FCC Offers Eye-Popping Initial Bids For Northwest TV Airwaves
The Federal Communications Commission is trying to consolidate broadcast TV spectrum in order to free up more bandwidth for wireless data transmission. The initial bids to buy back the airwaves used by some Northwest TV stations reach hundreds of millions of dollars.
The FCC published the maximum prices it's willing to pay station owners to voluntarily go off the air or move to a less desirable channel. These initial bids range from around $250 million in Seattle and nearly $200 million in Portland down to nothing at all in Boise, Bend, Yakima and the Tri-Cities -- where additional spectrum is “not needed.”
In most cases, the bid amounts are expected to decrease once the "reverse auction" begins as the FCC seeks to secure the desired spectrum at the lowest possible price from multiple offers.
With the advent of digital TV, a station that relinquishes its broadcast spectrum can team up with another station to broadcast multiple program streams on a shared channel that remains on air. The broadcast spectrum auction represents an opportunity for owners of struggling stations to cash out while their airwaves are put to higher use.
Gracia Martore is CEO of highly profitable broadcaster Tegna, which owns six stations in the Northwest among the 46 it operates nationwide.
"We see some interesting opportunities on the channel sharing side in a number of markets,” Martore said. “On the pure selling spectrum side, we don't see that as any kind of a material event for our company."
Martore addressed the FCC auction during a quarterly earnings discussion with Wall Street analysts Tuesday. Tegna contains the broadcast and digital assets recently spun off from Gannett Corporation.
Cable and satellite television subscribers may not notice any difference after it all shakes out, observed Stuart Benjamin, former scholar-in-residence at the FCC and now a professor at the Duke University School of Law.
"If you are one of the 90 percent of Americans who doesn't get channels over the air anyway, you will be unaware of it," Benjamin said in an interview with public radio's newsmagazine The Takeaway on Tuesday.
The upcoming airwaves auction has caused unease among some community activists and labor unions who are concerned about TV station jobs and access to free over-the-air news and information.
"It is ridiculous in this country for decisions that will have real life and death effects on people, that these decisions be made by zillionaires behind closed doors," broadcast union local business agent Dave Twedell complained at a September town hall in Seattle.
The deliberations about whether to participate in the broadcast spectrum auction could be trickiest for noncommercial stations, whose mission includes serving marginalized populations. For example, the FCC is tempting Oregon Public Broadcasting with an initial bid for its Portland TV spectrum of $105.1 million. KWSU-TV in Pullman, a PBS affiliate licensed to Washington State University, received an opening bid to go off the air of $43.9 million. KCTS-TV in Seattle was offered $109.4 million for starters.
Oregon Public Broadcasting president Steve Bass said his station's Board of Directors would decide in private about what course to take.
"We are solely committed to providing an over-the-air service, which we have done for 93 years," Bass added.
Station owners have until December 18 to decide whether to participate in the spectrum sale. This process only affects TV station spectrum, not radio.