After much anticipation, the Federal Communications Commission announced opening bid prices for the upcoming 600 MHz incentive auction.
The spectrum auction, currently set to begin March 29, will be different than past events in that it will include a forward auction where television broadcasters bid on the amount of money they will take to give up their current spectrum in the 600 MHz band and then a reverse auction where telecom operators will bid on that newly available spectrum. Television stations stand to make a substantial amount off their under utilized spectrum.
The FCC set an opening reverse price of $900 million for New York’s WCBS‐TV, while some stations have been marked as “not needed” meaning the FCC does not need spectrum in those markets to meet its goal. Among markets listed as not needed include Grand Junction‐Montrose, Colo.; and Butte‐Bozeman, Mont.
Senior FCC official’s noted they were able to release the opening bid amounts as they could easily be calculated with publicly available information.
“For potential incentive auction participants, today is a watershed moment,” said FCC Chairman Tom Wheeler in a statement connected to the release of the opening bids. “For all practical purposes, we’ve fired the starting gun: the release of final opening bid prices – combined with the detailed application procedures and other data released … – provides broadcasters with all of the information they need to decide whether to apply to participate in the auction. Stations that miss the Dec. 18 deadline will not be able to participate in this historic auction. Commission staff stand ready to educate and assist applicants as they prepare.”
Television broadcasters have until Dec. 18 to decide if they want to participate in the forward auction process. Once they decide to participate, television broadcasters will then be able to decided whether to follow one of four options, including relinquishing spectrum and shutting down; relinquishing and sharing spectrum; moving from a UHF to a VHF channel; or moving from a high to a low VHF channel. The decision will impact the value of the spectrum. WCBS‐TV, for example, will only be valued at $900 million if it shuts down. If it moves to a low VHF channel, the spectrum’s opening bid will be set at $675 million; and if it moves to a high VHF channel the opening bid will be valued at $360 million.
One senior FCC official noted depending on the stations decision “there is a lot of money to be had by each individual broadcaster.”
