In light of the upcoming Federal Communications Commission broadcast incentive auction that starts this March, Duff & Phelps has issued an interesting white paper that discusses the valuation of TV broadcast licenses. An FCC license is the primary asset of a television broadcast station, so the valuation of a television station is highly dependent on the underlying value of the license.

The auction: Because of the increasing demand for wireless broadband access, the FCC plans to reallocate a portion of broadcast spectrum used by television stations and make it available to wireless carriers. In many parts of the U.S., spectrum can be freed up by reorganizing existing TV broadcast channels, a process known as “repacking.” But, in some areas, including some densely populated areas, the FCC will need to buy spectrum before it can reallocate it. This will be done through the incentive auction, and TV broadcasters can choose to participate or not. If they don’t, there’s a risk of being repacked into a lower frequency spectrum.

According to reports, the top bid will be in New York City—$900 million for WCBS-TV.