The FCC chairman tries to reassure broadcasters that any incentive auction plan of TV spectrum would be voluntary, saying it’s “essential that broadcasters be treated fairly.” He reinforces his claim that such action is needed to meet a growing need for wireless broadband services, saying, “If we wait until there’s a crisis to reallocate spectrum, we'll have waited too long — for consumers, for our global competitiveness — and, I believe, for broadcasters.”
NAB 2011
Genachowski Preaches To The Unconverted
Making yet another pitch for his incentive auction plan for recovering a large swath of TV broadcast spectrum, FCC Chairman Julius Genachowski today sought to reassure broadcasters that participation in the auction is strictly voluntary and that those who choose not to participate will not suffer any harm to their wallets or over-the-air coverage.
“[I]t’s essential that broadcasters be treated fairly,” he said in a speech before a ballroom full of skeptical station owners and managers. “That means, for example, that broadcasters should be fully compensated for any costs of any channel changes, and that any moves from UHF to VHF should be voluntary.”
Genachowski also tried to allay concerns that the so-called repacking of the band after the auction would diminish the over-the-air reach of the remaining TV stations. These concerns were colorfully expressed yesterday by Post-Newsweek Stations President Alan Frank, who compared the incentive auction plan to the decision to move Jay Leno into primetime.
“I’m confident that, working together, we can resolve relocation issues, as multiple relocation issues have been resolved since the FCC held its first auctions nearly 20 years ago.” Genachowski said.
The incentive auction is a means by which the FCC intends to recover up to 120 MHz of TV spectrum to meet what it says is the increasingly urgent demand of wireless broadband.
Volunteer broadcasters would offer up their spectrum for auction to wireless broadband providers with the FCC playing the middleman and dividing the proceeds between the broadcasters and the federal treasury.
BRAND CONNECTIONS
Although Genachowski wants to make sure that non-participating broadcasters come out whole in the process, he said there is a limit to how much they can be accommodated.
“[V]oluntary can’t mean undermining the potential effectiveness of an auction by giving every broadcaster a new and unprecedented right to keep their exact channel location,” he said.
“This would not only be unprecedented, it would give any one broadcaster veto power over the success of the auction — and be neither good policy for the country, nor fair to the other participants.”
NAB President Gordon Smith, who introduced Genachowski, said afterward that the NAB is willing to talk to the FCC about developing a workable auction plan. “We will be at the table with you.”
The FCC doesn’t have the authority to conduct incentive auctions in which proceeds are shared with incumbent users of that spectrum. That will take an act of Congress.
But Genachowski expressed confidence that Congress would eventually act, citing a powerful and growing consensus to find more spectrum for broadband through incentive auctions not just of broadcast spectrum, but of other bands as well.
“Over the past year since the voluntary incentive auction proposal was introduced, it’s become clear that this is an idea whose time has come.”
Without naming names, but undoubtedly with broadcasters in mind, Genachowski said he is disappointed by those who are trying to undermine incentive auctions with a variety of arguments. “For example,” he said, “some have argued that there’s no spectrum crunch — but the data couldn’t be clearer.
“Some have argued that we should spend more money and years on even more detailed inventories before moving forward. But the commission’s extensive prior work on spectrum and baseline spectrum inventory made clear that there are only a few major opportunities to unleash spectrum, and that there is no big swath of unused spectrum that we’ve missed.
“Some have argued that there is massive warehousing of spectrum. But market forces and build-out requirements are designed to ensure that those who paid for spectrum at auction will put it to its highest and best use. And beyond that, the projections of a growing spectrum gap assume that all previously auctioned spectrum will be built out.
“Some have argued that incentive auctions would stop mobile DTV, but it won’t. The current standard and commission rules permit it, and indeed encourage experimentation and the development of mobile DTV business models.
“Even if 120 MHz of the 294 MHz allocated for broadcasting were freed up as a result of an incentive auction, a healthy and robust broadcast system would remain, and nothing would change the terms of use of a 6 MHz channel, including mobile DTV.
