An auction of 119 FM frequencies may not raise much money for the U.S. Treasury. With radio stations still recovering from the Great Recession and lending for mergers and acquisitions tight, radio broadcasters may not have the financial wherewithal to bid up by much minimum payments for construction permits in FCC Auction 93, experts said. It seems unlikely to raise more money than auctions of a similar number of stations held by the commission last year and in 2009, said lawyers who represent radio stations before the agency. Last year’s auction had net winning bids of $8.54 million (CD April 28 p9), with $5.25 million (CD Sept 8/09 p7) in 2009.
Small carriers who have long asked the FCC to mandate that handsets developed for use in the 700 MHz band work across lower 700 MHz, could be headed for victory next year. The FCC agreed to launch a notice of proposed rulemaking last week as part of an order approving AT&T’s buy of 700 MHz licenses from Qualcomm (CD Dec 27 p1). The NPRM, slated for the first quarter, would tee up the issue for what could be a key early decision of the newly reconstituted FCC, following the expected confirmation of Jessica Rosenworcel and Ajit Pai as commissioners as early as February.
Spectrum wasn’t included in the two-month payroll tax extension agreed to Friday morning by Congress. The agreement (CD Dec 23 p8) did pave the way for a House-Senate conference on a year-long extension, and it’s expected that the body will consider authorizing spectrum auctions as a spending offset. “For those interested in spectrum legislation, the one significant difference between this agreement and the deal endorsed by the Senate last week is that it means the House and Senate are already in conference on an extension of the payroll tax through 2012,” said David Taylor, executive director of the Wireless Broadband Coalition. “In this conference, the House-passed version of HR 3630 is the only option containing the offsets needed to pay for what now amounts to a 10-month extension of the payroll tax and other expiring provisions. … Procedurally, the deal effectively limits the scope of the conference and increases the odds that spectrum legislation based largely on the [House Commerce Committee’s spectrum bill] will be incorporated into any conference agreement that emerges.” The conference will have until the end of February to reach a deal. Among the eight conferees announced earlier this week by the House: Commerce Committee Chairman Fred Upton, R-Mich., and Communications Subcommittee Chairman Greg Walden, R-Ore. Also joining the conference are House Commerce Committee Ranking Member Henry Waxman, D-Calif., and four other House Democrats, Minority Leader Nancy Pelosi, D-Calif., announced Friday. Senate Majority Leader Harry Reid, D-Nev., chose four senators, but none come from Senate Commerce. Minority Leader Mitch McConnell, R-Ky., didn’t name his conferees by our deadline. President Barack Obama Friday afternoon signed into law the payroll tax extension and the fiscal-year 2012 appropriations bill, including $340 million for the FCC.
House Republicans were reportedly close late Thursday to agreeing to a modified two-month deal on the payroll tax extension. They didn’t announce the deal before our deadline. The two-month deal agreed to last week by the Senate did not include spectrum auctions as a spending offset. Earlier this week, the House took the first steps toward setting up a House-Senate conference to work out a one-year extension, and the Senate reportedly will nominate conferees as part of the agreement with the House. The conference, which includes House Commerce Committee Chairman Fred Upton, R-Mich., and Communications Subcommittee Chairman Greg Walden, R-Ore., is expected to consider including spectrum authorization in the final package (CD Dec 21 p4).
AT&T and T-Mobile both face some tough decisions in the aftermath of their failure to consummate their merger. AT&T’s proposed buy of its smaller rival has preoccupied both companies since March, before it was officially ended Monday. AT&T had been soldiering on for almost four months after the Justice Department sued to block the deal in a surprisingly quick decision Aug. 31.
The House GOP authors of spectrum legislation hope to negotiate the payroll tax cut extension with the Senate, but that could be tough because senators have largely returned to their states for a month-long break. After voting Tuesday to move to conference, Speaker John Boehner, R-Ohio, named as conferees House Communications Subcommittee Chairman Greg Walden, R-Ore., and Commerce Committee Chairman Fred Upton, R-Mich. However, at our deadline, Senate and House Democrats still had not agreed to participate. Members of the Senate have already left for the holidays, and Senate Majority Leader Harry Reid, D-Nev., refused Tuesday to call back his members. House Minority Leader Nancy Pelosi, D-Calif., also said she would not appoint conferees.
The fate of spectrum legislation remained in flux Monday as members of Congress continued to squabble over an extension of the payroll tax cut. Lobbyists consider the payroll bill the “last train out of town” this year for spectrum legislation. Spectrum reform was nearly left behind when the Senate agreed late Friday on a bipartisan basis to a two-month rather than year-long deal (CD Special Bulletin Dec. 17). But in a surprise move, House Republicans vowed to pull back the measure and lobbyists now view a two-month extension as dead in the water.
It seems unlikely spectrum negotiations are finished between the House and Senate Commerce committees, despite frustrations voiced by each side, multiple telecom industry lobbyists said Thursday. But governance of the public safety network continues to divide the chambers, they said. Senate Commerce Committee Chairman Jay Rockefeller, D-W.Va., complained Wednesday that the House had halted talks on a spectrum deal (CD Dec 15 p1). House Communications Subcommittee Chairman Greg Walden, R-Ore., responded that he’s waiting for the Senate to pass its own spectrum legislation. Congressional leaders said Thursday they were moving closer to agreement on a payroll tax cut bill, which has been used as a vehicle for spectrum legislation.
CBS said it agreed to buy WLNY-TV Riverhead, N.Y. a full power DTV station on Long Island. The station has pay-TV distribution around the New York, Connecticut and New Jersey region, and is not affiliated with a major broadcast network. CBS also owns WCBS-TV New York. Terms weren’t disclosed, but Wells Fargo analyst Marci Ryvicker said the transaction was a smart one for CBS to make. Owning two stations in the largest U.S. media market, CBS could probably increase margins at the two stations by 10 basis points, and potentially increase revenue at WLNY-TV by adding new programming and through retransmission consent revenue, she said.
A spectrum venture of three cable companies agreed to sell 122 AWS licenses to Verizon Wireless for $3.6 billion, the companies said Friday. SpectrumCo is a joint venture of Comcast, Time Warner Cable and Bright House Networks, and the licenses cover 259 million POPs. The consortium was the third-highest bidder in the AWS-1 auction, which ended in September 2006, behind only T-Mobile and Verizon. The deal likely faces pushback similar to that aimed at AT&T for its proposed buy of 700 MHz spectrum from Qualcomm, a smaller deal now stalled at the commission. (See story in this issue.)