Full Power Broadcasts, Promotion of Digital Broadcast Programming and Plug-And-Play C

[Gregg Lengling]

Increased Set Sales and Declining Prices Mark Strong DTV Equipment Rollout First Quarter 2003 DTV Product Sales Rise 86%

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Arlington, Virginia 4/22/2003

While growing consumer equipment sales have helped accelerate the broadcast transition to digital television (DTV), the Federal Communications Commission (FCC) should ensure that broadcast stations begin transmitting digital signals as soon as possible, and do so at full power, to drive the transition toward completion, said the Consumer Electronics Association (CEA) in comments filed today with the FCC. The filing was submitted for the Commission's "Second Periodic Review of the Rules and Policies Affecting the Conversion to Digital Television."
"By any measure, the introduction of digital television to the American consumer marketplace has been a success," said CEA in its comments. "The adoption rate of DTV has been more rapid than that of PCs, VCRs, CD players and color TVs at a similar time after introduction. Total factory-unit sales of DTV products in 2002 represented 10.9 percent of all television sales."

In its filing, CEA reported that manufacturer-to-dealer sales of DTV products (displays and integrated sets) totaled 766,373 in the first quarter of 2003 on $519.6 million in sales. This represents a unit-sales increase of 86 percent and a dollar sales increase of 64 percent compared to Q1 2002.

"This success lead manufacturers to drop the average price of HDTV monitors 11 percent from March 2002 to March 2003, and we project higher sales figures and additional price drops this year," CEA reported.

While successful consumer equipment sales have helped accelerate the broadcast transition to digital television, a number of factors continue to hinder the transition, said CEA. Most notable is the fact that many commercial stations still have not commenced digital broadcasts notwithstanding the FCC's May 1, 2002, deadline. Moreover, the majority of stations that are on the air are broadcasting at less than full power, depriving many in their analog audience access to their digital signal.

"Only 854 of the 1,688 DTV channels the Commission allotted for DTV broadcasting-or 51 percent-were on the air in early March 2003," commented CEA. "Of these 854, only 394 - 23 percent - were reported to be operating at full power to replicate the service area of their analog station. The large number of stations not broadcasting on their DTV channels at full power unnecessarily delays the DTV transition and return of the analog spectrum."

CEA also pointed to the lack of promotion for over-the-air digital broadcast programming as a drag on the DTV transition, noting that broadcasters do little to promote DTV programming in newspapers or on their analog channels.

"Broadcasters, both as a group and individually, with only minor exceptions, are not doing enough to promote digital programming nor the use of antennas to receive over-the-air- broadcast signals," wrote CEA. "In contrast, the broadcasters' focus appears to be more on obtaining federal mandates to require other transmission services (satellite and cable) to carry their signals. Indeed, the broadcaster advocacy of a mandatory digital tuner requirement is puzzling given their lack of advocacy in the marketplace for over-the-air reception using indoor or outdoor antennas.

"At the very least, the FCC should insist that broadcasters advocate for over-the-air broadcasting rather than increasingly relying on federal mandates on others to ensure their commercial success."

In its filing, CEA further called upon the FCC to approve the cable compatibility plug-and-play standards agreed to by the consumer electronics and cable industries to make sure that equipment is readily available for viewing broadcasts over cable and could be used throughout the country.

CEA also urged the FCC to adopt the Program and System Information Protocol (PSIP) standard in its entirety to ensure that all the functionalities built into DTV broadcast receivers will operate as intended, including closed captioning, V-Chip and translator reception.

"In summary," wrote CEA, "significant manufacturer roll out of DTV products by consumer electronics manufacturers, declining prices and increased sales indicate that the DTV transition is going well for many sectors of the DTV industry. The over-the-air broadcast part of the transition is not making the same progress, however. We urge the Commission to address the issues that are hindering the broadcast portion of the digital TV transition and continue its efforts to see it to a successful conclusion."