William Lake, FCC Media Bureau chief, discussed options for upcoming broadcast spectrum incentive auctions in a webcast Monday sponsored by Pricewaterhouse Coopers, reports TVNewsCheck.
The commission could conduct a single-round auction using sealed bids, or a multi-round option, also known as a "descending clock auction." For that, “rather than have the broadcasters give us a price, the commission would set a price," Lake said.
Here's how that would work: The FCC would ask broadcasters to sell bandwidth for, say, $100. "If we pick that opening price high, we should get a lot of offers," Lake said. "Then, we’d say, that’s more spectrum than we need. Who would be still willing for 90? And presumably as we ticked the clock down individual broadcasters would compare that price to what they think their station is worth and one by one they would drop out of the auction. We would stop the auction when we have … the right number of continuing offers.”
The FCC aims to finalize the auction rules in 2013 and conduct the auctions in 2014. "Many observers expect those targets to slip," TVNewsCheck notes.
Earlier this year, Congress authorized the FCC to conduct spectrum auctions to free up bandwidth for the growing number of mobile devices (Current, Feb. 28).