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In a two tier cellular network - comprised of a central macrocell underlaid with shorter range femtocell hotspots - cross-tier interference limits overall capacity with universal frequency reuse. To quantify near-far effects with universal frequency reuse, this paper derives a fundamental relation providing the largest feasible cellular Signal-to-Interference-Plus-Noise Ratio (SINR), given any set of feasible femtocell SINRs. We provide a link budget analysis which enables simple and accurate performance insights in a two-tier network. A distributed utility- based SINR adaptation at femtocells is proposed in order to alleviate cross-tier interference at the macrocell from cochannel femtocells. The Foschini-Miljanic (FM) algorithm is a special case of the adaptation. Each femtocell maximizes their individual utility consisting of a SINR based reward less an incurred cost (interference to the macrocell). Numerical results show greater than 30% improvement in mean femtocell SINRs relative to FM. In the event that cross-tier interference prevents a cellular user from obtaining its SINR target, an algorithm is proposed that reduces transmission powers of the strongest femtocell interferers. The algorithm ensures that a cellular user achieves its SINR target even with 100 femtocells/cell-site (with typical cellular parameters) and requires a worst case SINR reduction of only 16% at femtocells. These results motivate design of power control schemes requiring minimal network overhead in two-tier networks with shared spectrum.