2019 Outlook:
	NAB CEO not expecting passage of major broadcast legislation in 2019 Part 1: Analysts weigh Charter's next move in 2019 as M&A integration winds down Part 2: Previous wave of pay TV M&A sets stage for operators' 2019 initiatives

➤ NAB members want station relocation as part of the spectrum repacking process done as soon as possible, but a few things are out of their control.

➤ The development of ATSC 3.0 is a way to showcase American leadership in broadcasting.

➤ Live sports will drive the business case to get ATSC 3.0 into stores quicker.

Gordon Smith, president and CEO of the National Association of Broadcasters, or NAB, spoke to S&P Global Market Intelligence about next-gen TV services, when they might be available in stores, and how some broadcasters are dealing with spectrum relocation as a part of the spectrum repack process. ATSC, or Advanced Television Systems Committee, is a group of broadcasters, TV manufacturers, and other tech companies that develop standards for the technology. Some members include Comcast Corp., QUALCOMM Inc. and DISH Network Corp. The ATSC 3.0 standard was approved by the Federal Communications Commission in 2017. The new IP-based broadcast standard promises to bring more digital-like interactivity over the air and to mobile devices.

S&P Global Market Intelligence: Are you guys following the tests on the ATSC 3.0 signals?

Gordon Smith: We are. We're investing heavily in those tests. We have every incentive to keep everybody watching our stuff. But, it's also hugely exciting in terms of what it offers to the viewer and the consumer. And the optionalities, and the mobility, the 4K, the immersive sound, the internet interoperability, if they want it. It gets broadcasting into the 21st century in a major way. So we see it above all, it's important, that we continue to invest in the efficiency of our spectrum. And 3.0 does that.

What kind of support is NAB providing to help speed up its deployment?

Millions of dollars. I don't know if you remember analog to digital transition. The broadcasters were pretty fearful of it. It proved out to be a great blessing. And we actually did the legislation much earlier [than the transition], 2006 I think. But we needed that run-up to get all the equipment ready, and then to have a hard slice and then turn it over. President Obama, I think one of his first acts when he came into office was to delay it six months. It's a huge task. But it's also where the puck is going. There's an inertia behind it, which I think makes it inevitable that people are going to want the best pictures, the best sound, the best optionalities that come with 3.0. And, you know, they want American leadership in broadcasting, and this is the way you get it.

Are there any other changes you want to see from the FCC to help speed things up?

No, they've approved everything. They've been fantastic. They're following very closely. Monitoring our tasks and making sure it works.

Do you have any idea when we might see stations outside the test markets broadcasting 3.0 signals?

What's going to end up driving this [televisions that can receive ATSC 3.0 in stores], that date, is probably the Olympics. I think the other thing that will drive the business case for 3.0 are sports. And there's nothing that shows better on television than sports in 4K.

Regarding the targeted ads on ATSC 3.0, do you think the privacy concerns are being adequately addressed in the development?

[Some privacy concerns have been raised about the technology, as it allows broadcasters to receive and use more viewer data, similarly to how internet companies use browsing histories to deliver targeted ads.]

So the privacy concern about the interoperability of 3.0, that's a voluntary thing. They're not going to be able to see you. But if you want to have a two-way communication, you can do that through the IP protocol on 3.0. ... It helps a lot in the efficiency of advertising, so it has some correlation with what you want. So is there some loss of privacy? I suppose, but not unless you volunteer it.

Regarding spectrum repacking, some broadcast stations have begun relocating. What are you hearing from members about how that's going?

[Spectrum repacking aims to clear spectrum formerly held by broadcasters for mobile broadband use.]

Well, the phase one [of 10] has just ended, and it's gone well. But, there are like 13 crews to do 1,000 stations. It's a lot of work and it's dangerous. Two people already died in accidents doing this. The tough phase is just starting. But, I was on [the Senate] Commerce [Committee] when we went, the DTV [digital television] transition. Analog to Digital. And I saw what NAB did then. And we've had that template, which we're doing again with websites and information and advertising that informs people when their station is moving and when they need to rescan. We have no incentive to do anything but get this in the rearview mirror. We want it done fast. We have no reason to delay. But the only caution we would have is just we don't want any viewer disenfranchised because a deadline isn't met because there's a blizzard and the work can't be done and people could be unduly, unnecessarily imperiled with their lives.

Will all of your members be able to relocate within the 39-month timeline?

[The U.S. Federal Communications Commission has designated that all broadcast stations designated for relocation as a part of the repacking process must relocate within 39 months or be forced off the air.]

That's our incentive. That's what we want. But a lot of that calculation is out of our control. It's Mother Nature.

And NAB unsuccessfully tried to get the FCC to extend that deadline, right?

Yeah. And I think where it's left is on an ad hoc basis, they've already shown they're willing to give extensions. When it's beyond the control of anybody, then they're going to give waivers. They've proven that.