Broadcast Auctions

Subscribe to Broadcast Auctions via RSS

The FCC adopted proposed auction procedures for its incentive auction at its meeting on Friday, and thus far has released a Fact Sheet on these procedures by which it plans to buy back spectrum from broadcasters and resell it to wireless companies for wireless broadband uses.  The tentative procedures, along with the recent “Greenhill Report” setting possible prices to be paid to television stations who are willing to surrender their channels for the FCC to resell to wireless companies (see our summary here), are setting the stage for a series of meetings with broadcasters to attempt to convince enough to participate in the auction to satisfy the FCC’s goals for the auction – goals that also became a bit clearer from Friday’s releases.  Further information on the auction procedures is expected soon in a more detailed Public Notice fleshing out the proposals outlined in the Fact Sheet so that comments can be filed by the end of January. 

The fact sheet is not the detailed notice of auction procedures that some broadcasters may be familiar with from participating in past broadcast auctions – that will apparently come soon in the Public Notice that it summarizes.  But it does provide an outline of proposed general principles that will be applied to the incentive auction.  Initially, it proposes that the FCC would set opening prices for each station – prices at which the FCC would offer to pay the licensee to give up its spectrum.  The prices would be set based on an analysis of two factors: (1) the impact that the station would have on the repacking of the broadcast spectrum after the auction because of the interference that it causes and (2) the population covered by the station.  If a station agrees to move to the VHF band instead of surrendering its licenses altogether, it would receive somewhere between a third and a half of the opening price if it accepts a high VHF channel, and between 67 and 80% of the opening price for a low VHF channel.  According to the fact sheet, the prices that will initially be offered to the broadcaster will be initially set high, and will be lowered as the auction progresses until the prices reach a point where there are just enough broadcasters willing to take the lowered offer to clear the amount of spectrum that the FCC needs to fill the demands of the wireless users.  There has also been introduced the concept of a “dynamic reserve price,” setting a limit on how much the FCC is willing to pay some stations for giving up their spectrum, which could conceivably result in the amount that they are offered being lowered even when it is known that they cannot be repacked into the amount of the spectrum that remains available in the smaller post-auction TV band.   How much spectrum must be cleared for the auction to go forward?
Continue Reading Putting Details to the Incentive Auction – FCC Asks for Comments on Fact Sheet on Auction Structure, and Prepares for Meetings with Broadcasters

We wrote last week about some of the upcoming issues on the FCC’s agenda for the very short term related to the TV incentive auction to clear part of the TV spectrum for use by wireless companies, and the subsequent “repacking” of the TV stations who do not sell their licenses in the auction into the new smaller TV band.  On Thursday, the FCC took a step to make that repacking somewhat more concrete – releasing a Public Notice where the FCC’s Media Bureau seeks comment on a draft TV Broadcaster Relocation Fund Reimbursement Form (the draft form is here, and draft instructions to the form can be found here).  This will be the form that broadcasters will use to claim payment from the government for the costs of the repacking.  The Bureau asks for comments on the draft Reimbursement Form.  The comments are due on October 27, 2014.

The form provides a checklist of likely expenses, asking for details of the equipment to be bought and other expenses to be incurred in making the transition, including both hardware costs and soft costs including the reimbursement of tower crews, consulting engineers and even broadcast attorneys for filing the necessary FCC forms.  Broadcasters should carefully review the draft form to make sure that it anticipates all categories of expected expenses that stations may incur in the repacking process.
Continue Reading FCC Seeks Comments on Form for Reimbursement of Expenses for Technical Changes Caused By Repacking the Television Specrum After the Broadcast Incentive Auction

The incentive auction by which the FCC will try to get some television stations to surrender their spectrum so that it can be sold to wireless broadband users is moving forward.  A vote on the general rules to implement the auction and to repack the television band are expected to be held at the Commission’s May 15 meeting.  We are now beginning to get a look at what the FCC is thinking, based on a post on the FCC’s blog on Friday by Chairman Wheeler, and a fact sheet released later that day (which does not appear to be available on the FCC website).  While not terribly detailed, the documents at least show that the Commission is planning a quick transition – looking for the repacking to be complete within 39 months from the end of the incentive auction – and perhaps sooner for some stations.

