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President uses budget threat to hasten transition

The Bush budget would impose an annual charge to broadcasters of $198 million for the use of legacy analog transmitters.

President Bush is adopting a get-tough attitude toward broadcasters in an attempt to get the transition to digital implemented at a quicker pace. A hint of what was to come surfaced in early March when the administration sent Congress an outline of the budget, but the full impact of this new approach became a reality in early April when the President submitted his full budget request to Congress.

The Bush budgetary proposal suggests that the Federal Communications Commission (FCC) draw up rules that would impose an annual charge to television broadcasters of $198 million for the use of legacy analog transmitters until they return the spectrum. The move is designed to free up spectrum used by analog television transmitters so that the FCC can auction it to wireless companies for consumer-oriented advanced telecommunications services. “The legislation will promote clearing the spectrum in channels 60-69 for new wireless services in a manner that ensures incumbent broadcasters are fairly compensated,” Bush's 2002 budget said.

The FCC is slated to auction the channel 60-69 spectrum in September. Although the sale was to have been completed last year, the proposed budget gives the agency until September 2004 to get the job done.

If excising the channel 60-69 spectrum from the family of television broadcast frequencies weren't enough, the FCC is also slated to auction the airwaves used by broadcasters occupying channels 52-59 by next fall. The Bush budget proposal, however, grants a brief reprieve in the timeline, extending it to September 2006.

“As a result of the increased certainty about how and when the spectrum in channels 60-69 will become available and shifting the deadlines for both auctions closer to when the spectrum is expected to be available, revenues for these auctions are expected to increase by $7.5 billion,” the budget said.

The proposed budget is vague when it comes to what the legislations should or would say and when it would be sent to Congress for action. This is not surprising in light of the fact that the plan to charge broadcasters is opposed by the industry and key members of Congress, and past attempts to impose fees have failed in Congress.

“Penalizing America's broadcasters — who are struggling to make the transition to digital — with punitive spectrum fees is a terrible idea, and I will fight it every inch of the way,” said Rep. Billy Tauzin, R-La., who chairs the House Commerce Committee, which oversees the FCC and the broadcast industry.

While Tauzin opposes any analog spectrum fee, he said he would support delaying the 52-69 auction.

“The president has offered a restrained budget that is both fair and responsible, but — as in all administration budgets — changes to it are inevitable,” he said. “In the area of telecommunications, for example, the president's decision to postpone certain spectrum auctions makes a lot of sense to me, and I will support his efforts.”