Auctions

Sens Cory Gardner (R-CO) and Maggie Hassan (D-NH) introduced the Advancing Innovation and Reinvigorating Widespread Access to Viable Electromagnetic Spectrum (AIRWAVES) Act, which will encourage the federal government to continue to free up spectrum for commercial licensed and unlicensed use and leverage the success of spectrum auctions to help close the urban-rural divide.

First, the legislation establishes a spectrum pipeline that will provide more capacity for wireless providers to improve existing service and expand to new areas. The AIRWAVES Act aims to motivate industry and federal agencies to find ways to better utilize spectrum and avoid a spectrum crunch and lay the groundwork for 5G technologies. Second, this legislation requires 10 percent of all of the proceeds from spectrum auctions in the bill to go directly to wireless broadband infrastructure buildout in unserved and underserved areas throughout rural communities across the country.

A bi-partisan coalition of 43 Congressional Reps is asking the Federal Communications Commission to reserve at least three TV white space channels in the 600 MHz band to support rural broadband deployments. “We believe that the television white spaces (TVWS) have strong potential to revolutionize broadband internet accessibility in rural areas,” wrote the coalition in a letter to the FCC. The coalition was led by Rep Kevin Cramer (R-ND) but also included some Democratic representatives, including Rep Anna Eshoo (D-CA).

The three channels referenced would include the duplex gap between 652-663 MHz, Channel 37 (608-614 MHz) and an additional vacant channel in the post-auction broadcast TV band (54-608 MHz), the letter stated. The channels would be reserved for unlicensed use. If the idea of reserving three channels below 700 MHz for rural broadband sounds familiar, it may be because that’s what Microsoft has asked for to support the company’s plan to spur the deployment of TV white spaces technology to unserved rural areas. The 600 MHz band initially was licensed to television broadcasters but a portion of that band will now be repurposed for wireless use. A recent auction gave broadcasters the option of voluntarily relinquishing spectrum and sharing the auction proceeds with the government.

This report provides details on two separate spectrum auctions conducted by the Federal Communications Commission (FCC) that included: 1) the 1710 to 1755 megahertz (MHz) band, and 2) the 1695-1710 MHz and 1755-1780 MHz bands. This report covers the period from January through December 2016.

The Federal Communications Commission will hold an Open Meeting on Thursday, August 3, 2017 for the subjects listed below:
Connect America Fund Phase II Auction (Auction 903) – The Commission will consider a Public Notice to initiate the pre-auction process for the Connect America Fund Phase II auction which will award up to $198 million annually for 10 years to service providers that commit to offer voice and broadband services to fixed locations in unserved high-cost areas. (AU Docket No. 17-182)
Mobility Fund Phase II Challenge Process – The Commission will consider an Order on Reconsideration and Second Report and Order that lays out a robust challenge process that will enable the Commission to direct Mobility Fund Phase II support to primarily rural areas that lack unsubsidized 4G Long Term Evolution (LTE) service. (WC Docket No. 10-90; WT Docket No.10-208)
Form 477 - The Commission will consider a Further Notice of Proposed Rulemaking that takes a focused look at the Commission’s Form 477 to improve the value of the data we continue to collect. (WC Docket No. 11-10)
Expanding Flexible Use in Mid-Band Spectrum Between 3.7 GHz and 24 GHz – The Commission will consider a Notice of Inquiry that explores opportunities for next generation services – particularly for wireless broadband – in the 3.7 GHz to 24 GHz spectrum range and asks about how we can increase efficient and effective use of this spectrum for the benefit of all services and users. (GN Docket No. 17-183)
Wireless License Renewal and Service Continuity Reform – The Commission will consider a Second Report and Order and Further Notice of Proposed Rulemaking that would adopt unified construction, renewal, and service continuity rules for the Wireless Radio Services, while seeking comment on a range of additional possible actions to increase the number of Americans with access to wireless communications services. (WTB Docket No. 10-112)
Transmitter Identification Requirements for Satellite Digital Video Uplink Transmissions – The Commission will consider a Memorandum Opinion and Order that waives the requirement that satellite news trucks, and other temporary-fixed satellite earth stations transmitting digital video, comply with the Digital Video Broadcasting-Carrier Identification (DVB-CID) standard if the earth station uses a modulator that cannot meet the DVB-CID standard through a software upgrade. (IB Docket No. 12-267)
Hearing Designation Order – The Commission will consider a Hearing Designation Order.

Sen Jerry Moran (R-KS) joined by a bipartisan quintet of fellow senators have introduced a bill to provide additional funds if the $1.75 post-incentive auction TV station repack fund is not sufficient. Federal Communications Commission Chairman Ajit Pai told Congress recently that the FCC was pretty sure the $1.75 billion would fall short given that broadcasters' initial estimate was north of $2.1 billion. The Viewer and Listener Protection Act of 2017 (S 1632) would authorize added funds to cover any shortfall in compensating TV stations for reasonable expenses, including funds to compensate FM stations, which could be affected by TV station moves on co-located facilities. The bill would also direct the FCC to adjust its 39-month repack transition period on a case-by-case basis "station if necessary to ensure that no broadcast television station is forced to stop broadcasting for a significant period of time."

