O'Rielly Questions Spectrum Auction Set-Aside

Related: O’Rielly Says Costs, Timeline Are Post-Spectrum Auction Issues

FCC Commissioner Michael O'Rielly questions whether Comcast needs or deserves a chance to bid on reserve low-band spectrum in the incentive auction.

Comcast applied to participate, and while it is the largest cable company, it is not among the largest holders of low-band spectrum, which means it can bid for some of the spectrum being reserved for nondominant wireless carriers.

O'Rielly, speaking to the National Association of Broadcasters State Leadership Conference in Washington Tuesday, said he was worried that the FCC's decision to set-aside that spectrum will help companies "that don’t need or deserve the government’s assistance." The FCC has set aside up to 30 MHz of spectrum in each market as a reserve for companies with less than 1/3 of the low-band spectrum in those markets.

Related: O’Rielly Pushes to End Correspondence File

He singled out Comcast as an example.

"I won’t blame Comcast one bit if they choose to pursue reserve licenses as they have a fiduciary responsibility to shareholders," he said. "But should the Commission really give a preference or subsidy to a sufficiently capitalized, major market participant that is listed in the top 50 of the Fortune 500 list?"

He was equally troubled by reports that a hedge fund could spend billions to snap up licenses to eventually flip them. "Every dollar that is spent on the reserve, rather than through a completely open and fair auction, will depress the ultimate value of broadcast stations for participating and non-participating broadcasters," he added.

O'Rielly dissented from the decision to create the set-asides.

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.