You Need To Make NPRM Comments
Friday - 12/12/14

The most important action you can take to help protect and enhance the value of your FCC LPTV or TV translator license(s) is to file official comments into the LPTV NPRM (National Proposed Rule Making) process by Jan. 12th, 2015. The more experienced of you already are preparing to do this, but the vast majority of LPTV licensees we are assuming are not.  We can help!

The goal of the Coalition is to assist you and your legal counsel do this so that the FCC has a diverse group of licensees participating.  You each have a unique perspective, business model, and community of license which needs to have their concerns, ideas, and voice heard.  Whatever we can do to help we will, but YOU have to take the first step.

But let's face reality head on here...the concerns of the major license holders with top-50 market stations can be different than those in markets below that. The licensee with a single station has different concerns than a multiple station operator.  Those with a channel leasing model are far different than a full service station with ad-insertion.  Both can utilize rev-sharing deals for extra or main cash-flow.  

The TV translators business models are also rapidly changing.  Those that are still affiliated with primary stations have a singular focus to serve that station.  Tax-district and civic-owned stations are quickly waking up and implementing multiple digital channels, paying retransmission fees for primary networks, and are trying to act more like a local broadcaster. Community owned non-profit translator groups are also trying to figure out new business models while staying true to their not-for-profit charters.  And the non-com PBS and education systems are wondering what to do next.

And of the 475 or so of the Class-A licensees, the FCC says that about 100 of them are not eligible for the auction, which means they are also not afforded protection in the repack.  This is despite there not being anything in the Spectrum Auction Act which says this.  And the Class-A's, no matter what their status in the auction, must convert to digital status by September 2015.

For the rest of the LPTV and TV translators the analog-to-digital conversion date is being potentially pushed back, and all remaining new construction permits deadlines have been suspended until the LPTV rule making is complete.

A key thing to remember is that within the LPTV NPRM the FCC is proposing an entirely new regime for LPTV, with the addition of the primary station digital replacement translators having a priority in the repack over all other LPTV and translators.  The potential abuse which could be done with this proposal could affect each and every TV DMA, no matter the size and market.

Remember the numbers, there are only about 1850 actual entities which control approximately 10,000 Class-A, LPTV, and TV translator licenses and new construction permits.  This means most are multiple station operators. Of those 10,000 are 6500 built and licensed facilities, and 3500 construction permits.  Of those construction permits about 1000 are the remaining analog to digital conversions, and 2500 are new digital permits.  The vast majority of these new digital permits were obtained in the 2009 rural filing window, and they were specifically obtained to deploy mobile and fixed broadband services in support of the National Broadband Plan.  But that pesky Incentive Auction Act was passed (1200+ days ago now), and the construction permits these pioneering entrepreneurs obtained are now in serious risk of not being able to be built-out as planned, and their waiver requests are languishing. 

The 550 or so PBS-affiliated translators are also stuck, and are trying to figure out what the auction means to their national coverage.

The 475 Class-A stations represent less than 5% of all LPTV and TV translator licenses and permits.  And about 3.75% are eligible for the auction, while 96.25% of us are not. The Greenhill Book, which the FCC paid to have done to convince auction eligible broadcasters to participate in the auction, well it projects a combined value for the Class-A stations of about $5 Billion! With the one in the San Diego TV DMA valued at $230 million, and others in NYC over $100 million.  

Add into this equation the fact that all non-auction eligible Class-A's, and all LPTV and TV translators, will have to pay for their own relocation costs, so thanks Congress!.  The Coalition first estimated these costs to be about $150,000 per license.  That made it a $1 Billion "unfunded mandate" on us (discounted for non-built CPs).  Then when the official FCC auction costs reimbursement estimates came out, this figure rose to almost $250,000, which means we could end up paying well over $1.75 to $2 Billion!  Never mind the damages to our businesses during this long auction design and rule making process goes not.  While a lot of operators are doing well with their LPTV investments and operations, many others are not.  And the capital markets, debt financing, and innovation/risk capital has dried up for us.

But these costs pale in comparison to what the value of the spectrum is worth for those 10,000 licenses and permits.  The FCC specifically said in both the 2012 Incentive Auction NPRM, and the 2014 Report and Order that they had the authority to include LPTV and TV translators in the auction under their general auction authority, even if Congress did not.  But that LPTV added no value to the auction process, and thus was not worthy of including it in the auction.  They did this without conducting any type of economic analysis at all.  Same with Congress, they never studied the economics of the auction with LPTV included.  We know this for a fact now.

Another key fact to remember - between channels 51-38 nationally, the for sure 86-Mhz clearing, there are about 2650 LPTV and TV translator stations and permits.  This is about 15,900 Mhz of spectrum, or about 90% of ALL spectrum in this auction clearing target!!!!  If the clearing goes down to channel 32 (the full 126-Mhz), then LPTV and TV translators will be contributing about 60% of all spectrum for the auction!  Doing some simple math the value of this spectrum, according to the Greenhill Book numbers, comes to $27 Billion! So the Congress and the FCC got it all wrong!!! The LPTV service is bringing to the auction more spectrum, more value, and more clearing than any other stakeholder.

