WGBH, Others Tell FCC to Allow Post-Auction License Transferability

Say auction winner KBEH's application to transfer license is not a novel request

Noncommercial station WGBH Boston has joined with other broadcasters to encourage the FCC to allow TV stations that got paid to move off their spectrum and share with another station in the spectrum auction to sell the license they are transferring to that shared spectrum to a third party. 

That came in comments filed at the FCC, which sought input on the application of KBEH—a Spanish-language independent in Los Angeles that was paid to give up spectrum—to sell the license and some associated assets it retained, including must-carry rights on cable.

If the FCC approves the sale of the spectrum-less station, it could trigger similar sales by stations that initially signaled they’d stay in the business, which was virtually all broadcasters that sold spectrum in the auction. 

Hero Licensco, which got $146.6 million for the 6 MHz worth of spectrum used by KBEH, would get an added $10 million if the FCC lets it transfer the rights the FCC said it could keep after it sold the spectrum and strike a deal to share spectrum with another station. Hero indicated to the FCC at the time of the auction it would strike a sharing agreement (with KWHY) if it won, though that was not binding.

In the FCC filing, WGBH—joined by CNZ Communications, Commonwealth Public Broadcasting Corp., Latina Broadcasters of Daytona Beach, London Broadcasting Co., OTA Broadcasting, Rancho Palos Verdes Broadcasters, and WRNN License Company—said they were not taking a position on the merits of the specific application of KBEH but instead were supporting the "free transferability of the licenses of stations that submitted successful bids, as many of them did.

The commenters said that among them they own 15 stations that submitted winning bids in the auction, and that by "failing to process applications to assign the licenses of winning channel share bidders in the normal course of business, the Media Bureau is disrupting the allocation of licenses through free market mechanisms and unnecessarily interfering with the reasonable, Commission-driven expectations of licensees that participated in the Incentive Auction."

They argue that several similar transactions have been "stymied" as the parties await the FCC's decision about whether to allow such transfers. 

The FCC incentivized stations to sell spectrum by saying they could strike channel-sharing deals and retain their licenses and must-carry rights. But when it got the KBEH application, it said that being able to transfer such rights was an issue of "broadly applicable policy." 

WGBH et al. say that is incorrect and that there is nothing new about the KBEH application. They say the auction rules "unambiguously permit" the transfer of such rights and Congress anticipated such transferability as well.

"Permitting flexible assignment of the licenses of stations that were the subject of a successful bid to channel share will preserve the 'very important public interests' served by over-the-air broadcast television. These channel sharing stations will continue to be bound by all applicable public interest requirements and provide another free, over-the-air television service to viewers in their communities," they said, but then warned: "At the same time, without the ability to assign their licenses, many licensees that submitted winning channel sharing bids might simply surrender their licenses and remove another potential source of localism, competition, and diversity from the broadcast airwaves."