Suddenly It's Hip To Spectrum-Split
The second coming of multicasting
By John Eggerton and Ken Kerschbaumer -- Broadcasting & Cable, 12/7/2003 7:00:00 PM
When ABC's Preston Padden and Sinclair's David Smith talked up digital multicasting in 1997, the suggestion landed both in hot water in then HDTV-crazed Washington. It also prompted other broadcasters to accuse them of selling out high-def.
This fall, though, news that NBC and ABC are working with their affiliates to develop locally oriented multicasting services generated hardly a ripple. Where did the controversy go?
With compression technology offering the promise of "HDTV and" rather than the threat of "HDTV or," broadcasters are beginning to see ways to do more than HDTV over their digital channels. They are doing a little—and talking a lot about—multicasting.
Today, more than 190 digital TV stations are multicasting, according to Decisionmark, a Cedar Rapids, Iowa-based firm that closely tracks DTV. While most are public-television stations, a growing number of commercial stations are multicasting local news and weather, public affairs, HDNet, and UPN.
HD pioneer Jim Goodmon, owner of WRAL-TV (CBS) and WRAZ(TV) (Fox) Raleigh, N.C., is a convert to multicasting. "I believe that HD is the primary driver of digital, though SD [standard-definition TV] is great, too. We're a much better TV station because we can televise a local event or trial on the news channel."
WRAL-TV's digital station broadcasts the CBS HD feed, one SD 24-hour news channel and a small datacast; WRAZ's digital station offers HDNet during the day, a 24-hour local weather channel, local SD analog signal, upconverted Fox during prime time and even datacasts.
'All Free Bits'
Few TV sets can receive the services off the air. The pioneer multicasters rely on voluntary carriage by their local cable systems. But most are hoping for an FCC requirement that systems carry all their multicast services, whatever they are, or what Citadel President and NAB Joint Board Chairman Phil Lombardo calls an "all free bits must flow" mandate.
When the federal government granted every TV station a second channel almost eight years ago, it was with the expectation that it would be used to broadcast HDTV and thus keep America on the cutting edge of TV technology. That's why lawmakers and FCC officials were miffed in 1997 to hear ABC and Sinclair talking publicly about an alternative use: multicasting.
Despite those early expectations, broadcasters can and may use their DTV channels for a variety of services. For instance, NBC and its affiliates are talking about offering HD and two channels of conventional, or SD, TV during prime time and five channels of SD at other times of the day. Other broadcasters willing to push the compression technology further may offer six or seven channels of SD.
CBS and Fox declined to discuss any multicasting ambitions they might have. But CBS and its affiliates, as part of their deal on NCAA basketball (see story, page 10), have agreed to form a futures committee to explore multicasting, among other new businesses.
According to John Tupper, a small-market broadcaster who heads the Fox affiliate board, Fox has not said anything to him about multicasting. But Fox affiliates are interested in "something happening to improve the business," he says. "If Fox came along with a program that says we're all going to make more money by doing something different, I'm sure the affiliates would embrace it."
The majority of NBC affiliates are interested in pursuing NBC's proposed digital multicast weather service, according to NBC Affiliate Board Chairman Roger Ogden, of Gannett. Most are not currently offering such a service, he says, and those that are essentially provide a "loop channel, running their radar and forecasts without a lot of updating."
He acknowledges that a free, ad-supported multicasting service will be slicing and dicing an already fragmented audience, but he still sees a business there, noting "a lot of efficiency associated with it."
Many stations have already made heavy investments in weather gathering and presentation, he says. "So we don't have to go out and buy an awful lot of equipment or hire a lot of people. You don't have to have tremendous revenue streams to support it."
Ogden expects his sales department to sell the service to advertisers for a "relatively modest" charge as part of an overall station buy.
Aside from the NBC multicasting proposal, though, Gannett is concentrating on HDTV because it believes that will drive set penetration. "It's difficult to discuss what multichannel means until you start to penetrate sets in the home," Ogden says.
John Lansing, who heads the Scripps TV group and chairs the ABC digital news channel committee, is working with the network to see whether a news channel "would create value for all involved," including his ABC affiliates and cable operators. He expects a decision within the next few weeks.
Also, he will be looking seriously at NBC's weather-channel proposal for his three NBC affiliates.
Lansing emphasizes that "nothing is set in stone" at Scripps. "We're putting together options and opportunities [for multicasting]." Those could include a Spanish-language channel, time-shifted news or local sports, he says.
Scripps is currently multicasting an automated weather service in three markets and plans to air it in all its markets by the end of the month. Despite the increasingly fragmented audience, Lansing says, ad-supported multicasting makes sense, if the FCC requires carriage.
Two other top-10 station groups, Hearst-Argyle and Tribune, say they are discussing multicasting internally but not publicly.
