EOBC

The Expanding Opportunities for Broadcasters Coalition says the FCC’s incentive auction could yield $50 billion for the government and $35 billion for broadcasters — if the agency follows the EOBC’s advice for conducting the auction.

Responding to concerns of broadcasters who plan sell their spectrum in the incentive auction next year, the FCC said they may wait until after the auction before entering into channel-sharing arrangements so they stay in the broadcasting business. The action may encourage more stations to participate in the auction and help preserve “independent voices” in broadcasting, the FCC said.

In a meeting with FCC officials, NAB reps said the current 39-month deadline for moving channels during the post-auction repacking of the TV band was “unrealistic.” There are not enough resources to move the channels in that short of time, the NAB said. The EOBC opposed extension of the deadline, saying that more time could be granted on a case-by-case basis.

The FCC’s proposed formula for calculating the prices it will offer broadcasters in the opening round of the incentive auction will result in at least 1,100 stations getting less than they deserve. The alternative that the Expanding Opportunities for Broadcasters Coalition is advocating would yield billions more for stations by tying their auction value to the interference they cause rather than their business value.

Station owners have been active in the FCC rule-writing proceeding for next year’s spectrum auction, arguing for changes that could add billions of dollars to the bottom lines of broadcasters that opt to sell. At the top of the industry’s hit list is the FCC’s dynamic reserve pricing plan, which broadcasters believe will depress spectrum prices. At the same time, broadcasters are pushing for higher opening bids, figuring the higher they are, the higher the final take for broadcasters will be.

The Preston Padden-led Expanding Opportunities for Broadcasters Coalition says the FCC’s proposed pricing formula for the 2016 incentive auction is based 50% on the interference-free population that a station serves. This component, EOBC says “is completely irrelevant to a station’s interference or ‘blocking’ profile and is included in the formula for one reason — to drive down prices.”

The Expanding Opportunities for Broadcasters Coalition says “the commission’s proposal to manage the prices paid to broadcasters by ‘scoring’ stations is driving broadcasters away from the auction. And, the … plan is inconsistent with the Spectrum Act, which provides for the prices to be received by broadcasters to be determined by the market forces of the auction….”