A number of companies are buying TV stations not for the glamour of the broadcasting business, but for the megahertz. Betting that TV spectrum will bring a tidy profit when it is sold in the government's upcoming spectrum auction, six companies have spent $345 million to buy 39 TV stations over the last two years, per SNL Kagan, a leading tracker of broadcast station sales transactions.
The report provides an early glimpse into just how much spectrum the auction, which the Federal Communications Commission anticipates for 2014, may be able to offer for sale to wireless services.
Ultimately the success of the auction depends on whether there is enough spectrum to make a difference for consumers frustrated by slow mobile services and dropped calls. Robin Flynn, a senior analyst for SNL Kagan, said that 33 of the stations are in the top 25 largest markets where spectrum for wireless services is most in demand.
The companies stockpiling stations for auction are not familiar names in the broadcasting business. The most prolific buyer is NRJ TV LLC, which has spent $234.2 million on 14 stations in markets such as Los Angeles, New York, Chicago and Philadelphia. Another is OTA Broadcasting, a subsidiary of MSD Capital owned by Michael Dell, the computer magnate.