incentive auction

Agency officials are planning to meet with individual broadcasters to persuade them to participate in an auction intended to repurpose broadcast spectrum for smartphones and other wireless devices.

Broadcasters are anxiously awaiting details of the FCC’s plans for the spectrum auctions and resulting TV band repacking. FCC Chairman Wheeler last month laid out the schedule leading up to the auctions in mid-2015. But he did not offer a timeline for the post-auction channel switching, a process that could involve many stations and extend into 2020.

FCC Chairman Tom Wheeler has been busy promoting the virtues of the planned incentive auction, hoping to get TV broadcasters on board with selling all or some of their spectrum to the commission for resale to wireless carriers. He’s telling them it’s a smart move and an opportunity that won’t come again. Well, my Daddy taught me that as soon as the salesman tells you that you have to act now, you should walk away. What the chairman needs to do is go public with some honest-to-god figures on what broadcasters can expect to make in the auction.

The head of a coalition of broadcasters buying stations with the intent to sell spectrum in the upcoming FCC auction says the alternative, adopting a new transmission standard and then leasing some of their spectrum, is “highly speculative” and requires too many variables to go right over the next few years.

For some group owners, especially those with multiple stations in major markets, the FCC’s upcoming incentive auction is starting to look like an opportunity to reap a cash windfall. Both LIN and Meredith say they’re considering participating. And for others like Ion and Univision, the financial rewards are very tempting.

On Oct. 3, at an investors’ conference in Texas, LIN Media CEO Vince Sadusky and CTO Brett Jenkins acknowledged that the station group might sell some of its TV spectrum […]

When the House Communications Subcommittee convenes today to learn more about the FCC’s planned incentive auction, no representative of the low-power television indusry will be heard. That’s wrong. “It is the only group that has nothing to gain and everything to lose, especially if the repack is as aggressive as some would like it to be.”

The technical information includes a description of how to “pre-calculate which stations could be assigned to which channels in the repacking process” following the upcoming spectrum incentive auction.

If the FCC ultimately chooses to set the prices in the reverse auction for broadcasters’ spectrum, FCC Commissioner Ajit Pai says, they need to be high enough to get broadcasters to offer up their spectrum. “My preference is for prices to be determined by the market, rather than set by fiat,”

With the FCC’s incentive auction and repack moving forward, many LPTV broadcasters worry about what the agency’s continuing silence about their service portends Says attorney Peter Tannenwald: The FCC “is basically ignoring low-power TV, and therefore, no low-power TV station, right now, knows whether it’s going to be able to survive.”

Because the FCC’s planned spectrum incentive auction requires the cooperation of at least some large-market broadcasters, and it’s unclear whether enough will agree, there are market-based alternatives to the auction being talked about quietly in Washington that may be more lucrative for broadcasters. There is also risk that the government could take spectrum without giving broadcasters any compensation.

When the FCC gets around to repacking the TV spectrum, the results could differ from what broadcasters expect going in. It’s important for them to be aware of ongoing developments and not to assume they won’t be affected. Here’s an overview of some possible scenarios.

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….”

In comments to the FCC, NAB made it clear it didn’t like the way the commission was heading in its auction planning. “The overall approach … is unnecessarily complex, appears to ignore important engineering considerations and overlooks more basic and straightforward solutions.”

Hoping to buy low and sell high in the FCC incentive auction, NRJ TV, OTA Broadcasting and Locus Point have bought 39 stations over the past two years, according to SNL Kagan.

Because broadcasters have too many competitors, many are having a hard time earning a fair return. The common sense answer is for some stations to exit. Now, because of the compelling need for additional wireless broadband capacity, the FCC, in the incentive auction proceeding, is prepared to help ease some stations out the door.

The NAB, AT&T, Verizon and T-Mobile, Intel and Qualcomm ask the commission to adopt a “core set of band plan principles” that, in essence, outline how wireless and broadcast are going to co-exist in the post-auction world. The joint proposal offers an alternative to an FCC proposal under which broadcasters would be packed into two non-contiguous blocks separated by a block of wireless spectrum.

A coalition of the willing — TV stations eager to sell their spectrum back to the FCC so it can be auctioned to wireless carriers — is urging the agency to stick to its plan to buy and sell the spectrum next year. That runs counter to the NAB, which has been calling for a more deliberate approach. “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,” says former Disney-ABC lobbyist Preston Padden who now fronts for the coalition.

