By Amir Nasr
February 16, 2017 at 1:17 pm ET
The Federal Communications Commission’s auction of broadcasters’ spectrum to wireless carriers may not have been necessary, and it’s fallen far short of expectations, according to Gordon Smith, head of the National Association of Broadcasters.
The FCC’s auction is scheduled to end on March 30, finishing a process that saw wireless companies buying airwaves from participating TV broadcasters. The auction has raised $19.6 billion.
“There was an earlier auction that got $40 billion and they got half the spectrum that this one held out,” Smith said, referring to an auction that ended in January 2015 and raised $44.9 billion. “For twice the spectrum, they got half the money and broadcasters got a quarter of what they were led to believe was part of this extravaganza. It was no extravaganza.”
In January 2016, now former FCC Chairman Tom Wheeler (D) said the auction would be a “spectrum extravaganza.” Wheeler stepped down from the FCC last month.
The auction results reveal “what was always overblown, which was that there was some spectrum shortage or crunch,” and telecommunications companies “proved” that “there is no such spectrum crunch,” Smith said Wednesday during a taping of C-SPAN’s “The Communicators” that’s scheduled to air on Saturday.
While the bidding phase of the spectrum auction is set to end in late March, the next phase consists of broadcasters being transferred to new bands of spectrum. The FCC allotted $1.75 billion of the proceeds from the auction to facilitate the “repacking” of those TV broadcasters in a 39-month window after the auction ends.
“We hope that will be enough money to get all those television stations repacked with minimal disruption to viewers, but that’s a big hope,” Smith said. The NAB said in a November 2014 filing with the FCC that they think broadcasters will “easily deplete” that money, and they might need an additional $1.1 billion.
Smith said he hopes broadcasters will be given the “elbow room” to work outside the 39 months requirement without TV blackouts. “It’s a huge job,” he said, adding that “it makes the transition of analog to digital look like a Sunday school lesson by comparison.”