2016 United States wireless spectrum auction
The 2016 United States wireless spectrum auction, officially known as Auction 1001, allocated approximately 100 MHz of the United States Ultra High Frequency spectrum formerly allocated to UHF television in the 600 MHz band. The spectrum auction and subsequent reallocations were authorized by Title VI of the payroll tax cut extension passed by the United States Congress on February 17, 2012.
Background
The 2008 United States wireless spectrum auction, dealing with allocations for UHF television in the 700 MHz band, generated $19.6 billion from companies such as AT&T and Verizon Communications. This auction re-allocated the UHF space formerly occupied by channels 52–69, after the completion of the primary digital television transition in the United States from NTSC to ATSC in 2009. In effect, the digital transition had eliminated 25% of the space allocated for UHF television in the United States.Wireless broadband internet access interests had expressed desire for more broadcast spectrum for their use, and in March 2009, Massachusetts Senator John Kerry introduced a bill requiring a study of efficient use of the spectrum. The lobbying group CTIA pressed for 800 MHz of additional spectrum. David Donovan of the Association for Maximum Service Television, seeing that further cuts of broadcast television UHF frequencies were being eyed, stated that the 2 GHz S band, allocated for mobile satellite service, was not being used ten years after its allocation, and would be an appropriate allocation target rather than demanding even more space in UHF broadcast ranges. The National Association of Broadcasters and the AMST commented to the FCC that the government should make maximum use of the newly available 700 MHz UHF spectrum and other spectrum already allocated for wireless before asking for more, while companies that would benefit asked the government to look everywhere possible. Many broadcasters objected to further encroachment on the UHF broadcast spectrum.
A Consumer Electronics Association study claimed that $62 billion worth of spectrum could become $1 trillion for wireless, and one proposal would require all TV stations, including LPTV, to give up all spectrum, with subsidized multichannel services replacing over-the-air TV, even after viewers spent a great deal of money on the DTV transition. Broadcasters responded, "In the broadcasting context, the 'total value' is not a strict financial measure, but rather is one that encompasses the broader public policy objectives such as universal service, local journalism and public safety." Broadcasters pointed out that the government, viewers and the related industries spent $1.5 billion making sure that a minority of the audience would be ready for the DTV transition. Any change could mean the loss of free TV to people in rural areas, broadcasters said, particularly "local journalism, universal service, availability of educational programming, and timely and reliable provision of emergency information."
Meredith Attwell Baker, a Republican FCC commissioner, agreed that properly using the existing spectrum was important, and part of doing this was using the latest technology. The wireless industry needed more spectrum, both licensed and unlicensed.
FCC broadband advisor Blair Levin wanted a plan by February 2010. Another proposal was "geo-filtered WiMAX", which would allow HDTV but only in a particular market, with the remainder of the spectrum sold for $60 billion. WiMax would replace the existing services but would make MVPD services cheaper, while still allowing broadcasters to make more money. The additional spectrum made available could then be sold to pay the industry's debt.
Bob Powers, vice president of government relations for the National Religious Broadcasters, pointed out that the Levin proposal did not provide for religious broadcasters.
In 2009, venture capitalist Tom Wheeler called broadcaster opposition a "jihad", but he went on to say broadcast TV was "without a doubt... the most efficient means of delivering
common content to a large audience." Wheeler was nominated for FCC chairman in 2013.
Broadcaster resistance
Regarding the CEA study's findings, Donovan said to Broadcasting & Cable magazine:Wireless companies are asking the government to participate in the biggest consumer bait-and-switch in American history. For the last few years, the government told consumers that digital television would bring them free over-the-air HDTV and more channels. Now, after purchasing billions of dollars in new digital equipment and antennas, wireless advocates are asking the government to renege on its promise. High-definition programming and more digital channels would become the sole and exclusive province of pay services. The American public simply will not stand for this.
PBS and its stations also opposed the plan, saying they had spent a lot of money on the digital upgrade which they need to earn back, and viewers had contributed expecting the digital broadcasting to continue. They claimed PBS was "efficient and productive, and abundantly serves the public interest." Noncommercial broadcasters said they needed broadcast spectrum for superior educational and children's programming. PBS said 85 percent of its stations used HDTV and 82 percent had two or more standard channels. Ohio State University said it had "no excess" spectrum, though it later sold WPBO in Portsmouth, Ohio as part of the incentive auction due to an "incredible duplication of PBS signals" in the area.
An FCC workshop on November 23, 2009 produced several ideas. Virginia Tech professor Charles Bostian said sharing should be done, but not in the white spaces; WiFi spectrum should be used instead. Vint Cerf of Google said cable companies could share some spectrum, which the companies would like to do except they have "must-carry" rules that will not allow this. BBN Technologies chief engineer Chip Elliott called for government-funded broadband to be shared by researchers. Collaboration was the key to advancing the technology, and the word "collaboratories" referred to broadband as "not only the goal of the research, but the vehicle as well."
Wi-Fi testing using white spaces took place in Virginia in Fall 2009 and in Wilmington, North Carolina in 2010.
