Study: Broadcast Licenses Hardly a Windfall

According to the study, commissioned by the National Association of Broadcasters from Navigant Economics managing director Jeffrey Eisenach, virtually all TV station owners paid market value for their spectrum in private transactions. The study also points out that some wireless carriers urging the FCC to move broadcasters off their spectrum did not pay the government for their spectrum.

While the FCC did assign TV station licenses without collecting any money for them, the study found that 92% of those original stations have been bought and sold since then.

"From an equity perspective, those opposed to according television broadcasters strong property interests in their licenses often argue that doing so could generate a 'windfall' since they 'got their spectrum for free.' As an initial matter, this argument overlooks the fact that broadcast television licensees are not unique in the sense that they hold licenses originally granted without direct payment to the government. Prior to the congressional grant of auction authority to the FCC, all spectrum licenses were issued for nominal payments of application fees."

The study was released Jan. 21, the day before the FCC was scheduled to hold its first spectrum auction, one of three to raise money for an interoperable broadband public safety network and to free up spectrum for wireless broadband. The congressionally mandated auctions will culminate in a broadcast incentive auction scheduled for mid-2015.

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.