Tune In to See the Poor Get Screwed

July 1, 2008

-By Kenneth Hein


On Feb. 17, 2009, millions of Americans will settle into their couches, pick up their remotes and turn on their TVs—only to gaze at a blank screen. Kids will wonder: Where's Sesame Street? Moms will wonder: What happened to the morning news? Everyone will wonder: What is going on?

"The Digital Transition," that's what.

By federal mandate, networks nationwide will shut down the analog signals they've been sending into the air since the 1950s. The move will render all older TVs (aka. rabbit-ear sets) utterly useless.

For Americans who've already gone digital, the changeover is largely academic. But it won't be for the 9.4% of households that, as of May, were completely unprepared for it, per Nielsen data. These millions of consumers don't have satellite or cable; they don't own a TV with a digital tuner or converter box. More to the point: They don't know that, very soon, they'll be cut off from their favorite programming.

Or perhaps they just don't believe it. I can hardly blame them. It seems almost  inconceivable that, for the first time in our history, the consumer is being forced to buy a new electronic device simply because Congress said so.  But it did and, by passing  "The Digital Television Transition and Public Safety Act of 2005," it made it sound like our welfare was the driving force, too.

Even those who know "the transition" is coming won't get by without some inconvenience: Nearly a quarter (22%) of Americans have at least one TV that will be inoperable. The tally of households with at least one soon-t0-be-useless set comes to 25 million.

Like many oddities conceived by our government, this one appears (surprise) to be motivated by money. That purportedly outdated and useless 700 megahertz band that's going away? Well, the FCC actually sold it for $19.6 billion earlier this year. Most Americans didn't notice, but the likes of Verizon and AT&T did. They ponied up the money after weeks of secret bidding.

 Of the auction proceeds, $7 billion will go to reducing the deficit; $1.5 billion's earmarked for a coupon program (more on that in a minute); $1 billion is allocated for public safety communications grants; and $75 million will help low-power broadcasters go digital. The rest flows directly into the fed coffers.

"The value is using the airwaves more efficiently," said Todd Sedmak, rep for the Department of Commerce's Converter Box Coupon Program. He noted a small portion of the band will go to first responders like police and firemen.

But what about the families who still rely on analog? Take heart: The DoC has offered to help. Consumers can apply for two $40 coupons to buy a converter box that retails for $50 to $80. Four million have been redeemed to date. The government's spent $5 million to educate the public about these coupons; electronics brands and cable companies have dropped close to a $1 billion.

None of this, however, addresses the consumers who have no desire to get a coupon or a converter box; who like their service just fine and probably view the digital age as daunting. Too bad. For them, the choice is to comply or, if they  happen to live in border states, watch Canadian or Mexican TV.

Not surprisingly, it's the disadvantaged who'll be hit the hardest. "There will be millions of low income, primarily Hispanic, households that will not be able to watch [their] shows," said Richard Doherty, director of The Envisoneering Group, Seaford, N.Y.

Then there are the roughly 100 million portable TVs people enjoy while camping, or hanging out in the backyard. These, in Doherty's words, "will become landfill." What's worse, the vaunted digital signal won't be available during a blackout or state of emergency.

So how did this happen? Depending on whom you ask, it's either a necessary step to move the country into the future or bureaucratic  favoritism by a government blinded by dollar signs. Those staring at their dead TVs early next year will figure it out pretty quickly. Somebody somewhere made a whole bundle of money and didn't bother thinking of them when they made the deal—again.

khein@brandweek.com


Tune In to See the Poor Get Screwed

July 1, 2008

-By Kenneth Hein


On Feb. 17, 2009, millions of Americans will settle into their couches, pick up their remotes and turn on their TVs—only to gaze at a blank screen. Kids will wonder: Where's Sesame Street? Moms will wonder: What happened to the morning news? Everyone will wonder: What is going on?

"The Digital Transition," that's what.

By federal mandate, networks nationwide will shut down the analog signals they've been sending into the air since the 1950s. The move will render all older TVs (aka. rabbit-ear sets) utterly useless.

For Americans who've already gone digital, the changeover is largely academic. But it won't be for the 9.4% of households that, as of May, were completely unprepared for it, per Nielsen data. These millions of consumers don't have satellite or cable; they don't own a TV with a digital tuner or converter box. More to the point: They don't know that, very soon, they'll be cut off from their favorite programming.

Or perhaps they just don't believe it. I can hardly blame them. It seems almost  inconceivable that, for the first time in our history, the consumer is being forced to buy a new electronic device simply because Congress said so.  But it did and, by passing  "The Digital Television Transition and Public Safety Act of 2005," it made it sound like our welfare was the driving force, too.

Even those who know "the transition" is coming won't get by without some inconvenience: Nearly a quarter (22%) of Americans have at least one TV that will be inoperable. The tally of households with at least one soon-t0-be-useless set comes to 25 million.

Like many oddities conceived by our government, this one appears (surprise) to be motivated by money. That purportedly outdated and useless 700 megahertz band that's going away? Well, the FCC actually sold it for $19.6 billion earlier this year. Most Americans didn't notice, but the likes of Verizon and AT&T did. They ponied up the money after weeks of secret bidding.

 Of the auction proceeds, $7 billion will go to reducing the deficit; $1.5 billion's earmarked for a coupon program (more on that in a minute); $1 billion is allocated for public safety communications grants; and $75 million will help low-power broadcasters go digital. The rest flows directly into the fed coffers.

"The value is using the airwaves more efficiently," said Todd Sedmak, rep for the Department of Commerce's Converter Box Coupon Program. He noted a small portion of the band will go to first responders like police and firemen.

But what about the families who still rely on analog? Take heart: The DoC has offered to help. Consumers can apply for two $40 coupons to buy a converter box that retails for $50 to $80. Four million have been redeemed to date. The government's spent $5 million to educate the public about these coupons; electronics brands and cable companies have dropped close to a $1 billion.

None of this, however, addresses the consumers who have no desire to get a coupon or a converter box; who like their service just fine and probably view the digital age as daunting. Too bad. For them, the choice is to comply or, if they  happen to live in border states, watch Canadian or Mexican TV.

Not surprisingly, it's the disadvantaged who'll be hit the hardest. "There will be millions of low income, primarily Hispanic, households that will not be able to watch [their] shows," said Richard Doherty, director of The Envisoneering Group, Seaford, N.Y.

Then there are the roughly 100 million portable TVs people enjoy while camping, or hanging out in the backyard. These, in Doherty's words, "will become landfill." What's worse, the vaunted digital signal won't be available during a blackout or state of emergency.

So how did this happen? Depending on whom you ask, it's either a necessary step to move the country into the future or bureaucratic  favoritism by a government blinded by dollar signs. Those staring at their dead TVs early next year will figure it out pretty quickly. Somebody somewhere made a whole bundle of money and didn't bother thinking of them when they made the deal—again.

khein@brandweek.com
 


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