Stations Face ‘Formidable’ Spectrum Lobby

Hundreds of state broadcasting association officials and other broadcasters will be on Capitol Hill today reminding members of Congress that broadcasting is still a vital and relevant service.

They’ll be asking lawmakers to be wary of the FCC plan to reclaim broadcast spectrum and make it available at auction to providers of wireless broadband — a service the agency sees as a major driver of the U.S. economy in the years ahead.

Central to the plan is the so-called incentive auction that would, if authorized by Congress, allow broadcasters to share in the proceeds of the auction of spectrum recovered from broadcasters. Despite that prospect, the broadcasters fear that the plan will force some broadcasters to give up spectrum and ultimately diminish the reach and power of all TV stations.

In their meetings on the Hill, the broadcasters will also challenge the FCC’s assertion that the country is facing a “looming spectrum crisis” — an imminent shortage — and will ask Congress to investigate thoroughly the supply and demand before making policy that may damage broadcasting.

“NAB doesn’t have a problem with incentive auctions as long as  they are truly voluntary and if broadcasters who choose not to volunteer are not damaged in the process,” says NAB spokesman Dennis Wharton.

The lobbying push was organized by the NAB as part of its annual, two-day State Leadership Conference, essentially a legislative rally.

It’s badly needed. In the battle over broadcast spectrum, broadcasters are facing a formidable phalanx of telecommunications, consumer electronics and high-tech companies and their powerful Washington lobbies. Included are some of the biggest names in American industry today: AT&T, Verizon, Sprint Nextel, T-Mobile, Google, Intel, Cisco Systems and Microsoft.

Their businesses all have a stake in wireless broadband and they all have a covetous eye on broadcast spectrum, believing they can put it to much better use than TV stations.

AT&T alone is a force to be reckoned with. According to OpenSecrets.org, which tracks political influence in Washington, AT&T’s political action committee donations from 1989 to 2010 were more than $46 million, making it the second largest PAC of 140 top donors. The NAB, by contrast, ranked 125 with roughly $8.2 million in contributions.

“This is a very much David versus Goliath. The broadcast industry is very small in comparison to the wireless industry and its vendors,” says John Hane, a broadcast attorney who has been following the action on spectrum closely since the FCC first broached its plan in the fall of 2009.

“They have many more lobbyists,” Hane says. “They have vastly more money. The companies are themselves much bigger and individually have far greater resources. That’s a lot of fire power.”

And in their drive to break off a piece of broadcast spectrum for themselves, the industries have important allies. The White House has made the FCC broadband plan its own. In Michigan early last month, President Obama gave a speech on his economic agenda in which he promised to make high-speed wireless broadband service available to 98% of Americans within five years.

It gets worse for broadcasters. Tea Partiers and other fiscal conservatives see the auctioning of broadcast spectrum as one very big way of closing the budget gap. Estimates on how much an auction of 120 MHz of broadcast spectrum, the amount called for in the FCC plan, range from $27 billion to $60 billion.

On the point for businesses going after broadcast spectrum is the High Tech Spectrum Coalition. Formed last fall, it comprises Cisco, Ericsson, Intel, Nokia, RIM and Qualcomm, and three high-tech trade groups — the Information Technology Industry Council, the Telecommunications Industry Association and the Semiconductor Industry Association (SIA).

“I don’t think anyone is saying we should eliminate broadcasting,’’says Brian Toohey, president of one of the Coalition members, SIA. “But I think technology has evolved so that in many cases broadcasters don’t necessarily need their large allocations of spectrum any more from a pure technical perspective.”

Peter Pitsch, an Intel lobbyist, believes the FCC broadband plan got it just right. “There is a coming tsunami of demand for wireless data applications and technology alone is not going to be able to solve this problem,” he says. “Given that, it behooves the United States to try to come up with mechanisms that free up additional spectrum.”

Like FCC officials and others spectrum auction proponents, Pitsch maintains that sufficient spectrum can be reallocated without forcing the hand of any single broadcaster. “The coalition is 100% committed to the idea that broadcaster participation in any incentive auction or channel sharing arrangement should be entirely voluntary.”

Pitsch also addressed broadcasters’ fear that their over-the-air service would suffer if the FCC reassigns or “repacks” broadcast channels as part of the spectrum plan. Any broadcaster that is repacked should be “fully and completely compensated’’ for any and all of the costs that are entailed, Pitsch says.

Another proponent makes the point that repacking is a must, and the FCC doesn’t need an act of Congress to do it.

“The FCC can order licensees to change frequencies and can move things around; that’s a condition of being a FCC licensee today,” says Cisco Systems’ Mary Brown, director of technology and spectrum policy.

“Having pockets of 6 MHz’s taken up here and there renders the spectrum much less valuable and much less useful,’’ she says.

For the CTIA – The Wireless Association, “identifying and bringing to market additional spectrum for wireless broadband services is our top priority,’’ says CTIA’s Jot Carpenter, VP of government affairs.

Broadcasters need to get on board for the good of everybody, he says. “There’s an opportunity here for the broadcasters to play a role in the incentive auction process and for them to win. There’s an opportunity for us to get spectrum that our members badly need and therefore for us to win; and for the government, which badly needs spectrum to generate revenue and thus for it to win; and, most importantly, for consumers to get something at the back end of the process that they want, which is better, more ubiquitous, robust wireless broadband access.’’

Carpenter says the CTIA and other proponents are ready to work with broadcasters. “We’d love to design a system that is going to work for everybody.”

Despite such win-win talk, broadcasters remain skeptical. And NAB’s Wharton points out that some of the rhetoric coming from the other side has been downright hostile. “They’ve been saying broadcasting doesn’t matter anymore and we need to take their spectrum to serve this national imperative,” he says. “That sort of rhetoric is not helpful, and it is not true. Broadcasting still matters to millions of people. It is a lifeline service in times of crisis and is being reinvented through creative uses of the digital TV spectrum.”

Forced relocation of  broadcast stations could mean less program choice  and a denial of live and local mobile DTV service for  millions of  viewers , according to Wharton.

“Broadcasters are by far the most efficient users of spectrum, because our transmission service is one-to-everyone while theirs is one-to-one. You can’t invent a more efficient technology to deliver video than broadcast television,” he says.

So far, there has been one public flare up between the two sides.

Last month, NAB President Gordon Smith sent a letter to the Hill challenging the wireless industry’s claims of a spectrum shortage and asking Congress to look into reports that wireless carriers are sitting on as much as $15 billion in unused spectrum.

That elicited a sharp response from AT&T’s top Washington lobbyist Jim Cicconi in a Feb. 3 blog.

AT&T “paid more than $10 billion simply for the rights to spectrum for our LTE wireless build. This amount had to be paid before we could even begin spending the billions also required for the actual build out of LTE,” he said.

By contrast, he said, broadcasters have “paid nothing’’ for their spectrum.

Broadcasters’ spectrum “when used at all, serves only a sliver of the population with services that, at best, duplicate robust services widely available elsewhere.

“In short, if NAB is truly committed to identifying those sitting on unused or underused spectrum, they can start by looking in the mirror.’’

Media Access Project’s Andrew Schwartzman, a long-time observer of the Washington communications policy scene, knows what the broadcasters are up against. “There are a lot of big players who are interested in this.’’ But, he says, the broadcasters’ position is not hopeless. “The NAB’s ability to make itself heard should not be underestimated. Gordon Smith understands the Hill.’’