Posted by: Joan Marsh on June 18, 2014 at 10:32 am
Yesterday, in the FCC’s Incentive Auction proceeding, AT&T filed a computational study that seeks to provide insights into some fundamental and essential auction questions – namely, for any given clearing target, what might a successful auction look like in terms of how many broadcasters must participate and in what markets? And, how much diversity is there in the solution sets necessary for a successful outcome and, how are adjacent markets correlated?
As important and interesting as these questions are, to date scant analysis on these questions has been offered. The research submitted today, authored by Michael Kearns and Lili Dworkin of the University of Pennsylvania, will help address that void.
The study attempts to ask and answer a series of straight-forward mathematical questions like: how many broadcasters need to participate in the New York City designated market area (DMA) to clear 84 MHz of spectrum? How do those numbers change if you take the FCC’s published domain constraints into consideration? If you assume an 84 MHz clearing target, how many markets, on average, will require some level of broadcaster participation?
Given the complexity of the auction, the answers are rarely black and white. For any clearing target, there are almost unlimited variations on possible broadcaster participation and a very large number of possible repacking solutions. But from the research, an outline of the scope of the possible begins to emerge.