Cell-phone providers like AT&T and T-Mobile will have to wait a bit longer to get access to the powerful frequencies they say they need to keep their networks from slowing down.
The Federal Communications Commission admitted Friday that it will have to postpone an auction of airwave licenses from mid-2015 until early 2016.
The agency said the delay is thanks to a lawsuit from broadcast TV stations, who are trying to force the FCC to rework the details of the auction.
In a blog post, Gary Epstein, the head of the FCC's auction task force, said he's confident the agency will beat the TV stations in court. But the court decision might not come until the middle of next year. Given the complexity of the auction and the need for companies to know the rules well in advance, the agency won't be able to meet its original timeline, he explained.
"Despite this brief delay, we remain focused on the path to successfully implementing the incentive auction," he wrote.
The decision is a blow to the cell-phone carriers, who are clamoring for access to more airwaves as soon as possible. The increasing popularity of streaming videos and browsing the Web on mobile devices is straining the capacity of the wireless networks. The cell-phone carriers warn that consumers could soon face more dropped calls and grainy videos unless the government provides them with more airwaves.
Scott Bermann, a vice president for wireless lobbying group CTIA, said the delay is "unfortunate" and "underscores the need to resolve the pending litigation over the FCC's rules expeditiously."
But when the auction is eventually held, "mobile companies will have their checkbooks ready," he said.
Under a plan approved by Congress in 2012, the FCC plans to pay TV stations to auction off their broadcast licenses to the cellular industry. The program is voluntary, but many local TV stations around the country are expected to take the payout and go off the air.
The TV frequencies are particularly powerful, and they could help the cellular carriers provide service over larger areas. The frequencies are also good at penetrating walls and other obstacles.
Even after paying off the TV stations, the FCC is expecting to rake in billions of dollars from the auction to pay for a high-speed communications network for first responders and to reduce the federal debt.
The National Association of Broadcasters, the lobbying arm of the TV stations, officially supports the auction as long as it remains voluntary. But the group sued the FCC in August, claiming that even stations that want no part in the auction could reach fewer viewers and could be forced to pay millions of dollars to revamp their equipment to work on new channels.
The broadcasters are demanding that the FCC set aside an additional $500 million to compensate the TV stations for their expenses and use a different formula to ensure that the stations can reach the same number of viewers as before the auction.
When the broadcasters filed their suit, they insisted they weren't trying to derail or slow down the auction.
NAB issued a statement Friday denying that its "narrowly focused lawsuit" is to blame for the delay. But in any case, it's "more important to get the auction done right than right now," group spokesman Dennis Wharton said.