NAB 2011

Frank: FCC Auction Plan Like ‘Leno In Prime’

As part of an NAB Show panel on the FCC’s spectrum plans, Post-Newsweek President Alan Frank says the proposal to auction spectrum to aid broadband  is not so much how such a voluntary auction will affect the minority of broadcasters who choose to participate in it, but rather how it will affect the majority who choose not to. And then there’s that word “voluntary.” “I had the honor of serving in the Army and I understand voluntary,” Frank said. Responding was FCC Media Bureau Chief Bill Lake, who promised that it was not the FCC’s intention to degrade TV service in any way.

Even if the FCC incentive auction plan is as voluntary as the FCC says it is, it still could damage a broadcasting service that is a unique blend of national and local service and the “envy of the world,” Post-Newsweek President Alan Frank said Monday at a NAB panel session — Spectrum:  The Air That We Breathe.

The question is not so much how the auction is going to affect the minority of broadcasters who choose to participate in it, he said. The question is how it is going to affect the majority who choose not to.

The auction puts the entire broadcasting system “at risk” in ways that cannot now be understood, he said. “We just don’t know; nobody knows.”

At the very least, he said, the non-participants will lose interference protection and coverage as the FCC “repacks” the spectrum following the auction to clear large national blocks for the auction winners. Such degradation of service “is a given,” Frank said.

Before broadcasting made the final shift from analog to digital in 2009, the FCC and broadcasters thought they had it all figured out.  But afterward, they discovered problems that none had anticipated. “It’s a tough position to be in.”

“To me, the whole thing feels like, ‘Let’s put Jay Leno in prime,” he said, eliciting laughter.

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“Incentive auction” is shorthand for the FCC’s plan to coax broadcasters to give up spectrum by allowing them to share in the proceeds from the auction of the spectrum to wireless broadband providers. The FCC hopes to recover up to 120 MHz of spectrum in this way.

However, broadcasters have been wary of just how voluntary it would be. That skepticism was expressed by Frank: “I had the honor of serving in the Army and I understand voluntary.”

The man on the spot at the session was Bill Lake, who as chief of the FCC Media Bureau had to explain and defend the plan.

Responding to Frank’s concern, Lake promised that it was not the FCC’s intention to degrade broadcast service in any way and that questions on how it might could be addressed in rulemakings leading up to the auction, which he said probably would not take place until 2015.

Since before the FCC formally unveiled the plan in March 2010, the agency has been promising “models” that would predict what would happen to stations in the broadcast band under various auction and repacking scenarios.

Asked about those models, Lake acknowledged that they are overdue, but partially because of the FCC’s desire to make them more accurate.

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For instance, he said, they are now using actual signal contours of stations rather than simple distances to describe the coverage of stations. The FCC has also had to revise the models to take into account Mexican and Canadian stations along the borders, he said.

Pressed for a date of when the models might be released, he said, in the “next few months.”

To proceed with the plan, the FCC needs congressional authorization before it can cut broadcasters in on the auction proceeds. Asked to handicap the chances of such legislation being enacted this year, panelist John Hane, a communications attorney who has been tracking the spectrum plan closely, set the odds at between 30% and 50%.

In any case, the legislation — three bills have been introduced — bears watching. “It’s very important for broadcasters…. You have to pay attention,” he said.

According to Hane, the FCC officials may be having a tough time selling the incentive auction plan to broadcasters because some of those officials had suggested that broadcasting was an obsolete medium when they first pitched the incentive auction. That may not have been the message that the FCC intended to send, but it’s the message that was received, he said. “That did not set the dialog off on the right foot.”

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And the FCC continues to underestimate and underappreciate broadcasting, Hane said. While it recognizes that broadcasters are now experimenting with broadcasting extra channels and mobile DTV service, he said, it fails to see what broadcasting could be.

“I don’t see the FCC … saying: ‘You know, free TV is a damn good thing and we ought to figure out how we can make it better.’”

For broadcasting to achieve it potential, it must be freed of technical constraints and ownership restrictions, he said. “Then, maybe there is something positive; maybe there is a win-win here.”

Hane also challenged the FCC’s assertion that there is a “looming spectrum crisis” in wireless broadband that makes it imperative that the FCC recover some spectrum from broadcasting.

The assertion has “nothing to do with reality,” he said. “There is no shortage. There is vastly more spectrum already allocated to mobile broadband than there is capital to deploy it.”

In response, Lake said, the FCC doesn’t have to be right about spectrum forecasts. “If there is no real demand, the auction will tell us that…. We did our jobs and we can all go home.”


Comments (8)

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Roz Smith says:

April 12, 2011 at 9:05 am

Excuse me, but when all is said and done at&t wants the spectrum. And they’re asking nicely. Don’t we always give at&t what it wants? Of course we do. Don’t we, Ma?

Kathryn Miller says:

April 12, 2011 at 9:12 am

The damage is already occurring, at least on the vendor end. When one talks to prospects, customers, and potential lenders/investors, the upshot of this tomfoolery is always in the room, sometimes called out by name. The FCC lacks this jurisdiction. The Congress — this one, the next one, the previous ones — would never give the FCC jurisdiction. So, how could this be anything more than the spectrum equivalent of EarthFirst! “monkeywrenching?” The tactics speak to the techniquest in Saul Alinsky’s “Rules for Radicals.”

To what end?

Paul Gourley says:

April 12, 2011 at 10:30 am

Is anyone surprised that by having the FCC involved in anything(The Government) that it is a problem and will get screwed up. Can anyone say “lets raise the ownership limit to 35%”. That sure did a lot for the Brooadcasting business didn’t it. It let Rupert Murdoch and companies like Sinclair grow their local affiliate business and that sure did alot for broadcasting didn’t it!. The FCC should go the way of NPR and planned parenthood!

Janet Frankston Lorin says:

April 12, 2011 at 10:44 am

Much of the damage has already been done. What business hates more than anything is uncertainty. This hair-brained idea has cast a net of uncertainty on the future of broadcasting to the extent that the values of television stations continue to fall, even though it is clear that the margins have skyrocketed and the long-term viability of television is strong, except for the spectrum issue. The FCC has already cost broadcasters billions of dollars in equity. But then again, if you study the players, I believe that is their plan.

Paul Gourley says:

April 12, 2011 at 10:47 am

I have an idea. Lets put Obama in charge of the FCC when he loses in 2012!

ABELARDO BLANCO says:

April 12, 2011 at 11:56 am

Hi…I’m from the government and I’m here to help you. The most dangerous 11 words in the English language. Voluntary must mean voluntary and as broadcasters we must unite and make sure spectrum is absolutely protected.

Ben Gao says:

April 12, 2011 at 2:36 pm

They just got a huge chunk of spectrum and there’s chunks already NOT being used; I say that the ‘buck stops here’ – no more spectrum grabbing and grubbing. We need to get OTA HDTV working as it is now first, then mobile DTV, then we’ll see about selling spectrum to companies who’s only goal is to make gobs of money by charging obscene monthly data rates for programming that you currently get for free!

Renauld Roker says:

April 13, 2011 at 8:04 pm

Not once have I heard NAB make reference to consumer benefits from wireless companies obtaining more spectrum. Broadcasters, because of the Internet, have options for distributing their programming. Consumers cannot use broadcast TV to access the Internet or make phone calls. The increasing demand for these services plus the increase in time spent on line versus decrease in time spent watching broadcast television should be enough evidence that a reallocation of spectrum is needed.


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