Crafting Balanced Incentive Auction Rules in the Public Interest

This Sunday marks the first day associated with summer, and what will be the critical time of year for finalizing key details pertaining to next year’s Incentive Auction. This two-sided auction will use market makes to make available more low-band spectrum to meet the wireless broadband needs of consumers and businesses for the twenty-first one hundred year, and to promote a competitive wi-fi marketplace. More spectrum will encourage innovation, economic growth and result in greater consumer choice.

Commission staff recently wrapped upward a nationwide tour of information classes with broadcasters and, in order to verify with interested broadcasters that all celebrations are counted, released a list of auction-eligible stations. Last week, the full Commission accepted revised rules to provide broadcasters with additional flexibility to reach agreements to share their own spectrum with other TV stations, which broadcasters have told us would give them more incentive to take part in the auction.

Right now we turn to the crucial task associated with finalizing our auction rules. To be able to serve as the foundation for a successful public sale that best serves the public, all those rules must carefully balance the number of goals that Congress founded for us. For the last 19 months all the interested parties have been jockeying pertaining to rules that benefit their placement. I understand the jockeying – I actually once engaged in it myself – but it is now time to end the back-and-forth and make decisions. Not one party will be happy with everything we have done, but the final product is a balanced solution to a challenging situation with additional moving parts than a Swiss watch. One message we heard noisy and clear, however , was that the last rules must be as simple as possible. We have thus eliminated earlier ideas that added to complexity.

The other day, Commission staff briefed the Commissioners’ staffs on proposed recommendations to determine final rules for the auction that balance our statutory obligations, heeds commenters’ calls for simplicity and transparency in the flow of the auction, plus – most importantly – serves the public’s interest in an effective, efficient, plus timely auction

The particular proposal aims to clear the highest possible amount of spectrum for broadband consistent with broadcasters’ voluntary decisions to relinquish some or all of their spectrum usage rights. At the same time the proposal limits the number of impaired new licenses that are developed in those isolated instances where it is necessary to relocate a TV broadcaster on the same or adjacent frequencies as those being auctioned. The particular proposal eliminates bidding procedures that lots of commenters believed were burdensome and may limit broadcaster participation. It also adopts a formula for opening bid prices that creates value pertaining to both broadcasters and American taxpayers. The proposal responds to demands to make more information about bidding available to bidders before and during the public sale. And it ensures that competitive wireless companies and new entrants have a obvious shot at adding sufficient low-band spectrum to their portfolios so that they can contend more effectively in both rural and cities.

The proposal displays an incredible amount of modeling and the consideration and analysis of all parties’ comments and concerns in a robust criminal record. The proposed package of rules is designed to best serve the broad public interest – and that is the true test of good public policy.

Hard decisions in difficult situations mean that no stakeholder will get exactly what it wants. Taken as a whole, nevertheless , the proposal we will present to the Commissioners strikes a fair balance that serves the greater public interest. The particular American people will be the real winners.

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