Reid's debt plan could speed wireless auctions

Markets Reuters

By Jasmin Melvin

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WASHINGTON (Reuters) - Efforts to give U.S. regulators the authority to auction off some television airwaves for mobile broadband use are getting a boost in a debt ceiling plan proposed by Senate Majority Leader Harry Reid.

The auctions have the potential to raise $15 billion in revenue, according to Reid's plan, with some of the proceeds going to broadcasters as compensation.

The Federal Communications Commission has been pushing for the authority to hold such auctions as a part of its broader National Broadband Plan. The FCC wants to repurpose 120 megahertz of spectrum currently used by TV broadcasters to free up more airwaves for rapidly growing wireless services.

The final shape of a plan to cut government spending in an effort to gain Republican support for raising the nation's $14.3 trillion borrowing limit is very uncertain.

Lawmakers are still far apart over competing plans in the U.S. House of Representatives and Senate to raise the debt ceiling before August 2, when the U.S. Treasury says the government will start to run out of money to pay its bills.

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The debt package proposed by House Speaker John Boehner, a Republican, does not include spectrum auctions, multiple industry sources said.

But the inclusion by Reid, a Democrat, of the auction revenues could speed a spectrum reshuffle if it were to become part of the final plan.

Some 25 million Americans already watch video on smartphones and tablet computers like Apple Inc's iPad, putting 120 times more demand on spectrum than older mobile phones.

"This deficit-reducing proposal reflects insight from members of the FCC, leading economists and wireless technology experts, all of whom have cautioned a spectrum crunch is looming," said Jonathan Spalter, chairman of Mobile Future, a coalition whose membership includes technology and communications companies.

But broadcasters have expressed concerns over the unintended consequences repurposing their spectrum could have on their TV signals and the 46 million viewers that still rely on over-the-air TV.

Broadcasters worry that the FCC's plan would affect not only those who voluntarily part with their spectrum, but the entire industry. The FCC would "repack," or move TV stations, to make large swaths of spectrum considered more suited for mobile broadband use available.

A study released by the National Association of Broadcasters on Monday found that 40 percent of U.S. full power local television stations could have to vacate their current TV channel assignment.

"NAB is deeply concerned about provisions currently in Senate Majority Leader Reid's legislation that would threaten the future of a great American institution -- free and local television. We will work with him as the process moves forward in hopes that our issues can be addressed," said Dennis Wharton, NAB's executive vice president of communications.

(Reporting by Jasmin Melvin; Editing by Tim Dobbyn)