incentive auction

Those are what’s on my mind this afternoon. First is the good news for broadcast spectrum sellers that the FCC is listening to the EOBC and the NAB and making changes in the incentive auction rules. Second, the commission needs to listen to broadcasters and require DirecTV to keep its 12-year-old promise to carry all local TV stations in a market. Quit stalling. And, third, please NBC, cut all ties to Donald Trump. The network and the nation will be better for it.

The FCC plans to drop dynamic reserve pricing, a method of pricing that could have lowered station prices. Although the FCC is killing DRP, it rejected a proposal from would-be station sellers for a more preferred pricing formula that takes into account population covered by the station.

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.

A federal appeals court says that an NAB-Sinclair Broadcast Group challenge filed last year objecting to portions of the FCC’s spectrum auction plans is without merit.

Jerald Fritz of ONE Media says if broadcasters can submit a petition to the commission this summer, the FCC may be able to conduct a rulemaking and give its blessing late this year or early next. That means TV stations could be on the air with the standard sometime in 2017, he adds.

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.

Many in Congress would no doubt like to stick it to FCC chief Tom Wheeler for some of his bold moves. Now they have a chance. Four senators have introduced a bill that would grandfather existing JSAs. Passage would give a nice boost to broadcasters who do nothing but provide a superior news and entertainment TV service to the American public free of charge. And it would show that Congress still has some say in FCC affairs. Addendum: The NAB is going to ask the FCC to give broadcasters more time to move their channels during the incentive auction repack. The FCC should grant it because it just can’t be done in 39 months.

A coalition of LPTV broadcasters says that buyers of LPTV stations who turn over the spectrum to the FCC for unlicensed use be granted tax credits in the same amount or twice the amount as the stations’ purchase prices. The credits could be used to reduce ordinary taxes or those of businesses that use unlicensed spectrum.

With estimates on the post-auction repack now running as high as $2.6 billion, the NAB is trying to increase the government reimbursemend fund, now capped at $1.75 billion. But NAB also needs to get to work on increasing the time broadcasters will have to move their channels during the repack. The current 39 months just isn’t enough, given the capacities of tower and transmission companies.

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.

As president of the NAB, Gordon Smith can’t solve all the ails facing TV broadcasters, but he seems determined to do what he can to provide adequate repacking reimbursement for broadcasters who don’t participate in the incentive auction, advance the next-gen broadcast standard and defend broadcasters’ retrans rights on two fronts (in Congress and at the FCC).

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 Expanding Opportunities for Broadcasters Coalition says its method of calculating opening bids for next year’s spectrum auction significantly boosts the value of spectrum and broadcasters should get behind it.

Research from economist Peter Cramton, comissioned by the broadcasters eager to cash in on the FCC incentive auction, says the commission will raise at least $85 billion.

A new study from Kagan Media Appraisals says AT&T, Verizon and other broadband carriers will turn out in force to bid for whatever TV spectrum is available in the FCC’s incentive auction. It also estimates that the carriers will pay $60 billion-$80 billion for 84-100 MHz of spectrum.

To meet its original goal of recovering 120 MHz of TV spectrum in its incentive auction, the FCC will have to buy around half of the UHF stations in 37 markets, including four of the top 10 — New York, Los Angeles, Philadelphia and San Francisco.

A new study from Kagan Media Appraisals says AT&T, Verizon and other broadband carriers will be out in force to bid for whatever TV spectrum is available in the FCC’s incentive auction.

Meeting with FCC staffers, NAB officials expressed concern about the dynamic reserve pricing the agency plans to use to buy broadcast spectrum in a reverse auction. DRP would allow the agency to continue to drop bid prices it offers to broadcasters even when their stations cannot be repacked in the TV band, the NAB said.

Fox along with Tribune, Univision and Ion met with FCC Chairman Tom Wheeler, officially acknowledging their interest in selling spectrum in the FCC incentive auction next year by offering suggestions on how the auction should be conducted.

Fox along with Tribune, Univision and Ion met with FCC Chairman Tom Wheeler, officially acknowledging their interest in selling spectrum in the FCC incentive auction next year by offering suggestions on how the auction should be conducted.

The coalition of broadcasters looking to sell their specturm in the FCC incentive auction told agency officials that key changes in how the agency conducts the auction will encourage more stations to participate and help the FCC achieve its goal of recovering 126 MHz of spectrum for wireless broadband.

The trade group says it’s looking out for the interests of broadcasters who now are interested in selling some of their spectrum back to the government, as well as those who don’t. But it should commission more research on spectrum value. More problematic is its divided stance on the next-gen TV transmission standard. While most affiliates want to go full bore on developing and implementing the new standard, the networks want to slam on the brakes. That’s too bad. If ATSC 3.0 is to have a chance of saving broadcasting, it’s going to need all the help it can get.

