FCC Ups Its Incentive Auction Ante

Agency Updates Briefing Books with Opening Bid Prices
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Just in time for its first incentive auction road show (Feb. 9), the FCC is providing TV stations with estimates for the commission's opening bids in the upcoming auctions, which FCC officials insist is on track for early 2016.

Last October, the FCC released estimates of projected high and median payouts to give broadcasters a sense of the financial upside of giving up some or all of their spectrum. The FCC has taken into account the success of the AWS-3 spectrum auction and has upped those estimates and, for the first time, is providing estimated opening bid and median bid prices for the auction.

The new auction information, a revision of the October briefing book from investment banker Greenhill & Co., is available here.

According to the new figures, the proposed opening bid price for New York is $870 million (maximum) and $660 million (median); $630 million and $560 in Los Angeles, and $610 million and $520 million in Chicago.

The maximum bid price is based on an actual station in a market that would command that price if it gave up spectrum— the FCC is not identifying which. The median value means there are an equal number of stations with valuations higher and lower than that figure. But those are opening bids, so they are likely to drop given auction competition.

Each station will have a unique opening bid based on its value in clearing and repacking spectrum based on various factors; the FCC will give that information to stations but is not making it public, which is why it is providing figures only for maximums and medians.

There will likely be multiple winners in larger markets as well as smaller markets adjacent to larger ones.

Read more at B&Chere.

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