NAB expresses concerns to FCC over how broadcasters will be moved around in incentive auction

The National Association of Broadcasters has already taken the FCC to court over its proposed rules for the incentive auction of 600 MHz broadcast TV spectrum, but the NAB is not letting up in its criticism of the commission's plans. A filing from the NAB indicates it has great concerns over the so-called "optimization" methodology the FCC will use to move around broadcasters after they give up their airwaves.

According to a Dec. 5 filing, on Dec. 4, the NAB's Rick Kaplan, Victor Tawil, Bruce Franca, Robert Weller and Patrick McFadden spoke by phone with Matthew Berry, chief of staff for Commissioner Ajit Pai, to express their concerns.

The incentive auction will consist of two main parts. The first is a "reverse" auction, in which broadcasters agree to sell their spectrum rights. Then the FCC will conduct a more traditional "forward" auction in which carriers and other entities bid on the spectrum license. The spectrum will then be moved around or "repacked" based on which stations relinquish their spectrum.

Importantly, the FCC's optimization, which will occur after the bidding, is designed to minimize the number of channel reassignments or the costs of repacking for broadcasters. Broadcasters will be able to comment on such plans and offer modifications. However, FCC staff has argued that because optimization analysis is time-consuming and complex, it can only be done after the bidding and not during the reverse auction--something the NAB objects to.

"NAB explained that, while it appreciates the elements purportedly included in the Commission's optimization, the Commission's ultimate use of optimization is likely to prove fruitless," the filing states.

If the FCC "remains intent on conducting optimization only after the auction, it will have greatly limited its ability to apply optimization factors, as it will have already backed itself into a sub-optimal corner." NAB wants the FCC to conduct optimization while the reverse auction is going on.

The NAB noted that "even the best optimization techniques can do little to help at that point in the auction--it is the equivalent of calculating the shortest driving distance between Washington and Florida only after one has already driven to Chicago."

Instead, according to the NAB, the FCC "has other, very viable, options to reduce the negative impact of repacking on broadcasters while still conducting a successful auction. The Commission has unfortunately refused to consider optimization between rounds, which is one simple and effective manner of driving towards a more optimal solution."

The FCC will vote on Dec. 11 on a detailed set of proposed rules for how the incentive auction will be conducted. If the FCC approves the proposals, the rules will not become final and will instead be opened up for public comment.

Last month the FCC decided to delay the start of the auction from mid-2015 to early 2016, in part because of the NAB's lawsuit. The NAB sued the FCC in August, arguing that the agency's rules would diminish broadcasters' coverage areas and could result in a loss in viewership. One of the broadcasters' main arguments against the FCC is that the commission has changed how it calculates TV station coverage areas, using a methodology known as OET-69, referencing the FCC's Office of Engineering and Technology.

For more:
- see this FCC filing

Related Articles:
FCC to vote on proposed incentive auction rules in December
Starting in January, FCC officials to hit the road to woo broadcasters to incentive auction
FCC delays start of 600 MHz incentive auction to early 2016
FCC pitches broadcasters to participate in incentive auction, offering billions as a reward 
NAB sues FCC over 600 MHz incentive auction rules

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