Broadcaster interest in U.S. spectrum auction strong: government

WASHINGTON (Reuters) - The U.S. Federal Communications Commission on Friday said there is strong television broadcaster interest in an upcoming spectrum auction and announced an initial target of clearing 126 MHz of spectrum.

The Federal Communications Commission (FCC) logo is seen before the FCC Net Neutrality hearing in Washington February 26, 2015. REUTERS/Yuri Gripas

The figure is at the high end of the government’s previously announced range. The auction is aimed at repurposing low-frequency spectrum relinquished by television broadcasters to wireless companies and other bidders seeking new airwaves to build and improve wireless networks.

Megahertz is a unit of measurement for the wireless spectrum, which is used to transmit radio and broadcast TV signals and mobile phone calls.

The FCC had considered nine targets from 42 to 126 MHz, but set the highest target based on binding commitment letters submitted by broadcasters.

Nearly all of the spectrum blocks being auctioned will not be hindered by any existing broadcast signals and are being offered nationwide.

“Today’s announcement reflects the voluntary decision by many broadcasters that this auction truly is a once-in-a-lifetime opportunity,” FCC Chairman Tom Wheeler said in a statement. The target “ensures that wireless carriers and other forward auction bidders have their chance to compete for the maximum amount of low-band ‘beachfront’ spectrum.”

Wireless carriers have said they need additional spectrum to meet growing customer demand.

The so-called “broadcast incentive” auction is considered one of the FCC’s most complex and ambitious spectrum auctions to date. Analysts have previously forecast that the auction could fetch proceeds in the $15 billion to $45 billion range.

The names of the TV broadcasters that are participating in the reverse auction will not be revealed by the FCC during the auction. But the FCC has disclosed the names of companies that applied to bid for the spectrum, including wireless companies Verizon Communications Inc, AT&T Inc and T-Mobile US Inc and pay-TV providers Comcast Corp and Dish Network Corp.

S&P Global Market Intelligence estimated earlier this month that a dozen companies could generate up to $13 billion in the spectrum auction at the high end of participation. The firm said its analysis showed that Univision Communications Inc [UVN.UL]., CBS Corp, Sinclair Broadcast Group Inc. and Media General Inc and Tribune Media Co are among broadcasters that could see substantial proceeds if they opt to take part.

The first step is a “reverse auction,” where the government recovers spectrum from broadcasters that voluntarily give up airwaves either to go off the air for a payout or be shifted to another frequency band for a smaller sum.

Of the 1,800 eligible broadcasters, an undisclosed number submitted applications. The reverse auction should be completed by summer and will be followed by a “forward” auction, where the government sells to telecommunications operators and other bidders the spectrum, which it will package into new bands.

Reporting by David Shepardson