Smaller Markets Get Raw ENG Deal

Broadcasters say the government's latest bid to reclaim electronic-newsgathering (ENG) spectrum gives them a no-win choice: Either spend a fortune in upfront conversion costs another industry was supposed to pay or endure years of nightmares until TV stations' replacements are ready to pick up the tab.

The TV industry is up in arms over last week's FCC order spelling out procedures for taking back spectrum that producers now use to beam news and sports back to their studios.

"This is very harmful to newscasters, especially those in medium and small markets," complained David Donovan, president of the Association for Maximum Service Television, which represents the industry on technical issues.

At issue is a plan to reallocate some of the spectrum now dedicated to broadcasters' ENG and turn the recaptured frequencies, located on the 2 GHz band, over to mobile satellite communications companies.

The upshot is that stations outside the largest 30 markets may be out of luck when it comes to winning compensation from mobile satellite service (MSS) companies, even though government rules entitle broadcasters to reimbursement for their costs.

Under the plan, broadcasters are giving up two of seven ENG channels. Stations in each market will have the choice of continuing to use the five remaining channels as they exist today or reallocating the spectrum into seven smaller digital channels.

In the top 30 markets, broadcasters almost certainly will convert to seven channels because the MSS providers are required to compensate broadcasters before moving into the channels and have a one-year mandatory negotiation period.

MSS users in markets between 31 and 210 were granted up to 10 years to negotiate payments and move into their new allotments. Broadcasters say that means, in markets like Providence, R.I., Grand Rapids, Mich., and Baltimore, Md., stations will have little choice but to buy new equipment out of their own pockets or risk interference when broadcasters in nearby top-30 markets, such as Boston, Detroit or Washington, use updated equipment to cover the same story. The two systems will use the same swath of spectrum but are incompatible.

The demand for backhaul broadcast spectrum will only grow, Donovan said, as stations air more high-definition digital programming and begin ENG transmission of bandwidth-eating HDTV live sports.

The costs could plague markets near almost every major city. "You'd be hard-pressed to find any top-30 market that isn't adjacent to a medium-size market," Donovan said.

Neither FCC staff nor executives from ICO Global Communications, the MSS company that has led the fight for lenient treatment for new users, returned calls seeking comment.

The total conversion cost across all markets is estimated by MSTV to be $397 million, with 42% of that in top-30 markets expected to be quickly compensated by new users. That leaves just under $230 million that broadcasters are entitled to receive in reimbursement but may never get if MSTV's warnings are correct.

"These medium and small markets appear to be in the least position to cover these relocation costs, which comes at a time when they are confronting DTV-conversion costs," Donovan said.

Such conflicts will come in play most notably when stations cover regional stories.

Today, stations coordinate on an ad hoc basis which channels each will use when transmitting coverage. But coordination between the two groups using incompatible systems will be "almost impossible, particularly in emergency situations where spectrum planning cannot be done in advance," MSTV and the National Association of Broadcasters warned in a letter.

The FCC dismissed that notion and predicted that stations will be able to use traditional coordination techniques to minimize interference. The downside of creating additional signal conflicts is outweighed by the benefit of new communications services, the agency found.