08.17.2004 12:00 AM
MSTV, NAB: Cheap Converter Boxes Key to Successful DTV Transition
The National Association of Broadcasters and the Association for Maximum Service Television filed comments with the FCC last week on how to minimize disruption to consumers when analog TV is switched off. A key part of the filing is an attachment with research showing how many households and TV sets still rely on analog over-the-air TV. The comments are in response to an FCC Notice of Inquiry described in RF Report for June 2, 2004.

According to the associations, in the 20.5 million over-the-air (OTA)-only households, there are approximately 177,000 OTA digital sets, leaving 20.3 million households with analog-only reception that would lose all TV reception if analog broadcasting was shut off today. Adding in the OTA sets in households hooked up to cable, satellite or another multiple video program distributor (MVPD), there are approximately 73 million OTA sets in all TV households. Obviously, with this many analog OTA sets, it is likely there will be many consumer complaints when analog is shut off unless steps are taken to encourage the switch to digital.

The MSTV/NAB comments praise the Powell Plan for encouraging the transition, but criticize cable companies for not carrying local DTV signals or for carrying only part of their digital signal. One problem, the comments point out, is that retail stores are not demonstrating over-the-air DTV because of "(1) contracts with DTV display companies or others that prohibit additional signals from being shown on display units, and (2) store policies that prohibit over-the-air reception because OTA signals may include advertisements for competing stores."

MSTV/NAB say "a substantial percentage of OTA households will likely have purchased DTV-capable receivers by the time analog broadcasting ends." However, there must be solutions for the OTA households that don't purchase a DTV. One solution is to subsidize the purchase of digital-to-analog converters for non-digital OTA households. Another is "sustained, ubiquitous promotion and education about DTV, on the part of all industries, to encourage more and more consumers (particularly those in OTA households) to purchase DTVs." A warning label on analog sets was suggested to alert consumers of the limited useful life of the sets.

Making the transition as consumer-friendly as possible is important. According to the comments, "the more consumers value true DTV and its extraordinary features, the more they will want to replace analog sets with DTVs and the less they will mind disposing of analog sets or buying converters to eek out some remaining useful life for them. Also, removing disincentives to adopt digital television will be important. For one thing, the prospect of a steep rise in one's cable bill, with the purchase or rental of a digital set top box and the recurring charge for the digital cable tier, remains a disincentive to buying a DTV. Cable systems not carrying all DTV broadcast signals remains a disincentive to consumers' investing in DTV, knowing they won't necessarily receive all of the digital stations available in their markets."

The comments emphasized that digital-to-analog converters must be as easy to use as analog TV and have certain minimum technical capabilities. For receiver performance, the ATSC Recommended Practice A/74 was suggested. Other capabilities include:
* Work with indoor antennas
* The ability to receive all ATSC formats, HD or SD on all TV channels, VHF and UHF. *The ability to receive enhanced VSB signals, which can be received in more difficult conditions than standard VSB, is desirable.
* An analog channel 3 or 4 RF output should be provided.
* Low-cost

The Comments note that the "Freeview" boxes sold in the United Kingdom carry cost approximately $72 U.S. Motorola testified that a digital converter box with a retail price of $67 is possible in 2007.

The MSTV/NAB comments conclude, "To the extent that the government wishes to change course from a market penetration end to the DTV transition, it can and should embark on a campaign to drive down the costs of digital converters for the benefit of all analog sets, as well as for OTA-only households. The form and shape of that campaign and the government's direct involvement will be determined over the coming months. Something, however, must be done to mitigate the consumer disruption that is certain to occur if consumer sets throughout the home become obsolete at the flip of a switch. It would seem that making converter boxes affordable is one key to bringing the DTV transition to a close."

The data mentioned in the Comments is summarized in the attachment Estimated Related to Broadcast-Only TV Households and Sets, and DTV Households with Over-the-Air Digital Broadcast Reception Capabilities by David Gunzerath, Ph.D., vice president of the Research and Information Group at the National Association of Broadcasters.

The attachment shows that 18.9 percent of U.S. TV households have broadcast-only reception, while nearly 21 percent of households that subscribe to an MVPD have one or more OTA-only sets. Although the majority of TV sets do not depend on over-the-air reception, these percentages show the broadcast signal is still important. An interesting chart illustrating regional use of over-the-air TV shows the greatest number of OTA households is in the South at 34.8 percent and the least are in the Northeast at 10.9 percent. The percentage of OTA households in the Midwest is 26.4 percent and in the West, 27.8 percent are OTA households. Heavily populated counties have the highest OTA household percentage, 40.3 percent, decreasing down to 15.2 percent for very rural counties.


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