NTIA Concerned About DTV Coupons, Converter-Box Supply
FCC, NTIA respond to questions from Rep. Ed Markey (D-Mass.) regarding status of DTV transition
BY John Eggerton -- Broadcasting & Cable, 12/26/2008 11:16:00 AM
Related: The DTV Countdown – Complete Coverage of the DTV Transition
The FCC says it should be able to handle calls about the DTV transition, but only with industry help. The National Telecommunications & Information Association (NTIA), meanwhile, says it may need up to $330 million more in funding to ensure no slippage or stoppage in distribution of its $40 DTV-to-analog converter box coupons.
In addition, NTIA says there could be a shortfall of up to 2.5 million converter boxes given current supply and anticipated demand.
Those sobering assessments came in responses to questions put to FCC Chairman Kevin Martin and acting NTIA head Meredith Attwell Baker from Rep. Ed Markey (D-Mass.) regarding the status of the DTV transition.
Markey said he would go over the responses but was already bracing for a cash infusion. “I will carefully review these responses," he said Friday, "but it is becoming increasingly clear that at minimum Congress may need to quickly pass additional funding for the converter box program in early January to prevent any delay in coupon availability or issuance.”
The FCC has told Congress it plans to spend about $10 million on in-house and outsourced call centers to handle viewer questions/problems during the final days of the DTV transition, saying that will help operators handle an estimated 350,000 calls per day during the week of Feb. 15-21.
But the FCC said that would not be enough money or operators to handle the expected flood of calls. Even if it allocated all $20 million Congress recently gave it for the transition, it would not be enough, said the FCC.
Martin said that additional resources from broadcasters, cable companies, states and others will be "critical," but that those efforts, combined with the FCC's, should be sufficient to handle viewer questions without any more money from Congress. But he did say he would welcome any additional funds Congress wanted to give the FCC.
Martin confirmed that government and industry representatives, including President-elect Barack Obama's transition team, had been meeting to discuss the call centers and other issues.
NTIA's Baker also was asked for her take on the transition, particularly whether there would be enough money to hand out all the DTV-to-analog converter box coupons that would be requested.
She said that with an anticipated 60%-65% redemption rate for the coupons and the $1.34 billion cap on funds, NTIA would run out of money for coupons and administration costs in January, perhaps as early as the first week. The agency then would have to wait until more coupons expired before sending out more. She conceded that would not be good. "Once the obligation ceiling is reached," she told Markey, "the Program will hold coupon requests until funds from unredeemed coupons become available for obligation. NTIA realizes that this would likely result in consumer confusion and dissatisfaction with the Program."
Currently, NTIA is set up to distribute 51.5 million coupons, but that number could be 60 million by the end of the program March 31, Baker said.
As to converter box availability, Baker said that demand could outpace supply by 2.5 million if additional coupons were distributed, but also said retailers have "generally kept pace" with demand and "would work to ensure inventory is available if additional coupons are to be distributed."
For Martin's answers to all Markey's questions, click here.
For Baker's full response, click here.
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From the home page of this section: "As the TV industry prepares for the switch to digital broadcasting on Feb. 18, 2009, B&C provides the latest news and analysis on the DTV transition."
Can we stop calling this a "switch TO" digital?
Even today, I read another piece ("WSJ") where the writer asked why we are making this overnight "switch".
Come on...this transition process has been going on for nine years. We are switching to ALL-Digital, we are switching OFF analog broadcast TV, we are not "flipping" from one to the other.
Ken English - 12/29/2008 3:13:00 PM EST -
MONEY CAN'T BUY YOU TIME. Throw tens of millions more at this transition and it won't solve the underlying problem: more time is needed to get coupons out; to install repeaters; to educate consumers (try aiming a roof antenna in the dead of a Midwest winter); to let the elderly outreach program (started way late in the game) take hold; etc. If there were NO coupon program keeping prices artificially high, boxes would be retailing for a lot less. When TV execs realize there could be an audience shortfall of 5 percent or more due to inability of OTA viewers to receive adequate signals -- prompting advertisers to demand makegoods -- they will beg Congress to mandate the extension of analog, maybe until Aug. 31, 2011, the Canadian target date for analog shut-off. Much money ill spent? Maybe, but at least not a public fiasco. More 4-1-1: nowpublic.com/world/u-s-tvs-digital-deadline-obama-eras-first-consumer-crisis
Vic Livingston, columnist, My.NowPublic.com/scrivener - 12/27/2008 12:25:00 AM EST
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