The spectrum speculator is buying KTNC San Francisco and KUBE (formerly KAZH) Houston from Titan Broadcast Management. Titan will continue to operate the stations.

Broadcasting fulfills its promise, delivering entertainment (like RGIII and Downton Abbey) and vital information (like storm warnings) to the public — free of charge, if people want it that way. Yet, the current FCC ignores broadcasting’s contributions and pushes broadband policies that undermine the medium. “Listen to the FCC and you’d think broadcast television is simply dead-weight economic loss.”

Broadcasting fulfills its promise, delivering entertainment (like RGIII and Downton Abbey) and vital information (like storm warnings) to the public — free of charge, if people want it that way. Yet, the current FCC ignores broadcasting’s contributions and pushes broadband policies that undermine the medium. “Listen to the FCC and you’d think broadcast television is simply dead-weight economic loss.”

The buyer of WLWC is OTA Broadcasting, a speculator that has been buying TV stations in anticipation of reselling their spectrum to the government in an eventual auction to wireless carriers. Sinclair is the seller of the CW affiliate, which is among the seven it acquired last year from Cerberus Capital for $200 million.

As the FCC moves ahead with plans for its spectrum auction, many details of what happens after it’s completed remain to be sorted out, none more important than how to coordinate new frequencies for stations along the Canadian and Mexican borders. With comments due later this month and replies due in March, TV broadcasters, their viewers, communities and others need to provide the FCC with opinions, information and proposed solutions to potential problems.

The FCC wants to do it in 2014 and some involved say that’s possible, but others claim there are too many complications and details that must be worked out to make sure the very complicated process goes smoothly. FCC Commissioner Robert McDowell told a CES audience: “So, while I hope it’s 2014 … folks just need to realistically understand that history tells us that these things can take longer than you hope or expect, especially when you have literally the most complicated spectrum auction in world history.”

Contrary to the thesis of a recent article on the FCC chairman, for better or worse (and most broadcasters would say worse), Julius Genachowski has had an extraordinary, if not revolutionary, impact on at least a couple of the key industries he oversees, especially TV broadcasting.

Once the “reverse” and “forward” auctions have been completed and the broadcast TV industry has been repacked, the FCC will finally be able to reconfigure the vacated UHF spectrum for mobile. But determining, now, precisely how that reconfiguration will ultimately look, then, poses a unique challenge in view of the number of unknowns currently in play.

I don’t think you’ll find many savvy broadcasters who don’t believe that ATSC 3.0 is absolutely critical if the medium is to remain competitive in the digital world. But what needs to be done is to get the ATSC 3.0 initiative on the same page as the FCC’s incentive auction so that the related TV band repacking takes into account the attributes of the new standard and so the public and broadcasters don’t have to suffer the trauma of TV band disruption twice.

An anonymous group of broadcasters interested in selling their TV spectrum in the FCC’s incentive auction has founded the Expanding Opportunities for Broadcasters Coalition and has tapped former Fox and Disney lobbyist Preston Padden to lead its efforts before the FCC as the commission writes rules for the auction.

It just might be for some TV stations.The value of the spectrum for alternative uses seems substantial enough that it may persuade some stations to participate in the FCC’s planned incentive auction and cash in. They now just have to wait for the FCC’s opening bid.

The reallocation of TV spectrum is moving ahead, with the FCC voting unanimously to adopt a rulemaking on how to acquire spectrum now used by TV stations, with compensation, and auction it for broadband development. The auction could come as soon as 2014.

The spectrum speculator adds to its growing portfolio of underperforming independent stations by buying the Los Angeles station, which airs programming in Chinese, Korean and Tagalog. NRJ TV is collecting stations, hoping to eventually sell their spectrum through the FCC’s planned incentive auction.

Ruth Milkman, an aide to FCC Chairman Julius genachowski, is tapped to oversee six others on the new Incentive Auction Task Force.

Washington communications attorney John Hane walks us through how the just-authorized broadcast TV spectrum auction may play out. He explains what the FCC has to do, how it may proceed, the vagaries of the whole process and points out what broadcasters should be wary of.

The FCC’s desire to auction TV spectrum to aid wireless broadband and generate revenue is now centered on a House-Senate effort to reduce the country’s budget deficit. Broadcasters, led by NAB, are concerned that the Super Committee version of the incentive auction will lack sufficient protections for those TV stations that choose not to participate in an auction. So, NAB and other broadcast lobbyists will be working hard over the next two months to make sure that whatever incentive auction provision emerges addresses the industry’s concerns.