Electronic Media

Published: 02-26-96


FCC'S MOONLIGHTING AS AUCTIONEER DOESN'T SERVE PUBLIC        


By - Joe Fedele 


 Last month, News Corp. and MCI paid a whopping $682.5 million 

at an auction for a direct broadcast satellite slot. The 

outrageous price paid by these two mega-companies is not really 

what this column is about, although it is, I am afraid, a sign 

of the times we live in and a reflection of more bureaucratic 

doublespeak.


This unprecedented DBS auction grew out of a Federal 

Communications Commission action and Notice of Proposed 

Rule-making issued late last year to ``reassign'' DBS slots. But 

I'm getting ahead of myself. Our story begins in 1982 when the 

first authorizations for DBS systems were issued for the purpose 

of delivering video programing direct to homes via backyard 

receiving dishes. At the time, a company by the name of Advanced 

Communications Corp. was awarded a DBS license.



In recent years, the FCC forced ACC to surrender its license for 

repeatedly failing to comply with the terms of the construction 

permit. The  rule-making issued last year is a product of that 

action. It marked the first time a DBS license had been 

``returned'' and was available for reissue.


Under FCC rules, which date back to 1989, the two orbital slots 

should have been made available to existing DBS permit holders 

as a ``first right of assignment''-in other words, at no cost to 

the licensee. The new DBS licenses would be reissued through a 

lottery or a comparative hearing process similar to what TV and 

radio broadcasters are subject.


The FCC, however, had other plans and changed the ground rules 

to allow for the auctioning of the licenses. That's right, 

folks, another auction. Sotheby's on the Potomac.


The commission's rationale was that the reassignment method no 

longer served the public interest.


 Oh, really? And whose interest is served by yet another 

auction? What the FCC fails to understand is that the cost of 

paying for the DBS slots will ultimately be passed on to the 

American consumer in the form of added start-up costs.


Perhaps the FCC should re-evaluate what ``serving the public 

interest'' means. Rather than being a regulatory agency, the FCC 

seems intent on selling anything it can get its hands on  to pay 

off the national debt.


In an attempt to explain the change in philosophy, the FCC's 

report stated, ``The Commission's view of what is  in the public 

interest may change, either with or without a change in 

circumstances.'' Translation: We can do whatever we want!


The FCC actually refers to these orbital positions in the  

rule-making as ``DBS assets.'' They never taught me that in my 

college electronics class.


Does this mean that someday my Citizen or Marine Band ``asset'' 

might be repossessed and sold at auction to some taxi cab 

company wanting to talk across town?


The notice cites a mandate from Congress to pursue the 

``recovery for the public of a portion of the value of the 

public spectrum resource made available for commercial use and 

avoidance of unjust enrichment through the methods employed to 

award uses of that resource.''


You figure it out.


Fortunately, this  rule-making has some redeeming qualities, as 

it contains some worthy proposals that would impose stricter 

performance criteria on the use of the spectrum.


The intent, it states, is to ``ensure that these resources are 

utilized in a timely manner, guard against potential 

anti-competitive conduct by DBS providers and ensure timely DBS 

service to Alaska and Hawaii.''


Now that is in the public interest!