Doing the incentive auction right rather than right away


GavelNAB’s Rick Kaplan said nobody is more in favor of getting the FCC’s incentive auction program over with than broadcasters, who don’t want to live under the uncertainty that accompanies it for a second longer than necessary. But it must be done right or it will fail, and getting all issues resolved by 2014 seems highly unlikely.

In a speech delivered at a Media Institute luncheon, Kaplan said for starters the FCC has failed to answer the two supremely critical questions that directly impact whether or not there will even be any spectrum to auction – in which markets a need for spectrum is anticipated, and how much broadcasters can earn by turning in their spectrum
Without that knowledge, broadcasters have absolutely nothing upon to base this existential decision.

In fact, Kaplan was able to list six elements critical to a successful auction that have yet to be answered:

a. How much spectrum should be allocated to licensed versus unlicensed services?

b. How will the Commission attract volunteers and know how much to pay them? 

c. How can we expedite the statutorily-mandated coordination process with Canada and Mexico to free up spectrum along the borders? 

d. What does the band plan look like, including whether the Commission should favor FDD or TDD operations?

e. How is the Commission going to administer the $1.75 billion TV Broadcaster Relocation Fund, designed to cover all broadcaster and MVPD relocation costs, and to do so within a mere three years of the auction closing?

f. If the auction winners don’t deploy their spectrum immediately, should the Commission allow the existing users continue to operate on it and/or allow unlicensed uses on that spectrum as well?

Kaplan spoke at length about the defects in any plan that places wireless and broadcast services anywhere near one another in terms of spectrum, including the concept of assigning spectrum variably on a regional basis. He said that the distance separations that would be necessary to avoid harmful interference would be too great to make such a policy feasible.

In conclusion, Kaplan suggested that the FCC avoid succumbing to political pressure to get it done fast, and to avail itself of the expert technical advice coming in free of charge from stakeholders who want to make sure the auction is done right, and noted that the latter depends on running an open and transparent process with plenty of opportunity for public comment.

RBR-TVBR observation: The smart money has been that there is no way on earth that this auction will happen as soon as next year. That’s still what we think – the international aspects of this matter alone are enough to cast extreme doubt on a 2014 deadline. And now, after hearing Kaplan, we have no doubt whatsoever that the FCC should begin thinking in terms of a more realistic deadline.

At this point, for all we know, in 2014 the FCC will still be trying to resolve the quadrennial review – that’d be the still incomplete quadrennial review of 2010.