2016-22105. Clearing Target of 114 Megahertz Set for Stage 2 of the Broadcast Television Spectrum Incentive Auction; Stage 2 Bidding in the Reverse Auction Will Start on September 13, 2016

AGENCY:

Federal Communications Commission.

ACTION:

Notice.

SUMMARY:

The Incentive Auction Task Force and Wireless Telecommunications Bureau announce the spectrum clearing target of 114 megahertz and band plan for Stage 2 of the incentive auction and that bidding in Stage 2 of the reverse auction is scheduled to begin on September 13, 2016. Also announces details and dates regarding bidding and the availability of educational and informational materials for reverse and forward auction bidders eligible to participate in Stage 2; the availability of Stage 2 bidding and timing information in the Incentive Auction Public Reporting System; and the importance of bidder contingency plans and reminds each reverse and forward auction applicant of its continuing obligations under the FCC's rules.

FOR FURTHER INFORMATION CONTACT:

Wireless Telecommunications Bureau, Auctions and Spectrum Access Division: For general auction questions, contact Linda Sanderson at [phone]. For reverse auction or forward auction legal questions, refer to the contact information listed in the Incentive Auction Stage 2 Clearing Target Public Notice.

SUPPLEMENTARY INFORMATION:

This is a summary of the Incentive Auction Stage 2 Clearing Target Public Notice, GN Docket No. 12-268, AU Docket No. 14-252, WT Docket No. 12-269, DA 16-990, released August 31, 2016. The complete text of the Incentive Auction Stage 2 Clearing Target Public Notice is available for public inspection and copying from 8:00 a.m. to 4:30 p.m. Eastern Time (ET) Monday through Thursday or from 8:00 a.m. to 11:30 a.m. ET on Fridays in the FCC Reference Information Center, 445 12th Street SW., Room CY-A257, Washington, DC 20554. The complete text is also available on the Commission's Web site at http://wireless.fcc.gov,, the Auction 1000 Web site at http://www.fcc.gov/​auctions/​1000,, or by using the search function on the ECFS Web page at http://www.fcc.gov/​cgb/​ecfs/​. Alternative formats are available to persons with disabilities by sending an email to [e-mail] or by calling the Consumer & Governmental Affairs Bureau at [phone] (voice), [phone] (TTY).

1. The Incentive Auction Task Force (Task Force) and the Wireless Telecommunications Bureau (Bureau) announce the 114 megahertz spectrum clearing target that has been set by the Auction System's optimization procedure and the associated band plan for Stage 2 of the incentive auction, as well as the number of Category 1 and Category 2 generic license blocks in each Partial Economic Area (PEA) that will be offered in Stage 2 of the forward auction. The Task Force and Bureau also provide details and specific dates regarding bidding and the availability of educational materials and remind reverse and forward auction applicants of their continuing obligations.

I. Stage 2 Clearing Target and Band Plan

2. Auction System's clearing target determination procedure has set a spectrum clearing target of 114 megahertz for Stage 2 of the incentive auction. Under the band plan associated with this spectrum clearing target, 90 megahertz, or 90 paired blocks, of licensed spectrum will be offered in the forward auction on a near-nationwide basis.

3. The generic license blocks offered in Stage 2 of the forward auction under this band plan will consist of a total of 3688 Category 1 blocks (zero to 15 percent impairment) and a total of five Category 2 blocks (greater than 15 percent and up to 50 percent impairment). Approximately 99.9 percent of the blocks offered will be Category 1 blocks, and 99.8 percent of the Category 1 blocks will be zero percent impaired. Attached to the Incentive Auction Stage 2 Clearing Target Public Notice as Appendix A is a list indicating the number of Category 1 and Category 2 blocks available in each PEA.

4. The clearing target for Stage 2 was determined by the procedure the Commission adopted in the Auction 1000 Bidding Procedures Public Notice, 80 FR 61917, October 14, 2015, using the same objectives as in the initial clearing target optimization and taking into account the additional channel in the TV band and any participating stations that have dropped out of the auction in the previous stage. Based on the new provisional television channel assignment plan, the nationwide impaired weighted-pops were calculated on a 2x2 cell level and the one-block-equivalent nationwide standard for impairments was applied.

II. Important Information Concerning the Reverse Auction (Auction 1001)

5. Online Stage 2 Tutorial. The Task Force and Bureau will make available an online tutorial on bidding procedures specific to Stage 2 of the reverse auction (and any subsequent stage, if necessary) on Thursday, September 1, 2016. This new tutorial will be accessible from the Auction 1001 Web site through a link under the “Education” section. Once posted, it will remain available and accessible on the Auction 1001 Web site for reference.

6. Accessing the Auction System for Stage 2. Starting at 10:00 a.m. Eastern Time (ET) on Wednesday, September 7, 2016, any bidder that had one or more stations with the status “Frozen—Provisionally Winning” at the end of the previous stage can log in to the Reverse Auction Bidding System for Stage 2 and view the bidding status, and, where applicable, the following information for round 1 of the new stage for each of the bidder's stations that qualified to participate in the clock rounds of the reverse auction: Initial bid option, available bid options, vacancy ranges, and clock price offers.