The House Commerce Committee’s Communications and Technology Subcommittee held a hearing on July 25, 2017. Lawmakers came to talk Federal Communications Commission oversight; they came to talk FCC oversight; but as with most telecommunications policy discussions these days, network neutrality grabbed the headlines.

Full Committee Chairman Greg Walden (R-OR) announced that he will hold a hearing on September 7 entitled “Ground Rules for the Internet Ecosystem.” He sent invitations to CEOs of leading tech companies -- including Facebook, Alphabet, Amazon, and Netflix -- and broadband providers -- including Comcast, Verizon, AT&T, and Charter Communications -- requesting they testify.

“A strong consensus is forming across party lines and across industries that it’s time for Congress to call a halt on the back-and-forth and set clear net neutrality ground rules for the internet,” said Chairman Walden. “In some form or another, we have been working for at least 20 years on the intertwined goals of incentivizing the huge investments needed to connect Americans, while keeping the internet open and protecting consumer privacy. With almost everyone in agreement about fundamental principles to prevent anti-competitive behavior such as throttling and blocking, I think we are closer than ever to achieving a lasting resolution. The time has come to get everyone to the table and get this figured out.”

In a letter requesting their appearance, Chairman Walden said the open internet rules put in place during the Obama administration — which subject broadband providers to utility-like regulation — “disrupted the longstanding regulatory balance that for years allowed the internet to grow and thrive.” He added, “With your help, I know we can craft a fair, predictable and sustainable solution that not only benefits edge providers and internet service providers, but also the billions of consumers worldwide that deserve a free and open internet.”

Chairman Walden is joined by his counterpart in the Senate, Commerce Committee Chairman John Thune, in a desire to adopt legislation that will end the net neutrality debate.

But these lawmakers so far have offered few specifics, and for the moment, they don’t have much Democratic support. Many in that party have rallied to save the FCC’s existing rules, preferring the Obama administration’s approach. Sen Cory Booker (D-NJ), for example, fears that any attempt to tackle net neutrality with Republicans in charge of the White House and Congress will result in rules that are too weak — and give broadband internet access service providers too much power to tamper with internet traffic.

In her opening remarks at the hearing, Subcommittee Chairman Marsha Blackburn (R-TN) bristled at the suggestion that Republicans are opposed to network neutrality. "Let me be clear. Republicans have always supported a free and open internet." We are trying to "restore the culture of humility lacking under the regulatory cloud left” by former-FCC Chairman Tom Wheeler. She said it was time to move past partisan rhetoric and pass legislation clarifying net neutrality oversight. Subcommittee Vice Chairman Rep. Leonard Lance (R-NJ) agreed and said there was common ground on the need for net neutrality and added that a light-touch approach has strong support.

Subcommittee Ranking Member Mike Doyle (D-PA) pointed to the over 12 million net neutrality comments in the FCC's public file as evidence that there was nothing wrong with the FCC's current net neutrality rules. He said the rules are working and to roll them back would hurt small business and "regular people." Rep Anna Eshoo (D-CA) agreed and said the FCC is barreling down the road toward eliminating critical protections and making it clear that start-ups and small business input is not as valued as special interests. “If the FCC moves ahead with its net neutrality plan the consequences will be severe,” said Rep. Frank Pallone (D-NJ), the ranking member of the full House Commerce Committee. “Their plan will have a chilling influence on our democracy, cut away at our connections with each other, and limit economic opportunities for the future.”

Morning Consult reports that the key takeaway from the hearing is that Democratic and Republican members of Congress both support net neutrality — they just have different definitions for the term.

Chairman Walden asked all the FCC commissioners if they support net neutrality. Chairman Pai said he favors “a free and open internet.” But Rep. Anna Eshoo (D-CA) took issue, telling him that his chairmanship “rests on the altar of dismantling net neutrality as we know it.”

“With all due respect to you, I don’t think it’s a credible statement to say that you support it,” she added.

FCC Commissioner Mignon Clyburn said that maintaining classification of broadband services under Title II of the Communications Act will ensure competition and drive greater service availability. “Taking away Title II for broadband undercuts our ability to ensure universal service for broadband by taking away our clearest source of authority to make sure all Americans are connected,” Commissioner Clyburn said. “Undoing our classification of broadband as a Title II service also harms the FCC’s ability to enable competition. There is specific authority in sections 224 and 253 of the Communications Act that allows the FCC to enable competitive access to monopoly infrastructure, and to remove other barriers to competition. Without Title II, it will be far more difficult for the Commission to enact policies to enable competition.” Commissioner Clyburn also pointed to how Title II helps to ensure privacy.

“We adopted rules of the road for broadband privacy last October and they were stripped away earlier this year with the passage of the Congressional Review Act (CRA) resolution of disapproval which means today, there are no comprehensive rules on the books protecting broadband consumer privacy for Americans,” Commissioner Clyburn said.

