It looks like stations along the border with Canada will be getting higher starting bid prices in the upcoming broadcast incentive auction thanks to the coordination agreement struck with Canada, which will be repacking its own stations at the time to free up more wireless spectrum.
Those bid prices are likely to drop, but the higher the starting point, the better for broadcasters looking to cash in or cash out.
The FCC's opening prices are determined according to a formula that includes population covered and the amount of interference (impairment)—the higher the population covered and the more potential impairment to wireless licenses a station represents, the more valuable its spectrum is to the FCC to reclaim.
According to a copy of the statement of intent between the FCC and Canada's Department of Industry announced late last week, U.S. TV stations will get credit for Canadian as well as U.S. population served, which would obviously boost that factor over U.S. alone.
It also suggests that stations will not only get "credit" for interference to Canadian stations in calculating prices, but that that figure will get a multiplier of 2.3 times those Canadian "constraints." That would appear to be an extra incentive, likely sought by Canada, for stations with the most potential interference to that country to put their spectrum up for auction.
That is good news for border broadcasters interested in putting their spectrum into the auction.
An FCC spokesperson confirmed that the letter means border station opening bid prices are likely to rise, but would not comment on whether the interference multiplier was Canada's proposal.
There will not be a similar multiplier for stations along the Mexican border, an FCC source said. Mexico is not undertaking a wireless spectrum free-up as are the U.S. and Canada,. though it has agreed to repack its TV stations below ch. 37—where U.S. stations are moving—after its upcoming DTV transition.
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