With more than 1,100 commercial stations still not transmitting digital signals, one would think that companies involved with tower construction and manufacture of DTV transmission products would be busier than a peanut vendor at an elephant convention.
Think again. The DTV circus is still out of town.
"The tower build-out hasn't been at the pace that we had hoped," says John Sluymer, president of LeBlanc Broadcast Group, a major manufacturer of broadcast towers and RF systems. "We expected there would be a bigger rush, like a tidal wave. There are some small waves, but there are no tidal waves."
Last week, the NAB released a good- news/bad-news report disclosing that 68.2% of 785 surveyed stations will be on-air with digital signals by the May 2002 deadline imposed by the FCC. But that leaves 250 of the surveyed stations admitting that they will not be ready in time (see story in Top Of The Week section).
Ira Goldstone, Tribune Broadcasting vice president of engineering and technology, doesn't doubt that survey. Tribune has eight stations on-air with DTV and four more scheduled to be up later this year. "We have six stations that may not make it due to local zoning, stuff like that," he adds. "We're working towards them all being on air, but six might not make it."
LeBlanc's Sluymer agrees that stations are having a tough time because of regulatory issues. "Technology has nothing to do with this," he adds.
What does have something to do with it is the economic slowdown. "The economy is down, so advertising is down and most probably revenues are down," says Ray White, president of Kline Tower and Steel. "And where's the programming? If the programming were there and [stations] were being provided something to get out, they would be pushing a lot more."
The end result is that Kline, like LeBlanc, hasn't seen a big push for the conversion to DTV. "Sure, we're busy, but we're not dizzy like we would need to be if this were going to happen by May of 2002."
Goldstone says that new technologies, like those allowing the combination of multiple signals on a single tower, are actually partially responsible for reducing demand for tower improvements. "Some of it is just workarounds," he says.
With an average of more than 33 stations needed to go on-air each week to satisfy the mandate, station groups have already begun lining up reasons for government officials on why they need deadline extensions (some hold that the release of the report last week is another shot across the bow hinting at deadline problems). But transmission and tower manufacturers seem to imply that any attempts to blame delays on lack of crews or equipment would be ineffective. Transmitter manufacturers have spent the past couple of years getting ahead of the game with transmitter construction, and many now have a backlog of equipment.
"As it gets closer, if people don't place an order soon, delays could be an issue as far as getting a station on-air by May, but we've got plenty of backlog products to support the demand that we hope will come," says Bruce Allan, president and CEO of transmitter manufacturer Harris Broadcast.
Harris is able to deliver a digital transmitter in 90 days, he says, adding that, even though the company is handling what he calls the lion's share of work related to the 475 digital transmitters on order or currently on-air, it would be able to handle more activity.
Doug Standley, president of tower builder and site-management company SpectraSite Broadcast, says that time is running out if stations are serious about the deadline. He points out that tower heights of up to 1,000 feet for low-power operation can be built in time but anything above that—where many medium to large broadcasters need to be to replicate their NTSC coverage—is problematic due to a limited number of qualified crews.
But, as Bill Clinton's campaign said in 1992, it's the economy, stupid.
With technical issues settled, broadcasters are now finding it hard, if not impossible, to justify the expense of going digital. Some industry officials believe that, aside from the deadline, there is little incentive for broadcasters to make the transition.
For example, to date 150,003 DTV sets with tuners capable of receiving an off-air digital signal have been sold in the United States, a number that includes both set-top boxes and integrated receiver/displays, according to the Consumer Electronics Association. And even these aren't sales into American homes as they include sales to appliance dealers. Couple limited capital funds in a soft economy with a lack of viewers and DTV becomes a not-too-attractive option.
"I think one can count on the FCC to be reasonable in granting extensions to stations with tower/antenna-location difficulties," Nat Ostroff, who serves a dual role as president of transmitter-manufacturing company Acrodyne Industries as well as vice president of Advanced Technology at Sinclair Broadcast Group, remarks. "Where [the FCC] will play hard ball is with a station that has done nothing and intends to do nothing."