“Some have argued that we should wait — up to a decade or more — until a new broadcast standard is adopted. I note that other broadcasters have argued against moving to a new standard, but in any event we don’t have a decade to wait, and the transmission standard issue is separate and distinct from incentive auctions, which don’t affect the transmission standard for a 6 MHz broadcast channel one way or the other.”
Genachowski did not say which stations should participate in the auction and which should not, but he gave a strong hint. “[N]ot all broadcasters are investing in news and new platforms,” he said.
“For example, of the 28 commercial, over-the-air stations in the New York market, only six invest in news coverage of any kind. In Los Angeles, it’s eight out of 23.
“Some stations choose not to invest in this type of content, and some simply can’t — it just doesn’t make economic sense for them. But it does affect any objective of broadcast markets in view of national spectrum needs.”
Again, without pointed the finger at broadcasters, Genchowski argued against trying to stall incentive auctions in Congress through delaying tactics.
“If we wait until there’s a crisis to reallocate spectrum, we’ll have waited too long — for consumers, for our global competitiveness — and, I believe, for broadcasters.”
Comments (12)
george willingmyre says:
April 12, 2011 at 4:58 pm
What is never brought up in the “voluntary” incentive auction discussion is any reference to broadcasters being allowed to be a part of the solution to finding spectrum with which wireless bandwidth needs may be met.
Many have outlined ways to utilize broadcast spectrum in a way that provides bandwidth for wireless applications while allowing broadcasters to provide those mobile and interactive services that hold so much promise to the American consumer. Their numerous attempts to engage in meaningful dialogue seem to fall on deaf ears and constipated countenances.
Chairman Genachowski, the NBP and its approach do nothing but stifle innovation and choke off the very lifeline that broadcasters need to develop new and varied services. Incentive auctions will do nothing but destroy a nascent mobile TV industry poised to deliver great things to a public hungry for video. By the way, the conversation regarding the need for more wireless bandwidth inevitably leads to video content. Again, as many have stated there is a way to marry wireless delivery and broadcasting– from what I understand it is available via a standard known as CMMB, which is a variation on a theme known as OFDM . Since the standard is already present in the marketplace why not allow broadcasters to deploy using alternative delivery systems. If the economics of wireless are as I suspect any broadcaster would be a fool to not devote bandwidth to video-intensive content delivery.
Ah, economics, that is the rub. What the FCC and Chairman Genachoswki are promoting has everything to do with economics, just not for broadcasters. I believe everything else is just a smokescreen. What the Chairman doesn’t realize is that by allowing broadcasters the right to provide much-needed services he achieves two things that are politically expedient to the incumbent President, 1) The Treasury receives a yearly annuity via a 5% ancillary revenue fee paid by broadcasters and 2) Wireless broadband to every nook and cranny faster than the NBP will ever deliver. NBP is declared a success and all can participate in the glory–will the Chairman do what is politically expedient and wise or continue on the path of “bad reception”.
Kimberly Gari-Luff says:
April 12, 2011 at 6:02 pm
“Incentive Auction Plan” = Tax
Don’t deny it, don’t pretend otherwise and don’t be fooled by gov-speak.
Kimberly Gari-Luff says:
April 12, 2011 at 6:06 pm
tvnewscheck: Please fix your software so it quits taking out blank lines. They’re needed for creating paragraph spacing. Subtle shifts in thought are lost when every word is confined in one huge paragraph. (It’s not like the extra electrons are going to break the bank at tvnewscheck.)
Peter Grewar says:
April 12, 2011 at 8:17 pm
I disagree with the implication of Genachowski’s comments that broadcasters aren’t providing a valid local service unless they’re producing news. Providing free entertainment is also a valid (and worthwhile) service.
Gregg Palermo says:
April 12, 2011 at 9:25 pm
If entertainment was such a valid service, how come only 9% of homes choose over-the-air signals instead of cable or satellite?
