Senate DTV Bill Would Set April 2009 Hard Transition Date

The bill sets no funding levels for the programs. They're expected to be worked out in a meeting today (Mon.) between Senate Commerce Committee Chmn. Stevens (R- Alaska) and Co-Chmn. Inouye (D-Hawaii), a Senate aide said. She described the draft as “very much a bipartisan effort,” but said the 5-page draft was limited because of budget reconciliation rules that restrict provisions unrelated to funding. Other DTV-related provisions are expected to be addressed in a 2nd DTV bill, Stevens has said. It isn’t clear when that bill will be ready. The only funding provision in the draft bill is the $4.8 billion that the Committee was instructed to raise in the budget resolution earlier this year.

The April 7, 2009, date seems to be drawing widespread support from govt. officials and the industries. NAB has said it would accept a date in 2009, but it didn’t have a substantive comment on the draft Fri. “We're studying it,” a spokesman said. NCTA said it supported the “priority placed on achieving a hard date.” The group was pleased with the draft bill’s silence on mandatory multicasting, “which would injure consumers and threaten diversity in programming choices,” a spokesman said. CEA supported the draft, saying it has long supported a hard cut-off date for analog broadcasts. “A hard date provides certainty to manufacturers, retailers, consumers and all others with a stake in the transition,” said CEA Pres. Gary Shapiro: “We call on broadcasters, cable system operators and others to join us in working with Congress to set a hard cut-off date and educating consumers about the transition.”

“Stevens is being pragmatic” with the hard date, which is important in maintaining the trust of voters on something that will have a significant consumer impact, said High Tech DTV Coalition Exec. Dir. Janice Obuchowski. He’s chosen a time when Congress will be in session but after 2 major TV events, the Super Bowl and NCAA basketball March Madness, she said. A Senate aide said the committee chose a time after high-profile TV viewing and the holiday season so more consumers could purchase DTVs, reducing the number of converter boxes needed. The timing first considered was May-June, the aide said.

Giving the Commerce Dept. oversight of the subsidy and other auction-related programs is a decision that the Senate Commerce Committee had intended from the outset, a Senate aide said. “It’s a clever move -- functionally what he’s doing makes sense,” said E-911 Institute Exec. Dir. Greg Rohde. The former NTIA dir. said it makes sense to have the FCC conduct the auctions and then turn over administrative functions to Commerce. Rohde also praised Stevens’ efforts on emergency communications. “He’s trying to move aggressively within his priorities, and that’s a good thing,” he said.

The draft is a “good start,” Obuchowski said at a media breakfast where the coalition released a letter from 31 CEOs of high-tech companies asking the House and Senate Commerce Committees to set a hard transition date. The certainty of a hard date gives companies a chance to plan purchases of hardware and do advance planning, she said. “From a corporate perspective, setting the date in advance allows companies to be more confident to bid,” she said. “The hard date will drive consumer behavior, corporate behavior and government behavior,” she said. Once there’s certainty that the hard date will stick and the word gets out to retailers, consumer behavior will change, she said, adding that the landscape is already changing.

The draft recognizes the need to compensate consumers whose sets will go dark in an analog cutoff, said Jeannine Kenney, senior policy analyst at Consumers Union (CU). CU “is certainly pleased” with that recognition, she said, but finds it “very troubling there’s absolutely no guarantee consumers would receive any such compensation because the language is so broad and noncommittal.” The way the draft is worded, the Commerce Secy. would be free to use the spectrum auction proceeds for the other programs outlined “and spend only enough money to do, say, a consumer education campaign,” she said.

With no guarantee consumers will be compensated for “the costs of the technology they'll have to buy to keep their otherwise perfectly good television sets working, what that means is the people who'll bear the cost of this transition are consumers,” Kenney said: “You're looking at direct, out-of-pocket costs of $3.5 to $4 billion, and there’s simply no guarantee any of that cost is covered by the government.” CU plans to press its case that consumer compensation “should take priority” in the fund, “given that there'll be more than enough auction revenue to meet the $4.8 billion reconciliation instruction,” Kenney said.

“Consumers bear the brunt of the costs of this transition and receive very little of the benefit” under the draft bill, Kenney said. “The benefit goes largely to the telecommunications companies that will bid for the spectrum. Consumers shouldn’t have to bear the costs. They should be held harmless, particularly because this is not a market-driven transition. This is a government- driven transition.”

The draft bill’s funding program for the E-911 act passed last year drew praise from the National Emergency Number Assn. (NEMA), which sent a letter Fri. to Stevens and Inouye thanking them for including the provision. “Robust, effective and available 911 technologies and systems are of paramount importance for our homeland security as well as everyday emergency preparedness,” the letter said. Lack of funding is the reason only 50% of the Public Safety Answering Points (PSAPs) covering 65% of the U.S. population have the technology to locate wireless E-911 callers, NEMA said.