Yet the granting of extensions is not a foregone conclusion, even though the commission's ambiguity on the subject has caused many to doubt the seriousness of the deadlines.
"The FCC needs to be more definitive in its messages to the industry," offers Chris Taylor, vice president of sales at Thomcast Communications, which makes the Millennium digital transmitter. "Things like DTV receiver performance and other guidelines for what's acceptable must be clearly defined so that confusion is minimized."
Although there have been signs from FCC Chairman Michael Powell that Congress could extend the 2006 date, the issue is thorny. If Congress does grant extensions to some stations, what about the 202 stations that have already made the investment?
"We're not going to be pleased to have spent the money to comply with the rules and then have the rules change because some other guy didn't spend the money," said one West Coast chief engineer, who asked to remain anonymous. "They still have their money in the pockets, and I'm out millions of dollars."
Ostroff concurs, pointing out that his company will have spent $100 million on the digital transition when all of its stations are up. "I think our response is going to be, we've been damaged here," he says, hinting at a lawsuit.
What remains evident is that, if the terrestrial transition continues to move along slowly, it could be detrimental to broadcasters' future business. Many predict that the FCC will make extension decisions based on the financial capacity of the station to comply.
"There are stations ignoring the entire process due to the inability to bring themselves to spend the kinds of money necessary to make the transition," says Ostroff. "I think there's a general revolt going on among stations, with substantial numbers saying, 'I'm just not going to do anything.'"
But the commission already has made clear that it won't accept "economic hardship" as a reason for TV stations to put off the transition.
"While sensitive to the economic challenges facing small-market broadcasters and the funding problems facing non-commercial stations, the commission rejected this approach," wrote FCC Mass Media Bureau Chief Roy Stewart to Sen. Phil Gramm (R-Texas) in July.
Stewart points out that the commission will "grant an extension of the construction deadline where a broadcaster has been unable to complete construction due to circumstances that are either unforeseeable or beyond the licensee's control, if the licensee has taken all reasonable steps to resolve the problem expeditiously. Such circumstances include, but are not limited to, the inability to construct and place in operation a facility necessary for transmitting DTV, such as a tower, because of delays in obtaining zoning or FAA approvals, or similar constraints, or lack of equipment necessary to transmit a DTV signal.
"The commission stated that it did not anticipate that the circumstance of 'lack of equipment' would include the cost of such equipment," Stewart says.
Stations that aren't going to make the deadline can get two six-month extensions from the Mass Media Bureau and then requests for further delay will be referred to the entire commission, Stewart says.
Constructing a new tower can cost anywhere from $2 million to $7 million plus the cost of the antenna, transmission line, transmitter and RF gear, which can range from $1 million to $3 million.
Many broadcasters will probably try to build onto an existing antenna, which often involves strengthening the structure and retrofitting it with the new equipment. Although this often is the more cost-effective route, it can still run into the millions. Either option also requires long lead-times (often from six months to a year) so broadcasters would have to have begun the process already if they hope to meet the deadline.
And there are additional costs. Ted Collora, a vice president with international design-consulting and construction firm Hanson Professional Services, headquartered in Springfield, Ill., says that a "no-frills" design, depending on the site location, usually costs between $1.5 million and $2 million, excluding the transmitter or tower.
Furthermore, for those stations that do make the capital investment in equipment, issues like power levels also surface. Standley believes that many broadcasters are doing the minimum required by the FCC to get on-air while they work out their business plans.
"We're seeing more and more groups state they will do the minimum," he says. "Many have not adopted their full-power capability … there is a tremendous amount of confusion, and it comes down to economics. Many groups under no circumstances can capitalize on the full-power convergence."
Cost-effective technical solutions include a phased approach to power output whereby a station can buy a low-power transmitter today, then upgrade it later by swapping a module (see "Xmitter power play," page 34). Virtually every transmitter manufacturer, including Acrodyne, ADC Broadcast, Harris Broadcast, Larcan, and Thomcast, can accommodate this strategy.
