FCC Releases Opening Bids, Application Deadlines for TV Incentive Auction

The PNs contain the most detailed schedule for the auction released to date, information about mock auctions, and for the first time list specific stations that the FCC won't need to purchase spectrum from, broadcast attorneys told us.

The prices were calculated using a formula previously released by the FCC, but take into account updated interference data on the borders and elsewhere. The numbers don't differ significantly from previously released opening bid information, BIA Kelsey Chief Economist Mark Fratrik said. Because the broadcaster portion of the incentive auction is a reverse auction, the opening bid is the highest price participants will be offered; the bids will decrease each round. Senior FCC officials said on a news media call Friday that the opening bids now range from $900 million for one New York City station to under $1 million for some stations in the Midwest.

Broadcast attorneys told us it's seen as unlikely that many stations will receive their initial opening bid price, but that may not be the case, said auction consultant Preston Padden, executive director of the Expanding Opportunities for Broadcasters Coalition until it recently folded in preparation for the auction. Projections run by the EOBC show many broadcasters receiving their opening bids, Padden said. Though EOBC is now defunct, its members have an interest in encouraging maximum auction participation, broadcast attorneys have told us. Broadcasters reviving their opening bid prices will be determined largely by repacking concerns, Padden said. If other broadcasters in a given area are easier to repack, it could make some stations' spectrum attractive enough to go at the initial price, he said.

The filing window for reverse auction applications opens at noon Dec. 1 and closes at 6 p.m., Dec. 18, the application procedures PN said. Though broadcasters still will be able to back out of participating between Dec. 18 and the March 29 “initial commitment” deadline for the start of the auction, no station that misses the Dec. 18 deadline will be able to participate, FCC officials said. The Dec. 18 filing deadline also marks the start of the “quiet period” required by the anti-collusion rules, which will last through the end of the auction. Senior FCC officials said Friday that while it is impossible to say exactly how long the auction will last, they are expecting a duration of two to three months.

The FCC will announce an initial clearing target and band plan three to four weeks after the March 29 commitment deadline, and will send participants information about mock auctions after that, the application procedures PN said. The commission will also hold workshops and webinars on the bidding process, and tutorials on the auction bidding screens broadcasters will use to accept bids. The PN makes this process sound more complicated than it is, Padden said. “The bidding screen will be the epitome of simplicity.” The screen will show broadcasters a price and a way to say yes or no, Padden said. Though more details about the process are available in the PN, it's not necessary for broadcasters to “check under the hood” to participate, he said.

The PN lists some stations that aren't needed in the auction. These stations occupy less valuable spectrum in areas -- such as Las Vegas -- that “will always have a feasible assignment in their pre-auction band at the initial and all subsequent clearing targets,” the PN said. Those areas have long been seen as unlikely to generate interest in the auction, and the news that their spectrum isn't needed is unlikely to be a surprise, Fratrik told us. Those stations will still be part of the repacking process along with all full-power and Class-A TV broadcasters, FCC officials said.

Carrier Details Unveiled

AT&T and Verizon aren't eligible to bid for reserve spectrum in the seven largest U.S. markets, according to another document released by the FCC. Those markets are New York, Los Angeles, Chicago, San Francisco, Baltimore, Philadelphia and Boston. The rankings are based on the population of the licenses covered.

Verizon, but not AT&T, is reserve-eligible in the eighth- and ninth-largest markets, Dallas and Miami. The largest markets in which AT&T is eligible are Cleveland and Phoenix, the 14th- and 15th-largest markets. Charleston, West Virginia, the 52nd-largest market, is the biggest in which both AT&T and Verizon are reserve-eligible. The FCC lists 416 markets, and T-Mobile is reserve-eligible in all of them. Verizon is reserve-eligible in 112, and AT&T in 242. The Competitive Carriers Association earlier projected that AT&T or Verizon will be reserve-eligible in markets that cover 74 percent of the nation and 40 percent of POPs (see 1510090022).

“We’re pleased the FCC continues to make progress on the incentive auction, and releasing the reverse auction opening prices is another significant step forward,” CCA President Steve Berry said. “Broadcaster participation is absolutely critical, and keeping them interested is a ‘must’ for the auction to be successful. CCA members understand the importance of acquiring additional low-band spectrum, and robust broadcaster participation provides opportunities for all carriers to access these important airwaves.”