FCC to set rules for spectrum auctions that could occur in 2014

The auctions would repurpose broadcast TV spectrum for mobile broadband use
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FCC Chairman Julius Genachowski is circulating an order to his fellow commissioners to establish rules for incentive auctions of broadcast TV spectrum, which the FCC plans to repurpose for mobile broadband use. The auctions are expected to take place in 2014.

FCC spokesman Neil Grace confirmed earlier reports that the commission will consider the rulemaking proceeding at its Sept. 28 meeting. The long-awaited rules come after Congress authorized the incentive auctions in February, legislation that was itself years in the making. The idea is that if a comprehensive proceeding is started now it can be finalized in 2013 and the auction can take place in 2014, which is a timeline the wireless industry has favored. 

The rulemaking will outline and seek comment on plans for the reverse auction of broadcast spectrum as well as establish rules for how wireless carriers will bid on the spectrum. Additionally, the proceeding will outline specifics on how remaining broadcasters will be moved off the spectrum, a process often referred to as "repacking."  Broadcasters are expected to have significant input on the plan.

Under the law, the FCC will pay the broadcasters to relinquish their 6 MHz pieces of spectrum and the revenue raised from the auctions will be used to compensate the carriers. The incentive auctions are designed to be voluntary for broadcasters, but many worry that given broadcaster's fierce resistance to the auction in the past several years they will not easily give up their airwaves.

"In freeing up spectrum for wireless broadband, incentive auctions will drive faster speeds, greater capacity, and ubiquitous mobile coverage," Genachowski said in a statement. "These are essential ingredients for innovation and leadership in the 21st century economy where smartphones and tablets powered by 4G LTE and Wi-Fi networks are proliferating, and the mobile Internet becomes more important every day. Over the last few years, the U.S. has regained global leadership in mobile innovation-and we must not let up now."

Meanwhile, the FCC is also expected to vote on a proceeding later this month to review its rules for how much spectrum a carrier should be able to hold. That proceeding, which deals with the FCC's so-called "spectrum screen" could impact which carriers are able to participate in the incentive auction.

Wireless carriers, including AT&T Mobility (NYSE:T), have welcomed opportunities to review the rules, and the FCC is reviewing them in light of the calls from carriers and public interest groups for a review. Yet many consumer and public interest groups have openly worried that AT&T and Verizon Wireless (NYSE:VZ) could use the incentive auctions to accumulate even greater spectrum reserves.

"The economic impact of bringing additional spectrum to market will be tremendous," CTIA President Steve Largent said in a statement. "The FCC is taking a vital step that will foster continued growth in the U.S."

For more:
- see this Washington Post article
- see this The Hill article
- see this Bloomberg article
- see this Broadcasting&Cable article

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