Stations may face choice:
Cash soon or opportunities later
At what cost spectrum?
If the gods of the spectrum see fit, the mortals of public TV may find their fiscal Holy Grail — a frequency auction that endows a big trust fund and relieves their ongoing need to trudge to Capitol Hill with hats in hand.
Or perhaps stations will refuse to appease the spectrum-lust of future iPad users and fight instead to keep their broadcast frequencies for future over-the-air public services, including spiffy mobile DTV innovations.
As part of the government’s broadband expansion campaign — wireless as well as wired — the FCC is pondering the telecom industry’s request for a stunning 800 MHz of spectrum. That’s more than 15 times as much as the agency freed up for the last big auction, which sold off former analog TV channels.
The FCC has long warned of a spectrum crunch. Airwaves are already chock-full of a panoply of signals from satellites, garage door openers, ham radios, cell phones and secret federal devices.
The public is hungrier than ever for more wireless devices, such as the just-announced Apple iPad and the like. After the Jan. 27 iPad announcement, two FCC officials blogged that the device was yet another spectrum-eater. Phil Bellaria, FCC director of scenario planning, and John Leibovitz, deputy chief of the Wireless Telecommunications Bureau, wrote that “the widespread use of smartphones, 3G-enabled netbooks, and now, perhaps, the iPad and its competitors, demonstrate that wireless broadband will be a hugely important part of the broadband ecosystem as we move ahead.”
Myriad details of any bandwidth reallocation have yet to be proposed officially by the commission, much less decided. Recommendations of the FCC’s National Broadband Task Force are due to Congress by mid-March.
The House Subcommittee on Communications, Technology and the Internet last month approved a bill directing the agency to undertake a massive spectrum inventory as the first step in the process. A companion bill is now before the Senate Commerce, Science and Transportation Committee. Experts agree that any action on spectrum is years down the road.
Still, a lot will be at stake when the time comes. “Potentially very significant amounts of money” could be in play, Larry Sidman, APTS president, told Current. No one yet knows how much spectrum will be involved, but the 2008 auction of some 50 MHz brought in nearly $19.6 billion.
Beginning of the beginning
Assorted broadband stakeholders have floated the idea that broadcasters could voluntarily give back some or all of their broadcast channels in exchange for cash. For noncommercial stations that might involve creating a trust fund that would endow ongoing federal support for public media. Congress ordinarily puts FCC auction proceeds into the government’s general fund, where politicians can say it is “reducing the deficit,” so legislators would have to agree to payouts to broadcasters.
Commissioner Michael Copps, speaking to the CPB Board last month, questioned whether Congress would go along with a trust fund plan, asking, “Is there any guarantee those folks wouldn’t put it toward the national debt? We need to be careful with an idea like this — awfully darn careful on the distribution.”
CPB President Pat Harrison agreed. She and other CPB officials have been meeting with the staff of FCC broadband advisor Blair Levin. “It’s very important to have us at the table,” Harrison told the Board. “Where will the money go? Who manages the fund? How will stations realize money from the fund? Will there be prohibitions on using the money? We are now just at the beginning of the beginning of an intensely complicated discussion.”
Another sticky matter: Broadcasters are wary of a spectrum grab. Bellaria, the broadband scenario director, told Broadcasting & Cable magazine in January that the “initial thought” was that broadcasters would not be required to give up spectrum. However, “at some point we may have to go back and re-look at alternatives if we face some new shortages.” He added that the FCC has had conversations with “many broadcasters” who would relinquish spectrum for monetary compensation due to their financial “dire straits.”
After the FCC completes its bandwidth inventory, Copps assured the CPB Board, the agency will look only at spectrum users that don’t “make good use of it for the public interest..” He told the pubcasters: “You folks make good use of your spectrum.”
Sidman said the FCC’s Broadband Plan staff has assured APTS that pubcasters’ involvement in a spectrum auction would be voluntary. “We accept their word,” he added.
Todd Gray, a Dow Lohnes attorney who represents numerous pubcasters, expressed doubt over the fed’s possible actions. “I don’t know that we can rest assured that ultimately some sort of coercive action may not be used if that is found to be necessary.”
Hungry for the “sweet spot”
Pubstations have good reasons to hang on to spectrum. For instance, Sidman said, retaining spectrum could help them expand service into ethnic minority and underserved communities. “The penetration of mobile devices there tends to be high,” he said. So mobile DTV may be an important means of reaching those viewers “with the kind of quality, trusted information that is a hallmark of public TV” — and part of pubcasting’s mission.
TV’s UHF channels, occupying some of the band between 300 MHz and 3 gigahertz, are regarded as prime spectrum for wireless devices. The “sweet spot” for wireless providers is toward the top of that band, around 3GHz.
It remains to be seen how much spectrum the FCC can scrape up for the next generation of mobile devices. Wireless industry groups such as the Cellular Telecommunications and Internet Association want a total of 800MHz of spectrum to be auctioned for such uses; their policy opponents say the request is high and probably just a starting point for negotiations. But Steve Largent, CTIA president, told the House communications subcommittee in December that commercial wireless operations will need at least 1300MHz of usable spectrum by 2015. The country now allots only about 500MHz of spectrum for that use.
It may be far too early for pubcasters to weigh any options. Because the FCC has yet to announce its recommendations, broadcasters can’t even be sure there will be an auction, said Ellen Goodman, a Rutgers law professor and pubmedia expert who will soon serve a period as an FCC visiting scholar. Other ways to free spectrum might include, say, a mechanism in which one financially struggling pubcasting station might shift to a multicast channel of another station, and the asset value of freed-up spectrum would be reinvested in pubmedia. Or the FCC could simply allow the marketplace to figure it all out, with wireless providers approaching license holders directly. That was tried during a spectrum auction in 1994 but proved complicated for many telecoms to negotiate with so many licensees.
No one can say now how much money a pubstation would make if its spectrum is auctioned off. Goodman said spectrum value is set per hertz per population, “so it varies completely by the population where the license is. And entities pay more if they can get a large footprint — preferably nationwide.
For now, the spectrum stays as is, the FCC gathers information, wireless groups push for bandwidth and broadcasters keep lines of communications open with the agency as well as Congress.
One thing is certain, Goodman said. “Noncommercial TV broadcasters need to have a strong position on this, not just, ‘don’t touch my spectrum.’ Because it’s going to be touched.”
Clarification
Our report on the FCC’s spectrum hunt, Feb. 8 [above], said TV’s UHF channels, coveted by mobile phone providers, “are sitting between 300 MHz and 3 gigahertz,” the phrase has been revised for clarity in this version.
Jabran Soubeih, executive director of engineering and technical planning at Seattle’s KCTS, pointed out that TV broadcasters don’t have access to that entire band. Their reduced bandwidth amounts to just 704 Mhz of about 2,800 MHz of spectrum in the UHF band.
Posted Feb. 10, 2010
Copyright 2010 by Current LLC
Takoma Park, MD