And After 2006 What Happens?

SOMEWHERE OUT THEREYou might not have noticed that people watch television. You might also not have noticed that people tend not to throw money away.

My goodness! What am I blathering? Of course you've noticed that people watch TV. Of course you've noticed that throwing money away ain't good. Everybody has noticed those things – except for William Kennard, Lord Chief High Hoo-Hah of Our Befuddled Commish (known in some circles as the FCC).

Organ music, maestro, if you please. Yes, it's time, once again, for another episode of "As the DTV Finger of Blame Points," the ongoing saga of a confused industry and its tormentors. This month's episode: "What the...?!?!"

NO CLUE

Let me put this as gently as I can: L.C. Triple-H. Kennard has gone off the deep end. He's lost it. He's about 200 dB short of a milliwatt. He ain't got a clue.

What am I ranting about? His speech on Oct. 10 about how to solve the DTV transition problem. Here's the relevant section, in its entirety, as taken from the FCC Web site:

"The way I see it, there are three things that Congress can do to eliminate the waste of spectrum by fence-straddling stations, accelerate the national transition to DTV, and buttress the current system of affirmative public interest obligations all in one.

"First, Congress should reconsider the 85 percent loophole on the 2006 date, so that it doesn’t become a 'trick number' to justify making the double dose of spectrum a broadcaster entitlement for the next 25 years.

"Second, Congress should direct the FCC to adopt a requirement that, by a given date – say Jan. 1, 2003 – all new television sets include the capability to receive DTV signals. In addition to accelerating DTV deployment, this order would make DTV technology much more affordable by unleashing market forces and economies of scale to drive down the cost of equipment and receiver chips in both sets and converter boxes.

"Third, Congress should require that, as of Jan. 1, 2006, broadcasters will pay a fee for the use of the analog channel. This 'spectrum-squatters’ fee would escalate yearly, until broadcasters complete their transition to digital and return the analog spectrum to the American people."

Ahem. Humor me by skipping number one for a while; I promise to get back to it. I want to start with the one that actually has some semblance of reality associated with it – number two, the one that says that all TVs sold after a certain date have to "include the capability to receive DTV signals."

If he meant that the way he said it, then he's dreaming some pretty amazing receiver developments between now and 2003, which will allow folks indoors in high-multipath conditions to receive DTV.

That is important, but I'll give him the semantic benefit of the doubt and assume he meant simply including ATSC receiver/decoders, whether they have "the capability to receive DTV signals" in their owners' homes or not. After all, if L.C. Triple-H. Kennard can order receiver manufacturers to put DTV reception into all TVs, surely he can also order cable/DTV must-carr – mmmpfff!

Ptooey! Some jackbooted FCC thugs just came and washed my mouth out with soap. All I said was cable/DTV must-carr – mmmpfff! Blechh! Well, enough of that.

SOLVING THE ISSUES

So, let's make believe the reception "capability" issues are solved. Let's make believe the cable (can I say "issues"?) issues are solved. Let's make believe the cost of this ubiquitous receiver/decoder drops to next to nil (the cheapest receiver now on the market lists for $549), so manufacturers won't be upset to add it, and consumers won't be upset to pay for it.

In that case, it's one heck of a great idea! But return with me now to item number one. L.C. Triple-H. Kennard wants Congress to drop the 85 percent "loophole."

This "loophole" is a section of the Balanced Budget Act of 1997 that allows NTSC to continue to be broadcast if 15 percent or more of households in a market don't have access to DTV programming. That doesn't sound like a loophole to me; that sounds like a way for people to continue to watch TV.

"But, Mario, you just said Chairman Kennard's idea to include DTV reception capability in all TVs was great, so everyone will have DTVs by 2006 anyway. What's the problem?"

I never called him "Chairman," and I only said it was a great idea if the reception problems are solved and the cost is insignificant (and I wouldn't bet on either happening by Jan. 1, 2003). But "the problem" has nothing to do with either of those.

Give or take a few million, there are 25 million TVs sold each year. Give or take a few million, there are 100 million homes in the U.S. So, if L.C. Triple-H. Kennard's plan went into effect on Jan. 1, 2003, and if every family got in line to buy just one new TV, then, on or about Jan. 1, 2007, there'd be a DTV in every home. But what about all the other TVs?

WHO WATCHES TV?

The best guesstimate I've heard is that more than 300 million TVs are in use in the U.S., not counting VCRs. At 25 million a year, they'd all get replaced somewhere in the vicinity of 2015. Meanwhile, thanks to the removal of the "loophole," those existing TVs (even the ones bought for the 2002 holiday season) would stop working in 2006. My, my. As I said at the beginning: You know folks watch TV. I know folks watch TV. But L.C. Triple-H. Kennard doesn't seem to know folks watch TV.

