FCC Chairman Tom Wheeler believes the AWS-3 auction should promote competition, an agency official told us in response to T-Mobile President John Legere’s Wednesday blog post criticizing the sale of the brunt of the spectrum to three providers (see 1502180054). Wheeler supported policies that “will not permit dominant carriers to ‘run the table’ in the incentive auction, which includes a market-based reserve of spectrum for bidders who don’t currently have a lot of low-band spectrum,” the official emailed. The auction also has buildout requirements “to ensure that the spectrum is put to use for American consumers.” The commission will require new 600 MHz Band licensees to build out to 40 percent of the population in their service areas within six years and to 75 percent of the population by the end of their initial 12-year license terms, the official said.

Assistant Wireless Bureau Chief Brett Tarnutzer, one of the key FCC staffers working on the TV incentive auction, is leaving the agency to join the GSMA, where he will work for John Giusti, who heads the London-based group’s Spectrum Policy Team. Industry officials said in interviews that Tarnutzer’s departure is potentially significant since he's in charge of many of the technical aspects of making the auction work, including computing and the repacking software.

The FCC should look for new bands for wireless microphones to use, said NAB and CTIA in comments posted online in docket 14-166 Thursday. “It is critical for the FCC to immediately identify new bands on which wireless microphones may operate,” said NAB, urging the FCC to identify the new bands before the incentive auction ends. The FCC should explore new bands for wireless mics but require unlicensed operations to “cease use of licensed spectrum in areas where a 600 MHz licensee has commenced service,” CTIA said. The FCC should modify rules for unlicensed use so that unlicensed operations “adequately protect the substantial investments of 600 MHz licensees,” CTIA said. CEA also expressed concern about wireless microphone interference: “The Commission must weigh the costs and benefits of expanding access to spectrum for wireless microphone operators and undertake rigorous technical analyses to address potential interference concerns before it decides on any course of action.”

With the end of the AWS-3 auction, the upcoming incentive auction will be costlier, panelists at a spectrum conference sponsored by PwC said Thursday. It’s unclear how that will affect broadcasters on the reverse side of the upcoming incentive auction, said Eric Wolf, vice president of technology strategy and management at the Public Broadcasting Service. “There will be a lot more demand for spectrum,” said John Hane, a Pillsbury communications lawyer. “Another view is the AWS-3 auction is fundamentally different from the 600 MHz auction. AWS was a fairly straightforward auction -- people knew what they were bidding on. The 600 auction is very complex, even on the forward side of the auction.” The industry has “essentially forced consumers to stitch together the services that they want,” Wolf said. It can disaggregate and break up service from infrastructure, Hane said. He said he’s optimistic that ATSC 3.0 will be adopted. The “3.0 will make it a lot easier,” said John Lawson, principal of Convergence Services. “It seems like it’s happening, but there’s no structure to make these devices interoperable. We’re still in this scenario with silos.” Wolf said, “Don’t think about it as how many dollars per hertz or bits you can extract. Think about it as how can you help the consumer?” The FCC should be thinking of the consumer, too, and beyond the dollars, he said. “By 2025, I see the FCC trying to auction the T-band,” said Mike Gravino, director of the LPTV Spectrum Rights Coalition. “I see a constant struggle between the wireless industry and broadcast industry, even though we want to be the same, a struggle over this bandwidth.”

FCC Commissioner Mignon Clyburn opposes any unnecessary delays in holding the incentive auction, she said in an interview Friday. Clyburn clarified comments she made at CES about the need for a pause in the auction, now scheduled to start in early 2016 (see 1501080032). “I want to ensure we reach the proper decisions in the pending rulemakings and hold the incentive auction as expeditiously as possible,” she said. Clyburn also voiced concerns about how low-power broadcasters may be affected by the auction.

The FCC should reconsider its plan for dealing with interservice interference after the incentive auction, said NAB and Sprint in reconsideration petitions posted Friday in docket 12-268. The commission's method for predicting interference from TV stations to wireless uses “severely underestimates the real-world level of interference that could result,” Sprint said. FCC methodology is “unnecessarily complex, will not lead to accurate predictions and creates needless uncertainty and risk for bidders in the forward auction,” said NAB. The association also took the commission to task for not instituting a cap on interference and population losses in the repacking, a complaint in tune with its ongoing court challenge against the incentive auction order for not sufficiently protecting broadcast coverage areas. The NAB petition also uses language commonly associated with the threat of litigation: “The Commission should revisit its arbitrary and capricious treatment of aggregate caps on such losses.” Sprint wants the FCC to use a different statistical measure for calculating interference within a 600 MHz spectrum block, while NAB wants to completely revamp the commission's approach to the problem. Adopting a simpler methodology would “increase confidence that winning bidders in the forward auction will actually be able to deploy service using the licenses they have won,” NAB said.

Projected difficulties with interference between wireless and broadcast signals after the incentive auction and repacking are largely caused by FCC use of a variable rather than nationwide band plan, said NAB in comments in docket 14-14, responding to a public notice on interservice interference, called the ISIX PN. CEA, CTIA and engineering firm Cohen Dippell made suggestions on how the problems associated with interservice interference could be addressed. NAB’s suggestion that the FCC completely redo the band plan was the most sweeping. The FCC “could make its own job simpler, reduce the number of points of potential failure during the auction, present clearer, more attractive offers to bidders, and avoid an unnecessarily jumbled post-auction interference environment by pursuing a nationwide band plan,” said NAB.

The AWS-3 auction is on holiday hiatus, to restart Jan. 5, but ended the day Tuesday with $44.5 billion in provisionally winning the bids, a record for an FCC auction. The auction has far exceeded most expectations, including at the commission, where officials told us their hope was it would meet the reserve price with some money left over to pay for part of the $7 billion startup costs of FirstNet. The auction is the first major spectrum sale by the FCC since the 700 MH auction in early 2008.

Broadcast industry observers are divided over whether interest in the incentive auction expressed by CBS CEO Les Moonves last week is likely to have much effect on potential participation in the incentive auction, they said in interviews Friday.

The AWS-3 auction, which has brought in provisionally winning bids of more than $41 billion so far, could be a game changer for the TV incentive auction, taking pressure off the auction to pay for FirstNet and other expenses that must be recovered through auction proceeds, industry officials said in interviews Friday. Government officials said, even after taking out the costs of relocating government incumbents and other costs, the AWS-3 auction should easily pay the $7 billion startup costs of FirstNet, plus smaller funds for public safety research, 911 grants and other costs that must paid for through auctions under the 2012 law that authorized the incentive auction.