Obama Proposes Spectrum Fee That Would Generate $4.8B

The just-released 2011 federal budget 
again includes a spectrum fee on un-auctioned spectrum licenses, which would
include those held by broadcasters and cable operators.

The administration predicts that fee collections would begin
this year and total $4.8 billion through 2020.

The budget historically contains a spectrum fee
proposal, and just as historically the fee is eventually
excised during the negotiations in Congress before it gets
approval from the Hill.

"To promote efficient use of the electromagnetic
spectrum, the Administration proposes to provide the FCC with new authority to
use other economic mechanisms, such as fees, as a spectrum management
tool," the budget says, essentially reproducing the 2010 language.
"The Commission would be authorized to set user charges on un-auctioned
spectrum licenses based on spectrum-management principles. Fees would be phased
in over time..."

The FCC has been transitioning to an auction model for
spectrum, which has the potential to raise billions for the treasury, as witnessed
by the approximately $20 billion in raised in the 700 mHz auction of spectrum
reclaimed from broadcasters in the DTV switch.

The budget would also extend "indefinitely" the
FCC's authority to auction spectrum, an authority that expires Sept. 30, 2012.

The new budget also revives the proposal to auction new
domestic satellite licenses, which the administration says would raise $200
million by 2020.

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.