Wheeler Delays Spectrum Auction Until 2015

WASHINGTON — The TV spectrum incentive auction has been postponed by a year. The chairman of the Federal Communications Commission, Tom Wheeler, delivered the news via FCC Blog on Friday.

“I believe we can conduct a successful auction in the middle of 2015,” he wrote.

“Getting the right policy and procedures for the auction is only half the job,” he said. “For the incentive auction to be a success, we must also ensure that the operating systems and software to run it work from the moment the first bid is placed, until the final broadcast station is relocated or ‘repacked.’”

The National Association of Broadcasters has lodged several concerns with the TV station repacking software, TVStudy. NAB executives met with FCC engineering officials last week to object to the proposed calculations in TVStudy, and questioned whether it indeed met the spirit of the law that “all reasonable effort” be made to preserve TV signal reach. (See “NAB Challenges FCC’s ‘Reasonable Effort.’”)

Wheeler seemed to address those concerns directly: “Above and beyond our normal auction preparation procedures, our project plan for the incentive auction includes several software demonstrations for potential users in addition to the ‘mock auction’ we typically hold to ensure the software and system performance. Only when our software and systems are technically ready, user friendly, and thoroughly tested, will we start the auction.”

Until Friday, the FCC appeared to be determined to hold the auction in June of 2014. Many details, however, remain undetermined, including repacking coordination with Canada and Mexico. Wheeler laid out a timeline in his blog. He said the FCC’s Incentive Auction Task Force would provide more timeline details a the commission’s regular January open meeting, but that a Report and Order would be expected in the spring.

“Another important aspect of the project plan will include developing the actual procedures for how the auction will be conducted,” he said. Related Public Notices are expected in the second half of 2014.

Marci Ryvicker, broadcast analyst at Wells Fargo said the delay was no surprise, and that it “gives broadcasters more information to determine their likelihood of participation.”

By that measure, the delay bodes well for a group of the willing led by former Disney executive, Preston Padden, who is set to testify at a Senate Commerce Committee hearing Tuesday on the incentive auction.

“The FCC has not yet attracted anything approaching the critical mass of TV station volunteers that will be necessary to have a successful auction,” he wrote in his prepared testimony. “Without sufficient TV station volunteers, the FCC will have no spectrum to auction.”

Both the broadcast and wireless lobbies reacted. CTIA-The Wireless Association, was measured:

“CTIA welcomes FCC Chairman Tom Wheeler’s announcement…” its chief Steve Largent said. “I commend Chairman Wheeler for his efforts to advance this important proceeding and his commitment to conducting this critical auction by middle of 2015."

Gordon Smith, chief of the National Association of Broadcasters, said, “NAB appreciates Chairman Wheeler's decision to set new goals for the commission's incentive auction timeline. As NAB has long maintained, given the complexity of the auction and its many moving parts, the most important goal is to get the auction done right.”