Powell Defends Spectrum Payment Plan

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Federal Communications Commission chairman Michael Powell is defending the agency's decision to allow dozens of TV stations to collect millions of dollars for spectrum they were supposed to return to the agency without charge.

In an Oct. 23 letter to Senate Commerce Committee chairman Fritz Hollings (D-S.C.) — a critic of the FCC's action — Powell said the agency had to respond to conflicting mandates established by Congress. Its decisions would strengthen free television and benefit consumers, he added.

"Without our most recent action, broadcasters may have been more likely to just take the money and run, instead of continuing broadcasting service to the public," Powell said.

In an Oct. 17 letter to Powell, Hollings accused the chairman of defaulting on the FCC's obligation to manage the spectrum by allowing TV stations to "extract millions of dollars from wireless carriers in return for vacating this spectrum band early."

Hollings called the FCC's plan "outrageous" and claimed the FCC bent "the law to meet the excessive demands of industry."

Under the FCC plans, 99 analog TV stations located in channels 60 to 69 may sell their spectrum to wireless companies and continue broadcasting in analog on digital channel assignments outside the 60-to-69 band.

DTV transition rules established by the FCC and Congress give TV stations the right to remain in the 60-to-69 band until 2006, or until 85 percent of households in their market have digital reception equipment.

Because TV stations could hang onto their 60-to-69 spectrum almost indefinitely, the FCC decided allowing wireless companies to pay TV stations to leave promptly was the best way to clear the band for use by wireless carriers and public-safety organizations, which were allocated 24 MHz.

That rapidly cleared spectrum would increase government revenue from wireless bidders at next June's auction and put more spectrum into the hands of public safety officials seeking nationwide interoperability, Powell told Hollings.

Powell said he does not know how much money the TV stations will receive. But Paxson Communications Corp. — with 17 analog stations in the 60-to-69 band — expects to receive $1 billion from the wireless companies to clear out within a few years.

In a speech in Chicago last Wednesday, FCC member Kathleen Abernathy defended the 60-to-69 plan. Because the FCC was hampered by law, she claimed, it had to craft a plan "amenable to a private market-based solution" through voluntary band clearing.

"There have been concerns raised about this process — that is, broadcasters will gain a windfall to be paid by the June 2002 auction winners," she said. "I appreciate this concern, but without the authority to mandate relocation before 2006 and with a significant need for spectrum by public safety, I am hard-pressed to reverse the current policy approach."

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