Analog Cutoff Debate Heats Up

A new study by the Consumer Electronics Association (CEA) reveals that only 33.6 million (12%) of the 285 million television sets in the United States are used to watch over-the-air (OTA) programming. CEA issued its data in a letter delivered to the leadership of the Senate and House Commerce Committees to assist them in "their deliberations on how to ensure the needs of all Americans are addressed when analog broadcasting ceases." The House Commerce Committee is preparing to consider legislation currently under development by Commerce Committee Chairman Joe Barton (R-TX) that will set a hard cutoff date for analog broadcasts. The Senate Commerce Committee is poised to release draft DTV legislation later this month.

"This letter provides specific data on ownership and usage of TV sets in American homes," wrote CEA president and CEO Gary Shapiro. "We provide this data to arm you with the facts to quantify the likely costs of various policy alternatives regarding the end of analog broadcasting."

CEA's calculations are based partially on information from Nielsen Media Research, which shows there are 109.7 million US television households, each owning an average of 2.6 televisions. CEA employed the firm of Opinion Research Corporation and explored how each of the 285 million television sets is used. Of the total TV households, the study found that 65.7 million (60%) subscribe to cable, 26 million (24%) subscribe to digital satellite, and 2.7 million (2%) subscribe to both. Another 2.1 million households (2%) report that they do not subscribe to a pay TV service nor use an antenna to receive over-the-air television. The study also found that approximately ten percent of all TVs in US households are used exclusively for an activity other than viewing broadcast programming (such as viewing DVDs, playing videogames, etc.).

"Clearly, the vast majority of TVs in the United States are not used to view over-the-air television and we can presume that these numbers will diminish as more and more Americans subscribe to pay-TV services, including coming technologies such as TV-over-IP, via telephony, and even powerline," said Shapiro. "More than 88 percent of today's TVs are connected to cable or satellite service or are used to play videogames, watch pre-recorded content, or some other non-broadcast television function."

The CEA letter prompted an immediate rebuttal from Edward Fritts, president and CEO of the National Association of Broadcasters (NAB). In his own letter to Rep. Barton, Fritts said, " It has come to our attention that the Consumer Electronics Association recently sent you a letter in which CEA President Gary Shapiro dismissed the value of free, over-the-air television and made a series of wildly inaccurate claims." He went on to cite statistics from the Government Accountability Office (GAO), whose director of physical infrastructure issues, Mark Goldstein, testified before Barton's committee that 19% of all American homes rely exclusively on over-the-air television and that roughly 21 million homes in America are totally reliant on an over-the-air signal. This doesn't seem tremendously different from the CEA results, but Fritts also claims in the letter that, "Today, there are 73 million over-the-air television receivers not hooked to cable or satellite." Clearly, this is significantly different from the CEA and GAO numbers, and the inconsistency is puzzling.

According to Fritts, "CEA's letter appears clearly designed to shift attention from its relentless effort to delay reasonable 'DTV tuner mandate' rules established by the FCC. We're puzzled why TV set manufacturers continue resisting phased-in tuner mandate rules, given that the DTV transition will allow these companies to share among themselves the greatest transference of wealth in the history of consumer electronics." His letter goes on to say, "It's common knowledge that each sale of an analog TV set only elongates the DTV transition. Yet astonishingly, CEA admits that its member companies intend to sell nearly 59 million analog television sets between 2004 and 2008."

He concluded by saying, "Let me assure you that broadcasters are committed to working with you in fashioning pro-consumer DTV legislation. We now have more than 1500 stations on air with digital and high-definition programming, and broadcasters are betting that DTV represents nothing short of a re-birth of over-the-air television. We look forward to completing this historic transition, mindful that the interests of millions of Americans who rely on over-the-air broadcasting for compelling news, information, and entertainment programming must be considered."