A Best Buy store in northwest Washington, D.C., set the stage Thursday for the kickoff of the digital-TV converter-box-coupon program in an event that looked for all the world like the Yalta conference. It didn’t quite rise to the level of the allied powers convening to decide the fate of the post-war world, but it did unite the major players involved in the switch from analog to digital in the TV world.
On hand were U.S. Commerce Secretary Carlos Gutierrez, Federal Communications Commission chairman Kevin Martin, Best Buy senior vice president Michael Vitelli, National Association of Broadcasters president David K. Rehr, National Cable & Telecommunications Association president Kyle McSlarrow, National Telecommunications and Information Administration head Meredith Atwell Baker and CEA VP Jason Oxman. CEA president Gary Shapiro would have been there but he was at a board meeting in Utah.
The message was that much has been done to educate TV viewers about their options in the coming digital age: Get a converter box if they have an analog-only set and want to receive over the air signals; hook up to cable or satellite; or buy a new DTV or HDTV set.
The NTIA is overseeing the converter-box-coupon program, and it has said boxes will be on the shelves Feb. 17, when it will start processing coupon requests. Consumers have been able to apply for the coupons since Jan. 1, and more than 2 million people have already applied for more than 4 million coupons (a maximum of two per customer).
As flashes flashed, Vitelli reminded an audience of reporters and the occasional interested Best Buy shopper that his chain had been the first to stop selling analog TVs back in October, and he called the upcoming transition "one of the most important days in communications history.”
That day was the official announcement that digital-to-analog converter boxes are now available in Best Buy, RadioShack and Wal-Mart stores. Best Buy also unveiled its new hotline, 877-BBY-DTV9, where customers can get information about the transition and eventually redeem their coupons and purchase the boxes over the phone.
Vitelli said the transition was unprecedented for retailers, as well as the media, adding that it had required revising its point-of-sales system and retraining employees.
Asked why hooking up to cable was option No. 2 for a transition that is primarily broadcast, Martin conceded that the education message would probably be different depending on who was giving it out -- cable could be expected to recruit viewers to its service, broadcasters to tout the benefits of over-the-air "and I won't be surprised at all if the consumer electronics manufacturers are encouraging them to buy a television or to buy a converter box," he said.
Rehr did not disappoint. Speaking before a bank of monitors all showing DTV-converter-box coupons, he said, “Digital broadcasting offers crystal-clear pictures and sound, more channels and more services than ever before. And it's free!”
Rehr added that as part of what he called a $1 billion education effort, broadcasters would launch a new set of public-service announcements later this month focusing on the coupon program.
Martin proposed requiring broadcasters to air a certain minimum number of PSAs, but broadcasters countered with their own proposal that the FCC exempt from such rules any broadcaster that commits to voluntarily exceed that minimum.
Martin said he and the others were united in an effort to make sure viewers don't wake up to a blank screen Feb. 18, 2009, when the plug is pulled on most analog signals (low-power stations and TV translators are not required to make the switch at that time).
The coupons -- worth $40 apiece toward the purchase of a converter box costing anywhere from $40-$70 -- expire within 90 days, so having them on the shelves when the NTIA starts issuing them is important. Asked why only three retailers had them on the shelves, Gutierrez pointed out that those three already had the boxes, so they were early, and he thought they would be widely available by the time consumers started getting their coupons. He added that there should be enough coupons for everyone who needs them. "This will be the open market, so there will be plenty of demand and plenty of competiton," he said. "We don't see any reason why the converter boxes won't be in really widespread distribution. For the time being we have three retailers who have national distribution and who will cover many communities around the country."
Vitelli added that there are 250 retailers certified to carry the boxes, but that those three have them now. "It is a supply and demand issue that many of us are challenged in making that decision. I could do an hour on the technical complexity of how many boxes and how many stores, how many manufacturers and how many retailers. It is why retailers like Best Buy have stepped up to put them in all stores."
Guttierrez said he expects "a lot more" retailers to have the boxes in stock by the time NTIA mails out the coupons.
That was echoed by Oxman, although the CEA and the NAB differ on their figures. The NAB says 17% of households are analog-only, while the CEA put the figure at 11%.
Rehr said he would have to wait and see whether there were enough coupons, adding that he expected an increase in requests spurred by the NAB's new education efforts. If it looks like they are going to run out, he added, he would ask the government for more funds for more coupons.
The event was initially scheduled for next week, closer to the one-year pre-anniversary of the Feb. 17, 2009, hard date for the switch to digital. But Congress had other ideas, scheduling a couple of DTV-transition-update hearings that forced the move to this week.