Los Angeles Business Journal

Dialed In

Channels share one signal so they can sell second By Jonathan Polakoff Monday, March 17, 2014

Some TV stations are tuning in to a sudden opportunity to sell what could be their most valuable asset – their airwaves. Cellphone companies covet them to satisfy the ever-growing appetite for mobile Internet use.

Stations thinking of selling are mostly small, such as niche ethnic outlets and cash-strapped public broadcasters; any sale represents a rare chance at big money. And even if they sell their “spectrum,” or broadcast frequency, they could still stay on the air by sharing bandwidth with another station.

In a national first, two local stations have begun a channel-sharing test: downtown L.A. public broadcaster KLCS (Channel 58), owned by the Los Angeles Unified School District, and KJLA (Channel 57), the flagship station of the bilingual Spanish-English LATV network.

So far, the experiment shows promise and thus could make a spectrum sale feasible, said Sabrina Thomas, general manager at KLCS.

“We find channel sharing to be a win-win,” she said. A sale of spectrum could be lucrative enough to “help sustain KLCS operations for the foreseeable future and give us financial independence.”

The Federal Communications Commission is asking American broadcasters to sell it spectrum, which the commission will then auction to mobile carriers such as Verizon and AT&T. Those companies would use it to improve their mobile broadband service.

Spectrum is a finite resource and especially valuable in Los Angeles since the area has a huge appetite for mobile data. As Thomas said, it’s beachfront property.

Under channel sharing, stations share a transmitter and antenna to simultaneously broadcast their programming. They compress their signals so they can broadcast side by side, sharing the 6 megahertz of spectrum that is allotted to each TV station.

Since television sets are tuned to capture a 6 megahertz channel, the stations can’t sell increments.

A channel-sharing arrangement should be invisible to viewers, since stations sharing a channel can keep their old place on the dial. Part of the test is making sure TV sets can parse out distinct feeds.

Go off air?

Theoretically, a station could sell its spectrum, stop broadcasting over the air and distribute on the Internet, but that could cut it off from cable distribution because local broadcast stations are guaranteed cable carriage under FCC rules. Cable companies have little financial incentive to carry an independent local programmer, the likely sellers of spectrum; they want national programming such as the History Channel.

KLCS uses its 6 megahertz of spectrum to broadcast its main channel, which features programming from the Public Broadcasting Service, and also for three other digital subchannels that feature PBS Kids programming and other educational content. The subchannels aren’t big ratings draws, but they are important to KLCS because they feature educational programming and serve people who don’t subscribe to pay-TV services.

Page 1 of 3

Prev