Digital TV switch faces more hurdles

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EIU / Infoestrategica

WASHINGTON — Congress is under increasing pressure to delay a 2006 deadline for a nationwide transition to digital TV.

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One reason is electronics makers' argument that they cannot speed production of digital sets.

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This week, the Arlington, Va.-based Consumer Electronics Assn. told the Federal Communications Commission that March 2006 was the earliest date by which TV manufacturers could comply with agency rules stipulating that larger TVs be capable of digital reception, according to filings at the agency.

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Also, the Congressional Budget Office is warning that a planned government auction of $18 billion in airwaves may not bring as much interest as previously thought.

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The office has told the staff of Senate Commerce Committee Chairman Ted Stevens (R-Alaska) that buyers might opt to wait for the huge chunk of TV airwaves to hit the market after stations go digital.

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Under current government rules, TV broadcasters must shut off their analog signals starting Dec. 31, 2006, in markets where 85% of households have sets capable of receiving a digital TV channel.

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Those analog airwaves would then be returned to the government for auction to other communications providers such as cellphone operators.

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Although about 90% of the nation's 1,700 TV stations now transmit digital signals, station owners have long decried the multimillion-dollar cost of the transition and fear they will lose millions of viewers unable to afford the expensive digital TV sets.

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Last year retailers sold more than three times as many analog TV sets (22 million) as digital (7 million), according to the Consumer Electronics Assn.

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Some experts believe the latest disclosures give station owners sufficient ammunition to delay the transition, possibly to 2008.

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"Broadcasters are going to grab on to any reason to push back the deadline further," said Thomas W. Hazlett, a telecommunications analyst for the Manhattan Institute, a New York-based think tank.

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He expressed pessimism that Congress would stick with a December 2006 transition date. "It's problematic," he said, "if Congress just focuses on the revenue question" raised by the Congressional Budget Office.

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A delay is bitterly opposed by Intel Corp., Cisco Systems Inc. and other companies that hope to use the analog TV spectrum to offer wireless services such as high-speed Internet access.

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"Congress never intended to maximize auction revenue," said Intel's Washington lobbyist Peter K. Pitsch. "The goal should be to make airwaves available so that they can be used efficiently for consumers and the larger society."
 
SOURCE:  EIU / INFO-e

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