The National Association of Broadcasters opposed ending broadcast TV because the industry spent $15 billion, in addition to giving up spectrum already. On December 14, 2009 at a hearing before the Communications Subcommittee of the House Energy & Commerce Committee, NAB president Gordon H. Smith said the government and individuals had spent too much money on the DTV transition and for HDTV for further changes to make their efforts worthless, and that broadband and broadcasting could co-exist. He pointed out that in the 1970s, broadcasting used 60 percent of the spectrum that it does now to deliver a much higher quality product, and that existing regulations required more efficient use of the spectrum than would be the case for new devices. On the subject of what could be done instead, Smith recommended using white space in rural areas with fixed devices rather than mobile devices, and new types of broadband service such as those developed by Sezmi.
CTIA president Steve Largent said that the industry needed spectrum, "wherever it comes from." He said government spectrum probably was not efficiently used and would "likely" be "repurposed", while other broadcast and satellite spectrum "may" be used better for wireless. Largent also said without more spectrum, companies might merge to better use what they had. Consultant Dave Hatfield, former FCC engineering and technology chief, said making maximum use of existing spectrum through compression and modulation would help, but it would not be enough. Oregon Republican House member Greg Walden criticized the FCC for hiring Distinguished Scholar in Residence Stuart Benjamin, whose essay recommending replacing broadcast spectrum entirely Walden called an "abomination".
Plan announcement and preparations
On March 16, 2010, at the FCC's monthly meeting, Connecting America: The National Broadband Plan was revealed, with a combination of mandatory and voluntary efforts expected to increase spectrum by 300 MHz; 120 MHz of that was expected to come from broadcasters, and 90 MHz from mobile satellite service. By 2015, broadcasters would have to leave channels 46 through 51, allowing another 36 MHz to be used for wireless Internet access by "repacking", or relocating channels now on those frequencies. A total of 120 MHz needed to be reclaimed from broadcasters, the rest voluntarily. The FCC Chairman's Senior Counselor Colin Crowell explained that the spectrum crunch wasn't an imminent crisis, but rather "it's a crisis in five or six years." Failure to act could make Internet access more expensive and leave the United States less able to compete with other countries, the FCC report said. House Communications Subcommittee chairman Rick Boucher, a Virginia Democrat, said it would take four years from the time a bill passed to determine where the new spectrum would come from.The FCC had 50 MHz of spectrum available for wireless broadband, but this was expected to increase to between 500 MHz and 800 MHz over 10 years. 300 MHz would be made available by 2015. The National Association of Broadcasters opposed the plan, issuing this statement:
We are concerned by reports today that suggest many aspects of the plan may in fact not be as voluntary as originally promised. Moreover, as the nation's only communications service that is free, local and ubiquitous, we would oppose any attempt to impose onerous new spectrum fees on broadcasters.
Mark Wigfield, broadband spokesman for the FCC, pointed out that even in the unlikely event all broadcasters in a market gave up their spectrum, the FCC would have to guarantee that some over-the-air service remained.
In April 2011, FCC chairman Julius Genachowski said "realigning" would be necessary if broadcasters did not volunteer, while Intel's Peter Pitsch told Congress "the repacking process should not be made voluntary." The NAB's Smith worried that the process could cause numerous problems for broadcasters and viewers. The spectrum auctions were authorized by Title VI of the payroll tax cut extension passed by Congress on February 17, 2012. A reverse auction would let broadcasters determine how much they were willing to take for giving up spectrum, while the sale of licenses to broadband providers would take place through a forward auction, in which proceeds would have to cover payments to broadcasters, costs of the auction, and costs of relocation.
On April 27, 2012, the FCC approved letting stations share spectrum using DTV subchannels, with all stations that had "full channels" keeping rights such as must-carry. At the first "reverse incentive auction" workshop on October 26, FCC Media Bureau chief Bill Lake said stations would not be able to decide their channel but could apply to change it.
At a September 30, 2013 workshop, broadcasters and equipment makers were asked what the changes would cost. The result was that answers would only be possible after the FCC said who would be moving and how. The Spectrum Act provided $1.75 billion for the reasonable expenses of relocating stations, and the money would have to be paid in three years without further action by Congress. Among the expenses would be meeting new tower standards for dealing with wind and ice, interim facilities so some stations would not be temporarily forced off the air, and translators in areas that needed them, mostly in the West. The FCC asked for comments to be received by November 4, 2013, with spectrum auctions coming later. Providers of wireless services recommended that broadcasters give up two channels, or 15 MHz, of Broadcast auxiliary service, which is used for relaying breaking news, but the NAB said this spectrum could be shared with the United States Department of Defense.
In March 2014, KLCS and KJLA conducted a channel sharing trial in partnership with CTIA and the Association of Public Television Stations, which tested the viability of broadcasting two sets of television services within the same 6 MHz channel band, including varying combinations of high and standard definition feeds. The experiment was deemed successful, although certain scenarios were found to affect video quality on more complex content. Later in September 2014, KLCS announced that it would enter into a channel sharing arrangement with fellow public station KCET and participate in the 2015 auction.
In March 2014, the FCC voted to ban joint sales agreements—arrangements in which a station brokers the sale of its advertising to another station in the market, by making them count the same as outright ownership if the senior partner sells 15% or more of the brokering station's advertising, and give two years for station owners to unwind joint sales agreements that are in violation of the new rules. It was speculated that the move to ban JSAs was an attempt to devalue television stations, and in turn, push their owners to participate in the incentive auction. FCC Media Bureau Chief Bill Lake denied that the push to ban JSAs was connected to the spectrum auction.