And what do we get for this?  The thrill of being displaced and not knowing how long we will be on-channel, and the privilege of paying for our own displacement moves.  How exciting and special.  And we may have to move to the VHF, and we may have to change our city of license, lose our audiences, and may even have to petition to move to an adjacent DMA to find a channel.  And the courts will not like hearing that LPTV was never given a stakeholder seat at the table and public LEARN session as all other stakeholders were BEFORE the Report and Order came out.  Remember, the Vice Chairman of the Incentive Auction Task Force publicly said that LPTV were not real broadcasters, the same line the CTIA says about us.

With the still-running AWS-3 auction, which the FCC Chairman touted today about it going over $41 billion so far, the value of the LPTV and TV translator spectrum could be worth well over $35 billion!!!!  Yup, we got no value. Without our spectrum there is no auction folks...no auction at all.

Ok, I have ranted enough.  But we did not even talk about the diverse ownership base we have.  The diverse networks we air, nor the diverse audiences we serve.  Nor the vital localism we provide.  The upcoming GAO LPTV impact study for Congress will do that.  

One last point.  If you want assistance to prepare your own NPRM comments, just ask.  We can help you and your counsel get it done by the Jan. 12th deadline.  The Coalition members are providing this service to you just so that our collective input is greater. 


             

FILING NPRM COMMENTS?
Did you know that as an LPTV licensee that if you file Comments into the LPTV NPRM process the correct way you instantly gain status to take the FCC to the Court of Appeals (assuming some other standard legal conditions)?  Give your business the gift of having the standing to sue the pants off of the FCC about the Incentive Auction this New Year.  We can help you and your legal counsel, just ask!  Comment filings must be submitted by Jan. 12th, 2015.

Thursday FCC Open Commissioners Meeting

The FCC Commissioners held their final Open Meeting for 2014 and the net neutrality protesters were out in force.  While I declined to attend the event today, I did watch it on line and was glad I was not there.  But the real fireworks was between the Commissioners, with the two Republicans getting into quite a word fight with the Chairman.

 

Here is what TV Technology said about the meeting:


And TVNewsCheck chimed in with:

And of course the FCC website page for the meeting has the video, all of the Commissioner statements, the Public Notices, etc.


House Energy & Commerce Committee
This is the sixth in a series of white papers issued by the committee in its process of reviewing the Communications Act for update. This paper focuses on regulation of the market for video content and distribution.


Tribune Media Weighing Its' Auction Options
Tribune Media CEO Peter Liguori: "We have crazy optionality with something like [selling spectrum]," he said. "We could sit here and line up six, seven, eight different options on how we can maximize that spectrum and really drive some shareholder value. Rest assured we look at it [the incentive auction] every day. We are active in the debate, we are monitoring the situation and we are sitting in a very good position."


ATBA & NAB To Tightly Control The LPTV Messaging At NAB Show
We are very sad to report that the concept of free speech, one of the key components of the Communications Act, is now being threatened by the gatekeeper role being played by that former shadowy group, now publicly known to be, "who the heck knows", the Advanced Television Broadcasting Alliance.  All we know is that they have issued a notice saying that they, with NAB, will control all LPTV and TV translator content and messaging at the NAB show in April.  And if you want to say anything at the show you need to give them 200 words of what it is you want to say.  So unless this group approves what someone wants to say about LPTV and TV translators you will not get a forum, booth, event space, or any messaging at the NAB Show on Monday during "LPTV Day". Expect a lot of time and messaging to be about the poor primary station translators, and the much needed expansion of the digital replacement translators for the primaries. And of course, that mythical ATSC 3.0 which may or may not come out before LPTV is finished off by the FCC.  But let it not be said we are not team players (we were the first to report about the event), even though our repeated requests to be included in the planning of this event have been ignored.  Here is the ATBA Request For Speakers.  Maybe they will let you talk, just make sure to stick to the NAB/ATBA party line.  Remember, the FCC is giving NAB a bone with those DRT's and having them get a higher priority over LPTV.  But heck, this is NAB's trade show, so of course they should control the content and messaging.  


          

LPTV LEGAL DEFENSE FUND
Make sure to make your contribution to our industry's common legal defense, and be part of the movement to save LPTV.  Unless we fight the auction rules and regulations now, and in court in 2015, we will not have a lot of spectrum remaining to displace and rebuild into in 2016-2020.  

Wiling to talk with any LPTV licensee, management, industry service partner, networks which air on LPTV channels, whistleblowing FCC staffer, Congressional staffer, heck I will even talk to the elected officials and not charge a fee.  But seriously, as most Coalition members and others will tell you, I am here if you need to ask a question, vent some frustrations, have a great idea, or want to know something.  I really don't know much, but our open Coalition has a lot of expertise about most anything you might need.  

We Got Your Back LPTV!

Mike Gravino
Director
LPTV Spectrum Rights Coalition
(202) 604-0747
lptvcoalition@gmail.com