Just a Few More Months
April 3, 2002
Broadcasters Seek DTV Extensions
Television broadcasters flooded the FCC with reasons why they will miss the May 1 deadline for digital build-out, but most cited technical, legal or logistic reasons, and most predict they will transmit digital signals within a year.
More than 700 stations have filed for extensions. Still more need other FCC approvals. And many are in the midst of band-clearing negotiations for UHF slots and will be exempt from the deadline if they vacate those channels.
In all, about two-thirds of U.S. commercial broadcasters may still be analog-only on May 1, about twice the number predicted in an August 2001 NAB survey.
To over-the-air optimists, the numbers are the sign of a transition well underway, even as the government balks on the fixes that broadcasters want.
"I think that clearly shows more than good faith, it shows best efforts on the part of the broadcast industry to get this up and going - and to do it in an environment where the government hasn't moved forward with placing tuners in digital sets, where there's a lack of carriage in most markets on cable, where there no cable interoperability and where the copyright issues haven't been resolved - is truly a tremendous effort," said David Donovan, president and CEO of the Association for Maximum Service Television (MSTV). "I don't think that says that the digital transition is off-track at all; it's still moving forward."
Many broadcasters have taken advantage of the FCC's decision in November allowing stations to meet the deadline with a low-power build-out.
"It's much more inviting to go ahead and go build lower-power facilities, because you'll be able to operate with these for some time, and then scale up as receivers get out there," said Frank Jazzo, an Arlington, Va., telecommunications lawyer.
Jay Martin, marketing director of Maine-based antenna maker Dielectric Corp., said his low-power products have sold well since the November decision.
"We have had some groups come in and blanket-order for all their facilities for low-power, just to get on the air," he said. "But there are other groups that have done more planning and are sticking to their guns on high-power solutions. But I am seeing favoritism to low-power today."
Martin estimates that 60 to 70 percent of his customers will be initially broadcasting at lower power than the maximum they are permitted.
And, he said, many of those systems will not upgrade to higher power cheaply or easily.
FEELING YOUR PAIN
When the FCC relaxed the rules, they talked tough about holding broadcasters close to the transition schedule, promising that requests for deadline waivers would be scrutinized closely.
"I think that's sort of for Congressional consumption," said one attorney. "I think when they're talking to the broadcasters, they're more along the lines of, 'We feel your pain.'"
So far, no requests have been denied. Many stations just need a short-term waiver to get equipment delivered and installed. Several stations, however, present more long-term financial issues.
Granite Broadcasting Corp., for example, owns and operates nine stations, six in small or medium markets. It anticipated two years ago that it could not cover build-out costs, according the company's extension application.
At just one station - WEEK in Peoria, Ill. - the company estimated a $303,000 build-out bill. That's a tough investment for a group that reported a 20 percent revenue slump and a $5.4 million loss in the first three quarters of 2001.
Granite told the FCC that it has a plan to generate some cash with a portion of its digital spectrum, teaming with other broadcasters to bring high-speed Internet service over the DTV signal. But so far, the so-called Delta V technology, which brings downstream Web speeds of up to 256 Kbps, is available only in the Cincinnati area on a trial deployment.
Granite President Steuart Beck and others hope the recession is really over and that the ad revenues will flow again.
Another solution could be new owners. With courts and the FCC signaling major changes to the station ownership rules, poor-performing stations with licenses to two channels could become more attractive to larger owners or networks.
"You're going to see some increased consolidation," said Robert Rini, a Washington lawyer representing broadcasters. "We've seen that in radio. I think we're going to see it in TV."