The blog post again reiterates the Chairman’s belief that the Incentive Auction process poses:

a once-in-a-lifetime opportunity to expand the benefits of mobile wireless coverage and competition to consumers across the Nation – particularly consumers in rural areas – offering more choices of wireless providers, lower prices, and higher quality mobile services

The post also suggests that TV stations, by agreeing to share television spectrum with another station in their market so that they can give up a channel to the auction have another “once in a lifetime” opportunity to get money from the government to pursue new business opportunities in new technologies, while still providing some broadcast service.  This is much the same message that the Chairman conveyed at the NAB Convention in Las Vegas a few weeks ago.  But for stations that do not take him up on his invitation to sell their spectrum, what is likely to happen?
Continue Reading FCC Gives a Peek at Some Details for the Incentive Auction – What’s Up for TV Stations?

At long last, it appears that we will soon have a complete FCC, as the Senate has approved the nomination of Tom Wheeler to be the next FCC Chairman, and Michael O’Rielly for the other vacancy on the FCC.  The nomination of Mr. Wheeler had been held up by Senator Ted Cruz on grounds that he feared the FCC taking action to implement provisions of the Disclose Act (which we wrote about here).  Senator Cruz was particularly concerned that a new FCC might adopt rules that would require disclosure not just of a political ads sponsor, but also of the chief financing sources of the sponsor.  Mr. Wheeler apparently assured Senator Cruz that the adoption of such a rule was not high on his agenda, the hold on the nomination was dropped, and the new Chairman was confirmed.  He should take office very soon – with press reports suggesting that it will be on Monday.  What issues should broadcasters expect the new FCC to tackle?

There are many big issues for broadcasters that are under consideration but not decided, and we would expect that the new FCC chair would want to quickly start to deal with them.  The biggest issue is no doubt the Incentive Auctions – looking at the reclaiming of spectrum from TV broadcasters to allow it to be re-sold to wireless companies for wireless broadband and other uses.  We last wrote about that incredibly complex proceeding here.  The FCC under Chairman Genachowski had looked to have rules in place before the end of this year to reclaim the spectrum and to sell it to the wireless companies.  The former chair had hoped to have the auction itself occur in 2014.  With the delays in the confirmation of the Chairman, and the recent government shutdown, many observers are expecting the rules will be pushed back to next year, and the auction itself to the year after – but all that remains to be seen.
Continue Reading Tom Wheeler Confirmed As FCC Chair – What Broadcast Issues Will the New FCC be Addressing?

We have not written as much as we should have about the current FCC proceeding looking to reclaim parts of the television spectrum in order to repurpose it for auction to wireless users. The process by which the FCC will pay some broadcasters to give up their spectrum (the "incentive auction"), and get the money to pay for that surrender of spectrum from a simultaneous auction of the reclaimed spectrum, is a very complicated one. It will require careful judgments about how much money will be received and how much will be needed to be spent to clear the required spectrum, and to pay for other costs required by Congress in the enabling legislation (see our article here about the legislation), including the costs of moving remaining broadcasters to new channels after the auction. In order to provide a uniform block of wireless spectrum across the country (so that devices can be built to receive new signals on the same channels everywhere), the television stations that are not going to return their spectrum to the FCC will have to be “repacked” into a reduced television band, requiring some stations to change channels to accomplish that repacking. This week, the FCC made two announcements that will begin to shed some light on that transition – announcing the panelists for a discussion on the repacking process, and asking for comments on the costs to be incurred by TV broadcasters which can be reimbursed by the fund that the FCC is required to maintain to fund that repacking.

The FCC first released notice of the panelists for a September 30 discussion of how the repacking of TV spectrum will take place, discussing the likely mechanics of the repacking and the ways that the repacking can be accomplished efficiently.  (For more on the discussion, go to this page on the FCC website).  Representatives of the FCC will moderate panels of trade association representatives, engineers and others to discuss the repacking process. The discussion will be webcast by the FCC (go here for the webcast on September 30).Continue Reading FCC Seeks Comments on Reimbursable Costs of TV Stations Changing Channels as Part of Repacking of TV Spectrum for Incentive Auctions, and Announces Panels to Discuss the Process

As is the case with most months, June brings a number of FCC deadlines for broadcasters, both standard regulatory filings and comment deadlines in important regulatory proceedings. The regular filing deadlines include license renewal applications due on June 3 (as June 1 is a Saturday) for Commercial and Noncommercial Full-Power and Class A Television Stations, TV Translators, and LPTV Stations in Ohio and Michigan; and Commercial and Noncommercial AM and FM Radio Stations, FM Translators, and LPFM Stations in Arizona, Idaho, Nevada. Noncommercial stations in the states with renewals also have to file their Biennial Ownership Reports, as do noncommercial radio stations in Maryland, Virginia, West Virginia, and the District of Columbia.

