[opendtv] TVTechnology: FCC Aims to Clear 84 MHz of TV Spectrum
- From: Craig Birkmaier <craig@xxxxxxxxxxxxx>
- To: OpenDTV Mail List <opendtv@xxxxxxxxxxxxx>
- Date: Tue, 16 Dec 2014 10:37:38 -0500
http://www.tvtechnology.com/news/0086/fcc-aims-to-clear--mhz-of-tv-spectrum/273682
TVTechnology: FCC Aims to Clear 84 MHz of TV Spectrum
WASHINGTON—Regulators today approved proposed proposals to clear 84 MHz of TV
spectrum, establish opening bid prices and develop procedures to close the 2016
incentive auction. I.e., they suggested rules to recommend for final adoption
in a Public Notice approved in a 3-2 party-line vote.
“This is the considered opinion at this point in time on which we’re seeking
your comment,” said Federal Communications Commission Chairman Tom Wheeler,
emphasizing each word after protracted dissents from Republican commissioners
Ajit Pai and Michael O’Rielly.
The PN calls for comment on reverse- and-forward-auction reserve bid pricing,
clearing 84 MHz “near-nationwide” at a benchmark price of $1.25 per MHz/pop and
dividing spectrum according to the predicted interference.
Opening bid prices in the reverse auction, which will determine how much
broadcasters could get for their 6 MHz licenses, will be based in part on how
much interference a station will create in the repacked TV band, and in part on
what the commission decides it will be via “dynamic reserve pricing.” This
would allow the commission it to tweak pricing based on the geographic and
spectral location of a license, so it can offer “high opening prices to every
broadcaster,” and let the auction determine final pricing, said Martha Stancill
of the Wireless Bureau. (This was initially attributed to Margaret Wiener,
chief of the Wireless Bureau. The author apologizes and regrets the error.)
Pai said he didn’t think so. The repack interference method could undermine
license values if, for example, a small, interference-free station stands in
the way of those in larger markets. He gave the example of a station in College
Station, Texas, serving about 330,000 people. The station is within driving
distance of Dallas, Houston, Austin and San Antonio, he said, and if it doesn’t
give up its spectrum, “it will preclude certain stations in each of the large
Texas markets from being repacked.”
He also said dynamic reserve pricing would devalue TV licenses.
“For certain television stations, the commission will continue to lower the
price offered even when the station cannot feasibly be assigned a channel in
its pre-auction band,” he said. “So essentially, the FCC will try to get away
with paying some broadcasters a below-market price.”
When these orphaned stations drop out of the auction, they’ll end up on a
channel where interference is more likely, creating more impaired spectrum in
the auction, he said.
O’Rielly said dynamic reserve pricing could strand some TV stations in the
duplex gap between wireless up- and downlink spectrum, or the guard bands
between wireless and broadcast services.
Impaired spectrum refers to how much interference a frequency block is expected
to have in the repack. The Notice proposes two categories of impairment—zero to
15 percent, and 15 to 50 percent. Spectrum blocks above 50 percent impairment
will not be offered for auction, Stancill said. Both impaired and unimpaired
spectrum will be counted toward the 84 MHz goal, with a proposed limit of 20
percent impairment nationwide, based on market populations weighted according
to the relative value of their spectrum in previous auctions.
The auction system will assess this impairment threshold after each round using
an average price of $1.25 MHz/pop across 84 MHz. If bidding in high-demand
markets does not reach $1.25 MHz/pop, the auction system will implement an
extended round “to ascertain whether the incentive auction can conclude at that
clearing target, or whether it can be moved to a new state with a lower
clearing target,” Stancill said.
Extended round prices will be the same for all blocks in the same license
category, she said. The Notice proposes establishing a procedure to lower the
clearing target if the 84 MHz at $1.25 goal isn’t met.
Finally, the PN proposes criteria for optimizing final TV channel assignments,
including minimizing relocation costs and aggregate new interference above 1
percent.
Democrats Jessica Rosenworcel and Mignon Clyburn threw in with Wheeler to pass
the Public Notice, which was voted on at the commission level according to its
own established auction procedures. Public Notices typically are released at
the bureau level.
Pai and O’Rielly came at it with elbow checks and flying scissors.
“The commission proposes a series of unnecessary outcome-driven machinations
and tentative conclusions to bolster its ability to claim success at the close
of the auction,” O’Rielly said. “I do not have confidence that the complex and
confusing proposals in this Public Notice will maximize revenues or ensure that
the spectrum goes to the highest valued use.”
Pai first criticized the rules released in May.
“They attempt to manipulate the results through the blunt levers of command and
control, and they unnecessarily provoked litigation,” he said, referring to
lawsuits filed by Sinclair Broadcast Group and the National Association of
Broadcasters.
Pai said he made 12 proposed modifications to the Public Notice up for vote.
Eleven were dismissed immediately; the 12th got a “maybe.”
“We could easily have had a unanimous vote on today’s Public Notice, but there
was no interest in working toward consensus,” he said. “Virtually every line
drawn in this item was one color—red. Accordingly, I dissent.”
Wheeler once again emphasized that nothing was written in stone.
“As we’ve all said up here, we’re seeking comment on proposals, not making
final decisions,” he said.
The FCC will take its pitch for the incentive auction on the road next month.
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