Incentive Auction Better for Broadcasters Than Leasing Spectrum After ATSC 3.0, Says Task Force Vice Chair

Broadcasters planning to take advantage of the capabilities of the upcoming ATSC 3.0 technological shift to lease spectrum to wireless carriers would be better served by participating in the TV incentive auction, said Incentive Auction Task Force Vice Chairman Howard Symons during a webinar Thursday. Largely about the incentive auction, the webinar, hosted by Broadcasting and Cable, also touched on the new broadcast standard and repacking.

Since the auction allows broadcasters to sell their spectrum as part of large contiguous chunks attractive to wireless carriers, they’re likely to get a better price than they would by offering up their spectrum individually, Symons said. Sinclair Broadcast, which has been pushing for speedy completion and adoption of the new standard, hasn't said it's planning to lease spectrum to wireless companies, responded Sinclair Vice President-Advanced Technology Mark Aitken during the webinar. ATSC 3.0 “could fundamentally change" how people use communications services, he said.

ATSC 3.0 will be ready in time for the repacking, Aitken said. And if it's ready, the FCC should adopt the new standard, he said. “We see every reason to do so, unless the intent is to hinder broadcasters,” Aitken said. "We will look at it as expeditiously as we can,” Symons said. ATSC President Mark Richer said at recent ATSC 3.0 field trials in Cleveland he thinks it's possible ATSC 3.0 products and services will be ready for launch within three to five years, assuming the first version of the standard is finalized as expected by early 2017 (see 1507130007).

Sinclair stations aren't expecting to be “active participants” in the auction, Aitken said. Sinclair CEO David Amy said at an SNL Kagan panel last month that in some markets where Sinclair owns duopolies, auction participation could make sense (see 1506250060). The FCC has an “optimistic view” of broadcaster auction participation, Aitken said.

Large auction participation could be an answer to the recent opposition to the FCC’s proposal to repack some TV stations into the duplex gap, said Expanding Opportunities for Broadcasters Coalition Executive Director Preston Padden. Robust auction participation would mean more TV stations sell their spectrum and thus don’t have to be repacked into the gap or elsewhere, he said. The opposition may be “a bit overblown” because of the small number of stations likely to be affected, he said. The duplex gap is the place where some stations will cause the least interference, Symons said. Without being able to repack stations in the wireless band, the FCC would be limited to a very low clearing target, Symons said. TV stations repacked into wireless bands could be stuck with impaired signals for years, NAB General Counsel Rick Kaplan said. The FCC should adopt a plan that minimizes that problem, instead of one that “sacrifices all other values” in order to clear the most spectrum, he said.

The auction has benefits even for broadcasters that don’t sell their spectrum, since it will “thin the herd” and reduce competition for those that remain, Padden said. Such a thinning may not be a benefit, Kaplan said, since it will likely reduce diversity in broadcasting. The industry’s strongest competitors won’t exit the business, he said. The FCC “doesn’t subscribe to the culling of the herd theory,” Symons said, saying the commission wants a “robust” broadcasting industry after the auction.