NAB 2010: Genachowski Tells Broadcasters That Spectrum Auctions Are Voluntary—Period.

NAB 2010: CompleteCoverage from B&C

FCC Chairman Julius Genachowski used his keynote speech at
the NAB Show in Las Vegas
April 13 to pitch the FCC's spectrum reclamation plans as a compromise between
taking all 300 MHz from broadcasters and doing nothing, as well as to counter
what he said was disinformation about the commission's national broadband plan.

Genachowski said that the incentive auctions for broadcast
spectrum would be entirely voluntary, that it would not take many stations'
participation to get the 120 MHz in mostly urban markets that the FCC needs,
that broadcasters would be able to set their own floor price for their
spectrum, and that he is confident the FCC will not have to go to a plan B
necessitated by not getting enough spectrum the first time around.

National Association of Broadcasters President Gordon Smith, who has billed the plan as a Godfather-like request, called Genachowski's talk "reassuring," but not all broadcasters shared that.

The FCC has a five-year plan for getting that spectrum back
from broadcasters to turn over to wireless broadband. (See related article, "FCC Broadband Plan: Commission Sets 2015 Spectrum Deadline")

In his address, Genachowski praised broadcasters for their
public service before laying out the case for a looming spectrum crisis and the
re-auctioning of spectrum collected from broadcasters and others.

"Some have suggested that all 300 MHz now allocated to
broadcasting should be reclaimed and auctioned," he said, according to a
prepared text of his speech. "Others take the view that the status quo is
fine; no change needed. The Broadband Plan recommends neither course.  Instead,
it lays out a well-balanced plan designed to be a win-win-win for broadcasters,
mobile Internet providers, and the American people.

"It proposes voluntary incentive auctions -- a process
for sharing with broadcasters a meaningful part of the billions of dollars of
value that would be unlocked if some broadcast spectrum was converted to mobile
broadband," he continued. "The plan would give broadcasters the choice to
contribute their licensed spectrum to the auction and participate in the

Genachowski added that it would be "fine" if the
large majority of broadcasters weren't interested in taking the FCC up on the
offer, an offer that the previous day NAB President Gordon Smith said was like a
mob offer that could not be refused.

But he also said that broadcasters who want to contribute
half their capacity and share with another broadcaster, for example, should not
be denied that opportunity.

"A lot has been said and written about this auction
proposal, including at this conference, that just isn't accurate," he
said, stating that the auctions were "voluntary, period. Participation is
up to the licensee and no one else."

He said the commission does not need "all, most, or
even very many" licensees to participate to make it work. And he noted that
broadcasters would be allowed to set a reserve price below which their licenses
would not be auctioned.

The suggestion that the FCC wanted to drive broadcasters out
of business is "not so," Genachowski said, adding that no one will be
forced to participate in spectrum auctions.

Moreover, he said, the spectrum reclamation plan will not
prevent the deployment of mobile DTV, and that broadcasters who give up some
spectrum would still be able to provide it.

"I'm pleased that the DTV transition has enabled the
development of standards and the launch of market trials for mobile DTV," said
the chairman. "Our job is not to predict innovation or business models, but to
enable them. Under the incentive auction plan, broadcasters will be able to
provide mobile DTV, both licensees that choose to retain all 6 megahertz, and
those that choose to share."

As to the $64,000 question -- what happens if the FCC cannot
get back all the spectrum it needs through this voluntary program -- Genachowski
said he did not believe it would come to that. And the country, he said, simply
can't "afford for it to come to that."

He asked broadcasters to accept his offer to work
constructively to help the commission flesh out the proposal, and announced he
would convene an engineers' forum, "which will enlist broadcast, mobile
and other engineers to address concrete technical issues raised by the plan and
help develop the best path forward."

One small-market TV operator was not assuaged. "It wasn't thumbs up, it wasn't thumbs down, it was just there."

Michael Malone contributed to this story.

John Eggerton

Contributing editor John Eggerton has been an editor and/or writer on media regulation, legislation and policy for over four decades, including covering the FCC, FTC, Congress, the major media trade associations, and the federal courts. In addition to Multichannel News and Broadcasting + Cable, his work has appeared in Radio World, TV Technology, TV Fax, This Week in Consumer Electronics, Variety and the Encyclopedia Britannica.