g
per
i
o
d
so
f
networ
k
con
g
est
i
on. T
h
ese pract
i
ces are set
f
ort
hi
n our Accepta
bl
e Use Po
li
c
y.
S
ome providers and users have ob
j
ected to network mana
g
ement practices of telecommunications carriers. If th
e
FCC or other regulatory authorities were to adopt regulations that constrain our ability to employ bandwidt
h
m
ana
g
ement practices, excessive bandwidth use would likel
y
reduce the qualit
y
of our services for all subscribers
.
A
decline in the quality of our services could harm our business, or even result in litigation from dissatisfied
s
u
b
scr
ib
ers
.
I
n certain of our international markets, we ma
y
be required to obtain a license for the use of re
g
ulated radio
frequencies from national, provincial or local regulatory authorities before providing our services. Where required
,
r
e
g
ulator
y
authorities ma
y
have si
g
nificant discretion in
g
rantin
g
the licenses and in determinin
g
the conditions for
use of the frequencies covered by the licenses, and are often under no obligation to renew the licenses when they
e
xp
i
re. A
ddi
t
i
ona
ll
y, even w
h
ere we current
l
y
h
o
ld
a
li
cense or success
f
u
ll
yo
b
ta
i
na
li
cense
i
nt
h
e
f
uture, we may
be
r
equ
i
re
d
to see
k
mo
difi
cat
i
ons to t
h
e
li
cense or t
h
ere
g
u
l
at
i
ons app
li
ca
bl
etot
h
e
li
cense to
i
mp
l
ement our
b
us
i
nes
s
s
trategy. For examp
l
e,
i
n certa
i
n
i
nternat
i
ona
l
mar
k
ets, t
h
e
li
censes we
h
o
ld
,an
d
t
h
e app
li
ca
bl
eru
l
es an
d
r
e
g
u
l
at
i
ons, current
ly d
o not spec
ifi
ca
lly
perm
i
t us to prov
id
emo
bil
e serv
i
ces. T
h
us,
b
e
f
ore o
ff
er
i
n
g
mo
bil
e
s
ervices to our subscribers in those markets, absent action b
y
the re
g
ulator
y
authorities to modif
y
the licenses an
d
applicable rules, we ma
y
need to obtain the approval of the proper re
g
ulator
y
authorities
.
Th
e
b
reac
h
o
f
a
li
cense or app
li
ca
bl
e
l
aw, even
if i
na
d
vertent, can resu
l
t
i
nt
h
e revocat
i
on, suspens
i
on
,
c
ance
ll
at
i
on or re
d
uct
i
on
i
nt
h
e term o
f
a
li
cense or t
h
e
i
mpos
i
t
i
on o
ffi
nes. In a
ddi
t
i
on, re
g
u
l
ator
y
aut
h
or
i
t
i
es ma
y
g
rant new licenses to third parties, resultin
g
in
g
reater competition in territories where we alread
y
have ri
g
hts to
licensed spectrum. In order to promote competition, the FCC or other re
g
ulator
y
authorities ma
y
also require tha
t
t
hird parties be
g
ranted access to our bandwidth, frequenc
y
capacit
y
, facilities or services. We ma
y
not be able t
o
obtain or retain any required license, and we may not be able to renew our licenses on favorable terms, or at all.
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