The spin vortex is particularly intense in Southern Nevada in January. Even if you only spend a couple of days at the International Consumer Electronics Show (CES) in Las Vegas, you're in serious danger of being sucked in. But spin or no spin, there did seem to be some good news for digital television at the show.
DTV wasn't exactly the star of CES. Take Sony for example. If you didn't know better, you might have thought it only made computers, little bitty camcorders, nifty personal music systems, and a robot dog. TV sets were not high on Sony's agenda. Most of the attention went to wireless gizmos that bring the Web and video to your combination cell phone/PDA, or home networks that link everything from your Internet connection and cable TV service to your garage door opener and home theater. Kick-off speaker Bill Gates wants Windows XP to power your remote control.
The wearable consumer electronics fashion show was a big hit, too. It featured cell phones and CD players and little computers (the fashion models and the music may have had something to do with its popularity). But, beyond the flashy stuff, there was some encouraging news for those of us who prefer to see the DTV glass half full. As the Consumer Electronics Association (CEA)'s technology primer pointed out, whether you call them flat panel displays, big screens, or home theaters, "the TV set remains the most important entertainment element in the home," and broadcast digital television is the only source of "free," high quality programming for those screens. Every other source wants your money and/or information on your habits and preferences.
Last April, at NAB2001, the NAB and CEA promised to jointly promote DTV. At a CES press conference this year, CEA President Gary Shapiro and NAB President Eddie Fritts laid out their plans to fulfill that promise. The effort includes broadcasters, manufacturers, and retailers. It will focus on "DTV Zones"÷metropolitan areas where all the network affiliates have DTV up and running and there is a "strong retail commitment to digital television marketing and sales."
By the time you read this, the campaign should have rolled out in three trial zones, Indianapolis, Portland, and Houston. A fourth, Washington DC, will be added later in the year. If successful, the program could expand nationwide.
Key features of this educational push are a "significant" local advertising effort including, but not limited to, promotional spots on local TV stations and celebrity appearances on local morning shows. There will be special events in high traffic areas where manufacturers will provide HDTV sets to let the public see just how good DTV can be. Also planned are station tours and even "watch parties" where residents will be loaned HD sets to show their neighbors (kinda takes you back to the late 1950s, doesn't it?) what it's all about.
Along with demonstrating the high quality pictures and sound DTV can deliver, the campaign will try to make a few other points: DTV is becoming more and more affordable, it offers more programming options, it won't necessarily make obsolete your bedroom and kitchen sets and (my personal favorite) digital cable, as currently practiced, is definitely NOT digital television.
A number of factors have convinced the CEA and NAB that this is the time for this kind of push. All the networks are providing HDTV programming, with over 1000 hours scheduled for the current season. As of the ninth of January, 229 DTV stations were broadcasting in 80 markets covering 73 percent of U.S. TV households. An NAB survey, taken before the September 11 terrorist attacks last year, indicated that there would be at least one digital signal available to 95 percent of households by May of 2002 and that there would be more than 800 stations on-air by the end of the year. Subsequent events might soften that number a bit, but if most of them make it, two-thirds of the job is done.
Also, when consumers get to see DTV, they like it. In a session on the DTV transition, Tom Campbell, corporate director for Ken Crane's Home Entertainment Centers in Southern California noted that, despite a soft economy, his company had its best sales in 53 years last year, and he attributed it to HDTV. "Once they [the consumers] see it," he said, "They've got to have it." He believes we're beyond the early-adopter stage and that the promotion and extensive consumer education that have been crucial to Crane's success will work for others.
CEA says "DTV product" sales for 2001 exceeded projections by a few percent. Twenty percent of those sales were said to involve ATSC tuners. Campbell cited 30 percent for his ATSC tuner sales and noted that customers who previously bought monitors are coming back for tuners as the number of stations and programs increases.
Consumers not only like what they see, but they have much more choice now. New CES introductions included simpler, fully integrated sets with built-in ATSC tuners in screen sizes from 30 inches to 61 inches from manufacturers like Daewoo, THOMSON/RCA, and Zenith. Philips expanded their DTV set line from 10 to nearly 30 models. Everybody seemed to have new HD 60-inch flat plasma displays, 20-inch and 30-inch HD LCD screens, and a host of rear projection sets using CRTs and LCDs and DLP light mirrors.
Last but not least, CEA also showed curves suggesting that average DTV prices in their first four years are falling at a rate similar to or faster than those of color sets in the 1950s. CEA said the drop for color (in inflation adjusted greenbacks) was from about $3,000 to about $2,500.
For DTV products it's from around $3,100 to $1,800. You can always carp about CEA numbers. That $3,100 figure for 1998 introductory DTV "products" seems awfully low. If memory serves, those dumpster-sized sets were all in the $7,000 to $10,000 range. In 1954, a color TV set was a single, easily defined item. A "DTV product," on the other hand, can be either SD or HD, 3:4 or 16:9, with or without an 8-VSB tuner and MPEG decoder. It could even be just the tuner itself. So maybe that all averages out to $3,100.
Quibbling aside, DTV set prices really are lower. While it's true the most dramatic high-end displays cost more than $5,000 and often more than $10,000 (you can spend $25,000 or more if you'd like), some of the smaller, integrated direct-view HD sets are now below $1,500. That downward price pressure is likely to continue. In the transition session, John Taylor from Zenith said he expects another 50 percent drop in the next two years.
Of course, some problems remain, the two most prominent being DTV carriage on cable systems and copyright protection. Even here, there was optimism at CES. Both Fritts and Shapiro noted positive cable cooperation in eleven markets served by Time-Warner and another one served by Charter and Comcast, but they were not happy with the broader cable response. Taylor said he thought both matters "will be worked out this year, with or without Washington." They're banking on public pressure once consumers see just how good DTV can be.