Renewal pre-filing announcements must begin on June 1 for Commercial and Noncommercial Full-Power and Class A Television Stations in Illinois and Wisconsin and for Commercial and Noncommercial AM and FM Radio Stations in California. Post-filing announcements for radio stations in Texas should continue on June 1 and 16, as well as for TV stations in Indiana, Kentucky and Tennessee.

In addition to these regular filings, broadcasters also have many other deadlines that are coming up either in the month, or soon thereafter. Broadcasters who were successful bidders in the recent FM auction have payment deadlines on June 12, and then have a July 24 deadline for the filing of "long-form" applications on FCC Form 301 specifying the technical facilities that they plan to build (see the FCC Public Notice here). Applicants for new FM translators left over from the 2003 filing window are now in a settlement window, with deadlines for settlements between competing applicants due on July 22 (see the FCC public notice here). Continue Reading June FCC Obligations for Broadcasters – Renewals, EEO, FM Translator and Auction Filings, and Comments on Regulatory Fees, Indecency, and Incentive Auction Band Plan

April is one of those months in which many FCC obligations are triggered for broadcasters. There are the normal obligations, like the Quarterly Issues Programs lists, that need to be in the public file of all broadcast stations, radio and TV, commercial and noncommercial, by April 10. Quarterly Children’s television reports are due to be submitted by TV stations. And there are renewal obligations for stations in many states, as well as EEO Public File Reports that are due to be placed in station’s public files and on their websites. The end of March also brings the obligation for television broadcasters to start captioning live and near-live programming that is captioned on air, and then rebroadcast on the Internet. Finally, there are comment deadlines on the FCC’s proposal to relax the foreign ownership limits, and an FM auction and continuing FM translator filing requirements.

Radio stations in Texas and television stations in Tennessee, Kentucky and Indiana have renewal applications due on April 1. The license renewal pre-filing broadcast announcements for radio stations in Arizona, Idaho, Nevada, New Mexico, Utah and Wyoming, and for TV stations in Michigan and Ohio, must begin on April 1. All of these stations will be filing their renewals by June 1. EEO Annual Public file reports for all stations (radio and TV) with five or more full-time employees, which are located in Texas, Tennessee, Kentucky, Delaware, Pennsylvania or Indiana, must be placed in their public files (which are now online for TV broadcasters) by April 1.   Noncommercial radio stations in Texas, and noncommercial TV stations in Tennessee, Indiana Delaware, Pennsylvania, and Kentucky must also file their Biennial Ownership Reports by April 1. Continue Reading April FCC Obligations for Broadcasters – Renewals, EEO, Quarterly Issues Programs Lists, Captioning of Live or Near-Live Online Programming, FM Translator Filings, an FM Auction and Comments on Alien Ownership

February is almost upon us, and it brings a host of regulatory obligations for broadcasters – as well as the filing deadline for those interested in pursuing new FM channels in an upcoming auction, and a number of opportunities to comment on important FCC proceedings. The week before last, TV NewsCheck published our latest quarterly update on the regulatory issues facing television broadcasters – and these include several with February dates. Most importantly (at least in the short term), there is the obligation for television broadcasters to upload to their Online Public Inspection file all documents created before the August 2 effective date of the rules (but for documents relating to political broadcasting).   So documents that had been kept in paper – like Annual EEO Public Inspection File Reports and Quarterly Issues Programs Lists – need to be in the Online Public File by the beginning of the month. 

In the longer term, while not due in February, comments to be filed this Friday (January 25) on the television incentive auction process, will need to be analyzed in preparation for the Reply comments due on March 12 in this most important proceeding which may well define the composition of over-the-air television in the coming years. Comments on the FCC proceeding on expanding the information gathered in the Form 323 Biennial Ownership Reports are also due in February – just in time for Valentine’s Day on the 14th. 

