RBR-TVBR News Analysis: FCC introduces


The FCC says to check out “Spec it Out!” It’s “fun.” It’s “easy.” You’ll “learn” all about spectrum needs and incentive auctions. In the final analysis, it’s just a long page full of stats and charts, without any underlying supporting evidence. And it’s not really all that much “fun” either, if you want our opinion.

But don’t take our word for it – you can see it for yourself.

Among the claims made is that a voluntary incentive auction of underutilized beachfront spectrum in the television band could bring in as much as $30B, and that would translate into $300B worth of benefit to consumers.

Hey, it’s going to create 771K new jobs too!

We suppose ??“Spec it??” is thinking that the $30B will be gross proceeds. But j?ust to underline the fluid nature of the number being ?t?o?s?s?e?d?? ?a?r?o?u?nd, let’s look at remarks made by FCC Chairman to the US Chamber of Commerce recently: “Under this proposal from our National Broadband Plan, spectrum licensees like broadcasters could voluntarily contribute underused spectrum to an auction, in exchange for a share of the proceeds from the auction. It’s an incentive-based approach, grounded in strong free-market principles, that would free up large blocks of beachfront spectrum for mobile broadband while preserving a strong and healthy TV business, and generating $25 billion in potential deficit reduction, plus at least ten times that in economic benefits.”

Note that the chart said $30B, and Genachowski said ?n?o?t? ?j?u?s?t? $25B?,? ?b?u?t? ??$?2?5??B? ?i?n? ?d?e?f?i?c?i?t? ?r?e??d?u?c?t?i?o?n?. Compare that to legislators who have been kicking around potential deficit-reduction benefits in the $10-$15M range — we refer to Sen. Jay Rockefeller (D-WV) on the low end and Rep. Henry Waxman (D-CA) on the high end.

Now compare these various numbers put forth by advocates of the incentive auctions with the earlier CBO estimate of $6B worth of deficit reduction after all the costs and revenue-sharing aspects of the incentive auctions are settled, and you have to wonder where ANY of these numbers came from.

The NAB has conducted engineering studies that question the very feasibility of the incentive auction program, and numerous entities have noted that the feasibility is even weaker in border markets. Questions like that somehow didn’t find a place on “Spec it Out!”

But at least the chart is “fun” and “easy” to look at!