7. A bidder will need to use the RSA SecurID® tokens (RSA tokens) it used for placing bids in the previous stage to access the Reverse Auction Bidding System for Stage 2. RSA tokens with previously set personal identification numbers (PINs) may be used without setting a new PIN. Any authorized bidder that has not already set a PIN for his or her designated RSA token (e.g., an authorized bidder recently identified on Form 177 or one using a replacement RSA token) must set a PIN as described in the materials sent with the Second Confidential Status Letter. Each bidder will be able to access the Reverse Auction Bidding System at the same web address used during the previous stage. In addition, the FCC Auction Bidder Line phone number for Stage 2 will be the same number used for the previous stage.

8. Returning RSA Tokens. Each bidder that did not have any stations with the status “Frozen—Provisionally Winning” at the end of the previous stage will be sent a pre-addressed, stamped envelope to return its RSA tokens.

9. Clocks Rounds Start Date and Round Schedule. Bidding in the clock rounds of Stage 2 of Auction 1001 will begin on Tuesday, September 13, 2016, on the following schedule: Bidding Round (10:00 a.m.-2:00 p.m. ET). Starting on Wednesday, September 14, 2016, and continuing until further notice, the schedule will be: Bidding Round (10:00 a.m.-12:00 p.m. ET) and Bidding Round (3:00 p.m.-5:00 p.m. ET). The Bureau may adjust the number and length of bidding rounds based upon its monitoring of the bidding and assessment of the reverse auction's progress. The Bureau will provide notice of any adjustment by announcement in the Reverse Auction Bidding System during the course of the auction.

10. Reset Base Clock Price and Clock Decrement for Round 1 of Stage 2. The base clock price has been reset to $900 per unit of volume for Stage 2 of the reverse auction. The price decrement for round 1 of Stage 2 of the reverse auction will be five percent of the reset base clock price.

III. Important Information Concerning the Forward Auction (Auction 1002)

11. Bidding in Stage 2. Bidding in the clock phase of Stage 2 of the forward auction will begin on the next business day after the close of bidding in Stage 2 of the reverse auction. The schedule for bidding in Stage 2 of the forward auction will be announced in the Forward Auction Bidding System and in the Incentive Auction Public Reporting System (PRS). The PRS can be accessed directly at auctiondata.fcc.gov and from a link under the Results section of the Auction 1001 Web site (www.fcc.gov/​auctions/​1001) and the Auction 1002 Web site (www.fcc.gov/​auction/​1002).

12. Accessing the Forward Auction Bidding System in Stage 2. Any bidder that is eligible to bid in Stage 2 of the forward auction will be able to access the Forward Auction Bidding System beginning at 10:00 a.m. ET on Thursday, September 8, 2016, using the same RSA tokens, web address, and instructions provided in the bidder registration materials from Stage 1 of the forward auction. Any bidder with zero eligibility by the end of Stage 1 will not be eligible to bid in Stage 2 of the forward auction. Upon logging in to the Forward Auction Bidding System, an eligible bidder can download detailed impairment information for Stage 2, as well as the stage transition files. The detailed impairment information and bidder-specific information, including stage transition files and Stage 1 bidding information, are non-public and are provided only to eligible bidders to help guide their bidding in Stage 2 of the forward auction. This information will not be disclosed publicly until after the auction concludes.

13. Returning RSA Tokens. Each bidder that is no longer eligible to participate in the forward auction (i.e., any bidder that has zero eligibility by the end of Stage 1) will be sent a pre-addressed, stamped envelope to return its RSA tokens.

14. Rule for Round 1 of Stage 2. Starting in the first round of Stage 2, each bidder must be active on at least 95 percent of its bidding eligibility to maintain its bidding eligibility for the next round. Any changes to the activity requirement in subsequent rounds will be announced via the Forward Auction Bidding System. Prior to the start of Stage 2 of the forward auction, a bidder may view its initial eligibility and required activity for round 1 by downloading the My Bidder Status file under the Bid/Status tab.

15. Clock Increment for Round 1 of Stage 2. An increment of five percent will be used to set clock prices for products in round 1 of Stage 2 of the forward auction. Prior to the announcement of the forward auction bidding schedule for Stage 2, a bidder may view the clock prices for round 1 by downloading the Sample Bids file in the Forward Auction Bidding System.

IV. Public Reporting System

16. As was the case for Stage 1 of the incentive auction, publicly available bidding and timing information for Stage 2 of the reverse auction and the forward auction will be accessible through the PRS. The PRS will display the same types of bidding and other information for Stage 2 as was available for Stage 1. For more information about the types of bidding and other information available in the PRS, please see the Public Reporting System Public Notice.

