The broadcast television industry is facing yet another major transition: the reverse auction of television channel assignments followed by the repacking of spectrum in the 600MHz band to make room for mobile wireless services. In this 4-part series—the first of many we’re planning on this and related topics—we will give an overview of this transformative event that is set to begin with an Incentive Auction—to be conducted by the FCC—slated for mid-to-late 2015.
According to the FCC’s latest Report & Order issued June 2, 2014, “In the Spectrum Act, Congress authorized the Commission to reorganize the UHF band so that the television stations that remain on the air after the Incentive Auction occupy a smaller portion of the band, thereby freeing up a portion of the band for new wireless uses.”
The Incentive Auction will be carried out in two phases:
- A Reverse Auction where broadcasters will have the opportunity to voluntarily return licensed broadcast spectrum usage rights in exchange for payments and
- A Forward Auction of new, flexible-use licenses where the highest bidders can acquire and use that freed up spectrum for mobile broadband services
Even though many of the vital details of this spectrum repacking and auction process are not yet known, we at GatesAir are advising broadcasters who believe they will be affected by this channel relocation process to be proactive and begin laying the groundwork for this transition.
UHF television broadcasters will have four options to consider:
- Exit the television business: Put your channel spectrum up for auction to the highest bidder and cash out of the market
- Opt for a Channel Sharing agreement with another station so that one of the two transmitters gets turned off and that spectrum is allocated for the repacking
- Move from a UHF channel assignment to a high band VHF channel, which involves rebuilding your transmitter site
- Elect to do nothing and remain in business as a UHF television station, which may still require changing channels
In many cases except exiting the television business, stations will have a high probability of having to move to a new channel assignment as part of the repacking process.
A $1.75 billion fund—derived from the proceeds of the Incentive Auction—will reimburse broadcasters for their channel relocation expenses provided that they have upgraded their plant and submitted their invoices within the 36-month timeframe.
In Part 2 of our 4-part series, we’ll look at how spectrum repacking can affect transmission tower sites for stations that must move to a new channel assignment.