TV Spectrum Sellers Call For Early Auction

A group claiming to represent 39 major-market TV stations open to selling off spectrum in the FCC’s planned incentive auction next year is urging the agency to proceed with dispatch, putting it at odds with the National Association of Broadcasters.

Over the past several weeks, NAB EVP Rick Kaplan has been publicly pleading for agency caution, contending that the plan for a 2014 auction may too ambitious.

“A lot needs to be done and we really need to get these things right—not just done,” said Kaplan, during a panel session at the Consumer Electronics Show in Las Vegas earlier this month.

But in comments filed at the FCC Wednesday night (Jan. 23), the Expanding Opportunities for Broadcasters Coalition — the group headed by former Walt Disney Co. lobbyist Preston Padden — is urging the agency to push the pedal to the metal.

“The NAB appropriately is focused on the vast majority of stations who will remain in broadcasting and our coalition is focused on broadcasters who want to participate in the auction if they can get fair value for their spectrum,” said Padden, in an interview Wednesday evening with TVNewsCheck.

In its comments, the coalition also urged the agency to turn a deaf ear to calls by some public interest groups to restrict the ability of AT&T and Verizon to bid in the forward auction.

Without the participation of AT&T and Verizon, the auction will fail because it won’t “produce the revenues necessary to meet the expectations of the potentially willing broadcast sellers,” the coalition’s comments to the FCC say.

“Our message is that the FCC can succeed in reallocating a 120 mhz of spectrum for wireless broadband, and they can succeed in generating $7 billion for the public safety network, and they can succeed in generating money for deficit reduction,” said Padden, confirming that the coalition includes no members affiliated with one of the Big 4 broadcast networks.

“Those are the congressional goals. They just need to run this auction like a free market secondary market and not get into set-asides and prohibiting some players from participating,” Padden said.

“We need the maximum possible number of broadcasters offering their spectrum and the maximum possible number of wireless companies bidding for this spectrum, if this auction is to succeed.”

In its comments, the coalition, which insisted that no wireless carriers are members or contributors to the group, also said that the anonymity of broadcasters choosing to participate is critical to the reverse auction’s success.

“If you’ve got an ongoing business with advertisers, viewers and employees, you don’t want to stand out on the front porch and say, ‘Hey, we’re going to try to go out of business in two years,’ ” Padden said.

According to a coalition summary, the group now represents 39 stations “in the very largest markets.”

Also in the summary, the coalition said it is urging the FCC to calculate closing conditions on a national basis.

“Payments to broadcasters in the very largest markets may exceed wireless auction revenues in those markets,” the summary says. “But in most markets, the FCC will be able to clear 120 MHz for wireless without buying out any broadcasters. The payments to stations in the very largest markets add value to the spectrum in all the markets and are the key to generating wireless auction revenue nationwide.”

The summary also says that stations should not be scored based on enterprise value, signal strength or other factors not relevant to the 6 MHz of spectrum they are offering to surrender. “The only relevant metric for scoring is how removing a station impacts the commission’s ability to clear spectrum for wireless,” the summary says.