FCC Door

The FCC is preparing to dole out 130 construction permits for new FM stations via an online auction. But before what’s known as Auction 106 begins April 28, 2020, the Media Bureau is seeking comments on a bunch of different proposed ways the bidding process could be conducted.

Among the FM construction permits set to hit the auction block are a Class B in Sacramento, CA; a Class A in Fort Walton Beach, FL: a Class A in Stratford, NH, a Class A in Sagaponack, NY and scores more. They include 34 CPs that went unsold or were defaulted on in earlier auctions.

Under established FCC rules, an applicant can apply for any vacant FM allotment listed in the auction. If more than one party applies to buy the same frequency, they’re considered “mutually exclusive,” and the CP is awarded via a competitive bidding process. From there, the Media Bureau is seeking comments on a number of proposed bidding procedures in a Public Notice (Docket 19-290) issued Thursday.

Under one proposal it would use the Commission’s standard simultaneous multiple-round auction format, in which every construction permit is offered for bid at the same time. There would be successive bidding rounds in which parties can place bids on individual construction permits. The bidding would remain open on all construction permits until bidding stops on every construction permit.

Under another proposal, there would be sequential bidding rounds, each followed by the release of round results. The initial bidding schedule would be announced in a public notice issued at least one week before the bidding starts. Details on viewing round results would be included in the same public notice. But in order to move the bidding along quickly, while still giving bidders enough time to study the results, the FCC would be able to adjust the initial bidding schedule. These adjustments could include the amount of time for the bidding rounds, the amount of time between rounds, or the number of rounds per day, depending upon bidding activity and other factors.

To complete the auction in a reasonable time, the Media Bureau is also looking for input on a proposed “stopping rule.” Under the rule, bidding would close on all construction permits after the first round in which no bidder submits any new bid, applies a proactive waiver, or withdraws any provisionally winning bid. There are a couple options being considered for the proposed stopping rule. Because bidding would remain open on all construction permits until bidding stops on every construction permit, it wouldn’t be possible to determine in advance how long the bidding in the auction would last. The FCC says it would only use these stopping options in certain circumstances, such as where the auction is proceeding unusually slowly or quickly, there is minimal overall bidding activity, or it’s likely that “the auction will not close within a reasonable period of time or will close prematurely.”

The Notice also seeks comments on the circumstances under which the Commission can delay, suspend or cancel the auction, such as a natural disaster, technical obstacle, network interruption or other scenarios. There’s also a proposed “activity rule” under which bidders would be required to be active on a specific percentage of their current bidding eligibility during each round of the auction. Input is also being sought on upfront payments, bidding eligibility, reserve price, minimum opening bids, bid amounts, removing and withdrawing bids, post auction payments and other procedures. Comments are due Nov. 6 with the deadline for reply comments set for Nov. 20.