Alert
Alert
By Scott R. Flick,
10.22.12
The FCC released its long-awaited Notice of Proposed Rulemaking (NPRM) to begin the process of auctioning and repurposing broadcast television spectrum for mobile broadband use. Comments are due on December 21, 2012, and reply comments are due on February 19, 2013.
The Federal Communications Commission voted unanimously in favor of a Notice of Proposed Rulemaking that launches the incentive auction process with the hope of clearing a portion of the television band to allow for its use by mobile broadband licensees. The NPRM is very lengthy, covering many issues directly related to the auctions themselves, as well as numerous other issues that will be created by implementation of the spectrum auctions. The FCC has announced that it will be conducting a workshop on October 26 to provide further information about issues raised in the NPRM that are particularly relevant to broadcasters considering participating in the auction, including proposed auction designs, the mechanics of participation, and station eligibility.
The variety of issues in the NPRM is far too great to summarize in this Advisory without making it as long as the NPRM. However, among the broad and critical issues raised by the NPRM for broadcasters are:
The FCC’s NPRM is a result of the Middle Class Tax Relief and Job Creation Act of 2012 (“Spectrum Act”), in which Congress authorized the FCC to implement a complicated three part spectrum auction process. Specifically, Congress required the FCC to conduct (1) a “reverse auction” in which existing commercial and non-commercial full power and Class A TV stations submit bids to voluntarily relinquish spectrum in return for payment; (2) a “repacking” of the broadcast TV broadcast bands to make a portion of the UHF band available for other uses; and (3) a traditional “forward auction” for parties to bid on licenses for flexible use of the newly freed-up broadcast spectrum. The FCC’s primary auction proposals are summarized below.
Reverse Auction
According to the NPRM, the FCC plans to limit participation in reverse auctions to full power television stations and Class A television stations, including television stations operating on noncommercial educational reserved channels and stations operating on a noncommercial basis on non-reserved channels. Low power television stations would not be permitted to participate in the auctions. For full power and Class A TV stations interested in participating in the reverse auctions, the FCC proposes to provide such stations with three options to relinquish their spectrum and has initially concluded that these options will include:
1. A station going off the air completely;
2. A station moving to a lower broadcast television band (i.e., UHF to VHF); or
3. A station sharing a channel with another television station.
The FCC is also seeking comment on whether to allow stations to participate in the reverse auction by bidding to accept additional interference from other broadcast stations or by agreeing to reduce their service areas. According to the NPRM, the FCC proposes to allow existing full power and Class A stations, including those with pending license renewal applications or pending FCC enforcement actions, to participate in the auctions.
The Commission proposes to clarify its channel sharing requirements to prohibit any bids that would require a change in a station’s community of license. Therefore, a winning reverse auction bidder that relinquishes its rights with regard to a particular television channel would relinquish all usage rights for that channel and retain no further rights with regard to that channel. The FCC would dismiss any pending modification applications associated with the channel in question and cancel any outstanding construction permits if it decides to accept the bid.
The FCC also asks what information and certifications it should request from applicants in order to allow them to participate in the reverse auction bidding process. Specifically, the FCC is proposing to ask that parties provide the following information as part of their pre-auction submissions:
Download: FCC Releases Proposals for Broadcast Spectrum Incentive Auctions