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Commissioner Pai on Presentation of Incentive Auction Task Force

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Released: August 9, 2013

STATEMENT OF

COMMISSIONER AJIT PAI

Re:
Incentive Auction Task Force Update (August 9, 2013)
It's difficult to overstate the importance of repacking to the incentive auction proceeding.
A smooth repacking process will help preserve a vibrant over-the-air television broadcast service
after the auction. The repacking process will impact how much spectrum we are able to clear for
mobile broadband. And our repacking calculations must fit hand-in-glove with the auction
design we adopt.
One key component of the repacking process will be the TVStudy software we use to
ensure that broadcasters receive the protections afforded them by the Spectrum Act. At the end
of the day, the full Commission will have to decide how to update this software. To that end, I
continue to believe that the broadcast and wireless industries should come together and develop a
mutually acceptable compromise. Until that compromise is either presented or precluded, I'll
reserve judgment on this issue, which I know is a controversial one. But I will make two
observations.
First, broadcasters should support updating our software so that it can work on modern
computer systems, run more quickly, and perform the type of analysis that will be necessary to
support the incentive auction. Likewise, they should be open to including the most recent census
data in that software.
On the other hand, wireless carriers should focus on the important changes that need to be
made to the software for it to work, instead of every change that could be made. Debating each
minor update to the software won't serve anyone well, and we certainly don't want this project to
end up in court.
To date, I've been impressed by how wireless carriers and broadcasters have cooperated
in the incentive auction proceeding. For example, they developed the consensus "Down from
51" band plan that I hope the Commission will adopt. We should welcome their collaboration,
especially if it yields similar progress with respect to the TVStudy software.
On July 22, the task force also released data to allow parties to assess how the
Commission might conduct what is known as a "feasibility check." This "check" would allow
the Commission to determine during the auction whether assigning channels to a given set of
stations (i.e., those not participating and those no longer participating in the reverse auction) is
feasible without violating any statutory or other constraints when attempting to clear a
predetermined amount of spectrum in a market. I commend the task force for taking this step.
It is also important that we develop as soon as possible software that can produce optimal
repacking solutions--that is, software that minimizes the costs of paying bidders and repacking

while ensuring that every non-participating broadcaster has an actual channel after the auction.
All things being equal, an optimal repack should be our goal. After all, this could minimize
costs, maximize the amount of cleared spectrum, and increase net revenues for public safety and
deficit reduction.
In a July 22 Public Notice, the task force indicated that it would be difficult for the
Commission to use optimization analysis during the auction given the design that the task force
is contemplating. But as the full Commission decides how to design the auction, we should
consider all options. For example, some auction designs would allow us to conduct an
optimization analysis during the auction. Those options should be on the table when the full
Commission addresses auction design. We shouldn't discover too late that those alternatives
aren't practical because we don't have the right software.
In closing, I'm pleased that we have made progress on the repacking front. But we have
much work ahead of us. This is a critical issue. If we don't get it right, it could sink the entire
auction. It's imperative that we engage with all stakeholders and be as transparent as possible.
We need to get potential problems out in the open as soon as possible and fix them before the
auction. I thank the task force once again for all of their hard work and look forward to
continued progress in the months ahead.

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