NEW DELHI: Federal Communications Commission Chairman (FCC) Tom Wheeler has asked broadcasters to share channels, migrate to the Internet and use next year’s incentive auction to adopt a new transmission standard.
“We’ve just been through one TV transition,” Wheeler said in his remarks at the National Association of Broadcasters (NAB) show in Las Vegas. “We both know the magnitude of that challenge … Government and broadcasting will need to work together on this, because it will be a long and heavy lift.”
Wheeler’s NAB show debut as chairman came just days after the Commission passed an order cracking down on joint-service agreements (JSAs) and collective retransmission negotiations among certain TV stations. He acknowledged the contention. He admitted: “It’s no secret that broadcast has been critical of some of my actions at the FCC.”
He said he took NAB president and CEO Gordon Smith’s suggestion for a national broadcast plan “very seriously.” He added: “If Congress were to approve, I guarantee you we’ll support this.”
Smith suggested such a plan could include an ownership review and transition to a transmission standard based on orthogonal frequency-division multiplexing — a radical change from the current 8-VSB technology mandated by law.
“When it comes to OFDM, particularly ATSC 3, the FCC will be ready and responsive when the standard is completed,” he said. “If it is possible to get a multiple of throughput on spectrum with OFDM, we as stewards of the spectrum need to be supportive.”
Wheeler said the Commission would use discretion in reviewing JSAs and shared service agreements.
“When JSAs and SSAs serve the public interest … they will have no problem passing the FCC,” he said, “so long as they do not impair competition, diversity and localism. Some have impaired that. Those actions have encouraged … us to enforce the rules of the statutory mandate.”
Smith asked why the FCC focused on broadcast JSAs without taking the same approach to cable interconnects — multiple pay-TV operations that team up on ad sales. Wheeler said the JSA order specifically asked for evidence that interconnects were anticompetitive so the issue could be addressed.
The chairman pitched the incentive auction as an opportunity for broadcasters, as he has since being confirmed. While his JSA and retrans rulings cast him as a broadcast foe, he said there was “no conspiracy.”
“The FCC is carrying out the mandate of Congress,” he said. “Those who want to participate, can. Those who do not, do not have to.”
He said the auctions could provide the cash for TV stations to become over-the-top providers. “OTT represents an open field for stations because of their local news operations,” he said.
“You have the opportunity to deliver local news down to the neighborhood,” he added. “The Internet has failed to serve localities the same way.”
With OTT migration in mind, he encouraged broadcasters to support network neutrality, quoting a Pew study saying one-third of Americans consume news online.
“Many stations, most stations, many people in this room, have websites that deliver news video,” he said. “That means stations are positioned to leverage that trend … Assuring an open Internet is directly relevant to the opportunity the digital future presents to you.”
He encouraged more exploration of channel-sharing, and said the recent test of the methodology in Los Angeles proved its efficacy.
“It will allow you to maintain your existing business, while taking home an auction check,” he said. “It’s an once-in-a-lifetime business opportunity to expand your business model on somebody else’s dime” — one that wouldn’t happen again anytime soon. “Neither government nor broadcasters will want to deal with another repacking.”
Repacking TV channels into less spectrum is expected to be complicated for everyone involved, including over-the-air viewers, whose numbers are growing, Smith noted. Wheeler concurred, offering a personal anecdote.