Shure Makes Clever Defensive Gambit Against CTIA/Public Safety in 700 MHz Tussle — $1000 Rebate.

In an interesting new development in the wireless microphone saga, Shure is now offering a $1000 rebate on a replacement wireless microphone for anyone who trades in a wireless microphone that operates on the 700 MHz frequencies, provided the purchaser bought the microphone before February 2007. I’m not sure why the magic cut off date, and Shure does not explain.

Shure does, OTOH, offer an explanation for why it will make this generous offer — albeit an incomplete one:

“Our number one priority is to provide our customers with the highest quality products, service, and support,” said Al Hershner, Vice President and General Manager of the Shure U.S Business Unit. “We’ve known for some time that the ‘700 MHz band’ would be reallocated for new services following the DTV transition on February 18, 2009. Although a final decision from the FCC is still pending, we felt the need to assure our customers now that we will take care of them regardless of the outcome.”

Shure does not mention, of course, that the most likely outcome involves outlawing all use of wireless microphones in the 700 MHz, and a reasonable probability that Shure (and other manufacturers) will be required to replace the equipment for free. But that doesn’t mean Shure will miss an opportunity to spin its customers and recruit their support at the FCC explain to interested customers the ongoing FCC legal proceeding:

“There has been a great deal of confusion for wireless microphone users regarding the political and technological developments surrounding the DTV transition and the 700 MHz auction over the past few years,” added Hershner. “As always, Shure has a team of sales, customer service, and technical support staff available to answer any questions people might have about this rebate program or their products.”

Hmmm….could this have something to do with the recent push by the incoming public safety and commercial 700 MHz licensees to take this seriously so it won’t mess up deployment? Could Shure be trying to fob off the FCC with a fake remedial action while boosting its own sales and recruiting its customers for a massive push against the wireless guys and public safety? Or is that just my nasty and suspicious nature rejecting the idea that Shure is deeply — deeply I say — concerned about its customers (which it assures the FCC are only retailers and not members of the public ineligible for licenses to operate such systems) and I should be ashamed of myself for questioning this noble voluntary remediation by an upstanding corporate citizen that just happened to build its business on wholesale violation of federal law?

I explore the possibilities below . . . .

As readers may recall, I was apparently the first person to publicly point out that the massive illegal use of wireless microphones on TV Channels 52-69 looked to create serious interference issues for public safety and commercial wireless licensees who will begin using that spectrum in February 2009 after the DTV transition. Worse, although wireless microphones operating in the broadcast band requires an FCC license, and FCC rules limit eligibility to producers of broadcast programming, cable programming, and motion pictures, wireless microphone manufacturers had marketed them to the general public — and with great success. You can find them in churches, in high drama clubs, karoke bars, on the street with musicians out busking, and just about everywhere else. As a result, while nobody knows exactly how many of these units are out there (we estimated at least 1 million based on trade publications), or where or when or at what power (anywhere from 250 mW to about 10 mW) they operate. In spectrum management terms, if the 700 MHz is the “beach front” spectrum, wireless microphone manufacturers are the Exxon Valdez.

I later filed (on behalf of the Public Interest Spectrum Coalition (PISC)) a complaint and Petition for Rulemaking with the FCC, which put the Petition out for comment and began an investigation into the complaint back in August. We recommended, among other things, that the FCC (a) immediately ban all manufacture, sale and use of wireless microphones operating in the 700 MHz band, although possibly allowing grandfathered use of licensed systems, (b) grant amnesty to all illegal users (about 95% of the user population) and authorize them to use wireless microphones, and (c) make the wireless microphone manufacturers, who created this mess by marketing to the general public, pay to clean it up by giving all users new microphones that operate below 700 MHz. While folks duly filed comments and replies in the fall, most folks (including the wireless microphone guys) treated it as something of sideshow to the white spaces proceeding.

