FCC fines major retailers over TV transition rules

Shoppers make their way past Sears at Woodfield Mall in Schaumburg, Illinois, October 22, 2007.

WASHINGTON (Reuters) - U.S. regulators said on Thursday they imposed fines on retailers such as Wal-Mart and Sears along with two television suppliers for violating curbs on selling TVs that will not work easily after next year's transition to digital television.

The Federal Communications Commission said the fines against Wal-Mart Stores Inc (WMT.N), Sears Holdings Corp (SHLD.O), Target Corp (TGT.N) and eight other companies were for violating rules designed to prevent consumers from unknowingly buying TVs that cannot receive digital signals when broadcasters make the switch on February 17, 2009.

The actions included a fine of $992,000 against Wal-Mart; about $1.1 million against Sears; $712,000 against Circuit City Stores CC.N; $296,000 against Target and $280,000 against Best Buy Co (BBY.N), the FCC said.

FCC rules require retailers to have a label on or near television sets for sale that are unable to get over-the-air digital signals without an additional converter box.

Wal-Mart said the fines were for past violations and all the products it currently sells comply with FCC regulations.

"... we have already voluntarily invested millions of dollars in new technology, training, new product and consumer education for the FCC's DTV transition program," Wal-Mart said in a statement.

Target said it had taken steps to inform customers about the transition from analog to digital, including brochures and staff training. It said it would review the FCC's findings and take the appropriate action.

Representatives of the other companies could not immediately be reached for comment.

The FCC said it had also fined two other companies, including Syntax-Brillian Corp BRLC.O, for violating a related rule that set deadlines for companies to stop importing and shipping television receivers that could not receive over-the-air digital signals.

The agency said it levied fines against two more companies for violating a third rule that set a deadline for companies to stop shipping television receivers that are not capable of using V-chip technology, which allows parents to block some shows, in conjunction with over-the-air digital signals.

In a separate action, the FCC said it had reached settlements with seven other electronics manufacturers resolving investigations of possible violations of the V-Chip DTV rules.

Among the manufacturers who settled with the agency were Matsushita's (6752.T) Panasonic Corp, which agreed to pay $320,000, and the north American unit of Philips Electronics (PHG.AS), which agreed to pay $450,000, the FCC said.

Those investigations examined whether the manufacturers had complied with an FCC rule requiring that consumers' television receivers be capable of adapting to changes in the V-chip content advisory rating system, the agency said.

Congress ordered the switch to digital television to free up public airwaves for other uses, such as for police and fire departments. The switch will lead to improved picture and sound for TV viewers.

The transition is being closely watched because owners of analog televisions will not be able to watch television unless they subscribe to satellite or digital cable, replace their TV with a digital television by that date, or get a converter box.

The federal government is subsidizing the cost of buying a digital-analog converter box by offering $40 discount coupons to anyone who owns an analog television. That program is being overseen by an arm of the Commerce Department called the National Telecommunications and Information Administration.

(Additional reporting by Alexandria Sage in Los Angeles)

(Reporting by Peter Kaplan; editing by Tim Dobbyn)