Consumers in the dark, GAO study finds

[Gregg Lengling]

WASHINGTON (Reuters) - Few U.S. consumers are aware of the transition to digital television signals that will offer higher-quality pictures, and more steps are needed to accelerate the move, said a report to Congress Monday.

About 40 percent of Americans said they had never heard of the digital television transition and another 43 percent said they were only ``somewhat aware,'' according to a survey of 1,000 people included in a report by the General Accounting Office, the investigative arm of Congress.

Additionally, almost half of those surveyed did not know the differences between the current analog television signals and digital, the GAO said in a report sought by Rep. Ed Markey, the ranking Democrat on the U.S. House Energy and Commerce subcommittee for telecommunications.

``If consumers are unfamiliar with DTV -- particularly with benefits such as high-definition television -- they are less likely to purchase digital television sets,'' the GAO said. LG Electronics Ltd.'s Zenith and others have been running advertisements recently to promote digital signals.

Congress and the Federal Communications Commission have been pressing for faster advances of digital television so consumers can enjoy better pictures while the government can reclaim the airwaves used by the old analog signals. Those airwaves will likely be auctioned to wireless companies.

But sales of digital television units have been slow because they are expensive -- $1,000 and above -- and were just 5 percent of overall television sales last year.

Plus, content providers have been somewhat hesitant to produce programs in digital out of fear that shows will be illegally copied, and there have been differences between cable operators, television manufacturers and broadcasters over how to get the signals to consumers.

To jumpstart the move, the FCC has ordered television manufacturers to include digital tuners in new sets starting with the larger screens in July 2004, though the industry is challenging the ruling. Plus, the agency pushed programmers to make more shows available in digital.

STEPS IN TRANSITION

``Many other things must happen before the transition can be successfully completed,'' the GAO said. ``These include adoption of DTV equipment by consumers, cable carriage of digital broadcast signals and the availability and provision of digital programming.''

The GAO urged the agency to consider a specific date to require cable operators to switch to carrying digital signals from carrying analog signals. The FCC said that was one option under review.

The report also urged the FCC to evaluate the benefits and costs of requiring television makers to produce sets that are digital cable-ready.

``I will be crafting legislative proposals in the coming weeks that contain the policy suggestions advanced by the GAO, as well as other initiatives, for consideration by my subcommittee colleagues,'' Markey said.

Reps. Billy Tauzin and John Dingell, the chairman and ranking Democrat respectively on the full House Energy and Commerce Committee, plan to introduce a measure early next year ''to hopefully provide a roadmap for getting this (transition) done,'' said panel spokesman Ken Johnson.

Facing the lack of understanding about the transition, the GAO urged the FCC to consider embarking on a public relations campaign to boost awareness about digital television. The National Association of Broadcasters and the Consumer Electronics Association in January launched a consumer education program.

There are 250 million televisions already in consumers' homes and 68 percent of those surveyed did not know they would need a converter box to receive over-the-air digital signals.

Plus, the GAO said visits to retailers discovered staff overestimating how much digital content was available and misstating what was needed to receive digital signals.

``The potential combination of consumers who may be unaware of the DTV transition, interacting with retailers providing erroneous DTV information, is a consumer protection nightmare scenario,'' Markey said in a statement. The FCC ``should explore initiatives to address this concern.''

The cable industry said in response to the GAO report that it was already rolling out service to many cities while working with television broadcasters and TV makers on getting the signals to consumers.

NAB said 700 stations would be offering over-the-air digital signals by year-end and 60 percent of Americans are in markets where at least five stations are broadcasting in digital.