V. Bidding Contingency Plan

17. The Task Force and Bureau remind each bidder that it should develop a comprehensive contingency plan that can be quickly implemented in case difficulties arise when participating in the incentive auction. While the Commission will correct any problems with Commission-controlled facilities, each bidder is solely responsible for anticipating and overcoming problems such as bidder computer failures or other technical issues, loss of or problems with data connections (including those used to access and place bids in the Reverse Auction Bidding System or the Forward Auction Bidding System), telephone service interruptions, adverse local weather conditions, unavailability of its authorized bidders, or the loss or breach of confidential security codes.

18. A bidder should ensure that each of its authorized bidders can access and place bids in the Reverse Auction Bidding System or Forward Auction Bidding System, and it should not rely upon the same computer or data connection to do so. Contingency plans will ideally include arrangements for accessing and placing bids in the Reverse Auction Bidding System or the Forward Auction Bidding System from one or more alternative locations. A bidder's contingency plan might also include, among other arrangements, calling the Auction Bidder Line.

19. Each reverse auction bidder is further reminded that a failure to submit a bid for a station with the status “Bidding” is considered to be a missing bid, and the Reverse Auction Bidding System will automatically submit a bid to drop out of the auction for all stations with missing bids. The status of a station that bids to drop out of the auction will be “Exited—Voluntarily” once bid processing is complete for the round (unless the station first becomes frozen). Once a station has the status “Exited,” a bidder cannot bid for the station in any subsequent round or stage.

20. Each forward auction bidder is reminded that its failure to submit a bid during a clock round will be considered a missing bid and will be treated as a bid for zero blocks, at the lowest price in the price range for the round, for any products in which the bidder had processed demand from the previous round. If there is insufficient excess demand, the “missing” bid may be partially applied or not applied at all and the bidder will continue to have processed demand for the product in the next round. If the “missing” bid is partially or fully applied, that bidder's eligibility may be irrevocably reduced in the next round.

VI. Continuing Obligations

21. Due Diligence. The Task Force and Bureau remind each reverse and forward auction bidder that it is solely responsible throughout the auction for investigating and evaluating all legal, technical, and marketplace factors and risks that may have a bearing on the bid(s) it submits in the incentive auction. For more information, each bidder should review the Auction 1000 Application Procedures Public Notice, 80 FR 66429, October 29, 2015.

22. Prohibited Communications Reminder. The Task Force and Bureau remind all full power and Class A broadcast television licensees, as well as forward auction applicants, that they remain subject to the Commission's rules prohibiting certain communications in connection with Commission auctions. For communications among broadcasters, and between broadcasters and forward auction applicants, the prohibited communication period ends when the results of the incentive auction are announced by public notice. For communications among forward auction applicants, the period ends on the deadline for making down payments on winning bids. A party that is subject to the prohibition remains subject to the prohibition regardless of developments during the auction process.

23. The Task Force and Bureau further remind each full power and Class A broadcast television licensee that even though communicating whether or not a party filed an application to participate in the reverse auction does not violate the rules prohibiting certain communications, communicating that a party “is not bidding” in or has “exited” the reverse auction could constitute an apparent violation that needs to be reported. All forward auction applicants, including those that did not qualify to bid and those that have since lost eligibility to bid in the forward auction, are also reminded that they remain subject to the rules prohibiting certain communications until the deadline for making down payments on winning bids.

24. The Commission's rules require covered parties to report violations of the prohibition of certain communications to Margaret W. Wiener, Chief of the Auctions and Spectrum Access Division, Wireless Telecommunications Bureau, by the most expeditious means available. Any such report should be submitted by email to Ms. Wiener at the following email address: [e-mail]. Any report in hard copy must be delivered only to Margaret W. Wiener, Chief, Auctions and Spectrum Access Division, Wireless Telecommunications Bureau, Federal Communications Commission, 445 12th Street SW., Room 6-C217, Washington, DC 20554. Failure to make a timely report under the rule constitutes a continuing violation of the rule, with attendant consequences.

25. For a thorough discussion of the prohibition of certain communications during the incentive auction, please refer to the Prohibited Communications Public Notice, 80 FR 63216, October 19, 2015.

26. Making Modifications to Applications. The Task Force and Bureau remind each reverse and forward auction applicant that the Commission's rules require an applicant to maintain the accuracy and completeness of information furnished in its application to participate in Auctions 1001 and 1002, respectively. Each applicant should amend its application to furnish additional or corrected information within five days of a significant occurrence, or no more than five days after the applicant becomes aware of the need for amendment. Any applicant that needs to make changes must do so using the procedures described in the Auction 1000 Application Procedures Public Notice and the Auction 1002 Qualified Bidders Public Notice.

27. To make changes to an FCC Form 177 or FCC Form 175 while the Auction System is available, the applicant must make those changes electronically using the Auction System and submit a letter briefly summarizing the changes to its FCC Form 177 by email to [e-mail], or to its FCC Form 175 by email to [e-mail]. To make changes at a time when the Auction System is unavailable, the applicant must make those changes using the procedures described in the Auction 1000 Application Procedures Public Notice.

Federal Communications Commission.

Gary D. Michaels,

Deputy Chief, Auctions and Spectrum Access Division, WTB.