NAB: Nobel Is No Guarantee of Successful Auction

Broadcasters warn that theoretical ideal may not be real-world solution

By John Eggerton -- Broadcasting & Cable, 3/12/2013 12:50:44 PM

Complete Coverage: NAB Show 2013

In comments to the FCC, the National Association of Broadcasters suggests that that while the FCC has hired some great thinkers, including Nobel Prize-winning economists, to come up with an incentive auction framework, the result so far has been "an economist's academic ideal of a reverse auction untethered from engineering realities."

According to a summary of comments being filed on Tuesday, the deadline for reply comments on the FCC's incentive auction framework, the NAB says their approach so far is "unnecessarily complex, appears to ignore important engineering considerations and overlooks more basic and straightforward solutions."

NAB offers what it suggests is a more effective approach of identifying repacking scenarios for realistic amounts of spectrum, decide how much it expects to raise from that, and maximize its resources by using them to offer sufficient incentive to stations where it really needs them.

NAB suggests that will be in about 25 markets -- the top 25. NAB says the FCC must not adopt its proposal to "intersperse" broadcasters between wireless downlink and uplink operations.

One thing the FCC's proposal has done, a point FCC commissioner Ajit Pai will make in testimony on Tuesday at an FCC oversight hearing in the Senate, is to unite broadcasters and wireless companies in opposition to that repacking plan.

NAB also taken aim at comments by others suggesting the FCC should undertake wholesale repacking beyond simply that required to free up spectrum for wireless. "Whereas Congress clearly intended this process to be driven by market dynamics, some commenters appear to suggest that the commission should use this repacking opportunity as a pretext for a straight, government-directed reallocation," said NAB.

If the FCC fails to minimize repacking, says NAB, "people of color, foreign language speakers and lower income Americans," are likely to lose stations they rely on. Smaller, often minority-targeted or niche programming stations, are already those most likely to be giving up spectrum in the major markets where the FCC will need it.