"But, Mario, four out of five households get TV now through cable or satellite or something similar. Why won't they continue to do so?"

The satellite folks have just gone to court to be let out of what little must-carry requirement they've got – and it sure doesn't cover DTV. As for cable, the DTV must-carr – mmmpfff! Now cut that out! I'll just say that, after quite a few years and promises, Our Befuddled Commish has yet to come up with anything definitive in that little hotbed – except what I ranted about last month, their defining a DTV-cable receiver that won't necessarily work with off-air signals (I am not making this up).

LET’S TAKE ANOTHER CRACK

I wouldn't mind arguing this point with you until the cows come home, but I see Flossie on the horizon already, so let's have a crack at number three, what I'd call the "blame-the-broadcasters" clause. It's the one with the phrase "spectrum squatters" in it.

Surely, it must be pure coincidence that William Safire (the speechwriter who came up with Spiro Agnew's "nattering nabobs of negativism") called broadcasters "spectrum squatters" in a piece about the DTV transition in The New York Times on Oct. 9, and L.C. Triple-H. Kennard called them the exact same thing in a speech about the exact same thing in the exact same city the very next day. What elsecould it be but coincidence, eh?

Anyhow, L.C. Triple-H. Kennard wants to charge those nasty broadcasters who are hogging the NTSC spectrum and to keep raising those fees until they let go of their analog channels. Right on, eh? In a word: nope.

Commercial broadcasters are in business. The business they are in is delivering audiences to advertisers.

Now, suppose L.C. Triple-H. Kennard's Plan B somehow works. Suppose that, by 2006, everyone has a working DTV and can watch TV that way. Then why would any broadcaster want to hold onto the analog channel?

ONLY ONE PURPOSE

The analog channel has only one purpose: delivering TV to audiences. If the DTV channel performs that function, then why would any broadcaster want the analog channel? The transmitter power bill, alone, would be incentive enough to drop it. Who wants to throw money away for no purpose?

Well, now, it seems that L.C. Triple-H. Kennard does – or, rather, he wants broadcasters to throw money away for no purpose. That's what this "spectrum squatters’ fee" would be. One more time: If a broadcaster's audience has migrated to DTV, there is no reason to hold onto the NTSC channel. If the audience has not migrated to DTV, then there is every reason to hold onto the NTSC channel – it represents the core business of television broadcasting (and the only way a lot of folks will get to watch TV).

That is to say, it used to represent the core business of TV broadcasting. Despite L.C. Triple-H. Kennard's colossal lack of knowledge of television broadcasting, I ain't gonna accuse Our Befuddled Commish of intentionally trying to kill terrestrial broadcasting. At least not this month. But I think a quick read of the FCC DTV rules couldn't hurt, specifically 73.624 paragraphs (b), (c) and (f).

Paragraph (f) is the one that makes NTSC channels useless to broadcasters after the audience has migrated to DTV. It requires (eventually) 100 percent simulcasting of the NTSC programming on the DTV station. Broadcasters can't even use the NTSC station for different TV programming.

Paragraph (b) is the one that says there's no requirement for any HDTV transmission. That's at the end. The beginning starts "At any time that a DTV broadcast station permittee or licensee transmits a video program signal on its analog television channel, it must also transmit at least one over-the-air video program signal at no direct charge to viewers on the DTV channel that is licensed to the analog channel ... ." Then comes (c):

"Provided that DTV broadcast stations comply with paragraph (b) of this section, DTV broadcast stations are permitted to offer services of any nature, consistent with the public interest, convenience, and necessity, on an ancillary or supplementary basis. The kinds of services that may be provided include, but are not limited to, computer software distribution, data transmissions, teletext, interactive materials, aural messages, paging services, audio signals, subscription video, and any other services that do not derogate DTV broadcast stations' obligations under paragraph (b) of this section. Such services may be provided on a broadcast, point-to-point or point-to-multipoint basis, provided, however, that any video broadcast signal provided at no direct charge to viewers shall not be considered ancillary or supplementary."

Maybe I'm nuts (okay, definitely I'm nuts), but the more I re-read Our Befuddled Commish's DTV rules, the more it seems that, as soon as the transition period is over, television broadcasters no longer have to broadcast television – of any kind, "consistent with the public interest, convenience and necessity" of course.

Hey – I'm pretty sure this is just a blooper. Our Befuddled Commish didn't want to leave TV viewing at the mercy of the marketplace, did he?