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DTV to become AM radio?

Broadcasters must be feeling a bit abused. After spending billions to upgrade facilities, buy new transmitters and antennas and install HD, it appears the FCC now plans on reducing them to the equivalent of AM radio.

Under the warm and fuzzy banner of “broadband for all,” Obama’s FCC has targeted the OTA television spectrum as ripe for picking. Setting the stage for this theft is Mr. "I’m going to take your frequency" Blair Levin, the FCC’s executive director, Omnibus Broadband Initiative. His Nov. 5 blog post reveals not only where he (and Genachowski) clearly plan on going, but his justification to put you out of business. Below is a portion of his Nov. 5 post.

“When you’ve been a Wall Street analyst for the past eight years, as I have, you think a lot about how to get the best return on invested assets. In my return to the FCC, I’ve found that the same question is relevant, particularly as to our nation’s spectrum. Of course, our “return” is different — we don’t just think about maximizing profit, we think about providing important public benefits. But still, it’s the question the broadband team asks each day: How can we maximize the return on our most valuable assets to their owners — all of the American people? ”

Notice how he’s baiting the audience by saying “how can we maximize the return on our most valuable assets to their owners —all of the American people?” No one could argue against “maximizing the return,” unless that “return” is coming out of your hide. Also don’t forget, who "owns" the spectrum. Let’s continue …

“Recently, I’ve seen a lot in the press about our efforts to consider the best way to maximize the benefits on spectrum. Much of this chatter was triggered by a recent study submitted through the Consumer Electronics Association (CEA). The study suggested that broadcasters own licenses to approximately $62 billion worth of spectrum, but only extract $12 billion of value from that spectrum. In different hands, the study argues, that spectrum could be worth an extra $50 billion, which in turn would drive an extra $500 billion to $1.2 trillion dollars of economic activity. Not everybody agrees with the study, though, and 'Communications Daily' reports that some broadcasters and broadcasting trade groups, including the NAB and MSTV, are preparing to commission their own research that takes into ”account a different range of factors than did the CEA study.”

OK NAB and MSTV; you said the CEA’s study was basically bogus. Give us some data to back that claim. I realize this takes time, but the opposition already has marshaled its forces. Again, back to Mr. Levin …

“We welcome this as great news. As the record indicates, spectrum is a key input for broadband, but we know that it also has other uses of great economic and social importance. So we welcome a robust debate about how we can best allocate spectrum —both to maximize economic growth, but also to maximize the public good. We look forward to the NAB findings.

“Beyond the study, there have been reports about conversations I’ve had with broadcasters about spectrum. I’m not in the practice of publicly discussing details of private discussions. I want to ensure that every party is as candid as possible in helping us determine the best strategy to move America forward — but I do want to clear up a few details.

“These conversations originated from a few broadcasters, who recognized that they had more spectrum than they needed to deliver an economically efficient bit stream. We started discussing whether there could be a market-clearing solution that allowed them to monetize their extra spectrum, while allowing us to maximize the public good. This is the driver behind our discussions: We want the country to use most effectively one of its most valuable resources, while increasing optionality of those broadcasters who recognize that they’re not maximizing returns for their shareholders. We recognize that not all broadcasters would make the same choice, but our goal is to determine if there is a mechanism that will attract the interest of a critical mass.”

Levin just revealed his battle plan. Broadcasters will be offered a "choice." Want to bet the choice will be to go off the air entirely (for a payout) or reduce your bandwidth to one SD channel, and probably operate part-time?

We won’t know until February what may be included in the FCC’s broadband plan. Even so, a key component of that government plan is likely to include stripping the American public of a robust broadcast industry.

Of course, all that will be done in the interest of the FCC’s goals to “maximize the return.”