BROADCASTERS FEAR DIFFICULTIES MEETING 2002 DTV DEADLINE

Broadcasters have been touting launch of DTV by 187 stations reaching 68% of U.S. TV households, but that still leaves more than 1,400 stations that have to begin DTV broadcasting within next 13 months. One industry official said that meant one DTV station would have to be turned on every 6 hours in next 13 months. Particularly with ad revenue down, in many smaller markets launching DTV is “not a rational act,” Kraemer said. Others acknowledged that many stations in smaller markets probably wouldn’t meet deadline. Without guaranteed access to audience, “none of the deadlines make market sense,” Claudy said: “I do see this issue coming to an unhappy confluence.”

Broadcasters that fail to anticipate wireless tower capacity bottlenecks will increase chance of missing FCC-mandated May 2002 digital TV transition deadline, said David Sparano, principal engineer in Harris Corp.’s Bcst. Communications Div. Companies in northern states that don’t execute firm plans to deploy DTV antennas by Nov. “have virtually no chance of meeting” 2002 deadline since “tower work is difficult, if not impossible” in winter months, he said Sun. during NAB convention discussion, “A Look Back On 100 DTV Stations: What Lessons Have Been Learned?”

“Early predictions about a lack if capacity in the tower industry appear to be coming true,” Sparano said. “Tower erectors are currently reporting that availability is very tight. In fact, if a broadcaster does not already have a firm commitment and time slot from a reputable tower service company, they are in trouble for meeting the May 2002 deadline.”

Companies unprepared to submit extensive documentation to state and/or local zoning and environmental agencies, as well as to FAA, will face additional impediments to timely DTV compliance. Transmitter site building additions and tower modifications “can add months, or even years, to a DTV implementation schedule,” he said. FAA review of new towers or changes in tower heights “usually takes 3 to 6 months and there always is a significant risk of rejection,” he said.

Member of National Assn. of Tower Erectors told us his company had 17 tower crews and “all are booked” through end of year. But he said there still were hundreds of TV stations that weren’t yet preparing for FCC’s May 2002 deadline for switch to digital. “There’s no way they'll be ready” by deadline, he said.

Concern about 2002 deadline may be overstated, FCC staffers said Mon. David Goodfriend, aide to FCC Comr. Ness, said Commission had approved virtually all justified requests for deadline extensions based on construction problems, and that would be “a no-brainer” for future similar requests. “What is really at issue is the economics of small stations,” he said, and they will have to be considered on “case-by-case basis,” but deadline remained important to focus attention on need to begin DTV service. Susan Eid, aide to FCC Chmn. Powell, agreed most requests for extensions had been granted. Broadcasters should seek mass extension of 2002 deadline, and outgoing Comr. Furchtgott-Roth would “look favorably” on such request, said his aide, Ben Golant. Golant called 2002 deadline “unreal and unrealistic” and said broadcasters should challenge it in court as arbitrary and capricious.

Referring to congressional goal of halting analog TV broadcasting by 2006, Kraemer said “if the plan is to turn off analog in 2020, we're in good shape. But if it’s 2006, this is a debacle.” NAB Deputy Gen. Counsel Valerie Schulte agreed that “if you want a fast transition, we are way behind the 8 ball.” She blamed FCC, saying there were “pieces missing,” citing lack of broadcaster “access to audience” because of lack of mandated must- carry, DTV-cable interoperability and DTV receiver standards: “If we can’t get to the audience, they won’t buy it.”

Main problem is lack of compelling DTV programming, said Robert Pepper, head of FCC Office of Plans & Policy, and only CBS and PBS have made big commitment to HDTV programming: “If you offer compelling programming, cable will carry you.” He said recent cable carriage deals with PBS showed that cable was willing to carry DTV if programming was good enough, but Paul Karpowicz of LIN TV, vice chmn. of NAB TV board, said cable wasn’t signing carriage deals with CBS stations, even though 80% of CBS prime- time programming is available in HDTV: “If the government is mandating a timeline [for DTV transition], must-carry is one thing the government must mandate.” CBS Senior Vp Joseph Flaherty said broadcast and cable already were delivering about 150 hours of HDTV programming per week and that was “starting to boost DTV sales.”

However, there has been “a strong message from Washington” that DTV must-carry won’t happen, Shapiro said. He said FCC Chmn. Powell had shown strong interest in letting market handle DTV carriage, and Congress wasn’t likely to intervene: “This is up to the industry to work out.” Schulte acknowledged that must-carry didn’t fare well under former FCC Chmn. William Kennard and that Powell seemed even more market-oriented, but said FCC “has got to ask how fast a transition it wants.” She also predicted U.S. Supreme Court would uphold DTV must-carry, despite close vote for analog must-carry, because there was “a compelling government interest” in DTV transition. However, Pepper said broadcasters shouldn’t be focusing on required carriage of both analog and digital signals during transition, saying that wasn’t nearly as important in long run as defining what portion of digital signal would be carried after transition was complete.

There’s even less chance that Congress would enact law requiring all new TV sets to have DTV tuners, Shapiro said, since he said that could triple cost of low-end TV sets. He also said “consumers should make their own decisions” on whether to buy sets with DTV tuners, and such tuners already were in nearly half of all TV sets over 25” that were being sold. With final agreement on VSB DTV standard in recent months, Shapiro predicted proliferation of DTV tuners and sets at CES convention in Jan.

DTV transition “is not a debacle by any means” because nobody ever believed 2006 goal for turning off analog TV, Shapiro said. Even must-carry isn’t mandatory, he said, because of DTV being delivered by DBS and importance of DVD. He said 234,000 DTV sets worth more than $500 million were sold in first quarter, with 15% of units sold being DTV tuners. Even though figure is only for sales to dealers, he said that wasn’t significant because retailers weren’t increasing their inventory anymore, so sales to dealers were close to figure for sales to consumers.

Debate between VSB and COFDM modulation was “the best thing that ever happened” because it forced set makers to focus on receiver quality, Claudy said, making pitch for govt. mandate on receiver standards. He said there had been significant improvement in many receivers, but “the problem is that not all manufacturers” are investing in quality, and there are no guidelines to help consumers make quality decisions. Market will solve that, Shapiro predicted, so there’s no need for receiver standards.

New public interest obligations for DTV broadcasters are “DOA” (dead on arrival) at Powell-led Commission, Schulte predicted. On Bcst. Education Assn. panel here, attorney Richard Wiley said such obligations would be “premature. Sometime down the road, if there is a lot of multicasting, there is plenty of time then” to impose new obligations, he said.

DTV Notebook…

Importance of convincing rest of world to use U.S. DTV standard is “motherhood issue,” NAB Senior Vp Lynn Claudy said, “but you have got to prioritize.” Main issue, he said, has to be assuring DTV transition in U.S.: “We have got to get our act together.” Main benefit of global acceptance would be volume production of DTV receivers and production equipment using same standard, potentially lowering prices, but Claudy said just N. America and possibly rest of Western Hemisphere would create “a very large manufacturing base,” making economies of scale from rest of world “less important. It doesn’t really matter what happens in other countries.”

----

On-channel repeaters (OCRs) for DTV are viable option for extending DTV signal, said R.W. Zborowski, chief technical officer of ADC Communications, which has done extensive research on OCRs. He said OCRs for DTV were easier than for analog because requirement for DTV antenna isolation was 25 dB less than for analog, and because DTV power levels could be as low as few watts for some OCRs. High-power OCRs, which could be used to improve indoor reception, could “do more harm than good,” Zborowski said, but problem can be resolved through single-frequency networks.