 Continue Reading February Legal Deadlines for Broadcasters – Online Public File, Review of Incentive Auction Comments, Filing Deadline for FM Auction, and Lots of Renewals and EEO Public File Reports

112 new FM channels will be available in the next auction for new FM channels (referred to by the FCC as "Auction 94") to be held beginning April 23, 2013. To participate, interested parties must file their "short form" applications – setting out information about the ownership of the applicant and the channels in which they are interested – by February 6, 2003. All of the procedures for the auction are set out in the order released late Wednesday, available here. The locations of the available channels, authorizing the winners to build new FM stations  serving the named communities and the nearby area, are also set out in this attachment to the order. The notice adopts many of the same procedures set out when the Commission first proposed the auction back in September (see our article here). However, the Commission pushed the auction back the initially scheduled date for the auction by about a month to avoid religious holidays and the NAB Convention, ending up with the new starting date of April 23. The Commission also pushed back other dates associated with the auction, deleted a handful of channels that had been proposed for inclusion in the auction but had not been properly published in the Federal Register, and announced other decisions relating to the auction – all with many cautions for those who may be bidding about the possible pitfalls of the auction process.

The relevant auction dates are as follows:

Auction Tutorial Available (via Internet) …………………….January 28, 2013

Short-Form Application (FCC Form 175)

Filing Window Opens ……………………………………………….January 28, 2013; 12:00 noon ET

Short-Form Application (FCC Form 175)

Filing Window Deadline……………………………………………February 6, 2013; prior to 6:00 p.m. ET

Upfront Payments (via wire transfer)…………………………..March 18, 2013; 6:00 p.m. ET

Mock Auction ………………………………………………………….April 19, 2013

Auction Begins…………………………………………………………April 23, 2013

The most important dates for bidders are the deadline for the submission of the "short-form" application of February 6, the date for the Upfront Payments, and of course the dates for the start of the auction itself. The short-form lists the owners, any bidding agreements that the parties have with other bidders, and the channels in which the party is interested in bidding. The bidder can also submit specific proposed transmitter site coordinates for any channel in which they are bidding, which protects those named sites from moves by other existing stations that could otherwise preclude their use.   The failure to meet this February 6 deadline means that a party cannot participate in the auction.Continue Reading FCC Sets Deadlines and Procedures for the April 2013 Auction of 112 New FM Channels – February 6 Deadline for Applications to Participate

Do you want to start a new FM station?   In what seems to have become a yearly event, the FCC has released a list of 117 new FM channels to be auctioned (a list that also includes the proposed minimum bid for each channel). The FCC also issued a “freeze” on FM applications that could impact these channels. The auction itself is scheduled to begin on March 26, 2013. If the Commission follows the schedule used in the last FM auction, we should expect that the deadline for the "short-form" application to participate in the auction (which basically contains information about the ownership of the applicant and a list of the channels in which they are interested) will be due in early 2013, likely sometime between January 1 and January 15, 2013. The upfront payment of the necessary minimum bids would then likely be due around February 20, 2013.

The channels in this auction on which new stations can be built are spread all across the country. Many are located in large western states, including multiple channels in California, Oklahoma, Arizona and Texas, among other states. If you are interested in starting a station from scratch, look through this list of channels to see if there are opportunities for a construction permit for a new station in an area of interest. If you find something that you might consider, you need to start your due diligence on each channel now, as any bidder is responsible for insuring that the channel for which they are bidding can be built and will serve the audience that you expect. If you win the auction and decide that you can’t really find a transmitter site, then you may well be on the hook for the full amount of the bid even if you don’t build the station. And, if you are successful in the auction, you will have to have an available transmitter site to specify in your "long-form" application submitted about a month after the end of the auction – an application that will specify all of the technical details of the new station. So look at zoning issues, FAA considerations, coverage questions, and even whether technical details like the rural radio order limiting move-ins of FM stations from rural to more urban areas, may limit the potential economic value of the channel in which you are interested.Continue Reading FCC Announces Auction for 117 New FM Channels – And Freezes Certain FM Applications that Could Affect Those Channels