[opendtv] CEA: TV Chs Worth More As Broadband
- From: Craig Birkmaier <craig@xxxxxxxxx>
- To: OpenDTV Mail List <opendtv@xxxxxxxxxxxxx>
- Date: Mon, 26 Oct 2009 12:56:45 -0400
http://www.tvnewscheck.com/mobile/newsletter/article.php?id=36685&type=am&date=20091026
CEA: TV Chs Worth More As Broadband
By Harry A. Jessell
Oct 26, 2009, 8:54 AM ET
A Consumer Electronics Association-commissioned study concludes that
TV broadcasting spectrum would be five times more valuable if it were
reallocated and used for wireless broadband services than if it
continues to be used for broadcasting.
"It's clear that reallocating the spectrum would be creating benefits
for society and be a good, efficient [spectrum-use] policy," said
Coleman Bazelon, of The Brattle Group, the author of the study, in an
interview with TVNewsCheck.
The "highest value use" is broadband, he said.
According the study, the 300 Mhz of spectrum now allocated to
broadcasting is worth about $12 billion. But if were put up for
auction, wireless service providers would pay more than $60 billion
for it.
What's more, the cost of making the spectrum available for broadband
would cost between $9 billion and $12 billion, but would yield
consumer benefits of between $500 billion and $1.2 trillion.
CEA submitted the study to the FCC last Friday attached to a six-page
filing that decries the scarcity of wireless broadband spectrum and
calls on the agency to reallocate spectrum to it from other services.
In the filing, CEA does not say that the FCC should take away any of
TV broadcasting's spectrum, but it comes close.
In looking for new spectrum for wireless broadband, CEA says, "the
primary focus should be on spectrum not acquired at auction, i.e.,
spectrum used by the federal government or spectrum used by
non-federal entities that was not acquired by auctions."
Broadcasting falls into the second category.
Even though it paid for the Bazelon study, CEA says it "does not
necessarily endorse" it. The study, it says, is intended as a model
for analyzing whether spectrum is being used efficiently.
The CEA says the scarcity of wireless broadband spectrum is a
"crisis" that threatens the country's technological leadership.
"Unless significant amounts of new spectrum are allocated to wireless
broadband, the next iPhone, the next YouTube, the next telemedicine
applications won't be developed in the United States."
According to the CEA, businesses and consumers are increasingly
relying on wireless broadband for accessing the Web, sending e-mails,
watching videos, playing games and other personal and business
activities.
"Urgent action is required now in order to keep up with the spiraling
consumer demand, and to ensure that our nation's broadband platforms
are sufficiently robust to allow for the development of increasingly
bandwidth-intensive applications, content and services in the years
ahead."
CEA makes two recommendations in its filing.
First, the FCC should form a "blue ribbon" advisory committee charged
with finding more spectrum for wireless broadband.
"Many options should be explored, including the possible creation of
incentives for incumbents to relinquish their spectrum or to operate
more efficiently using less spectrum, thereby freeing up spectrum for
other important uses."
Second, the FCC should team with the National Telecommunications and
Information Administration to conduct a "rigorous inventory of the
nation's spectrum and assess where it is being utilized
inefficiently."
Congress is considering legislation mandating a spectrum inventory,
it says. "But we need not wait for these bills to become law."
The Bazelon study estimates the market value of the broadcasters'
spectrum if it were made available for wireless broadband at about
$60 billion. By contrast, the study says, the current market value of
TV broadcasting spectrum is just $12 billion.
The study fixes the value of the TV broadcasting business (excluding
tangible assets) at $62 billion. But, it says, only $12 billion of
that value is derived from the station's "over-the-air broadcasts"
because only 10 million or 9 percent of the 114 million TV homes
continue to receive broadcast service off air. Ninety-one percent
receive it via cable or satellite.
The study acknowledges that shifting the spectrum from broadcast to
broadband would, as a practical matter, involve some costs -- $12
billion to broadcasters to compensate them for their loss of
over-the-air viewers or $9.3 billion to migrate the remaining 10
million broadcast-only viewers to cable.
That $9.3 billion is the cost of buying lifetime cable subscriptions
to a broadcast-only tier for the 10 million homes over-the-air only
homes. The study assumes that the tier would cost $10 a month with a
$50 installation charge.
The study does not give broadcasters any credit for mobile video,
multicasting or any other new digital services they may come up with.
Bazelon said he is not alone. "It is fair to say that I am giving
them the same credit for that as the financial markets are.
"Even if you thought mobile TV was going to be reasonably successful,
I can't image the value of it is going to be anywhere near $40
billion, and it's going to take $40 billion or $50 billion to reverse
the conclusion of this."
----------------------------------------------------------------------
You can UNSUBSCRIBE from the OpenDTV list in two ways:
- Using the UNSUBSCRIBE command in your user configuration settings at FreeLists.org
- By sending a message to: opendtv-request@xxxxxxxxxxxxx with the word
unsubscribe in the subject line.
Other related posts: