Bush: Delay spectrum auctions, issue fees

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The Bush administration has once again proposed delaying auctions of
analog-TV spectrum, hoping that a postponement would increase revenues from
those auctions by $6.7 billion, according to the federal budget plan released
Monday.

The administration said it expects auctions of channels 60 through 69 (747
megahertz through 767 MHz and 777 MHz through 792 MHz) and channels 52 through
59 (698 MHz through 746 MHz) to raise more than $25 billion for federal coffers
over the next five years.

Still, revenue expectations for spectrum auctions have dropped. Last year,
the administration told Congress it expected delaying the auctions to raise an
additional $7.5 billion.

The administration said it will send related legislation to Capitol Hill for
Congress to approve.

The Federal Communications Commission was supposed to auction channels 60
through 69 last September, but the auctions have been delayed five times at the
request of involved industries, which said their business plans weren't
ready.

Two weeks ago, the FCC assigned June 19 to auction the three chunks of
spectrum.

The administration is also proposing that analog broadcasters pay $500
million in fees annually to lease their spectrum starting in 2007.

That practice would continue until broadcasters gave their analog spectrum
back to the government.

Last year, the administration recommended that broadcasters together pay a
total of $200 million annually in fees starting in 2002.

Broadcasters referred to such a fee as a tax, saying it would only hurt the
transition to digital television. Instead, they want the administration to
support their efforts to get legislative help with the transition.

'What the administration fails to acknowledge is that broadcasters are the
only participants in the digital-television transition making real progress,'
National Association of Broadcasters spokesman Dennis Wharton said.

'To speed this transition along, cable must carry signals of broadcasters and
DTV sets must have access to local broadcast channels,' he added.

Finally, part of legislation the administration will propose also would
'establish a framework for the FCC to develop regulations that promote clearing
the spectrum in television channels 60 through 69 for new wireless services in
an effective and equitable manner.'

Last September, the FCC approved a spectrum-clearing plan, proposed by Paxson
Communications Corp., that would allow broadcasters to accept buyouts from
wireless companies and others that wanted broadcasters to clear the spectrum
more quickly.

If Congress were to approve such a bill, Paxson's plan
would become law, which is more irrefutable than FCC rules.

The president proposed a similar bill last year, but it didn't gain any
traction in Congress. House Energy and Commerce Committee chairman Billy Tauzin
(R-La.) pronounced the proposal 'dead on arrival.'

This year, Tauzin and other members have been working with an industry
coalition to try to spur the transition.

'The president's budget assumes that the transition to digital is going to
fail, and we don't necessarily believe that,' Tauzin spokesman Ken Johnson
said.

'We're making good progress on our discussions with all of the affected
industries, and we are hoping to have a game plan in place in the near future,'
he added. 'We're in the process of trying to set up another digital-TV
roundtable for later this month.'

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