FCC Has Legal Obligation to Preserve Free TV

Legislators suggest FCC should not push too far 3/11/2010 05:27:00 AM Eastern

It appears that the FCC could not
reclaim all of broadcasters’ spectrum
even if it wanted to. That,
however, doesn’t mean the commission
can’t recapture a lot of
real estate.

But what happens if too many broadcasters volunteer
to give up their spectrum—
including, for instance, all
of the stations in a particular
market—when the FCC comes
calling with an offer to pay
broadcasters to relinquish it?

FCC broadband plan spokesman
Mark Wigfield says the
commission, by law, has to
ensure that some level of over-the-air service remains in each
market. That means the commission,
at least under current
law, can’t clear the broadcast
band. It also means that not
everyone who wants a buyout
may get it.

FCC Chairman Julius Genachowski
said in a Feb. 24
speech to the New America
Foundation that, as part of the national
broadband plan, the FCC will propose a
voluntary Mobile Future Auction that will
permit TV broadcasters and other licensees
to give up spectrum in exchange for
a share of the proceeds. Agency officials
had previously signaled that the proposal
would be part of the broadband plan.

“[T]he FCC is already required by
law to make sure there is a fair
representation of broadcasters
in every state,” Wigfield says.

“There are a number of levers the FCC
could use to ensure continuation of over-the-air broadcasts in a market, including
establishing rules in any spectrum auction
that would require a level of over-the-air service remain.”

Wigfield’s reference to fair distribution
stems from the Telecommunications Act’s
requirement that “in considering applications
for licenses, and modifications and
renewals thereof, when and insofar as
there is demand for the same, the Commission
shall make such distribution of
licenses, frequencies, hours of operation,
and of power among the several States and communities as to provide a fair, efficient, and equitable distribution of radio
service to each of the same.”

“If everybody in a market wanted to
take their deal? Yeah, that would be a
problem,” said a broadcast attorney who
asked not to be identified. He says that
absent a band-clearing, he isn’t sure how
different the FCC’s voluntary plan is from
broadcasters’ current ability to turn over
spectrum—and in this case, lease it—for

“As long as you put on one free standard-
definition signal, which does not
take up much space, you can
sublease the rest of it. This really
doesn’t seem to change much
unless you want to go out of business.”

Veteran broadcast attorney John Crigler
of Garvey Schubert Barer agrees
that the commission has to navigate this
statutory requirement concerning fair access,
but Crigler sees it more as a hurdle
than a wall: “This is something the FCC
is going to have to deal with if it starts
to recapture broadcast spectrum. There
is a mandate under [Section] 307(b) to
provide a fair distribution of broadcast
services everywhere.”

But that provision does not necessarily
give Crigler much comfort. “One reason
is that you can change the statute, particularly when a large sum of money is raised
under a congressional nose,” he points
out. “And second, it might just complicate
the recapture rather than make it impossible.
The way that 307(b) has been read
is that [it provides] at least a
first broadcast service everywhere,”
which the FCC could
do without changing the statute
by leaving at least one
station in every market. That,
however, does not resolve the
problem of figuring out who
stays and who goes.

Some legislators—John
McCain comes to mind—have
complained long and mightily
about the prospect of broadcasters
being compensated
for their public spectrum,
in reference to analog and
digital duplication during the
DTV transition. In this case,
congressional opposition to
compensation might throw a
monkey wrench into the FCC’s
reclamation plans; that could
be a good thing for broadcasters,
especially those who might otherwise
view the “voluntary” program as a mandate
cloaked in an invitation.

Both House Communications Subcommittee
Chairman Rick Boucher (D-Va.)
and former Energy and Commerce Chairman
John Dingell (D-Mich.) said last week
that they opposed any mandatory move of
broadcasters off the band. Boucher added
that whatever moves the FCC makes should
not reduce any broadcaster to only standard definition signals, and it should first do a
thorough spectrum inventory to figure out
where the spectrum should come from.

The likelihood of an oversubscription
by broadcasters to the plan is not great,
if the National Association of Broadcasters’
vociferous defense of all its spectrum
is any indication. Still, there are plenty of
private equity companies in the business
that might take the government-sponsored
opportunity to cash out.


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