Washington

NAB's Smith Defends Broadcast Future

Says mobile architecture fails as real-time video delivery system; stands up for decency regs as product differentiator and lobbying tool 12/14/2012 10:19:40 AM Eastern

National Association of Broadcasters president Gordon Smith
says that as the original wireless service, broadcasting remains "highly
relevant," particularly given what he says is mobile's limitations on
video delivery and the indecency regs that keep it a family viewing destination.

That came in an interview for C-SPAN's Communicators series of shows on TV's future. Smith used the word
"fail" repeatedly to talk about mobile's inability to deliver the
kind of live, real-time video, including high-value sports, which broadcasters
supply through their one-to-many architecture. Smith warned that in a world
where broadband has replaced, rather than complemented broadcasting, important public
values like free, local and decent content will be lost. He stood up strongly
for indecency regs, calling them good public policy as well as a good talking
point with Congress.

Smith said the challenges for broadcasting are to be on
every device, to be "held harmless" in the push to auction spectrum
for mobile, and working under a heavier regulatory burden than its competitors,
though he suggested some of those regs -- the public interest standard and
indecency -- help in making the case for the medium

While Smith said the ownership regs needed loosening, he
stood up for indecency regulations.

"When we were kids, when you wanted to bring smut home
you had to sneak it past your mother [not that he was advocating the practice].
Today, all you have to do is hit the wrong channel [on cable or satellite or
the Internet] and you get all the garbage in the world coming into your
house," he said. By contrast, "broadcasters have decency standards
that have to be observed and that parents ought to be mindful of when it comes
to family TV viewing." Smith called that decency standard "good public
policy."

He said he knows some of NAB's members think their First
Amendment rights are "somehow impinged" by that, but added that it is
a good point to make on Capitol Hill -- he is a former senator himself -- that
there should be somewhere for a family to turn that has "respect for
community standards."

Another challenge is Congress' and the FCC's move to
encourage broadcasters to give up some or all of their spectrum for mobile
wireless. "Obviously," he said, "spectrum is a finite resource
and others want that resource, and yet there is not enough spectrum in the
universe to do all video by broadband."

The FCC's spectrum auctions are uncharted territory, he
said. "I think I can say with confidence that none of the big networks are
going to be volunteering to go out of business."

Actually, the auctions offer several options, including giving
up all spectrum, giving up a portion of spectrum and channel sharing or moving
from UHF to VHF spectrum, which will allow the FCC to offer swaths of
contiguous spectrum to mobile. Smith did not address those alternatives.

But he did say he did not "have a clue" how many
broadcasters "on the edge financially" will say they will take the
money and "volunteer to go out of businesses." And there is no
guarantee that even those will necessarily be exiting.

Not everyone who wants to give up spectrum for compensation
will get it. They may not offer the winning bid, or the FCC may not need the
spectrum they are willing to give up. It is mostly looking for spectrum in
major markets where the need is greatest, though some broadcasters in smaller
markets will need to move to clear the contiguous swaths.

Preston Padden, former top exec at Disney and News Corp.,
and the former head of the Association of Independent Television Stations, is
heading a coalition of the spectrum willing,
the Expanding Opportunities
for Broadcasters coalition, which he says now includes over 25 major market
stations interested in participating in the auction.

Smith said the NAB's focus is on those who stay -- which is
the reason Padden's coalition was formed -- and that those who do be held
harmless.

"If a broadcaster wants to go out of business and cash
in, that's called freedom. We support that," he said. "The FCC
chairman has called it 'culling the herd.' Well, we don't want any of our herd
culled, necessarily, but if somebody wants to go out of business, they
can."

Smith said the problem with the FCC's calculation is that in
the urban areas where the FCC most wants the spectrum, broadcasters aren't
going out of business.

Smith said broadcasters will be cooperative with the
auction, but that if the FCC's repacking of stations after the auction isn't
done correctly, this next DTV transition will make the first one look like a
Sunday school class compared to the complexity of this move and "millions
disenfranchised."

He was asked what kind of business model broadcasters would
have 20 years in the future. He said a free, local system would still be
around. He said broadcast was the primary deliverer of sports video content, which
could not be done by broadband, given its one-to-one architecture.

Asked whether if that would still be the case if the mobile
industry got access to government spectrum the Obama administration is also
trying to free up through a combination of clearing and sharing, Smith
suggested it would tough to pry it out of the military's hands.

The government has over half the spectrum -- 60% was one
estimate at a Hill hearing on spectrum this week -- but getting it will be no
easy task, Smith suggested. "The problem is when you want to go get it
from the government, particularly the United States military, they have guns
and they don't want to give it up."

Smith said broadcasters have to be prepared for the wireless
industry to push for mandatory spectrum clearing if the FCC does not get enough
through voluntary auctions, but added that the future has to be a future with
both broadcasting and broadband, and it is just one it would "fail"
the American people. "All the other values like decency, localism, free,
that goes away."

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