Digital... The New Reality TV
Monday, August 18, 2008YASTINE: Ready or not, digital-only television will soon be a reality. The Federally mandated switch is just half a year away and electronics stores say as that day grows closer, more consumers come in trying to determine what, if anything, they need to get their digital TVs or their TVs digital ready. Scott Gurvey looks at how the transition is progressing.
SCOTT GURVEY, NIGHTLY BUSINESS REPORT CORRESPONDENT: At midnight, February 17, 2009 -- just six months from now -- most TV stations will turn off their analog transmitters and be strictly digital. There will be no TV on the channels we have grown to know and love over the years. But don't panic -- odds are your picture will not turn to snow. That's the message industry leaders like Matthew Braatz, senior VP for technology at NBC, have been trying to deliver.
MATTHEW BRAATZ, SR. VP TECHNOLOGY & OPERATIONS, NBC LOCAL MEDIA: The biggest challenge we've had in the whole process hasn't really been technical on our side or building up of facilities, it's really been about educating the viewers. There's a lot of confusion about what the digital transition really means to the average viewer at home. The reality is, for the bulk of our audience, those who watch via cable or watch via satellite, there most likely is going to be no effect.
GURVEY: You won't notice a thing if your TV is connected through a wire, like cable customers of Comcast, Time Warner, Cablevision or Verizon's Fios service or if it gets its signal directly from a satellite, usually through a rooftop antenna, like DirecTV and Echostar. But if you have an analog TV connected to a standard rooftop antenna or rabbit ears, you will need a converter box to receive the digital signal. People are flocking to electronic stores to buy converter boxes, which cost between $40 and $80. You won't need a new TV, so don't let them sell you one unless you're in the mood. PC Richards manager Dan Joy says some customers are interested in trading up.
DAN JOY, MANAGER, P.C. RICHARD: We are making some sales when they come in looking for the converter box and we explain the prices have come down so much on the TVs that they can upgrade now and it's not as cost prohibitive as it might have been a couple of years back.
GURVEY: The Nielsen company estimates 13 million households have only over-the-air, analog television receivers and must take action by the February deadline to continue getting TV. But Neilson doesn't know how many households have over the air, analog TVs in secondary locations like a kitchen or garage. S&P's media analyst Tuna Amobi, says there is little chance the switchover date will be delayed as the analog channels have already be sold for new uses.
TUNA AMOBI, MEDIA ANALYST, STANDARD & POOR'S: That spectrum has already been auctioned off this past January in the 700 megahertz auction by the FCC that kind of raised about $20 billion for the government. And, of course, some of that spectrum has been earmarked for, you know, what they call essential services -- public safety, you know, communications, et cetera.
GURVEY: The government is offering two $40 rebate coupons per household to help consumers buy their converter boxes. TV watcher Brandy Wood has an indoor antenna and she just bought a converter box for her set.
BRANDY WOOD, CONVERTER BOX BUYER: I've been using the rabbit ears for years. I really don't care for much of the cable programming and PBS is my favorite channel. That's for free, so I'm looking forward to having very clear PBS.
GURVEY: Now that's the kind of viewer we love. To get your own converter box rebate coupon and they look like this, go to the web site at www.dtv2009.gov or give them a call at 1-888- 388-2009. Scott Gurvey, NIGHTLY BUSINESS REPORT, New York.
PAUL KANGAS: Meanwhile, the Federal Communications Commission is stepping up its efforts to ensure Americans are ready for that digital transition. In an update today on the progress of the DTV initiative, Chairman Kevin Martin said all five FCC commissioners will travel to the 80 most at risk markets before February 17. The agency is also coordinating with broadcasters to test the shut-off of analog signals. Stephanie Dhue sat down with Martin this afternoon and began by asking how his agency is getting the message out about the DTV switch.
KEVIN MARTIN, CHAIRMAN, FEDERAL COMMUNICATIONS COMMISSION: Well, the first having to make sure they're aware of the upcoming transition and then we have to make sure that they understand what steps they need to take. But we've been working with a lot of the grassroots organizations to try to identify what are the ways that we can make sure that those hard-to-reach communities are aware of the upcoming transition. And so whether it's a combination of both, making sure we're putting out messages in mainstream media through public service announcements, television and radio. We're also as I said, working with grassroots organizations and groups like in Wilmington, for example, doing an early test, we've been working with Meals on Wheels, the groups that bring meals to the elderly population. We have been working with local churches and other local community organizations.
STEPHANIE DHUE, NIGHTLY BUSINESS REPORT CORRESPONDENT: Wilmington, North Carolina will be the first test shutoff market on September 8th. How will you measure success there?
MARTIN: I think that the most important thing we can do is try to make sure we can learn from it. So the success will be what we learn from it in order to better prepare us for the transition in February. But I do think that we have done a very good job of trying to increase awareness down there. There was actually some people had written recently into the Wilmington paper saying, enough, already. They have already heard about the - enough about the transition that's going to occur down there.
DHUE: Will there be other test shutoff markets and how do you anticipate that playing out?
MARTIN: We asked for several different markets that are technically able to go through the transition early that already had their broadcasters up and broadcasting in digital that were prepared to undergo an early transition. But we have no other takers yet. But what we are going to do and what part of the announcement was today was that the commissioners are going to these 80 markets that we've identified that have a high number of over the air viewers, people that still rely on rabbit ears or rooftop antennas. Then what we are going to do is actually coordinate with the local broadcasters and do so-called soft tests, where they'll actually announce that at a certain point in the day or evening they're going to go in and take their regular commercial programming off and put a special message on to identify other analog signals, so if you are getting that signal still, that means you still need to take steps to make sure that you are prepared.
DHUE: There are a number of agenda items at the FCC from universal service reform, to new spectrum fees. What can you realistically get done in the next four or five months?
MARTIN: I think that the commission has still been very active over the last, over the last few months and we'll continue to end up being very active. I think that we'll still continue to end up tapping a lot of different issues that I think are important from a consumer perspective. Just last month, the commission actually at our open meeting in the July meet took steps to make sure that consumers can't have their access to Internet content or applications blocked by Internet service providers. And I think that we'll continue to be on the forefront of that. But I think in the next few months, we're still going to take off some other issues as it relates to wireless both in terms of potential fees that wireless companies are charging for early termination and also in terms of making sure that we try to find a way to utilize some of the wireless spectrum so the public safety can solve some of their inoperability challenges and I think we'll also do some universal service reform in the next few months.
DHUE: You have taken on cell phone companies, cable companies. Some have described it as a populist agenda and that perhaps you're using that as a springboard to run for office. Is that something you would be interested in?
MARTIN: I am actually just focused on trying to make sure that we can do everything we can at the commission to actually help consumers. I think that our charge and our mandate is to act in the public interest. And almost all the time, the public interest is what's in the best interest of consumers. And then generally, I think that the market place serves consumers well and we should be providing less regulation and allowing consumers to benefit from innovation and competition that occurs between industries. But I think it is important to still make sure that those industries are behaving in such a way that they're not taking advantage of consumers. Whether or not it comes down to blocking their access to content or charging them too much if they want to be able to take advantage of competition and switch to their competitors.
DHUE: So, there is a presidential election coming up. It is pretty unusual for an FCC chairman to stay on. What is next for you?
MARTIN: I'm not sure what's next. As you said, we have taken on - I've already take on a lot of the companies. I'm just trying to survive the current job.
DHUE: We have been speaking with FCC Chairman Kevin Martin. Thank you for joining us.
MARTIN: Thank you.
