Bush Proposes Delay in FCC Wireless Auctions

The Bush administration Thursday raised the specter of delaying the Federal Communications Commission’s September auction of broadcast airwaves to allow more time to figure out how to clear the hotly desired spectrum.

The airwaves to be auctioned are held by television stations occupying channels 60-69 and are sought by wireless companies who want to use the spectrum to offer advanced telecommunications services.

However, broadcasters do not have to give up their analog airwaves for digital signals until the end of 2006 or when the penetration rate for digital television reaches 85%, whichever comes later.

That has created uncertainty about when the spectrum would be available and depressed estimates for the auction. For that reason and others, the FCC has delayed the auction several times.

To quell concerns, President Bush’s budget outline, unveiled Wednesday, proposed giving the FCC until Sept. 30, 2004, to deposit the proceeds from the auction, thus giving the agency room to delay the September sale.

The FCC would have flexibility to delay the September auction although people probably would prefer more time to work out deals to clear the broadcasters from the spectrum, said an administration official, who declined further identification. “What this proposal as a whole intends to do is to provide more certainty and do this in a fair and balanced way so the broadcasters are clearly going to receive their compensation but the taxpayer and the general public are adequately compensated,” the official said.

Bush’s proposal also increased the estimate the federal government could reap from the 700 megahertz auction as well as the follow-up auction of airwaves used by channels 52-59 to $11.1 billion from $3.6 billion, according to the budget.

The increase was “because of the more certainty provided by the legislative proposal about when spectrum would become available to new entrants,” a second administration official said.

“We’re still analyzing what impact delaying the auctions would have,” said Ken Johnson, a spokesman for Rep. W.J. “Billy” Tauzin (R-La.), the head of the U.S. House Commerce Committee which has oversight over the FCC.