The problem is, there seems little point in transmitting at full power if few consumers have DTV sets capable of receiving the signal. Indeed, if a typical full-power transmitter operates at 21 kW for 24 hours a day seven days a week and the local power company is charging $11 per kWh, a station will be spending $100,000 per year. With some markets having 100 DTV viewers in the market, the merit of the investment is debatable.
Thus, the prevailing opinion is that many stations, especially in smaller markets, will begin broadcasting at limited power, not reaching their entire NTSC coverage area until there are enough sets in the market to justify the expense.
For equipment manufacturers hoping to support the demand, when and if it comes, the waiting is the hardest part. These companies are trying anything and everything to relieve some of the financial burden on broadcasters, offering easy payment plans and helping to acquire bank financing.
Nonetheless, there are broadcasters that see digital as the future and not as something that just sucks money out of the budget. The justification is clear. "I feel as though digital is happening everywhere in every industry," says Fred Lass, chief engineer at Albany, NY, CBS affiliate WRGB (TV). "And any TV station that thinks it will make money from analog broadcasting in 10 years should rethink its position."
In Albany, six stations will feed their digital signals through three antennas. LeBlanc is building the tower, and Dielectric is providing three antennas, feed line and combiners.
Although there is no finite date for completion of the tower, Lass says, "we are working toward the FCC deadline."
In several markets, broadcasters are finding this co-location approach an economical solution to their tower problems. The approach has been proven at Sutro Tower in San Francisco, the DTV Condo in Needham, Mass., and DTV Utah in Salt Lake City.
"[Stations] have always worked independently, and now they need to work as a market," Standley says. "This conversion will happen only if the markets work efficiently."
Some broadcasters are also considering tower leasing as a quick and economical way to get on-air.
"Broadcasters need to focus on their core business, and that's local content and ad revenue," Standley stresses. "Our business is to be their tower partner and take the overhead away."
One of SpectraSite's latest projects is a 2,000-foot candelabra-style broadcast tower in Mobile, Ala., that will be able to accommodate more than 20 television and FM broadcasters.
Clear Channel-owned NBC affiliate WPMI(TV) will be one of the tower's tenants. "We analyzed it financially, and it made sense," says WMPI Vice President and General Manager Sharon Moloney. "SpectraSite was very flexible in negotiations."
In several markets, despite concerted efforts by broadcasters to get on-air with a digital signal, zoning regulations and community opposition to towers have created a huge roadblock.
Denver is perhaps the most notable example of this: KUSA-TV, KCNC-TV and KMGH-TV organized a consortium several years ago to build a joint DTV tower. Today, KMGH-TV is the only station in the consortium that is on-air.
In Hartford, Conn., community opposition and zoning laws have kept NBC O&O WVIT-TV from building its new tower on Rattlesnake Mountain in nearby Farmington, Conn. The station has proposed taking down its two existing towers, which are already loaded to capacity, to build a single, taller tower, but it has been rejected by the local zoning authorities several times.
"We're kind of stuck between a rock and a hard place," says WVIT-TV Director of Engineering Dave Bondanza.
According to WVIT-TV Vice President and General Manager Tom O'Brien, the station is working with neighboring tower owner Chase Enterprises to come up with a "creative" solution.
"We really are at the mercy of the zoning authorities as to what we will be able to construct," he says. "We'd like to get things done as soon as possible."
Public broadcasters are also beginning to face the DTV-transmission challenge. Public Broadcasting System (PBS) currently has 175 member organizations that operate 349 transmitters, and they are struggling with the transition. Some members are state organizations that operate from three to 15 transmitters throughout the state from a single master-control facility. Others are individual local stations, like WETA-DT Washington. Still others, as in Miami, are operated by school boards.
"As the commercial guys are holding back, so too are some of the public stations," observes Edmund A. Williams, an engineer at PBS headquarters in Alexandria, Va. This has caused private funding to be held back because, as people who normally support public broadcasting see this confusion surrounding DTV, they are increasingly skeptical, he says.
There is a "modest amount" of federal money available, according to Williams. Congress earmarked $20 million on July 20, "but we'd like a bit more, especially since [the transition] is a federal mandate," he says.