Video: Mixed signals on digital TV delay

updated 2/4/2009 7:22:11 PM ET 2009-02-05T00:22:11

The House voted Wednesday 264-158 to delay the analog TV shutdown until June 12.

The nation was two weeks away from the original date of Feb. 17 for the digital transition, allowing broadcasters to replace analog TV signals with digital ones.

But the Obama administration and many Democrats asked for the delay, saying millions of people are not ready for the switch. The bill, already approved by the Senate, now goes to the president for his approval, considered a given. Still to be resolved is the funding needed for more coupons to help consumers offset the cost of converter boxes. That issue will likely be considered as part of the economic stimulus legislation.

“The legislation passed by Congress provides more time for Americans to prepare for the (digital)  transition and will allow more time for the government to fix the coupon program," said David Rehron, president of the National Association of Broadcasters.

"It is unfortunate that Congress had to take additional action on this issue, but the prospect of leaving millions of consumers in the dark was simply unacceptable," said Rep. Edward Markey, D-Mass., and a member of the House Commerce Committee's Subcommittee on Communications, Technology and the Internet.

Opponents of the delay said it will cause confusion for consumers, and that it is not fair to the wireless companies, including AT&T and Verizon Wireless, as well as public safety agencies that are waiting to use part of the airwave spectrum that will go to them once the switch is made.

The Consumer Electronics Association, an industry trade group, expressed dismay about the decision and concern that the extension could lead to a shortage of converter boxes "because manufacturers and retailers planned box inventory based on a Feb. 17 transition date," said CEA president Gary Shapiro.

Planning started in 2005
With a nation in economic turmoil, it seems the last thing on the to-do list of legislators should have been the transition to digital television. The changeover has been planned since 2005, but the last 12 months were marked by public confusion about the switch and bureaucratic and political wrangling over a coupon program aimed at subsidizing the cost of converter boxes.

Yet the signs of trouble were there: the coupon subsidy program was running out of money, waiting lists were growing, and not enough public education in general was being done about the transition, the coupon program or how to hook up the converter boxes, which some have found troublesome.

“When government took their hands off the steering wheel of public education, a lot of confusion crept into the marketplace,” said Joel Kelsey, policy analyst for Consumers Union, which publishes Consumer Reports.

The Federal Communications Commission and the National Telecommunications and Information Administration might dispute that, pointing to what the agencies see as extensive education efforts, supplanted by those from private industry groups like the Consumer Electronics Association and the National Association of Broadcasters.

The NAB, for example, started its educational campaign in November 2006, according to Shermaze Ingram of the organization.

Still, yesterday, acting FCC chairman Michael Copps said in a statement that "It has long been clear to me — and it’s even clearer since I became acting FCC chairman two weeks ago — that the country is not prepared to undertake a nationwide transition in 12 days without unacceptably high consumer dislocation."

Misconceptions continue
Some of the problem has to do with misconceptions about digital TV itself. As late as October, 41 percent of Americans “believed every single TV needs to be a digital TV in order to get a signal,” said Kelsey, citing a Consumers Union poll.

“About 25 percent believe that every television, whether it’s digital or not, whether it’s hooked up to cable or not, has to have a converter box. And 21 percent believe everyone needs to sign up for cable or satellite service in order to keep a picture on their television sets. Consumers remain extremely confused.”

TVs do not have to be digital, but they do need to be able receive digital broadcasts. The main ways to do that are by buying a converter box to take a TV’s signal from analog to digital, and using an antenna as well; subscribing to a cable or satellite service; or buying a digital TV.

The Nielsen Co. said recently that while 85 percent of households are ready for the digital transition, nearly 6 percent are not at all, and another 9 percent are “partially ready.”

“Partially ready” means “you may have four TV sets in the house, and three are connected to cable and one is an analog set that isn’t,” said Anne Elliot of the Nielsen Co. “It means at least one working TV set in the household would not be able to get a digital signal.” That set could be one that is “used in the kids’ bedroom to watch DVDs,” for example, she said.

Some have moved to new TVs
A year ago, the digital transition was reason enough for many to justify signing up for cable or satellite service or to buy a new TV. At the end of 2007, more than 50 percent of American households owned a digital television, according to the Consumer Electronics Association.

In February 2008, the NTIA started making available two $40 coupons per household to help offset the cost of two converter boxes, which range from $50 to $80 each.

The coupons are only good for 90 days, and that, too, became part of the problem early on. If consumers were requesting the coupons, many weren’t redeeming them. By mid-April, for example, nearly 11 million coupons had been requested, with more than 500,000 of them redeemed, said Todd Sedmak, NTIA communications director.

In the first half of last year, there were limited choices of converter boxes on the market. And some consumers may have set aside the coupons and forgotten about them.

21.7 million coupons redeemed
During the summer, when more converter boxes went on store shelves, efforts to extend the 90-day expiration date were rejected by Congress.

At the end of the year, the NTIA said the $1.34 billion funding ceiling for the coupon program was about to be reached. As of last week, more than 47 million coupons had been mailed out since the program began, and 21.7 million coupons have been redeemed, while more than 14 million of them expired. Meanwhile, more than 3 million people are on a waiting list for the coupons.

The way in which the coupons are redeemed has also been an issue. Brick-and-mortar retailers like Wal-Mart, Best Buy and Radio Shack require in-store redemption, while some of the better converter box deals — including those for the cost of a coupon — can be found online.

“We think retailers need to have cheaper options available, and not just boxes for between $50 to $80,” said Kelsey. “With a $40 coupon, that’s still a relatively significant cost for someone who once got something — television transmission — for free.”

And like many things technological, setting up the boxes has not been a snap for everyone.

“It’s about as easy to setup a converter box as it is to set up a VCR,” said Kelsey. “That said, it’s not easy for everyone. So if you’re not used to this, or you’re not technically inclined, a lot of folks are wondering what to do and how to hook it up.”

Once the boxes are connected, getting a signal can still be a problem and an antenna may be needed. There’s no subsidy program for antennae, and some can be expensive.

More time for preparation
Chris Traver of Gresham, Ore., who had an analog set, decided to forego the converter box option and to buy a new TV earlier this year. Philosophically, he’s opposed to the converter box subsidies.

“We don't need the financial assistance and I do not support the government-sponsored program,” he said. “I do not believe it is the government’s responsibility to help pay for my choice in using television-based entertainment through the coupon program.”

A four-month delay to digital TV may not solve everyone’s problems, but will at least offer time to provide more consumer education and a chance to get more funding for coupons, says Kelsey.

That’s especially important for those most at “risk,” such as the poor, disabled and elderly, said Mark Lloyd, an attorney and vice president of the national Leadership Conference on Civil Rights.

“The focus now really should not be on blame, but how we can make sure that Americans get the equipment they need and the assistance they need to be able to move forward,” he said.

The Associated Press contributed to this report.

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