Thursday, January 29, 2009

Congress gives analog TV yet another reprieve

The never-ending saga for America’s transition to digital television just got a little more never-ending.

The U.S. Senate voted Monday for a four-month delay that would encourage but not require over-the-air TV stations to continue broadcasting both analog and digital signals until June 12. House Republicans blocked the measure Wednesday, but Democrats plan to bring it up again and have the votes to pass it. After June 12, all stations would finally turn off their analog signals.

President Barack Obama made the delay a top priority upon taking office, arguing that the original Feb. 17 deadline would leave millions of Americans unable to receive over-the-air TV broadcasts.

Despite a year of public service announcements and a government program to subsidize people buying analog-to-digital converter boxes for their old TV sets, it seems a lot of people still haven’t gotten the message. And some who did get it are out of luck.

The converter boxes range in price from $40 to $80, and the Commerce Department has run out of money for the coupon program intended to help people pay for them. The program’s funding limit is $1.34 billion, but the number of people on the waiting list for the $40 coupons has reached 2.6 million. Dangle “free” money around, and the world will beat a path to your door.

This, however, is just the latest screw-up in the long and convoluted transition to digital television. Congress and the Federal Communications Commission have been bungling the process for 20 years. Concessions to broadcasters delayed DTV implementation, which resulted in there being little incentive, until recently, for consumers to buy DTV-ready TV sets or converter boxes.

Those concessions are on top of the fact that the government gave additional broadcast spectrum to the stations free of charge.

One rule of economics is that people care more about something when they have to pay for it. But according to one estimate, TV broadcasters received up to $100 billion worth of prime broadcast real estate for nothing. That certainly didn’t give TV stations an incentive to quickly implement DTV and offer high-quality digital programming that would entice viewers to buy digital televisions. Instead, most stations just sat on that spectrum for years.

Now that broadcasters are finally ready to go all-digital, this latest delay has some of them asking for even more concessions. PBS chief executive Paula Kerger said Monday that continuing to broadcast in analog until June 12 would cost PBS affiliates $22 million, and she wants the federal government — meaning taxpayers — to pick up the tab.

Like most things the government does, there was a better way.

Congress and the FCC could have abandoned the fiction that the broadcast spectrum is and must remain a public resource, which broadcasters merely use so long as they promote “the public interest,” which is whatever politicians say it is. Broadcast spectrum is valuable property. Congress could have auctioned it off, forcing broadcasters to pay market prices. That would have ensured the spectrum would have gone to broadcasters who were prepared to exploit it as soon as possible and to its fullest.

Then, Congress could have allowed broadcasters to auction off their old analog spectrum to recoup some of their costs. As it is, as soon as broadcasters shut off their analog signals, that spectrum will go to wireless services and local public safety agencies. But there is no reason why TV stations couldn’t have sold those frequencies to wireless companies or back to the government. That would have been a fair concession to broadcasters.

Of course, this mess means nothing to the vast majority of TV viewers. More than 80 percent get their TV via cable or satellite. This expensive, drawn-out process is about the 20 percent of viewers who still rely on rabbit ears. And that number would be smaller if Congress and the FCC hadn’t spent most of the past 40 years restricting pay-TV’s growth and stifling competition — yet another gift to over-the-air broadcasters.

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