The FCC’s broadband chief Blair Levin is promoting a plan in which TV stations would voluntarily give back their spectrum so it could be auctioned by the government for wireless broadband access. Broadcasters would get a share of the money raised and get to keep enough spectrum to provide lifeline standard-definition service. NAB and MSTV are saying “no thanks” and suspect the industry may be in for “the fight of a lifetime.”
FCC broadband czar Blair Levin earlier this month met with leading TV broadcasters in Washington to discuss the nation’s urgent need for more spectrum for wireless broadband access to the Internet and the possibility of broadcasters’ relinquishing most of their spectrum to help meet that demand.
According to sources familiar with the Oct. 8 meeting with the board of the Association for Maximum Service Television (MSTV), Levin suggested broadcasters might want to consider returning their spectrum in exchange for a share in the billions of dollars that would come from the auction of the spectrum to the wireless industry.
Broadcasting would retain just enough spectrum so that each station could provide a lifeline standard-definition service to the millions of TV viewers who still rely on over-the-air reception.
Broadcasters could no longer offer over-the-air HD and second channels and mobile video would be off the table, but they could continue to provide a single channel of TV to every home in their markets as they do today — in full-blown HD via cable and satellite carriage and SD via the over-the-air lifeline service.
Broadcasters considered the idea at the MSTV meeting and at the board meeting of the National Association of Broadcasters last week in Dallas.
Although some were intrigued by the possibility of cashing in on their spectrum, the consensus was that broadcasters should hang on to it and move ahead with plans on monetizing it further through multicasting and mobile video.
“On the surface, it just doesn’t have any great appeal,” says Paul Karpowicz, president of the Meredith Broadcast Group and NAB TV board chairman.
TV stations have made a tremendous investment in new digital transmission facilities and HDTV and are spending more to bring mobile DTV and other digital services to market, he says.
“From our perspective, we’d like to hold on to the spectrum we’ve got and develop it.”
Jim Goodmon, president of Capitol Broadcasting and an MSTV board member, is also saying no thanks to the cash-for-spectrum plan. “The notion that somehow we are going to turn in our spectrum is completely foreign to me.
“I am not saying I am against what the FCC’s trying to do. They do need more spectrum, but, if it’s broadcasters’ spectrum, that’s not the right place to get it.”
The Levin initiative also touched off concern among the broadcasters that the cash-for-spectrum plan, presented by Levin as voluntary, may turn into a government mandate if the wireless and computer industries and broadband advocacy groups get behind it.
And some fear that, voluntary or not, broadcasters would somehow get cut out of the spectrum auction proceeds.
As a result, sources say, NAB allied with the broadcast networks and they are now mobilizing to protect the broadcast spectrum. “It may well be the fight of a lifetime,” says one TV industry representative.
Levin is a former top-level FCC official during the Clinton administration called back by new FCC Chairman Julius Genachowski to formulate a comprehensive plan for making broadband Internet access available to all.
In a speech in Washington in August, Levin warned that the FCC was interested in finding more spectrum for the cause. “This is already clear from the record: A key input is spectrum and everybody agrees there is not enough of it. Moreover, demand curves from new uses by smart phones suggest a massive increase in demand ahead for that input.”
In one of his first major policy speeches, at a meeting of wireless phone operators under the aegis of CTIA in San Diego on Oct. 7, Genachowski declared that “the biggest threat to the future of mobile in America is the looming spectrum crisis.”
“As this audience knows, it takes years to reallocate spectrum and put it to use,” he said. “And there are no easy pickings on the spectrum chart.
“But we have no choice. We must identify spectrum that can best be reinvested in mobile broadband.”
Levin declined to discuss any specifics about his meeting with MSTV members, saying only that he met “with a number of different broadcasters discussing a number of spectrum-related issues.”
But he underscored his purpose: “The record is pretty clear that America, if it wants to be ready for the mobile broadband future, is going to need more spectrum.”
A growing number of academics and policy experts believe that broadcasting is an inefficient use of spectrum, especially given that TV stations now reach most of their audiences via cable or satellite.
Tom Hazlett, a professor of law and economics at George Mason University and former chief economist at the FCC, has been a longtime and articulate advocate of putting broadcast spectrum to better use.
In an open letter to Genachowski published in the Financial Times last June, Hazlett suggested that the FCC bounce broadcasters from their spectrum — “they’re just cluttering it up” — and auction it off to the highest bidder. Based on past auctions, he figures the auction of some 300 Mhz of broadcast spectrum would bring in up to $75 billion.
“Funny thing is, the stations don’t care about broadcasting their signals anymore, either,” he says. “That’s expensive and wastes fossil-fuel generated electricity. Bad for the environment and it pollutes the most beautiful radio spectrum on God’s Green Earth.”
Broadcasters would beg to differ.
They do care about broadcasting their signals, they say, and they have the heavy debt from upgrading transmitters and antennas to digital and their monthly electric bills to prove it.
That they can reach every TV home and every TV in every home gives them a big marketplace advantage over their cable competition, they say. Broadcasting, they point out, remains the only ubiquitous TV medium.
And as a public policy matter, they say, broadcasters continue to provide high-quality HD service and critical information to viewers during local emergencies — all free of charge.
“You can rest assured that consumers will not be able to access wireless services for free,” says MSTV President David Donovan.
NAB Executive Vice President Dennis Wharton points out that broadcasters already gave up a big chunk of their spectrum in the digital transition.
“I don’t know of any other business in America that uses spectrum that has been asked to give back a third of their spectrum,” he says. “Maybe others ought to follow the broadcast model.”
Broadcasters have high hopes for a mobile video service they are planning to offer with portions of their digital spectrum.
“In three to five years, we are going to have more people watching free over-the-air television than we ever had before,” says Goodmon. “It’s much more effective to get video to hundreds of thousands of people from one transmitter than to hook them all up to the Internet. We are the most efficient distribution system by far,” he argues.
“We are entering the golden age of broadcasting.”