In light of the commission’s AWS-3 auction bringing in $45 billion, the FCC chairman says “we are confident there will continue to be strong demand for valuable low-band spectrum that will be made available in the incentive auction early next year.”

The FCC today launched a proceeding to write the rules for the TV incentive auction. But the two GOP commissioners voted against it, saying that some of the proposed rules would limit how much broadcasters can get paid for their spectrum and thus discourage them from participating.

Last month the FCC sent an information package, prepared by the investment banking firm Greenhill & Co. for the FCC, to the owners of every station eligible to participate in the auction. Building on the momentum generated by the information package, the commission is poised to begin the next phase of its outreach. FCC staff, again advised by Greenhill, will continue the dialogue with broadcasters in field visits to television markets around the country.

Advocates of low-power TV stations and translators have been worried that their interests will be ignored in the upcoming FCC incentive auction and spectrum repack. Now, however, the Government Accountability Office is being asked to study the situation and the hope is the results will help them win rights to continue operating in the auction’s wake — similar to the rights full-power broadcasters are already guaranteed.

For broadcasters to take the FCC’s proposed spectrum auction seriously, they needed hard dollar figures as to their stations’ value. Now that the commission has delivered that, it looks like billions of dollars could be up for grabs and station owners need to carefully calculate a strategy: They can sit it out, they can give up some spectrum and stay in the business by doubling up on channels, they can sell their UHF channels and move to VHF channels or they can just sell it all and head for the beach.

Two spectral efficiency experts, Pablo Angueira in Spain and Frank Herrmann in Germany, told an IBC audience how their work in layer division multiplexing and MIMO antenna technology should make it possible to move more TV and other data through a TV signal — a priority for ATSC 3.0.

Now that the trade group has had a chance to read the 500-page text of the FCC rulemaking covering the incentive auction of TV spectrum and repacking of the TV band, its CEO Gordon Smith says: “The order’s fundamental flaw is that it ignores Congress’s clear direction to do no harm to broadcasters who choose not to participate in the voluntary auction.”

An examination of the FCC’s 484 pages of incentive auction rules shows the commission has rejected a proposal to allow a blanket waiver for all a group’s stations if the group turned down federal reimbursement for moving. In addition, the FCC made clear that it believes it has wiggle room under Congress’ mandate that it make “all reasonable efforts” to preserve the coverage areas and populations served by stations required to move to new channels during the repacking.

Historically, broadcast TV’s biggest foes have been cable and newspapers, but now there seems to one more major adversary: wireless operators.Wireless has been lusting after broadcast spectrum, supporting the FCC’s incentive auction. That’s even more threatening since the auction push is headed by FCC Chairman Tom Wheeler, the former wireless trade association chief. Now, with Verizon’s nascent LTE Multicast service, it’s also planning on making a direct play for TV stations’ audiences as well.

While waiting for the FCC to repack the band and hand out new channel assignments, TV stations should not be idle. Here is a list of things they can start doing now to head off trouble later.

TV representatives deliver FCC chief Tom Wheeler a list of items they’d like to see included in the commissions incentive auction order expected to be issued next month. Their biggest worry is that the resulting changes from the repack will reduce stations’ coverage areas.

They worry that the timeline proposed for moving stations to new channel assignments following the FCC’s incentive auction is too short. The number of stations that may be required to change channels as part of the repack may exceed the industry’s capaciy to hang antennas, says consultant Jay Adrick. “There are only 14 tower crews in the United States.”

Broadcasters should move beyond rhetoric and craft a real National Broadcast Plan, a petition to Congress and FCC laying out what they feel they need to remain competitive with broadband and other TV media and continue to fill their unique role in the mediascape. Here are 10 ideas the NAB — and all TV broadcasters — can use to get started.

The NAB said that the FCC should stick to the traditional OET-69 methodology for calculating the over-the-air coverage of TV stations. Using another standard, the association said, would be “arbitrary, capricious and contrary to established law.”

As a result of the uncertainity over the FCC’s plans to auction and repack the TV spectrum, stations are putting off investments in transmission gear. The latest victim is Electronics Research Inc., which just laid off 22 employees.

And that is the importance of focusing on one’s most crucial task, something the Union general did exceptionally well. In the FCC chairman’s case, that focus should be on making sure the upcoming incentive spectrum auction is a success. For that to happen he needs broadcaster participation. So why is he risking antagonizing them with a totally discretionary attack on joint sales and shared services agreements that broadcasters have been using for the past nine years?

Plenty, say broadcasters.The impetus comes from liberal foes of big media, cable and satellite operators trying to slow the growth of retrans payments and possibly Wheeler’s own effort to promote broadcasters’ participation in the spectrum auction. “He’s trying to break apart broadcasters,” says one station group executive.