House Dems, GOP Urge Quick Authorization of Voluntary Incentive Auctions
The House Communications Subcommittee moved a step closer to wireless legislation, holding Wednesday what’s likely their last hearing in a series on spectrum. Subcommittee Democrats and Republicans supported authorizing the FCC to conduct voluntary incentive auctions. Subcommittee Chairman Greg Walden, R-Ore., suggested additional incentives for broadcasters.
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If voluntary, the incentive auction concept “is not only good spectrum policy, it is good economic policy,” Walden said. Congress should move fast to authorize the auctions, which could raise $100 billion for the U.S. Treasury, agreed Rep. Cliff Stearns, R-Fla. But broadcasters should be “compensated fairly” and maintain the ability to serve the same areas they do now, Stearns said. Full committee Ranking Member Henry Waxman, D-Calif., urged “specific legislative language that would provide assurances to broadcasters that they are not being forced to sell spectrum in the voluntary auction."
Congress “can, and should, act to preserve and promote” broadcasting, said Walden, a former broadcaster. “Additional funding [for broadcasters] could help pay for expanded mobile, Internet and even broadband offerings,” he said. And Congress should work with broadcasters to identify regulations that stunt broadcaster innovation, he said.
Lawmakers “need to be wary about limiting the FCC’s flexibility to design an efficient auction,” Waxman said. “We should take full advantage of the FCC’s world-class expertise on auction design and give the agency the ability to work with auction experts to set up the best possible incentive auction,” he said. “We should not micromanage the agency in this area."
Titan Broadcasting will sell its spectrum for “the right price,” said the company’s president Bert Ellis, but repacking should be “totally voluntary.” But Duke University professor Michelle Connolly said repacking cannot be voluntary or the spectrum won’t be as valuable in auctions. Spectrum could be worth between $0.075 and $0.08 per MHz/pop, “assuming there is sufficient competition,” she said. Connolly also opposed anything more than a straight authorization of incentive auctions, saying added legislative language could decrease the spectrum’s value.
For NAB, voluntary means “no negative ramifications for participating or for not participating,” said Schurz Communications CEO Todd Schurz. People who don’t participate should not be forced to relocate to an inferior network band or be subject to increased interference, and government should cover the cost of repacking, Schurz said. Broadcasters shouldn’t be forced into VHF spectrum, because it doesn’t work for digital broadcasting, Ellis said. But CTIA Vice President Chris Guttman-McCabe said there’s a difference between lower and upper VHF, and many companies are broadcasting in both. He urged immediate authorization of incentive auctions with mandatory repacking.
Ellis urged Congress to require radio tuners in wireless devices, but Qualcomm Vice President Dean Brenner said there was “no business case” to do it. Walden told reporters he'd rather the market decide. “Sometimes that’s done with a nudge from Congress,” but usually it happens because of “consumer demand,” he said.
Stearns asked if an inventory should come before incentive auctions. Broadcaster witnesses Schurz and Ellis said it should, but Guttman-McCabe and other witnesses said an inventory should not be a prerequisite. Ellis said an inventory could be completed in one weekend, but Connolly estimated it would take years given the usual speed of government. An inventory isn’t necessary to show more spectrum is needed, but would be useful later for spectrum planning, said Harold Feld, legal director of Public Knowledge. After the hearing, Walden said there’s “value” to doing an inventory, but questioned the possible costs. “When you start to parse who’s using what and how they're using it, it gets pretty subjective, and all of that … can take an awful long time."
Walden “continues to have concerns that reallocating the D-block rather than auctioning it may be a mistake,” he said during the hearing. AWS-3 and spectrum owned by the federal government should also be on the table for auctions, he said.
Spectrum legislation in the works by Rep. Doris Matsui, D-Calif., aims to promote research and development efforts and unlicensed spectrum use, Matsui said. Ranking Member Anna Eshoo, D-Calif., urged a look at tagging spectrum for unlicensed use, including the TV white spaces and the 5 GHz band. “Unlicensed spectrum has unlocked tremendous innovation and the coming years will drive the growth of smart grid, access to patient records in hospitals and much more,” Eshoo said.
Feld emphasized white spaces must be part of the discussion. “If we focus only on raising revenue” through unproven incentive auctions, “the spectrum crisis will become a spectrum Armageddon,” he said. White spaces would boost the economy and are the “most deregulatory approach to spectrum policy we have,” he said.
Wednesday’s hearing will likely be the last in the subcommittee’s spectrum series, Walden later told reporters. The subcommittee will review the testimony “and begin to put it into legislation in a bipartisan way.”