April 25, 2016
As the airwaves are increasingly crowded by wireless data, the Federal Communications Commission devised a “broadcast incentive auction” to convince TV broadcasters to sell spectrum that would be used to expand wireless airwaves. By the end of this month, the FCC’s early round of the auction is expected to be complete, but the entire plan won’t likely be completed before 2020. By acting as middleman, the FCC stands to make billions of dollars, which will pay for the auction; the rest will go to the government.
Just how valuable that spectrum can be was made clear by The Verge, which reports that one New York City Telemundo affiliate was offered $900 million by the FCC to start. Not all broadcasters are participating in the auction, but eventually all of them will either go off the air or share the remaining space on the spectrum. In the second phase of the plan, the FCC asks interested parties to start bidding.
To keep the process from stampeding smaller wireless providers, the FCC will organize a “reserve” spectrum auction once bidding hits a specific dollar amount. Those smaller providers can then bid against each other. The FCC’s idea is that the reserve will help increase competition and offer consumers more choices. But how much to allocate to the reserve has been “the subject of some controversy among wireless providers.”
Among the big companies involved are Comcast, Verizon, AT&T, and T-Mobile (Sprint is sitting out the auction).
Once this second phase is over, the next and last phase begins: transitioning TV broadcasters to their new homes on the spectrum, a process that The Verge says will take 39 months, as broadcasters replace old gear and are impacted by weather and geography. That’s why the dust won’t settle until 2020.
The impact on the ordinary consumer won’t be very noticeable. TV will be the same, except for any local stations that go off air, and you’ll have more speedy data than ever before.