Kathryn Miller says:
April 13, 2011 at 9:23 am
which is about as logical as asking “If trees are green, why is cheesecake not?”
mike tomasino says:
April 13, 2011 at 10:34 am
Rustbelt, you’ve been told about that number over and over again but you still keep using it. The 9% number is inaccurate and deceiving. First, a more accurate number is closer to 15-16%. Second, Antennas Direct sold 500,000 antennas last year. (That doesn’t include, AntennaCraft, Digitenna, Channel Master, Winegard, etc.) Third, MCV penetration dropped by about 1% last year. And fourth, a large portion of the population are still unaware that they can get sizable numbers of channels including better quality HD free over the air. You keep denying that there has been a digital transition and that it was a major technological step forward. When Charlie Ergan’s kids stop paying for television, you know something is afloat.
Monica Alba says:
April 13, 2011 at 4:52 am
Let me simplify this: Genachowski is an asshole!
Kathryn Miller says:
April 13, 2011 at 9:26 am
simple, direct statements are the best. How does this help us, though? We’ve had an FCC chairman who took a bribe and went to prison. Indictment and trial doesn’t sound like a viable exit strategy here.
Amy Davis says:
April 13, 2011 at 12:25 pm
Just like taxes…”Voluntary” – pish! Anything “voluntary” concerning the government is just a code-word for “eventually.” Just like the help that the government was going to give the OVER-100 markets to transition from analog to digital (didn’t happen), there will be no financial help re-retransitioning the Channels 31-51 (37 is already a non-broadcast entity itself) down into the Channel 2-30 monkey-pile of OTA selections that will be left. First off, Julius was known to not be TV-friendly when he was “selected” to the FCC way back when. How could anyone have missed that missle being fired? NOW he wants to play nicey-nicey with the Television industry? When was the last time anyone out there petted an alligator? On the nose? Why hasn’t anyone in this industry, fired point-blank back at him and taken him to task for is “rape” of the public air-waves? This auction is taking free OTA television and GIVING IT to private firms that re-sell products that NEED SUBSCRIPTION FEES to be able to be used. How many remember the closed-door meeting(s) between the FCC and Bill Gates a few years back? Did everyone forget that little mission? No broadcasters allowed…either radio or TV. Then this non-TV-owning clown. Then the made-up urgency of “broadband scacity” when all we have to do is remove the iPhones, iPads and the other 2,001 items our CHILDREN have badgered their brain-dead parental units into buying them…then you’ll see a whole different side of the broadband highway…as in…hardly being driven on. Everyone in government has their head so far up each others’ rear-end they wouldn’t be able to smell common sense if that was all that was being eaten by their mentors…starting now. Free OTA television AND radio may already be on its deathbed right now…we just haven’t quit rolling down the hill yet to realize it. I’m beginning to see the reason and allure of whay some people are so into “pirate radio” and even some “pirate TV” – it might be the only way to get any kind of message out to the masses without paying the “Master.” How sad….
Meagan Zickuhr says:
April 13, 2011 at 1:19 pm
Genachowski said, “However, he also noted that there are a lot of stations on the air that do not provide much in the way of local content — and can’t afford to. He said that there are 28 OTA stations in the New York DMA, but only six of them provide any appreciable amount of local news. In Los Angeles, he said only eight out of 23 are doing local news.”
WHY WOULD ANOTHER STATION WANT TO DO LOCAL NEWS WHEN 6 OR 8 ARE ALREADY DOING SO IN ONE MARKET?? WHAT DIFFERENT NEWS CAN THEY PROVIDE THAT THE OTHERS DO NOT? THAT IS NOT A SMART PROGRAMMING STRATEGY THAT WILL GARNER REVENUE. THERE NEEDS TO BE DIVERSITY OF CONTENT AND VOICES IN THE MARKETS AND IT CAN EASILY BE DONE WITH OTHER PROGRAMMING BESIDES LOCAL NEWS! YOU SAY YOU WERE A BROADCASTER MR. CHAIRMAN…. PLEASE STOP AND THINK BEFORE SPITTING OUT WHAT AT&T AND VERIZON WRITE FOR YOU IN YOUR SPEECHES!
April Davis says:
April 13, 2011 at 4:27 pm
Uh… Thanks Amy. For what it is worth, our station has no “local news” but has plenty of local content, from local christian church services, to local political panel discussions. It is an important outlet for local expression.