— Bulk purchases and volume
discounts are just a couple of suggestions being floated to qualify for a piece
of the $1.75 billion broadcaster moving fund. The Federal Communications
Commission is seeking comments on some of the items related to the Broadcaster
Relocation Fund in its Incentive Auction proposed rulemaking issued last
December. The fund is also supposed to cover cable and satellite operators who
have to retool to continue receiving relocated TV station signals.
Vendor discounts are emphasized. In its Public Notice seeking feedback, the
“Are there ways to encourage manufacturers and service providers to establish prices
with built-in discounts that reflect the volume of business that channel
reassignments will generate?”
“Do broadcasters typically pay list price for equipment or are discounts
common, particularly for bulk orders or for station group owners? If so, what
kinds of discounts generally apply?”
Companies that make broadcast facility equipment rarely publish prices because
contracts vary significantly. The commission acknowledged this by asking “if the
services and equipment necessary to accomplish a channel reassignment [are] too
customized to be eligible for discounts or bulk purchasing?”
Some of the equipment necessary to move a TV station to a different channel is among
the most customized, especially the half-ton antennas used to transmit signals,
which are slotted according to frequency. Antennas, as well as transmitters,
tubes, transmission line, mask filters, tower gear and rigging, HVAC and labor
are the primary items listed in the commission’s “Catalog of Eligible
Expenses,” an addendum to its Public Notice crowdsourcing a reimbursement
strategy. Widelity of Fairfax, Va., was brought into help compile the catalog
The commission also suggested holding vendors to federal contractor prices for
expenses that are already included in a General Services Administration Schedule,
and competitive bidding for expenses exceeding “a certain dollar threshold,” or
new tower construction.
On the TV station side, the commission proposed facility sharing…:
“Should the commission encourage broadcasters seeking reimbursement from the fund
to pursue tower- and antenna-sharing arrangements and, if so, how?”
and organized buying:
“We received minimal comments on bulk purchasing and, thus, seek specific
comment on the viability of having broadcasters organize bulk purchasing or
services arrangements to generate costs-savings.”
It also asked if interim facilities should be covered and how that equipment could
be repurposed to final facilities.
The Broadcaster Relocation Fund was established by a Congressional directive to
set aside $1.75 billion of the presumed proceeds raised in next year’s auction
of TV spectrum. There is no way to know if the fund will be sufficient to cover
all broadcasters because there’s no way to know before the auction how many and
which ones are participating.
Consequently, there’s no way to know how many TV stations will have to be moved
and where, which in turn could put vendors in the predicament of having to turn
out huge amount of specialized equipment very quickly.
Because the fund may have to be stretched, the commission asked if it could
“incentivize” cost-sharing by splitting any left-over monies with TV stations
and multichannel video service providers.
The commission’s Media Bureau will hold a workshop Sept. 30, 2013 “to discuss cost
and cost mitigation issues,” the Notice stated.
Comments on the Public Notice go in GN Docket No. 12-268 and are due Oct. 31.
Replies are due Nov. 14, 2013.