Broadcast Auction To Pay For Payroll Tax Holiday

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Congress has approved an extended payroll tax holiday. One of the ways it will be paid for is through federal auctions of sections of the broadcast spectrum to wireless companies. But consumers are not likely to see the benefits for years.


In the U.S., Congress hopes to subsidize the extended payroll tax holiday, partly by auctioning off sections of the broadcast spectrum. In theory, that could result in better and cheaper mobile broadband services.

But as NPR's Annie Baxter reports, those potential benefits are likely years away.

ANNIE BAXTER, BYLINE: TVs, radios and cell phones all rely on the broadcast spectrum to carry information. But some parts of the spectrum are worth more than others.

BLAIR LEVIN: It's a beachfront property. It's the Santa Monica beach equivalent.

BAXTER: That's Blair Levin, a former chief of staff at the Federal Communications Commission. He says the FCC will be auctioning off that pricey property. Television broadcasters currently live there. An auction would allow them to give up their spots in exchange for a lot of money. Then the government would give those slots to the highest bidders - among say, cell phone companies. Presumably, wireless services would improve and rates would go down as a result.

Levin likes the idea in principle but he says the actual deal hatched is too complicated and will take years to implement.

LEVIN: In the timeframe of 2014, 2015, 2016, we could find ourselves in a situation where our service is both more expensive and lousier than the rest of the world.

BAXTER: But the timeframe doesn't seem off-putting to the National Association of Broadcasters. Spokesman Dennis Wharton says TV stations will have time to figure out if they want to give up their spots or stick around.

DENNIS WHARTON: Our overriding concern all along has been to make sure that TV stations that want to stay in business are held harmless.

BAXTER: The FCC still has to write the auction rules. That by itself will take a long while.

Annie Baxter, NPR News.

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