Facing a potentially hostile audience, FCC Chairman Julius Genachowski began his first speech to an NAB Show by citing his own broadcaster credentials. Then he sought to convince his audience of broadcasters that they have nothing to fear from his broadband plan.
The Chairman recalled that the last time he’d been at an NAB Show was in the late 1990s when he was part of the team at USA Broadcasting, which was launching local TV stations that had formerly carried Home Shopping Network. “I know first-hand the challenges of local broadcasting. And I certainly understand the real-world impact on broadcasters of the economic crisis we’ve been suffering through,” Genachowski said. “I have enormous respect and admiration for the many broadcasters who succeed as businesses while providing news and other programming that serves America’s local communities.”
Not only did he cite his TV credentials, but Genachowski also recalled his personal history in radio – as a DJ on his high school carrier current station. And he noted recent actions by the FCC to aid radio stations: A power increase for HD Radio and a rule change that allows AM stations to use FM translators.
Having laid out his claims to being their brother in broadcasting, Genachowski insisted that a lot of misinformation has been circulated about the National Broadband Plan. The Chairman said there is no doubt that new spectrum is going to be needed to meet the rapidly expanding demand for wireless broadband services, but he insisted that there is no effort to put TV broadcasters out of business to grab their spectrum. Less than 25% of the 500MHz of spectrum being sought for reallocation is seen as coming from broadcasters, he said, and the program of surrendering TV licenses for the reallocation plan will be entirely voluntary. Stations which choose to participate will share in the auction proceeds (and be able to pull out if bids are too low) and have the option of cutting sharing deals to continue broadcasting under another station’s 6MHz allocation.
Genachowski said he fully expects that the majority of broadcasters will not be interested in the auction deal. “That is completely fine,” he insisted. But the Chairman said the plan will free up significant spectrum if only a small number of stations in large markets choose to participate.
“And so I call on all broadcasters to ignore the hyperbole and focus on the real challenges and the real opportunities,” Genachowski said.
Touching on retransmission consent, the Chairman said he agrees with broadcasters that the marketplace is the preferred way to set the fees that cable and satellite companies pay for broadcasters’ content. However, he said he is also concerned about the impact on third parties, specifically program interruptions and whether retrans results in higher cable rates for consumers.
“There are legitimate questions about whether to update the 20-year-old framework for retransmission consent and must carry. As we move forward, I’ll be focused on making sure we have a framework that is fair to consumers, as well as each of the businesses involved,” Genachowski said, without giving any indication of what that might mean.
He was equally vague on any potential changes to the FCC’s ownership rules, noting that the Commission will soon issue a Notice of Inquiry for the periodic review required by Congress.
Genachowski left the stage without taking any audience questions.
As he closed the session, NAB President and CEO Gordon Smith had this brief reaction to the Chairman’s comments on spectrum: “His thoughts were reassuring and we will reach back constructively.”
RBR-TVBR observation: We doubt that many broadcasters would have rushed to hug Genachowski if he had hung around, but he at least calmed some fears that the current Administration is going to be unabashedly anti-broadcaster. We note, though, that his speech avoided any mention of the idea of imposing new spectrum fees on TV stations which choose not to participate in the spectrum reallocation auctions.