Dole Wants TV Networks to Pay for New Channels

In an 11th-hour dispute that could derail the sweeping telecommunications reform bill and further delay the arrival of digital television in American homes, Senate Majority Leader Bob Dole and the broadcasting industry have squared off over Dole’s proposal to require broadcasters to pay for the airwaves they use for new digital TV services.

Dole (R-Kan.) opposes as “corporate welfare” a provision of the telecommunications bill that would allow broadcasters to acquire new pieces of the television spectrum for free.

The provision was initially designed to provide broadcasters with an easy way to introduce high-definition television, which features much sharper pictures and better sound than the TV of today. It would require TV stations to eventually give back their existing spectrum--presumably after the changeover to HDTV has been completed.

But Dole now says broadcasters should bid for the additional channels in an auction that, he estimates, could raise as much as $70 billion. The revenue estimates are in dispute, with House aides saying privately that an auction would raise more like $6 billion to $11 billion. But the majority leader’s proposal has struck a chord with conservatives and some liberal public interest groups.

Broadcasters, for their part, are livid. The heads of the nation’s three biggest networks sent a letter to President Clinton last week protesting the proposal, and NBC President Bob Wright said in California on Monday that his network might withdraw its support of the telecommunications bill if the Dole proposal gains steam.

“I really question whether supporting the bill any further makes any sense for us,” Wright told the Television Critics Assn. in a Pasadena meeting.

The political support of broadcasters is considered crucial for passage of the telecommunications bill, a landmark measure aimed at de-regulating the telephone, cable and broadcasting industries in hopes of creating more choices and lower prices for consumers.

It remains unclear how far Dole is willing to push for a TV spectrum auction. Observers say his plan could simply be a bid to burnish his conservative credentials or to vent his anger at broadcasters for what Dole is said to regard as poor coverage of his presidential candidacy.

“I don’t think anybody knows what Dole’s motives are,” said Nancy Victory, a Washington communications lawyer whose firm represents a wide range of broadcasting and communications companies. A Dole spokesman denied that the senator had raised the auction issue in response to news coverage of him.

The telecommunications bill is nearing the end of a tortured legislative journey that has been marked by bitter battles over local phone company entry into long-distance and ownership limits on media companies. A conference committee of House and Senate members has resolved the key differences between House- and Senate-passed versions of the bill, though some militant House members still have not signed off on the compromise.

Broadcasters, who are among the most aggressive lobbyists in Congress, could still kill the measure, which has won the grudging support of most of the telecommunications industry.

“This is the Big Kahuna for broadcasters,” said Gigi Sohn, deputy director of Media Access Project, a legal advocacy group on communications issues. If broadcasters don’t get their way on the spectrum issues, she said, “then there is no bill.”

Since the invention of television more than half a century ago, the federal government has freely allocated licenses to broadcasters to use the airwaves, so long as they operated in the public interest by meeting certain programming requirements.

As part of an effort to upgrade the nation’s TV infrastructure to HDTV, the Federal Communications Commission developed a plan to assign each of the nation’s TV stations an additional channel on which they could provide advanced digital TV, with the promise that the existing channel for analog TV would be returned later.

The idea was to enable broadcasters to send regular and HDTV signals in tandem while consumers gradually equipped themselves with the new TV sets needed to view HDTV.

But broadcasters have since realized they can make more money by using the new piece of spectrum for additional channels with picture quality similar to that of traditional TV--an option made possible by digital technology. Under the bill now in Congress, stations would be free to use their new spectrum in any way they chose, and they would pay a fee only if they used it for so-called subscription services such as pay-TV, wireless telephone or other commercial communications services.

At the same time, the government has recently raised about $10 billion by selling off spectrum rights for other communications technologies, such as wireless pagers and telephones, by public auction.

Broadcasters and critics of Dole’s proposal say introducing an auction would make digital TV too costly. They contend it would endanger the development of free, over-the-air HDTV and, in effect, limit new forms of digital TV to relatively expensive cable and direct broadcast satellite systems.

Still, some public-interest groups enthusiastically support Dole’s idea.

“Dole’s on the right track,” said Jeff Chester, executive director of the Center for Media Education, a Washington-based media watchdog group. “There’s no question that broadcasters should pay.”

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