FCC Sets Clearing Target and Starting Date for Incentive Auction

In a long-anticipated move towards commencement of the spectrum auction, the FCC today released a Public Notice and related Appendix providing an initial clearing target of 126 Megahertz of spectrum in what is currently the broadcast television band. The 126 MHz figure represents the targeted amount of spectrum to be repurposed from broadcast television to mobile wireless uses.  The FCC also announced that bidding in the reverse auction will commence on May 31, 2016.

The 126 MHz target is the highest the FCC was contemplating, and indicates that a large number of television stations have chosen to participate in the auction.  By setting a high clearing target, the FCC is maximizing the amount of broadcast spectrum purchased, but increasing the risk that if there is insufficient interest in the forward auction for this amount of spectrum (at the prices the FCC needs to pay selling broadcasters and cover other costs), the auction may have to be redone with a lower clearing target.

In the forward auction, the FCC will offer 10 paired blocks of spectrum, each block comprised of 10 MHz, to mobile wireless bidders.  The remaining 26 MHz of spectrum to be cleared will be used for guard band and duplex gap purposes; i.e., to protect adjacent users from interference.  If the auction is completed with the 126 MHz clearing target, the post-auction television broadcast band will consist of VHF channels 2-13 and UHF channels 14-29.  The process of repacking stations into channels 2-29 would commence following completion of the auction, and is estimated by the FCC to take approximately three years, although many have questioned whether that is sufficient time for the repack.

With the release of the clearing target information, the FCC has locked in all of the following dates for auction-related events:

May 4, 2016, noon:  Date by which each television broadcast licensee that made an initial commitment in the reverse auction must receive a third confidential status letter from the FCC.  That letter will inform the applicant whether its station(s) will be qualified to participate in the reverse auction.  Applicants who have not received this letter by noon (Eastern Time) on May 4 should contact the FCC Auctions Hotline at (717)338-2868.

May 5, 2016: FCC Incentive Auction Reverse Auction Bidding System User Guide available on Auctions webpage.

May 18, 2016:  Online Bidding Tutorial available on Auctions webpage.

May 23, 2016, 10 a.m.:  Bidding Preview Period begins.

May 24, 2016, 10 a.m.:  Clock Phase Workshop.

May 24, 2016, 6 p.m.:  Bidding Review Period ends.

May 25, 2016, 10 a.m.:  Mock Auction Bidding Round 1.  Additional Mock Auction Rounds occur throughout May 25 and May 26.

May 31, 2016:  Bidding in the reverse auction commences for qualified applicants, with a single round of bidding on May 31 and June 1, and two rounds per day starting on June 2.

While it is unclear how many rounds of bidding will be required before the auction closes, or whether the 126 MHz target might lead to a repeat of the reverse auction, today’s news brings a palpable sense that the auction has really begun.  How successful the auction will be for broadcasters, mobile wireless companies, and the FCC will be a developing story.  Stay tuned for more updates.