Lawmakers Mull Subsidy for Digital Converters

[Gregg Lengling]

In an effort to speed up the transition to digital TV technology, federal lawmakers indicated today that they are giving serious consideration to subsidizing the acquisition of digital converters for millions of analog television sets-a move that industry sources said could cost the U.S. Treasury billions of dollars.

The lawmakers didn't spell out exactly how many of the almost 300 million analog TV sets currently in U.S. homes would qualify for the subsidies. But at congressional hearings today, Rep. Joe Barton, R-Texas, the influential chairman of the House Energy and Commerce Committee, suggested that any federal payments be limited to low-income Americans. He also said the payment plan could clear the way for setting a firm DTV transition deadline as early as the end of 2006.

At the hearings, Gary Shapiro, president and CEO of the Consumer Electronics Association, said digital-to-analog converters currently cost anywhere from $200 to $400, but that the price could drop to less than $100 when manufactured in volume.

Industry sources said there are 80 million analog TV sets in the United States that aren't hooked up to cable or satellite. So at the $100 price, it would cost the government $8 billion to subsidize converters for the broadcast-only sets alone. A controversial plan by the Federal Communications Commission could eliminate more than 70 million analog sets currently hooked up to cable from the universe of 300 million sets needing converters by clearing the way for cable operators to downconvert broadcast digital signals to analog at system headends.

The FCC proposal, though vehemently opposed by broadcasters, received positive reviews from some key lawmakers at today's hearings. "I am intrigued so far by what I have heard of the proposal," Rep. Barton said.

Rep. Fred Upton, R-Mich., said, "This proposal brings a lot to the table."

[summerfun]

though vehemently opposed by broadcasters, [/B]

Why would the broadcasters oppose this? Don't they want their customers to receive their digital signal? The sooner everyone is on digital, the sooner they can stop dual broadcasting.

They are forced to go digital whether they like it or not. The proposal does not change that fact. It does however allow their customers to keep watching their programming.

It seems to me, they would be thrilled. Currently they are faced with millions of people that will not be able to watch their programming as soon as we hit the 85% threshold and they are forced to shut down analog.

[gparris]

I don't care if I have to pay another $7.95/month for my kid's bedroom TV set with its out-of-date analogue built-in tuner from 3 years ago. If I had satellite, it would be another $4.99/box/month to "mirror" service and deliver it them, anyway.

 If I get the spectrum back for more digital channels on cable, especially the HDTV ones TWC says it can't deliver because of bandwith-eating analogue channels, so be it.

 If the government wants its spectrum back and has to subsidize the convertor boxes so it's one to five dollars less a box - and - the government still can make the billions of dollars it says it will get for the treasury getting the spectrum back, great.