GAO to FCC: Pick a DTV Date

Goal is to provide incentive for HD, 'enhanced' programming

A long ignored idea for speeding the transition to digital TV is gaining new life in Washington. Last week, Capitol Hill analysts urged the FCC to pick a date when broadcasters' cable carriage rights would switch from traditional analog channels to their new digital ones.

By shifting must-carry rights to digital on a specific date, the General Accounting Office predicts in a new report, broadcasters would have more incentive to develop high-definition and "enhanced" digital programming, such as multicasts of several channels.

Also, consumers would have motivation to replace their old analog sets with new DTVs more rapidly. For the idea to work, however, the FCC also would have to require that new TV sets be equipped to work with cable television without set-top converter boxes.

"DTV still has incredible potential for being a driver of economic growth, innovation and job creation," said Rep. Edward Markey, D-Mass., who asked the GAO to study DTV's problems. But the government must take "concrete steps to dramatically accelerate the transition."

By combining a cable-carriage switch with a requirement for "plug-and-play" digital sets, GAO says, broadcasters would be assured of a large audience and have incentive to develop high-definition and other digital programming. GAO does not suggest a carriage "switchover" date, but a source familiar with the agency deliberations says a significant base of cable-ready digital sets could be in homes by 2011, five years after an FCC mandate requiring digital tuners in nearly every TV set.

After Christmas, Markey plans to circulate draft DTV legislation incorporating many of GAO's suggestions. He hasn't decided whether to introduce his own bill or join with House Energy and Commerce Committee Chairman Billy Tauzin (R-La.), who already plans a DTV bill.

The switchover option has been floated before, and the FCC has even proposed it as a possible way to go in previous rounds of comment of the DTV transition. Few industry parties took the idea seriously enough to comment, however. The revival by GAO is getting a favorable reception from lawmakers, who in recent months rejected an alternative idea for speeding DTV adoption by eliminating the so-called "85% loophole" that allows broadcaster to keep operate both analog and digital channels until 85% of households can receive local stations' digital signals.

Draft legislation floated by Tauzin would have imposed a firm 2006 date for retrieving analog spectrum, but the prospect of going all-digital before a critical mass of Americans is outfitted to watch DTV and of consigning millions of TVs to the junk pile met fierce resistance.

Current government law calls for cable companies to grant carriage for local broadcasters' analog signals until the analog spectrum is returned to the government after 85% of American homes are equipped to received local stations' digital signals. Officially, the government has targeted 2006 to retake the spectrum, but, realistically, policymakers concede that the pace of consumer adoption of DTV is way too slow for the 85% trigger to be reached by 2006.

"We're caught between a rock and a hard place," said Tauzin spokesman Ken Johnson. "No one wants to see television sets go fuzzy."

The GAO also recommends that the FCC better publicize the DTV transition after finding that 40% of surveyed individuals were unaware of the plan to one day abandon analog.

Although not saying so explicitly, between the lines, GAO questions whether the FCC and Congress will be able to stick to the current 85%-penetration test for retaking analog spectrum. GAO, the watchdog arm of Congress, notes that complaints from a mere 2 million satellite subscribers faced with losing access to broadcast-network signals illegally imported from distant markets forced Congress to enact DBS carriage rules before those signals were cut off. That controversy will be tiny compared with the maelstrom created if 15% of Americans—16 million homes and 40 million people—lose their local channels. "Policy makers will likely find it unpalatable to disenfranchise a large number of American households," GAO writes.

For now, lawmakers say they won't budge from the 85% giveback target, which could be well beyond 2011. In the meantime, broadcast and cable trade groups say they need more time to review the GAO's findings before weighing in.

Still left hanging is the critical question of exactly what part of a broadcaster's digital signal gets carried. The FCC's effort to revise digital-carriage rules remains stalled over a plan to require carriage of any free service that a station can cram into its 6 MHz signals, not just a single high-definition picture but several standard multicast transmissions, too.