BROADCAST, CABLE LEADERS CONTINUE DEBATE ON HDTV LAG

Cable carriage, Fritts said, has been “an elusive goal.” Nationwide, cable operators are carrying fewer than 10% of the nearly 800 local DTV broadcast stations, he said. Only 75 DTV broadcast stations are being carried on cable, and 55 of those are on Time Warner systems, Fritts said. “Let’s remember: Broadcasters are under a federal mandate to build out DTV stations… Television set manufacturers are under federal mandate to phase in DTV tuners. My question is: Why are cable operators largely taking a pass on carriage of over-the-air digital stations?”

Sachs said there were several reasons some digital broadcast signals weren’t being carried on cable. First, he said, cable operators wanted to carry broadcast HDTV, but most broadcasters were offering only standard-definition, low-power digital duplicates of their analog signal -- content that cablers already carried. Second, in instances where broadcasters were offering HDTV, some -- particularly some network owned-and-operated stations -- were demanding compensation for carriage of their HD signal. “Under these circumstances, it is disingenuous, to say the least, to claim that cable operators are ‘blocking access’ when broadcasters themselves have held back HDTV programming,” Sachs said. Nevertheless, cable subscribers in 73 of the top 100 markets have HD programming on at least one cable system in their market, he said. “The good news is that in a majority of markets, broadcasters are making their HD signals available to cable without levying a fee, and I hope even more will do so,” Sachs said, saying the stations used publicly-owned airwaves and distributed their signals over the air free.

Cable and broadcast executives are continuing a dialog, Sachs said: “In my experience, the give-and-take of private negotiations is always preferable to the government’s making decisions for us.”

Sachs praised the CE industry for its cooperation on the proposed plug-and-play agreement with cable operators, but also said retailers must do more to educate their customers. He said when cable operators sent employees out to a consumer’s home to install HD set-top boxes, as many as half of those who had ordered HD service didn’t have an HD-ready TV set. “Consumers are confusing large-screen and flat- screen TVs with HDTVs. A much better job of consumer education about DTV products needs to be done at the point of retail sale,” he said: “And DTV products need to be labeled much more clearly.” He said clear consumer labeling was included in the cable-CE agreement. Messages to CEA’s spokesman seeking comment on that issue weren’t returned.

MSTV Pres. David Donovan spoke as the chief proponent and fund-raiser for the proposed Bcst. Lab (CD Jan 16 p8). He said development of the lab was born out of the need for technical coordination among over-the-air TV, set manufacturers, the professional video industry, chip makers and others. He said DTV was “giving rise to new relationships and complexities,” stressing that the proposed lab wasn’t intended to replace the standard-setting function of ATSC. Broadcasters “can no longer afford the ad hoc approach to technology,” he said.

Donovan said the $9 million, 3-year commitment by MSTV and NAB to funding the lab “represents a significant milestone” in its establishment. Such a long-term pledge of support is “critically important” in hiring and retaining a high-quality staff, he said. A fundamental purpose of the lab will be to focus on projects “that enhance the vitality and competitiveness” of free TV, he said, which can be accomplished “only in a forum [lab] that provides for systematic cross-industry” discussion and development of technology.

Seeking funding commitments for the lab from the consumer electronics industry, backers now are going around CEA (whose Pres. Gary Shapiro hasn’t committed to support of the idea) and are appealing directly to manufacturers. Said Donovan: “Over the next few weeks, we will be contacting each of you individually to obtain your support.” Greg dePreist, ex-Toshiba and MSTV, has been retained as a consultant to help in fund-raising from manufacturers.

Rick Chessen, the FCC Digital Task Force chmn., said the “key pieces [in the DTV transition] are falling into place.” He said the transition had “a high priority” in Congress and at the FCC and that for digital to succeed, programming content “must be significantly different from analog” to give consumers an incentive to buy digital receivers. Among the major remaining challenges to digital are must-carry, the definition of primary channel, and public awareness, he said.

Michael McEven, pres. of Canada DTV (formed to help Canadian TV stations in the transition to digital), said his country was well behind the U.S. in making the transition. Chum Citytv, with experimental tests under way in Ottawa, Toronto and Montreal (with Vancouver to be added later this year), is the only licensed digital station in Canada, he said. Canada has only 600,000 homes with DTV sets -- all of them driven by DVD, not TV -- he said, and all digital equipment in the country has been imported from the U.S. At a recent meeting of Canadian content providers, not a single session was devoted to digital TV, he said.