Government Exceeds Original Converter Box Coupon Funding Limit

NTIA reports 33.6 million coupons redeemed

By John Eggerton -- Broadcasting & Cable, 7/24/2009 3:16:46 PM

The government has officially redeemed more coupons than it could have paid for with the original funds set aside for the DTV-to-analog converter box coupon program, though there will likely be some funds left over from the larger allocation.

According to the most recent figures from the National Telecommunications & Information Administration (as of July 22), the government has redeemed 33,578,000 of the $40 coupons that allow viewers to continue to receive a digital TV signal on an analog set. The original $1.34 billion in funding for the program would have covered 33.5 million of the $40 coupons.

Democrats had long argued the program was underfunded.

When the Democratic-led Congress moved the DTV hard date from Feb. 17 to June 12, it also provided an extra $650 million in funds (in the stimulus package) for the transition, $490 million of which went to fund the coupons. So far, $435 million of that has been committed to covering coupon requests. Since the redemption rate is averaging about 55%, that means as of July 22, at least $239 million of that extra money Congress added to the program will have been needed to cover the coupons.

Of course, Congress may also have created some of that additional volume by allowing everyone whose coupon had expired to reapply for a new one. Originally, those whose coupons had expired would have to pony up the money for the boxes themselves.

NTIA continues to average about 35,000 orders a day, with a week to go before the last coupons can be applied for on July 31, or about $5 million more worth of coupons to fund for orders received by that date if redemption rates hold. It will need a bit more to cover the ones that come in after that date but were applied-for by the deadline.

Still, as of July 22, NTIA had about $365 million in funds still available, so there will likely be some left over.