Mike DeClue, senior vice president and director of engineering for Clear Channel TV and Wireless, says he is discussing various multicasting models and his bosses are listening. Those models include free, ad-supported channels—a Spanish-language service, for instance—as well as channel outsourcing, in which a broadcaster leases part of its DTV signal to a third party.
NBC and ABC see multicasting as advertiser-supported, but other nets believe they could collect subscriptions just like cable, although that would require scrambling and, at least initially, set-top boxes.
Tupper believes in pay multicasting: "Broadcasters could be the low-cost provider of HBO and provide more local content than anyone else." He estimates that, with a 5% penetration of the market, each station could double the cash flow it generates from its ad-supported business.
Fox should offer a wireless cable service comprising news, movies, time-shifted programming, and demo-targeted channels, he says, but he doesn't see it happening. "Technically, it could be done tomorrow. Politically, I don't think it will ever happen. Fox is going to be hesitant to go into a business that competes with cable while it is negotiating rate increases for its news programming or regional sports channels."
The multicasting leader is PBS, which will most likely hold that position for at least a few years. The PBS DTV signal currently reaches about 80% of the nation's viewers, and, of those, about two-thirds have access to a multicast PBS signal.
According to PBS spokeswoman Stephania Aaronson, PBS stations currently set their own multicasting agenda, with available options including PBS Kids (a 24-hour children's programming network), PBS U (an educational multicast) and also the HD PBS loop. And some stations are even building their own multicast channel or working with others for a regional channel. KTCA-TV Minneapolis has created Minneapolis TV, a local arts and cultural channel, and PBS stations in Wyoming, Idaho and Nevada have created Focus West, a regional network featuring news and public-affairs programming.
On the commercial side, most of the multicasting push is coming from NBC and ABC, possibly to strengthen their hand in the fierce battle over multicast must-carry at the FCC. Cable operators say they will carry multicast services if they think they have value, but they don't want to be forced to carry everything the broadcasters cook up.
In a letter to the FCC last month, ABC O&O President Walter Liss told the FCC what it likes to hear. He emphasized the local and public-service nature of the multicast services that ABC's KFSN-TV Fresno, Calif., is offering: local news, weather, political debates and election results.
He promised more to come at all of ABC's O&O stations. "While generally following the Fresno model, each of our other stations will customize their DTV multicast offerings to fit the unique characteristics of their market."
Scripps's Lansing doesn't necessarily see any political calculation in the timing of the NBC and ABC efforts. "The digital transition has put all of our feet to the fire to move forward on every front, whether it's at the regulatory level or the broadcast level." Others see it as a move to put the FCC's feet to the fire on must-carry.
One multicasting model that appears to have no trouble getting cable carriage could be called UPN-casting. Affiliates of the Big Three networks are becoming dual affiliates, broadcasting UPN over their digital channels along with whatever HD they get from the primary network. At last count, a baker's dozen DTV stations were doubling up with UPN: eight CBS affiliates, three ABC and two NBC. In each case, the local cable systems have agreed to carry the signals.
The newest sign-ons are KMIZ(TV) Columbia, Mo.; WANE-TV Fort Wayne, Ind.; WEVV(TV) Evansville, Ind.; and WFTM-TV Syracuse, N.Y. A half dozen others are in the works, and more are in the talking stage, says UPN Affiliate Vice President Sandy Pastoor.
One of those UPN-casters is WBOC Salisbury, Md. Chief Engineer Danny Panichella says, if CBS comes up with a multicast plan, the station might not be able to accommodate it. Between CBS HD and UPN, he says, the station is using most of its available digital bandwidth. "We really can't spare anything else because we're serving the UPN affiliate, but I don't think we would feel much pressure from CBS because we're keeping their other network on the air."
Granite's KBJR-TV Duluth, Minn., is multicasting UPN under a three-year affiliation agreement, according to Granite Broadcasting President Stuart Beck. It's the only practical application for multicasting at the moment, he says, adding that he expects to make money from it, thanks to cable carriage to most of the market. "It ought to get us enough households to sell local advertising and to gradually hit the minimum so the national advertisers will buy it."
ABC excepted, Sinclair Vice President, New Technology, Nat Ostroff sees some irony in multicasting's current popularity with broadcasters, given the reception Smith and Padden received. That irony would only be compounded if broadcaster promises to fill it with local fare prove a means of answering Washington critics. "We were castigated by everybody. Now, years later, multicasting is the hot new topic that everybody thinks is great, but we have the scars and bruises for putting it forward four years ago."
Despite its early advocacy, Sinclair does not currently multicast. That's in part, Ostroff says, because the company thought it was "impossible for us to go forward because of the political atmosphere."
The company is, however, looking at some multicasting ideas, he says, including using its "centralcasting" operation to create a news channel. But the company is waiting to see if the FCC adopts multicasting must-carry. If not, those ideas would stay just that: "If you can't get cable carriage on your multicast signal, then we're not sure whether there is an audience that is worth the cost."
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