Article from USA Today (4/10/02)

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Competing interests slow rollout of digital television

By David Lieberman, USA TODAY

LAS VEGAS — While the conversion from analog to digital TV may be inevitable, station owners say it will continue to be slow — despite Federal Communications Commission Chairman Michael Powell's proposal last week to resolve some disputes between broadcasters, cable and satellite companies, and TV set makers.

"The chairman's proposal is a terrific step forward," National Association of Broadcasters CEO Edward Fritts said here at the industry's annual meeting. But "the plan is voluntary and not intended to be comprehensive."

Broadcasters say they still want the government to order that all new TV sets come with digital receivers, as well as analog. Most digital TVs sold are primarily used to provide clearer video for DVDs — only 14% of digital sets sold last year could receive broadcast digital TV.

Powell asked makers to voluntarily include digital tuners, beginning with the largest sets in 2004, and on all sets 13 inches or larger in 2007.

Many here are just as worried about whether cable subscribers will receive their digital transmissions.

Before stations spend heavily for digital TV they need assurance of cable carriage, says Tom Van Wazer, an attorney at Sidley Austin Brown & Wood who represents several small TV stations. They say Powell's plan falls short by just asking operators with highly advanced systems to carry several digital programming services. That would have little impact in rural areas. "Most smaller cable markets haven't been upgraded," Van Wazer says.

And even in big markets cable is a question mark over the digital rollout.

"My fear is that if cable carries a few broadcasters in major markets, that'll be viewed as satisfactory," says Ellen Goodman, a Covington & Burling lawyer who represents large broadcasters.

And many say Powell left a giant loophole by letting cable operators count non-broadcast services such as HBO and Showtime as digital carriage.

The FCC's Rich Chessen says the Powell proposal was "not written to be a regulation. This is a voluntary plan that asks people to do the right thing."

But the FCC may be forced to mandate details that still bedevil broadcasters and cable. For example, it's unclear how much systems, to save bandwidth, should be allowed to downgrade the quality of a TV station's digital signal.

While broadcasters are suspicious of cable, there are some signs of a thaw in their relations.

"Several cable operators are negotiating with CBS and PBS" to carry their digital transmissions, says Richard Doherty of the Envisioneering Group