DTV Difference Comes Down To Money - Broadcasting & Cable

DTV Difference Comes Down To Money

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Both the House and Senate Commerce Committees have now passed DTV transition bills, but battle lines have been drawn over how much government money to provide to viewers with analog-only TV sets when the plug is pulled.

The difference between the hard date—the date when broadcasters will shut off the analog signal and go all-digital—in the two bills is only a few months. The Senate has urged April 7, 2009, when the College Bowl games, the Super Bowl and March Madness will all be done.

The House bill sets the date at Jan. 1, 2009, which is already later than House Commerce Committee Chairman Joe Barton (R-Texas) had wanted.

The more significant difference between the two bills is the amount of subsidy for the digital-to-analog converter box. The bipartisan Senate bill set aside $3 billion for a $40 subsidy to cover two-thirds of the predicted $60 price of the box, while the House bill offers only $990 million for that same $40 coupon.

Those and other issues will have to be hammered out in a conference between the House and Senate following floor votes in the next two or three weeks on the budget- reconciliation package that contains the DTV bills.

The DTV-transition bills and the need for a hard date were given new urgency by Hurricane Katrina, which revived concerns over emergency-communications failures. Some of the reclaimed analog spectrum will go to first-responders, and there is money in both bills for new communications equipment.

The Senate bill did not spell out how its subsidy would be administered, thanks to Senate rules that prevent legislating on budget bills.

The House bill, by contrast, is detailed, and its outline of the subsidy makes clear that it is a limited fund, and purposely so, that will likely not cover everybody who will need the box.

That Republican bootstrap- versus-handout take on the subsidy helped generate the most-heated debate. Republicans were pushing for a more limited subsidy for those who applied for it, while Democrats were calling for a subsidy that would cover everyone.

The Democrats were twice defeated on attempts to increase the subsidy.

Pointing to the more generous Senate bill, the Democrats on the committee wanted to boost the subsidy from $990 million ($830 million after administrative costs) to $3.5 billion- $4 billion so that it would cover all $60 of the cost of the box. The base bill covers $40 and would apply to all viewers. It also caps the subsidy at the first 10.3 million households to apply, with a limit of two coupons per household.

Democrats said more than 20 million houses were analog-only, while the Republicans countered that it was 15 million. Either way, the House subsidy wouldn't cover them all.

Democrats also wanted to send the coupons to everybody, while the Republicans want a several-step process for those who take the “affirmative action” of asking for the boxes and thus presumably really need them.

Democrats say that process will favor individuals who are comfortable giving information to the government and understand the process; in turn, they say, it could work against poor, minority and elderly populations, who make up the majority of analog-only viewers.

The Democratic alternative would also have put all the money from spectrum auctions of the old analog signals into communications-related efforts, with nothing left over for the general treasury.

Rep. Ed Markey (D-Mass.), who co-sponsored the amendment, said that, without a subsidy covering everyone, the January 2009 hard date would be untenable. He suggested that the date be moved to April to match the Senate bill. Under the House plan, he said, the hard date would likely have to be moved as the transition got closer.

Democrats said they opposed the “TV tax” on the poor and elderly that the subsidy would represent if it covered only $40 of the $60 converters and only those first-come, first-served viewers.

Markey also argued that rendering 70 million sets inoperable was a “government taking” that required full restitution.

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