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Summary:

This week, the broadcast industry is meeting in Las Vegas. However, amid this collegial gathering of industry folks a $33 billion fight is brewing. The fight is nothing short of an entertainment battle royal with TV on one side and the iPhone on the other.

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This week, the broadcast industry is meeting in Las Vegas to showcase Adobe products, new sites and new services. However, amid this collegial gathering of industry folk,s a $33 billion fight is brewing — or maybe it’s only a $27.8 billion fight, depending on whose numbers we use. The fight is nothing short of an entertainment battle royale, with TV on one side and the iPhone on the other.

Actually, mobile phones, tablets and any other device we want to connect to the cellular network are on the iPhone side, but in a battle royale, it helps to have one protagonist and one antagonist. The issue is who will have access to the 133 MHz of spectrum currently used by broadcasters to deliver TV programming, and how that transfer of airwaves will take place if the broadcast industry can’t stop Congress and the Federal Communications Commission from its spectrum land grab. It’s a contentious issue over a wonky subject, and so like all debates that require some technical knowledge, both sides are flat-out misleading people. So here are five questions (and answers) about this issue, for those who want to separate the truth from the spin.

What’s the Issue Again?

Way back in 2005, Congress told broadcasters they would need to move off of their analog broadcasting systems and switch to digital because it was a more efficient way to divvy up spectrum. This switch to digital meant people had to buy a converter box or a new TV. The upside of this whole shebang was that the federal government auctioned off some of the 700 MHz spectrum vacated by the broadcasters to AT&T and Verizon, so they could improve cell phone service. This allows the operators to offer 4G wireless and netted the federal government $19.59 billion.

But wireless operators have become a victim of their own success, and now people can’t make calls. As more people buy tablets and iPhones so they can watch Netflix or tweet, service is only going to get worse, because all those apps are made up of bits transmitted via the airwaves. And each airwave, or megahertz, can only transport a limited number of bits. But there are so many Netflix and Facebook bits going over the air that the FCC is worried that we’re going to run out of spectrum before 2013.

To keep that from happening, the FCC and Congress want to use some of the megahertz the broadcasters currently use to deliver TV to people — not all of it, just some of it — because most broadcasters are not using all of their airwaves to deliver TV shows, and those that are could probably change the way the deliver their bits to deliver TV shows in less spectrum. The consumer isn’t likely to notice the difference, but it could cost broadcasters more money. And broadcasters already spent $15 billion to transition to digital, and in doing so, gave up a quarter of their spectrum.

Are We Really Running out of Spectrum?

The answer is no. While the FCC says we will run out of spectrum by 2013, the real truth is that their estimates don’t take into account technologies like femtocells, Wi-Fi offload and more efficient networking technologies that can cram more bits into a single megahertz. Folks inside the FCC argue the panic may not be entirely real, but justify the freak out because otherwise Congress would never act to appropriate more spectrum in time. It is true that we’ll need more spectrum.

Who Owns This Spectrum Anyway?

Technically, the government does. It granted broadcasters access to use this spectrum because it viewed broadcasting as a public good and theoretically could take it away at any point in time, but that’s not going to happen since broadcasters have built out a huge industry that many Americans still rely on for their entertainment and news.

What Is an Incentive Auction?

The incentive auction is the FCC’s attempt to offer broadcasters a peace offering: basically an auction whereby the broadcasters who give up spectrum will get to share in the proceeds of the auction, which the feds think could net $27.8 billion, and the CTIA and Consumer Electronics Association believe could be worth $33 billion. But to offer these auctions congress will have to pass a law — a law the NAB is fighting with all of its might.

Won’t This Take PBS Stations for Rural Viewers so People in Cities Can Play Angry Birds?

At a speech during NAB conference, CEO Gordon Smith said “Why should people in Kentucky, for example, have their local stations’ signal potentially degraded…so urbanites in Manhattan can have a faster download of the app telling them where the nearest spa is located?” But spectrum is geographically constrained. So having a lot of spectrum in New York means New York broadcasters will have to give up their airwaves, not the folks in Rochester.

  1. not quite “everything…” the actual number of consumers who watch broadcast and the amount of unused spextrum might be nice facts to consider as well

    basically broadcasters are not unlike squatters. a braver fcc would say, times up, time to move on

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    1. Fair enough, number of folks who watch broadcast would be good to know, although it’s hard to tally that fairly. Do we do only those relying on OTA broadcast or include those who get it via a pay TV provider? Thoughts?

      As for unused spectrum are you talking about the 6MHz per channel allotted to broadcasters or the whole gamut of usable spectrum? But then we’d also have to consider if the spectrum is not just usable but economically and technologically viable for mobile broadband. It’s complex but if you want to help decide what counts, I’m happy to try to find the facts.

