Did Binnie Jump, Or Was He Pushed?

Bill-Binnie-96_pp-8dbe32f5FCC Runs Reverse ‘Incentive’ Auction, AKA
“We’ll Make You An Offer You Can’t Refuse!”

Much ink has been spilled this week over big profits and job losses as WBIN-TV sold its UHF channel 35 TV broadcast spectrum to the Federal Communications Commission (FCC) for almost 8 times what Bill Binnie paid to acquire the rights a few years back, but curiously, the in depth coverage did not come from the Union Leader, but rather from the Laconia Daily Sun and the Concord Patch, both of which correctly latched onto the story that the FCC was hoovering up TV channels for 5G cellular data service.

Honesty in headlines award goes to the Laconia Daily Sun: “WBIN-TV SOLD TO GIVE MORE SPACE TO WIRELESS COMMUNICATIONS”

The Laconia Daily Sun:

The Federal Communications Commission, in what it calls a “spectrum auction,” is purchasing local television stations and reselling their broadcasting rights, or “spectrum,” to mobile telephone and wireless communications firms to increase the capacity for wireless broadband use and hasten the transition from 4G to 5G wireless internet service.

Concord Patch:

The sale will allow the FCC to create 5G wireless internet in the spectrum band that once broadcast Channel 35’s UHF television signal, the [NH1] report noted.

As always, there’s much more than the “Lamestream” media reports, when you dig into the details – let me try to explain:

Once upon a time, as color TV was spreading rapidly across the fruited plain, those new-fangled UHF channels stretched from about 450MHz to almost 900MHz in an unbroken line from #14 to #83, roughly grouped by 100MHz “bands.” The lower channels are less affected by terrain, and when stations were less densely packed, were highly coveted for their greater range, whereas the higher channels were gradually occupied for shorter range local stations.

Nowadays, with the advent of digital TV, and faster and faster cellular data service, the means by which people receive their news and information is changing rapidly, and that spread of TV stations up the channels has been thrown into reverse. Channels 70-83 (800MHz band) were never used for television and were re-allocated to cellular telephony in 1983. Then the advent of digital TV (which caused a flurry of channel changes) in the mid 2000’s, and the subsequent auctioning off of channels 52-69 (700MHz band) for cellular service expansion. And now, the reclaiming and auctioning off of channels 35-51 (600MHz band) for 5G cellular data, which brings us to WBIN-TV…

Located at Derry, NH, outside of a major metro area, and occupying the lowest channel (35) of the 600MHz band, WBIN-TV had a good coverage range, and would be considered very valuable if they were allowed continued enjoyment of their “property” in perpetuity. Unfortunately, the FCC has decided that now is the time to hoover up the 600MHz band and to prepare to auction it off to the wireless carriers (Verizon, ATT, Sprint, T-Mobile, etc) to satisfy their (and the public’s) ever increasing appetite for more and faster data services (TV on your phone or tablet).

Before the FCC can sell that spectrum, it has to gain free and clear title to it, which is done via a reverse ‘incentive’ auction, in which the channel owners can seek the best price from the FCC. “But, if ch 35 is so valuable, why wouldn’t WBIN just hang on to it?”tumblr_inline_nxxkv7D3Qh1r3ziyc_500 Glad you asked – that’s where the “incentive” part of the incentive/reverse auction comes in – if you don’t sell in the time window, then by a kind of eminent domain taking, the FCC can allocate you a new channel in the shrinking list by a process known as ‘repacking.’ In repacking, you are likely to have to not merely buy new equipment for the new channel, but to relocate the transmitter to avoid interference with other occupants of the tightly packed channel. But wait, it gets worse: The FCC added a “Death Penalty” clause to the channel repacking rules, meaning that a station which could not complete the relocation within the allotted time would have to shut down permanently! (Have you tried getting planning permission for a new TV mast lately?)

To summarize: WBIN could not keep that prime ch 35 spectrum it “owned”, would be forced to move both channel and transmitter location, and might be forced off the air altogether – or Binnie could sell while the going was good. NOW are you surprised that he took the money and ran to invest it in his other news operations?

Some observers have suggested that WBIN-TV’s prime channel was targeted because of their conservative outlook, but having read some of the background, I’m more inclined to think that the big squeeze is being put on “Over The Air” TV in general, perhaps a little prematurely, because there is no such thing as 5G wireless yet – the standards for it are half-baked, like Hosmer!

My source commented:

“Used to be spectrum was free but you HAD to use it. Now you get some wireless company waving money in the FCC’s face and the spectrum is re-auctioned never to be used. But it will be collateral for some half baked business venture which will employ D.C. Insiders.”

“Besides, why would anyone invest in broadcast assets if they can be taken away at a whim. BTW VZ has multiple Ghz of spectrum unused all over the country. So there is even less excuse for this. There needs to be a use it or lose it provision here along with a 5 year ban on participating in auctions in an area where you did not use it Much of VZs spectrum has been bought to bar new entrants.”

If you value your access to news, now would be a good time to ensure that you own an AM/FM radio, and maybe a shortwave radio as well, because if anything ever disrupts our increasingly digital world, those tablets will be nothing but paperweights and doorstops!

Summary: Binnie saw the push coming, and grabbed his parachute in order to fight another day!

Footnote: Article inspired by a text message exchange with a long term Grok Supporter and commenter, who wishes to be identified merely as “A knowledgeable student of spectrum auctions and politics.”

RCR Wireless on the Incentive Auction
National Association of Broadcasters Policy Blog
WikiPedia TV Channel Frequencies