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Comp is prize in ENG package

FCC would require mobile communications firms to bear replacement, retuning costs for broadcasters 7/09/2000 08:00:00 PM Eastern

With the release last week of the FCC's plan for reallocating some of the ENG spectrum that TV stations use for remote news coverage, broadcasters can now begin negotiating for compensation from new users of the spectrum.

The FCC is reworking the ENG spectrum, located on the 2 GHz band, to make room for new mobile communications services. Under the plan, broadcasters will relinquish 35 MHz (roughly the equivalent of two current ENG channels) of the 120 MHz now reserved for them within the 1990 MHz to 2110 MHz portion of radio spectrum. Because of the spectrum return, the industry must shrink the size of its seven ENG channels from roughly 18 MHz to about 12 MHz.

Mobile communications companies that move into the 2 GHz will compensate broadcasters for the full cost of replacing or retuning their electronic newsgathering equipment.

The compensation plan is generally a victory for broadcasters, who were forced to fend off proposals by mobile communications companies to pay only enough to cover the depreciated value of equipment that must be replaced. The FCC is requiring the new licensees and the broadcasters to enter negotiations to determine the total compensation package, including such thorny issues as which equipment can be retuned and which must be replaced.

A simple retuning could save the new entrants plenty. The typical station, with three live trucks and two receive sites, could be due $75,000 for equipment alone, according to an estimate by the Radio-Television News Directors Association.

The FCC will step in if the agency decides any side is negotiating in bad faith.

Broadcasters last week were still boning up on the complicated procedures and said it is too soon to say whether they have any problems with the new rules. But broadcast-industry trade groups didn't get all they wanted. For instance, they pushed for a national, rather than a market-by-market phase-in, and wanted more than the decade allotted before compensation obligations are sunset.

"This is going to be a major undertaking," said Victor Tawil, senior vice president at the Association for Maximum Service Television. Tawil worried that many broadcasters may lose their compensation rights if too few mobile servicers line up for licenses.

Most potential new licensees supported the FCC's compensation plan, which is based on procedures used to clear other portions of the radio spectrum for innovative uses.

A complicated phase-in period calls for the first changes to be implemented on a channel-by-channel basis, first in the top 30 markets, followed by the next 70 markets, and finally in rural markets.

In top-30 markets, the initial mobile communications licensees to use the spectrum in each market must bear the cost of moving broadcasters off 18 MHz of spectrum (the equivalent of today's ENG channel 1) before they begin operations. Subsequent licensees will reimburse the initial entrant as they move into the band. In the next 70 markets, the initial new entrants will have three years after beginning operations to complete the relocation of broadcasters. In this first phase, the broadcasters' ENG channels will be shrunk to 14 MHz each.

When that first 18 MHz of relinquished spectrum becomes crowded, a second phase of the reallocation will require broadcasters to give up another 15 MHz and shrink the seven ENG channels again to their final 12 MHz configuration. All of the mobile licensees in a market must chip in to compensate stations for the second reconfiguration of equipment.

As in the first phase, the new users must relocate all broadcasters in top-30 markets before using the 15 MHz block and will have three years after beginning operations to clear the remaining top 100 markets and five years to move stations in rural markets.

To figure out how much new licensees owe broadcasters for relocation, both sides are mandated to enter negotiations. A two-year countdown for the first 18 MHz block begins ticking in top-30 markets as soon as the new rules are published in the Federal Register, which is expected shortly.

For other markets, the window opens when a mobile licensee informs broadcasters in writing it wants to negotiate. A second two-year window will open for the 15 MHz block when a mobile operator informs stations it is ready to begin the next round of talks.

The new licensees' relocation obligations will end 10 years after the first relocation negotiations begin. Any broadcasters remaining at that time will be required to vacate the band within six months of a written demand of a mobile licensee.

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