06.22.2004 12:00 AM
Annual Assessment of Video Program Delivery Competition Begins
Congress, in the 1992 Cable Act, modified the Communications Act to require the FCC to make an annual report to Congress on the status of competition in the market for delivery of video programming. Last week the FCC released a Notice of Inquiry (NOI) to collect information for this year's report.

The NOI for this year's report lists many video programming distributors: cable systems; direct broadcast satellite (DBS) providers; home satellite dish (HSD) providers; broadband service providers (BSP); private cable or satellite master antenna television (PCO) systems' open video systems (OVS); multichannel multipoint distribution or wireless cable systems (wireless cable); local exchange carrier (LEC) systems; utilities; and over-the-air broadcast television stations. The report covers all methods for delivering video programming to viewers and the NOI also includes distribution by videocassettes and DVDs through retail distribution outlets and video programming over the Internet.

With the FCC's interest in shutting down analog TV in 2009, it is not surprising the NOI devotes several pages to the digital transition. Some of the questions asked in the NOI include, "How many of these digital television sets, both shipped and sold, include over-the-air DTV tuners? How many separate set-top over-the-air DTV tuners have been shipped to retailers, and how many of these tuners have been sold to consumers? How many DBS receivers contain over-the-air DTV reception capabilities? How many tuner cards meeting the advanced television system committee ('ATSC') DTV standards for use in personal computers have been sold?"

The FCC also seeks projections on the number of households planning to buy a digital TV set with a built-in digital tuner in the next two to three years and the screen size of these DTV sets. The FCC is also interested in how broadcast TV signals might be received on set-top boxes from other video providers such as cable and DBS. "We further seek information on the availability of MVPD set-top boxes with over-the-air DTV tuners. We request information on the number of cable and DBS set-top boxes designed for the provision of DTV that have been shipped to cable or DBS providers and how many subscribers use such set-top boxes. We also seek data on the number of cable and DBS set-top boxes designed to provide HDTV that have been shipped to cable or DBS providers and how many subscribers use such set-top boxes."

The NOI asks for information on how familiar consumers are with DTV and HDTV. It also asked how DTV and HDTV is being promoted. Some of the questions include: "How are broadcasters and MVPDs advertising or promoting DTV/HDTV beyond the text indicating that a program is being simulcast in HDTV? To what extent is broadcast advertising time being used to promote DTV/HDTV? How much advertising of DTV/HDTV is there on cable or other MVPDs? Do newspaper or other television guide listings indicate when programming is available in HDTV format? What type of education effort is going on in the retail stores at the point of sale?"

One item introduced for the first time in the Tenth Annual Report covering 2003 was a section on foreign markets. In that report it mentioned the successful completion of the DTV transition in the Berlin-Brandenburg television market in Germany. This year the NOI asks "Although there are significant technical, economic, and regulatory differences between the German transition and the transition ongoing in the United States, we seek comment on lessons that may be learned from the German experience with the DTV transition." It mentions the transition underway in the United Kingdom as well and asks, "How does the ongoing transition in the United States compare with the transitions in these foreign markets? How can we benefit from their experiences? How will the transition to DTV worldwide affect the transition in the United States?" The problem with protecting digital content is addressed -- "We request information regarding other countries' efforts involving digital rights and copy protection regulations for broadcast digital programming which would have implications for the protection of our domestic content."

As noted earlier, the NOI does not limit itself to over-the-air broadcasting. Refer to the Notice of Inquiry to get an idea how the FCC sees the video distribution market evolving and the issues it considers important. The Tenth Annual Report wasn't released until February of 2004, although the 2002 report was available at the end of December 2002. Comments in MB Docket 04-227, Annual Assessment of the Status of Competition in the Market for the Delivery of Video Programming are due July 23, 2004. Reply comments are due August 25, 2004.


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