Commissioner Pai wants reserve prices of broadcast auction to be accurately reassessed
Republican FCC commissioner Ajit Pai outlined his positions on the broadcast spectrum auction at a CTIA meeting in Las Vegas last week, and it was clear that Preston Padden, the former lobbyist who heads a group of stations wanting to participate in the auction, had made a favorable impression on him.
“If we do establish ‘initial offers’ (to use the terminology of a descending clock auction), they need to be high enough to encourage participation, and they have to be based on relevant criteria,” Pai said. “The word ‘relevant’ is important here. The incentive auction is about purchasing spectrum, or more specifically interference rights. It is not about buying broadcast stations.”
Preston Padden, executive director of the Expanding Opportunities for Broadcaster Coalition, has been lobbying FCC members about criteria the broadcasters want included in the auction. Pai’s positions appear to support the broadcaster’s wish list.
Earlier Pai said he had established four criteria for the auctions: be faithful to the statute passed by Congress; be fair to all stakeholders; keep it all as simple as possible; and conduct the auction in a reasonable time frame. In hindsight, he said, he left out an important fifth criteria: abide by the laws of physics.
“The laws of physics will play a major role in our decision-making,” he said. “Particularly when it comes to developing our band plan and repacking methodology, we must deal with the world the way that it is, not as we might wish it were. This means putting ideology and politics aside and concentrating instead on the simple question of what will work from an engineering perspective. The laws of physics aren’t liberal or conservative, Democratic or Republican; they are immutable.”
In that same light, Pai said he supports the “down from 51” band plan proposed by the NAB and wireless operators. “Uplink spectrum should be located at the top of the band and should be separated from the downlink spectrum by a duplex gap that does not include any broadcast stations,” he said. “Downlink spectrum, in turn, should be located between the duplex gap and channel 37 — which, by the way, should not be relocated. If we clear more than 84MHz of spectrum and go below channel 37, we should devote that spectrum to supplemental downlink.”
Pai said he called on the full FCC to embrace the consensus “down from Channel 51” proposal. He also said its important for the commission to release its repacking software, which will be used to find new spectrum for broadcast stations after the auctions.
“Carriers and broadcasters have said, and I agree, that stakeholders need an adequate opportunity to review and comment on this software in the near term,” Pai said. “So, completing our development of that software and releasing it in the coming months needs to be one of our top priorities, if not the top priority.”
As to OET-69 station methodology for calculating coverage areas and the potential of interference in repacking, Pai called on broadcasters not to stand in the way of updates for more modern computer systems and to work on a mutually acceptable compromise for all sides.
“Likewise, I see no reason why we shouldn’t update our software to include the most recent census data,” he said.
As to international cooperation on border issues involving Canada and Mexico, Pai said many people think that Northeastern markets, such as New York City, Philadelphia and Washington, pose the greatest obstacle to a successful incentive auction.
“But that’s not my view at the moment,” he said. “It’s border markets, such as Detroit, Buffalo, Seattle and San Diego, that worry me the most. We can always offer a higher price within our borders, but we can’t do so internationally. And I tend to doubt that annexing foreign territory to solve this problem would be a valid exercise of our ancillary authority."
He continued, “So if the incentive auction is going to be a success, coordination and negotiation with our friends in Canada and Mexico is critical. I’m pleased that some discussions have already started. We need to intensify these efforts. The problems that we face are too difficult to be papered over by press releases.”