Defining Visions: A Digital Slam Dunk?

The controversy continues.

A surprising number of public officials are stepping forward to endorse the Federal Communications Commission's controversial plan to complete the transition to digital television sometime between 2008 and 2013. Over the summer, Democratic and Republican members of the House Commerce Committee, which oversees the FCC, stepped forward to say that they liked the idea. About the same time, the Consumer Electronics Association (CEA) offered its conditional endorsement, which is not too surprising: Should the government speed up the transition, millions of people would rush into stores to buy new digital TVs or converter boxes.

The existing transition plan requires broadcasters to continue airing an analog signal until at least 85% of the homes in their coverage area are equipped to receive a digital signal. Hastening the day when that threshold would be reached was the primary motivation for requiring manufacturers to begin building digital receivers into all of their sets, a rule that was being phased in beginning in summer 2004.

But under the FCC's new proposal, every home that receives a cable signal would be counted as equipped to receive a digital signal. The tortured logic behind this scheme is that cable signals are digital, but are downconverted to analog for the majority of subscribers, who still have only analog service. If this idea is enshrined in law, at a single pop, about 80% of the nation's homes would be counted as being equipped to receive a digital signal.

The FCC has never voted to adopt this plan, but it is clear that a majority of commissioners would like to. In fact, almost as if the idea has already been enacted, in the summer the FCC opened a proceeding to receive comment on this question: What should be done for (or to) the people who do not have DTV service—that is, 15% of the viewers—when the analog channels are shut off?

Once the analog channels are shut down, that spectrum is to be auctioned off for other uses. It was clear from the questions posed in the FCC notice that the agency is considering requiring the companies that win those auctions to bear the cost of buying converter boxes for those people in the remaining 15%.

But in a late summer filing to the FCC, the National Association of Broadcasters threw some cold water on this developing proposal. The NAB represents the nation's TV stations, and to government officials, everything the trade group says on the issue of digital television is suspect. That's because most people believe that the broadcasters' underlying motivation—from the beginning of the DTV story, almost 20 years ago, to today—has been to hold on to the spectrum that has been allotted for television service since the late 1940s. Broadcasters deny that, noting that it costs quite a lot of money to broadcast two signals on two different channels, one digital and one analog.

Still, on this issue the broadcasters ought to have some credibility. They rightly point out that just over 20 million homes nationwide are served by nothing but analog, over-the-air television service. And most of those homes have more than one TV. What's more, most cable subscribers have at least one TV—in the basement, say—that is not connected to cable.

Collectively, Americans own 280 million analog-only televisions in 108 million households, and the NAB says that 28 million of those TVs in cable TV homes are not connected to cable. All told, the broadcasters say, 73 million television sets would need converter boxes, if the FCC goes forward with its plan to end the transition somewhere between 2008 and 2013. The cost—to someone—for all those converter boxes would be $22 billion.

The NAB's proposed solution: Extend the transition to give people more time to buy digital sets, and for the price of converters to decline. That makes sense, of course, but then, policymakers are likely to view the proposal as another attempt to postpone the day when the broadcasters will have to give up some of their spectrum.

The driving force behind this is lobbying from the wireless industry, including police and other public safety groups that want to use the television spectrum for telephones and two-way radios. These groups have been waiting and waiting and waiting. In fact, it was lobbying from these very groups that began the process that led to DTV. In the mid-1980s, public safety groups had nearly convinced the Reagan Administration to take away some unused TV spectrum for their use, when the NAB came up with the idea that they needed that spectrum for HDTV.

Now, for the Bush Administration, that argument seems to hold even more appeal. For one thing, Bush has gone out of his way to pass regulations that are friendly to business. At the same time, the public safety groups are arguing that they need the spectrum so they can better fight terrorists and deal with other homeland security priorities. For the Bush administration, that's a "slam dunk."

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