FCC Chairman Michael Powell gave the DTV transition the regulatory equivalent of a kick in the pants, floating a plan that would obligate broadcasters, cable, DBS and set manufacturers to provide specific levels of digital service.
Although the plan is billed as voluntary, industry officials speculate that Powell will use the threat of potentially tougher legislative or regulatory prods against lagging industry sectors to get everybody on board.
Powell's outline was first presented to top lawmakers April 4. Some in Congress have suggested that legislation may be necessary to generate cross-industry cooperation. The FCC plan is aimed at pushing the industry into agreements that would end disputes snagging the DTV transition and, perhaps, obviate congressional action.
"I intend to seek commitments along these lines in the near future," Powell wrote in letters to Sen. Ernest Hollings (D-S.C.) and Rep. Billy Tauzin (R-La.), chairmen of the Senate and House Commerce Committees, respectively.
Each group in the DTV business would be obligated to play a critical role:
Programmers: Big Four broadcast nets, HBO and Showtime would provide HDTV, "value-added" DTV, multicasting or interactive programming (not simply upconverted analog) during 50% of prime time beginning this fall.
By Jan. 1, 2003, Big Four affiliates in the top 100 markets would pass through network DTV with no signal degradation.
Operators with digital tiers would carry, at no cost to stations and programmers, up to five channels with digital programming during 50% of prime time. Channels would not have to be broadcast channels. Subscribers must be offered set-top boxes capable of displaying HDTV, as well as the connectors necessary to link to DTV sets.
Satellite companies would have to carry up to five programmers offering digital during 50% of prime time.
Half of sets 36 inches and larger would have DTV tuners by Jan. 1, 2004, 100% by Jan. 1, 2005; half of sets 25-35 inches by Jan. 1, 2005; all sets 13 inches and larger by Dec. 31, 2006.
Powell stressed that the plan would not preclude new DTV rules and that ongoing rulemakings would continue on mandatory cable carriage of local DTV signals, copy protection, "plug-and-play" TV sets, and other measures. "These are issues that can and must be resolved. But I do not believe we must defer all progress until we do."
So far, only broadcasters have had specific DTV mandates: By May 1, all stations are supposed to offer DTV and are obligated to return their analog spectrum when 85% of households can receive digital signals.
Most industry trade groups were caught off guard by the proposal, which was dropped on them with no warning. Many question whether a voluntary initiative will motivate the cable and TV-manufacturing industries to take steps that broadcasters say are necessary to get DTV signals to the 80% of TV homes that rely on cable.
Still, the initiative was almost immediately applauded by Disney President Robert Iger, who told Powell his ABC network "accepts your challenge" to shoot half of this fall's lineup in HDTV.
Other industry players were less sanguine. The Consumer Electronics Association reiterated its longstanding opposition to a DTV-receiver requirement while continuing to urge obligations for other industries. "A tuner mandate will undercut consumer choice," said Michael Petricone, vice president, technology policy. CEA also is leery of the call to make available so-called IEEE 1394 "firewire" set-top–box connections needed to render DTVs as interoperable as personal computers. The group continued to call for increased HDTV programming from broadcasters and for cable to finally establish standards for plug-and-play sets that won't need a set-top box.
Cable operators worry that the plan obligates them to devote spectrum to local broadcasters using digital multicast capabilities for little more than re-airings of prime time dramas and sitcoms. Their comment for public consumption, though, was plain old vanilla. "Chairman Powell has put forward some thought-provoking proposals," said National Cable & Telecommunications Association President Robert Sachs.
National Association of Broadcasters President Eddie Fritts called the plan "a major step forward" but added, "We have concerns over elements of the proposal." NAB wouldn't spell out reservations, but other broadcast lobbyists said the cable carriage mandate for "up to five" channels leaves operators leeway to carry only one or two digital channels—none of which, perhaps, have to be local broadcast stations.
That would seem a crucial reservation for broadcasters. Still, they generally are more enthusiastic, if only because multichannel providers and manufacturers would face implementation benchmarks.
"It's encouraging," said Greg Schmidt, LIN Television lobbyist. "There has to be a comprehensive solution that takes into account cable and DTV tuners."