The dates and minimum bids are set – and the next auction for new FM stations is a go for September 1, 2009. Applications to participate in the auction are due during the period June 16 to June 25, and must be filed electronically at the FCC, specifying on which of the 122 available channels an applicant is interested in bidding. Full, detailed auction instructions can be found in the FCC’s Public Notice, and the list of available channels and the minimum bids for each is available here. To give time for applicants to prepare their applications, the Commission has also initiated a variety of freezes on the filing of certain FM applications.
A freeze on any application or Petition for Rulemaking seeking a change in the channel of any channel proposed for use in this auction has been imposed effective immediately. Applications that shortspace any of the reference points for any of these stations are also barred. A subsequent freeze on the filing of any minor change application by an FM licensee will also be imposed during the June window. These freezes are to give applicants for channels the opportunity to evaluate which channels are worth bidding for, and to specify specific transmitter sites for certain channels (different than the reference coordinates) which will be protected during the auction process. Thus, applicants who see the potential for an increase in value of one of these channels that may come through the location of the station at a particular transmitter site can specify that site, protecting it and the value that they see.
The FCC procedures Public Notice sets out detailed instructions for bidders. The Notice goes into detail about the anti-collusion prohibitions. These rules forbid one bidder for a channel from talking about the auction with anyone else who has filed to bid for that channel – and the prohibition applies from the beginning of the filing window until the winning bidder makes its auction payment – even if one of the applicants drops out early in the proceeding.
The Public Notice also goes into detail about the applicants obligation to do due diligence on the channels for which it bids. An applicant cannot get a refund of its auction payments just because its transmitter site becomes unavailable, nor can it object if the station costs more to build than it expects – or if it does not make any money once it is built. Buyer beware.
Important auction dates are as follows:
- Auction Seminar ………….June 16, 2009
- Short-Form Application (FCC Form 175) Filing Window Opens ………..June 16, 2009; 12:00 noon ET
- Short-Form Application (FCC Form 175) Filing Window Deadline ….June 25, 2009; prior to 6:00 p.m. ET
- Upfront Payments (via wire transfer)…………………………..July 31, 2009; 6:00 p.m. ET
- Mock Auction ………………………………………………………….August 28, 2009
- Auction Begins…………………………………………………………September 1, 2009
Potential applicants for these channels should carefully review the FCC’s Public Notice setting out the bidding procedures. Applicants who have not bid in prior auctions may want to consider attending the FCC pre-auction seminar, though it will leave little time for preparing an application as the seminar is on the first day of the auction window. Opportunities may exist among these122 channels, but buyers need to do their research. Those interested in ownership for the first time, or to increase ownership interests that they may already have, should start studying the available channels now, to be ready for the June filing window.