DTV Bill Heads to President’s Desk

Let the countdown begin.

Congress finally sent legislation Wednesday to President Bush that sets Feb.
17, 2009, as the end of analog broadcasting in the United States. After
that, television sets must have digital tuners to receive an over-the-air
signal.

As part of the Deficit Reduction Act of 2005, the transition to digital
television (DTV) is expected to raise billions when the Federal
Communications Commission auctions off the analog spectrum currently
occupied broadcasters.

Wireless broadband providers are expected to be the primary bidders for the
spectrum. A portion of the spectrum will also be reserved for first
responders to improve interoperability.

“Congress has taken an important step toward completing the transition to
digital television. This will help keep America on the cutting edge by
freeing up spectrum for new wireless technologies,” Ed Zander, chairman and
CEO of Motorola and chairman of the Technology CEO Council, said in a
statement.

To help ease the conversion to digital television broadcasting for the
approximately 15 percent of American households that currently receive
exclusively over-the-air broadcasts, the legislation authorizes $1.5 billion
in digital converter-box subsidies

The bill also dedicates $1 billion in grants for first-responder
interoperable equipment and training.

Another $156 million is set aside for a national alert system and another
$43.5 million for a fully enhanced national 911 emergency alert system.

All funding for the subsidies will come when the analog spectrum auction
proceeds.

“We applaud the efforts of Congress and greatly appreciate the final passage
of DTV legislation that allocates a portion of the revenue raised during the
auction of recovered broadcast spectrum to fund the needs of our first
responders for interoperable communications systems,” Matthew J. Flanigan,
president of the Telecommunications Industry Association, said in a
statement.

Both the Senate and the House included provisions in the subsidy legislation
designed to minimize participation by consumers who already have a digital
tuner in their television sets or receive signals from digital cable
systems.

Under the plan, consumers will have to make an “affirmative request” to
receive up to two, $40 converter-box coupons. The coupons can’t be combined
for the purchase of a single converter box that is expected to retail for
approximately $60 per unit.

Left in doubt is the subsidy fate of 39 million households that currently
subscribe to analog cable services.

As originally drafted, the DTV bill
permitted analog cable companies to “down-convert” high-definition digital
signals into standard-definition analog signals, allowing subscribers to
receive digital television without purchasing a digital
converter box.

However, in the deal cut by the Senate and House, the down-convert signal
provision was eliminated.