Broadcasting's Relationship with Wheeler Unchanged Since Last NAB Show

In the runup to the NAB Show next week, numerous broadcasters and broadcast attorneys told us there has been little change in the industry’s relationship with the FCC and Chairman Tom Wheeler since the 2014 show, when many expected him to get booed during his speech (see 1404090023). That didn't happen. But the FCC’s actions on joint sales agreements had injected uncertainty into a broadcast transaction process that had been in place for 20 years, said Gray Television Senior Vice President Kevin Latek.

Though the transaction review process has since become more clear, there has been little positive for broadcasting to come out of the FCC since, said a broadcast industry official. Though the wireless and cable industries have suffered setbacks under Wheeler, they’ve also benefitted from FCC policies in ways broadcasters haven't, the official said. “We don’t love him any more or any less,” said Sinclair Vice President-Advanced Technology Mark Aitken. “There are a number of issues the entire industry is waiting for more disclosure on." NAB “continues to work closely with the chairman’s office to find areas of agreement,” said Executive Vice President Rick Kaplan. The FCC didn't comment.

The incentive auction and its subsequent repacking phase is the industry's primary issue, numerous broadcasters and broadcast attorneys said -- a situation similar to 2014. What was nearly universal concern about the auction then is now tempered with some enthusiasm, Latek said. Because more is known about the rules of the auction now and the FCC has offered projected prices in its Greenhill & Co. incentive auction investment book, “more people are open to the idea of participating in the auction,” Latek said. Gray is “eager” to see the auction take place as planned in 2016, Latek said. Very few broadcasters shared that sentiment at the 2014 NAB Show, Latek conceded. Despite that growing acceptance, aspects of the auction are still worrying to broadcasters, industry officials said.

The FCC’s proposed dynamic reserve pricing scheme “has no support among any auction stakeholders,” said Expanding Opportunities for Broadcasters Executive Director Preston Padden. “Carriers hate it and broadcasters hate it.” Though he said many questions about the incentive auction have been answered, Aitken said broadcasters still need more information than the FCC has provided: “The FCC clearly is not done with defining all the attributes of the auction.”

The low-power TV industry’s concerns about the auction are taking a front seat at the NAB Show, with an Advanced Television Broadcasting Alliance-hosted LPTV day April 13. That’s more attention than LPTV usually receives, said Fletcher Heald attorney Peter Tannenwald, who represents LPTV interests. LPTV stations are concerned about the specifics of the repacking still being ironed out by the commission, Tannenwald said. FCC rules that require stations to broadcast to keep their license could cause problems for LPTV stations that haven’t yet found a channel to use, he said.

ATSC 3.0 is also expected to be an important topic among the gathered broadcasters, said industry officials and broadcast attorneys. “Is broadcasting going to migrate into a multi-technology service, and if it does, who’s going to run it?” said Tannenwald. Meanwhile, Sinclair is moving ahead with its own next-generation broadcast standard, Aitken said. Since the Media Bureau has said it won’t hold up the auction to coincide with a new standard, Sinclair is trying to have its new standard ready in time to coincide with the auction, Aitken said. "We are doing all things required so that broadcasters get the standard they need.”

Radio broadcasters are increasingly concerned by the FCC’s planned reduction in enforcement field offices (see 1503300046), said a lawyer who represents radio clients. Pirate radio interference with radio stations is increasing and more difficult to address with less enforcement, the lawyer said. An increasing shift to over-the-top content and the FCC’s proposed shifting of the definition of multichannel video programming distributors are also important topics for broadcasting, industry lawyers said.