Broadcasters' windfall strategy goes beyond merely preventing incentive auctions

Cited Article

David Lieberman, Who Will Blink First Over TV Spectrum? Obama Administration Battles Broadcasters, Deadline New York, April 18, 2011.

Article Quote

“The NAB’s biggest concern is that the government might seizespectrum without a broadcaster’s consent. CBS chief Les Moonves echoed that message when he said last week that, as long as it “remains voluntary, we’re fine with that. Because we’re not going to volunteer….  The Obama administration wants TV stations to give up some of their spectrum so it can be redeployed to offer Internet services….”

My Comment

The TV broadcasters are holding out to get 100% of the windfall from the shift to mobile broadband internet uses of their spectrum.  All this talk about broadcast vs. internet is largely a smokescreen for this negotiating ploy.  Broadcasters are moving as fast as they can, without being too blatant, in transitioning to internet services.  In other words, they are trying to become what they purport to criticize.  Their acquisition of geographic area licensing (vs. site-based licensing) and mobile TV rights in recent years–both acquired below the public radar and without public compensation–is just the tip of the iceberg of this strategy.  From the broadcasters’ perspective, too, every day they hold out the demand for spectrum increases and with that their potential windfall.

Lieberman has basically gotten it right.  But the extra details matter, and the broadcasters aren’t going to volunteer them.  For example, when Les Moonves says he’s not going to participate in voluntary auctions, he’s only telling you half of the story.  The other half is that he wants to keep his cake and eat it, too; that is, capture the entire windfall from broadcasters’ abandoning broadcasting in the name of preserving it.

Recent Related Articles

Letter from CTIA to members of Congress, March 17, 2011

Cecilia Kang, President Obama pitches $18 billion wireless broadband plan, Washington Post, February 10, 2011.

The FCC’s Incentive Auction Proposal, Remarks by FCC Media Bureau Chief Bill Lake to National Alliance of State Broadcaster Associations, February 28, 2011.

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