Households to get coupons for digital TV switch

Exhibitors look over Samsung televisions in the Las Vegas Convention Center during set up for 2007 International CES (Consumer Electronics Show) in Las Vegas, Nevada in this file photo from January 6, 2007. Brushing aside congressional suggestions that the nation is ill-prepared for the conversion to digital TV in 2009, the Department of Commerce on Monday unveiled its plan to help subsidize the switchover from analog.

WASHINGTON (Hollywood Reporter) - Brushing aside congressional suggestions that the nation is ill-prepared for the conversion to digital TV in 2009, the Department of Commerce on Monday unveiled its plan to help subsidize the switchover from analog.

In the National Telecommunications and Information Administration (NTIA) plan, each household can claim two $40 coupons that they then can use toward the purchase of a set-top box that can translate digital signals so television shows can be viewed on analog TVs.

"The transition from analog to digital television is a historic change and brings with it considerable benefits for the American consumer," Secretary of Commerce Carlos Gutierrez said. "The coupon program is designed to help ease the transition to digital TV. Not only will the transition help expand consumer choices, but more importantly, the digital transition will enable more efficient use of the nation's airwaves, providing new advanced wireless services and increased public safety services for all Americans."

While the plan envisions as many as 33,750 of the coupons (actually a card similar to consumer gift cards), it is unlikely to be enough to convert the tens of millions of analog TV sets. There are about 73 million TVs in America, though many of them are hooked up to cable, or satellite TV service. About 15% of the TV-watching population depends on an antenna for its service.

Government officials hope that enough consumers will either decide to buy TVs that can automatically receive the digital signals or switch to digital cable or satellite TV to ease demand for the boxes.

"This is one option," Assistant Secretary for Communication and Information John Kneuer said.

Analog signals are scheduled to cease February 19, 2009. From then, TV programming will be transmitted digitally. Digital signals allow broadcasters to air high-definition programming with its movie-quality picture and CD-quality sound or several "standard-definition" programs or other programming streams.

Lawmakers have questioned the wisdom of the switch and its methods.

When the 2009 date was approved, Democrats pushed for a more robust program for the switch. The $1.5 billion for the set-top box subsidy isn't enough.

"After the administration opposed Democratic efforts to secure sufficient funding in favor of more tax cuts, the administration now shows newfound concern that not all households will be covered," said House Commerce Committee chairman Rep. John Dingell, D-Mich. "If the administration believes additional funds are needed to prevent consumers' television sets from going dark, then it should ask the Congress for such funding."

While Dingell said Monday that he supported the 2009 cut-off, he has questioned the wisdom of a hard date.

Under the NTIA, every household would be eligible for the coupons until slightly less than $1 billion is spent. If that doesn't go far enough, another $500,000 could be released but limited to only those people who depend on an antenna to get their TV.

"We want to make sure that no households are faced with losing service," Kneuer said.

Kneuer declined comment about possible changes in the date, saying Congress has to decide what to do about the frequencies that will be released by the switch.

When lawmakers approved the date, they set aside some of the analog frequencies for public safety; the rest will be auctioned. Many bidders have expressed an interest in the frequencies as they are some of the best for transmitting all kinds of services including broadband.

"I think before you consider changing the date, you need to answer these questions at the outset," Kneuer said.

Reuters/Hollywood Reporter