Warning that only a fraction of broadcasters will be able to meet the FCC’s current 39-month deadline for relocating their channels in the wake of the incentive auction, the National Association of Broadcasters (NAB) urged the FCC on Monday to hold off on setting the repacking deadline until after the incentive auction is completed.
The NAB backed its request with a study it had commissioned from Digital Tech Consulting (DTC), which concludes that about 445 of the stations to be repacked will be relocated within the 39-month deadline prescribed by the FCC. DTC estimates that between 800 and 1200 stations nationwide will be subject to repacking at a cost of between $1.98 billion and $2.94 billion, which exceeds the $1.75 billion that Congress allocated to the FCC for the purpose of reimbursing broadcasters for their relocation costs. Noting that a report issued by the FCC in 2013 “looked at repacking on a per-station rather than a nationwide basis,” the DTC study proclaimed: “it will not be possible for all of the assumed number of TV stations required to transition to new channels to do so within the stated FCC deadlines.” FCC rules require broadcasters that decide to keep their channels to repack within 39 months of the conclusion of the incentive auction or be forced off the air. The NAB characterized the FCC’s current approach as “manifestly unreasonable.”
As such, the NAB recommended that the FCC “eliminate the current, hard 39-month deadline, and instead work with stakeholders to develop a regional transition plan that will allow for the most expeditious, efficient repack possible once the auction is complete,” adding: “at that point, it will be clear how many stations must actually move.” Although NAB executive vice president Dennis Wharton argued that such flexibility “will not slow the auction [and] would ensure that no broadcaster is forced to go dark,” wireless industry executives pushed back on grounds that the NAB proposal would delay the introduction of new services and introduce uncertainty in the incentive auction process. Asserting that the current repacking deadline “is fair and achievable for the broadcast industry,” an official of wireless association CTIA told reporters: “the success of the auction assumes carriers will bid substantial sums, and that cannot happen absent certainty that they will receive timely access to the spectrum purchased.”
Meanwhile, in a public notice issued yesterday, the FCC reset the application deadlines for the reverse and forward phases of the incentive auction to January 12 and February 9, respectively. In the words of the public notice, the postponement accommodates modifications to TV station opening bid prices for the reverse auction. The changes “[correct] information for a small number of stations, and adjust population data for stations that are affected by these corrections.” While emphasizing that there is no change in the March 29 incentive auction start date, the FCC explained that a reset of the application deadline would give broadcasters “at least 60 days after the release of the recalculated prices to evaluate whether to apply to voluntarily participate in the reverse auction in light of such prices.” NAB and CTIA officials offered no comment.