But FCC Commissioner Michael O'Rielly said “the term net neutrality means so many different things these days than it once did.”

GOP lawmakers presented themselves as advocates of the concept of net neutrality, while simultaneously targeting the 2015 Open Internet Order which reclassified broadband Internet access service as a Title II service. Chairman Blackburn, for example was drawing a distinction between supporting a rollback of the net neutrality protections and the idea that such a move would limit internet access for users, saying that “Republicans have always supported a free and open internet.” Republicans say net neutrality limits investment and growth of internet service providers, while advocates say a rollback of the Obama-era regulation would allow ISPs to throttle, block or slow connectivity. Their argument echoed one that has been used by ISPs like Comcast and Verizon.

“Everybody says they’re for an open internet,” said Rep. Peter Welch (D-VT). “The question I have is: Why change the existing regime where everyone agrees that there is an open internet?”

Past network neutrality, the hearing considered a discussion draft reflecting, among other things, the Commerce Committee’s ongoing efforts to improve the FCC’s process and transparency. Here’s some quick notes:

1. Chairman Pallone questioned Chairman Pai about decisions that have favored Sinclair Broadcast Group. He asked if the Trump Administration has tried to influence these actions. Chairman Pai answered that the White House has not contacted him about the proposed merger of Sinclair and Tribune or the FCC's decision to restore the UHF discount, which helped pave the way for that deal.
2. Commissioner Clyburn criticized FCC Chairman Ajit’s Pai decision to allow Sinclair to purchase of Bonten's seven stations. She told the subcommittee that she was kept in the dark about the bureau-level decision, which, she suggested, was hardly in keeping with Chairman Pai's promise for more transparency.
3. Chairman Pai warned the subcommittee that unless Congress authorizes more money, broadcasters will have to pay some portion of their post-incentive auction repack expenses. FCC Commissioner Michael O’Rielly testified that it may be a little early to declare the $1.75 billion post-auction repack fund insufficient.
4. Chairman Pai said that if the facts warrant and the law allows it, the FCC will be aggressive about freeing up TV band white spaces for rural broadband.

The Federal Communications Commission's Incentive Auction Task Force and the Media and Wireless Telecommunications Bureaus identify each station subject to a winning reverse auction bid in the broadcast television spectrum incentive auction for which an incentive payment is ready to be paid. FCC staff has directed the US Treasury to make incentive payments for each station listed in the attachment to this Public Notice, which includes every station subject to a winning bid in the reverse auction that has provided sufficient banking information to facilitate payment. Subsequent public notice(s) will announce when FCC staff has directed the US Treasury to make incentive payments for any additional station(s) subject to a winning bid that subsequently provide sufficient banking information to facilitate payment.

House Commerce Committee Ranking Member Frank Pallone (D-NJ)—who has long pushed Congress to hold viewers harmless in the post-incentive auction repack—has introduced a bill to make sure the moving expenses of TV stations (and affected FM stations and pay-TV providers) are covered, given the initial broadcaster estimates of $2.1 billion in expenses and Congress' set-aside of only $1.75 billion.

The Viewer Protection Act would establish a $1 billion "emergency fund" if needed and fund a $90 million viewer outreach effort, given that most of a thousand stations are moving channels—some likely twice—in a 10-phase transition. Any money left over could be used to help low-power stations (including translators), who are not protected in the repack. The bill would also give the FCC's Media Bureau the flexibility to modify the transition periods for the phased transition so stations would not go dark to viewers for reasons outside their control.

As the repacking of the TV band proceeds after the Incentive Auction, the Federal Communications Commission has issued some guidance as to what comes next for TV stations. Obviously, in the near future, TV stations that agreed to surrender their spectrum in the auction will get notice from the FCC to expect their payments from the proceeds collected from the wireless companies that purchased the repackaged surrendered TV spectrum. For stations that are remaining in operation, who last week were required to file construction permit applications for their repacking to the smaller TV band, and their estimates of the expenses that they will incur in the repacking process, the FCC published an article on its blog, setting out what is next. The article notes that 25 stations will be filing soon in a new window for stations that either cannot construct on the channels that they were assigned by the FCC, or need expanded facilities to replicate their existing coverage. After that window, there will be another window when the remaining repacked stations can file to maximize their facilities on their new channels. Following those two windows, there will be a window for LPTV stations and TV translators who were displaced by the auction to file for new channels.

This week, TV stations and multichannel video programming distributors (MVPDs) eligible for reimbursement of costs associated with new channel assignments resulting from the incentive auction submitted their initial cost estimates. Jean Kiddoo, Chair of the FCC’s Incentive Auction Task Force, issued the following statement: “Based on information we have received as of 7:00 a.m. today, the aggregate amount of the estimated costs reported by reimbursement-eligible entities is $2,115,328,744.33. We expect to receive additional estimates from MVPDs and a small number of stations. In addition, the initial estimates that comprise this amount will be subject to a careful review by the Commission and our fund administrator. The aggregate cost estimate provided today will therefore change for purposes of the initial allocation of reimbursement funds.”