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      1. I think this comment might be referring to the spectrum that the major telecom companies already own but are not using. A recent article on DailyWireless stated that the carriers have 345 MHz in the Top 100 markets that is not being used. Perhaps the President could ask the carriers — in the spirit of commitment to restoring America’s leadership in broadband availability — to utilize that spectrum to help solve the “spectrum crisis”?

        http://www.dailywireless.org/2011/04/03/att-merger-wheres-the-spectrum/

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      2. Also, when people refer to a “shortage of spectrum”, what they may mean is a “shortage of capacity”. That could be addressed by increasing the efficiency of the network. One writer opined that 70-90% of AT&T’s network capacity is not being used.
        http://www.fastnetnews.com/a-wireless-cloud/61-w/4193-70-90-of-atat-spectrum-capacity-unused

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  2. Great article Stacey- I might add that wireless audio devices like microphones also live in the same spectrum (UHF) as those TV broadcasters. Wireless mic users have long shared that spectrum (with an acceptable degree of hassle), but with the potential for frequency agile data devices coming on the market, the likelihood of interference for wireless audio devices (think church, concert, business keynotes, tradeshow, sports broadcast etc) increases exponentially. Unlike IP packets, real-time wireless audio can’t be “re-sent” so interference is literally show-stopping. And since the lowly wireless microphone doesn’t stand chance politically against the national broadband plan, the Pro A/V community has its fingers crossed for a pretty complex geo location database solution and limited metro clear channels.

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  3. I was under the impression that the airwaves belonged to us the American people at least here in the US how is the Blue ATT Crips and the RED Verizon Bloods get to divy it up? and what did congress spend their 19.59 Billion on when they sold off the 700mhz spectrum?

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  4. If what cellphones and digital TV are transmitting is machine code (1s and 0s) what about both industries coming up with a more compact code by using one that has more than two letters. Think how long all words would be if only two letters could be used to spell anything. And if more than two can be used, it shouldn’t be limited by our alphabet but by the technology to differentiate what is being sent. In other words, if the differences could be 5,000,000, then that is what should be used. If this were done, then the constant challenge would be coming up with larger and larger “alphabets.”

    And then cellphone and digital TV could still use machine code by simply converting the more bigger alphabet code into machine code.

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  5. I was under the impression that the airwaves belonged to us the American people at least here in the US how is the Blue ATT Crips and the RED Verizon Bloods get to divy it up? and what did congress spend their 19.59 Billion on when they sold off the 700mhz spectrum?

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  6. I was under the impression that the airwaves belonged to us the American people at least here in the US how is the Blue ATT Crips and the RED Verizon Bloods get to divy it up? and what did congress spend their 19.59 Billion on when they sold off the 700mhz spectrum?

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  7. The carriers want access to the TV band spectrum primarily to satisfy growing demand for online video content, which is often produced using wireless microphones that operate in that same spectrum. It’s ironic that giving some of the TV band to carriers would effectively reduce the available spectrum for wireless microphone use, which will inhibit the production of the very video content that the carriers hope customers will pay to stream/download.

    News, sports, entertainment, and business all use wireless microphones in activities that employ people: concerts, sports events, theater productions, sales meetings, etc. I have yet to hear a cellular carrier say that having more spectrum will allow them to hire more people, although it will allow them to BILL more people.

    @KIneticartist: The American people own the spectrum in the same way that we own the waterways and airspace. The government is responsible for administering those resources for the common good. To facilitate the use of the 700 MHz band, licenses were auctioned openly; AT&T and Verizon were just two of the many winners.

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  8. I don’t buy the line that broadcasters dont use their spectrum. Many have launched HD and multicast channels. Most have plans to deploy mobile video. So we Americans should take spectrum from the broadcasters who offer free over the air video and sell it to the BIG Wireless Companies so those BIG companies can offer wireless video for a fee? And don’t tell me broadcasters got their spectrum for free when TV stations are auctioned today and many were acquired in the same secondary markets that BIG wireless used to acquire their spectrum. I am all in for repacking spectrum to free up more for wireless services but maybe we should make that spectrum available on a license exempt basis so small wireless businesses have a shot and don’t have to compete at auction with BIG wireless companies.

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  9. Since people in urban and suburban areas mostly receive TV via cable, their programs don’t need to be sent through the air at all; therefore the airwave spectrum currently used for that purpose could be reassigned to mobile. In rural areas, the TV spectrum could be allowed to remain as it is, since there aren’t large numbers of mobile devices in rural areas.

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  10. Some good data regarding real spectrum availability, telecom use:

    http://www.dailywireless.org/2011/04/03/att-merger-wheres-the-spectrum/

    Chris Regan
    RFvenue

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