Meanwhile, however, the incoming 700 MHz licensees — prompted by the FCC’s public notice of our complaint and petition — began to take a look at the issue and discovered that (a) wireless microphones could cause considerable interference with the proposed services in the band, and (b) no one had the least clue how many of these microphones were out there, where they were, or anything else that could let the new licensees get a handle on the actual interference potential. (As I have noted numerous times before, wireless microphones don’t interfere with TV reception because that is a powerful signal pushing down on a dumb receiver. They do interfere with the incoming public safety and commercial systems because those are much weaker two-way systems.) Concern about this has prompted large delegations from the wireless industry (joined at times by yr hmbl obdn’t blogger) to push the FCC to do something about this ASAP. At the very least, they would like the FCC to stop the problem from getting worse by issuing an Order affirming the tentative conclusion to ban the further manufacture and sale of 700 MHz wireless microphones — a problem aggravated by retailers slashing prices on units that operate in the 700 MHz band to clear out inventory before the FCC acts.

And now Shure responds with its amazingly generous offer of a $1000 rebate. You can find details here, including a number to call at Shure if you want more information. Is it merely a coincidence that they have opted to make this offer now, after discovering that it is not merely a few whacky public interest folks and wussy public safety groups demanding action? Does the fact that the wireless industry, which collectively spent about $20 billion for licenses in the 700 MHz band, are now demanding with increasing urgency that the FCC live up to its obligations and deliver the band in clean and usable condition have anything to do with it? Shure does not say.

In fact, Shure does not say an awful lot that folks availing themselves of the possible rebate might want to know. As is true of so much of Shure’s marketing, it isn’t that Shure tells any lies. They simply fail to disclose some rather important truths. It is certainly the case that “a final decision from the FCC is still pending” on these matters. But I doubt Shure will mention to their customers that the proposal at the FCC would require Shure (and others) to replace the equipment for free rather than require customers to buy a new unit and then apply for a rebate. Similarly, I strongly suspect that any customer that calls Shure for more info will be informed that between white space devices and the wireless industry, the FCC has it in for wireless microphones and they should go file a comment with the FCC right away and call their Congresscritters to help save little Timmy’s drama club or the church choir or whatever — without mentioning the amnesty and proposed rule changes that would make use of these wireless microphones legal.

In one omission in particular, Shure is singularly consistent. Nowhere in any of the rebate information does Shure explain that you need an FCC license to operate on the remaining broadcast bands.

This last might seem puzzling to some given the pending complaint. Doesn’t offering a rebate to entice people to buy more wireless microphones simply amount to more illegal marketing? But Shure recognizes a clever ploy when it sees one. True, it is marketing units to customer to whom it has no right to market. But Shure is wagering on the fact that the commercial wireless guys and the public safety guys don’t care about the fact that they are radio pirates in some other band. The 700 MHz licensees want the problem to go away, now, and without the licensees needing to pay for it. If Shure’s rebate offer gets users out of the 700 MHz band, then fine.

Meanwhile, it puts the FCC in a bind. If the FCC acts against Shure for this latest act of illegal marketing, it interferes with clearing the 700 MHz band — the FCC’s top priority here. Taking this voluntary remediation effort as more proof of illegal activity would let Shure and the rest of the wireless microphone manufacturer raise a huge squawk against the FCC for “punishing” Shure for “doing the right thing and taking responsibility” and “discouraging other manufacturers from acting responsibly to clear the band.” The FCC makes an easy target, especially if Shure recruits its photogenic back up chorus from Broadway.

On the other hand, the FCC (and anyone who thinks about it) should figure out that a rebate program like this will probably have minimal actual impact on clearing the band. The vast majority of users will probably never hear about it. Worse for the FCC, if it stays silent, Shure can argue that the FCC gives tacit assent to its sales practices.

And, of course, any sales are a direct profit for Shure, even with the rebate. But that is merely a bonus point for Shure.

It will be interesting to see how this plays out over time. In the short term, I suspect it will undercut the urgency at the FCC to take action. Lets face it, this is an ugly enforcement problem with no good solution and lots of ways to get in trouble politically. If the 700 MHz licensees didn’t face real interference issues of the kind that could majorly screw up deployment of wireless broadband and public safety systems, they would not want to touch this at all. I suspect the Enforcement Bureau will be grateful for any reasonable excuse to slow down action. Add to this the usual freeze on activity (particularly potentially controversial activity) that sets in during a transition, and we have a recipe for further delay.

Verizon & AT&T better hope lots of people go for the rebate.

Stay tuned . . . .