Friday, February 13, 2009

THE LONG ROAD TO DIGITAL CONVERSION

Are you as tired as I am of being bombarded constantly with digital television conversion announcements?

My journey from analog to digital television transmission goes way back to September 30, 1992 when I attended the first demonstration of an over-the-air digital HDTV simulcast. That was presented by WRC-TV and the Advanced Television Research Consortium in Washington, D.C. I was attending the National Association of Broadcasters annual meeting and, like everyone else in attendance, I was impressed with the quality of then new digital broadcast format. I remember that most people, while impressed, felt this was something way off in the future, but as is often the case we were all wrong.

Pressure had been building within the Defense Department to recapture a portion of the broadcast spectrum used by commercial and public broadcasters. It was then felt there was a vital need for added spectrum in the interest of national defense. Additionally, the industry experienced substantial commercial pressures to move into the new digital era of broadcasting, if for no other reason than the significant improvement in the quality of the transmitted picture, as well as other potential commercial opportunities. Thus the viewing public has known for many years that analog broadcasting transmission was going to be eliminated.

As the conversion date of February 17, 2009 rapidly approached, Senators Jay Rockefeller D-W.V. and Kaye Bailey Hutchison R-TX introduced legislation, which was passed, to delay the conversion date until June 12, 2009. A move that I believe is ill advised. It is estimated that 5.1% or 5.8 million homes in the country are not prepared to accept digital signals. Some communities such as Albuquerque, NM have a figure of 12.6% not ready, while Hartford, CT is in the best shape with only 1.3% of homes not ready.

One of the huge problems that I see is the fact that our government in their brilliance has totally failed to consider the broadcasters’ side of this ambitious conversion issue. It has been established that each TV station in the country will spend at least $6 million for a simple pass-through approach (this does not include local HDTV origination) that includes tower work, transmitter, antenna and transmission lines, a transmitter link to master control, an encoder/decoder, and tape decks to insert commercials, monitors, routers, and a switcher. WRAL-TV (CBS) in Raleigh, N.C. went for ‘top of the line’ digital conversion at an estimated cost of $26 million alone. Commercial stations have to pay the total bill, but PBS stations have received substantial government grants. Religious broadcasters have been left to secure solicitations from their supporters.

The government’s decision to legislate conversion impacted a significant portion of our national economy, because there are 578 VHF television stations, 775 UHF stations, and 354 Public Television Stations (total 1707) requiring huge cash outlays for the new equipment. Additionally, all the cable channels and producers of programming and commercials are required to retrofit into the digital format. I am not suggesting that the switch should not have been taken, but the decision has had wide ranging financial consequences far beyond the viewing public.

Currently our national economy is going through very difficult times and the future remains cloudy. Advertising is the life-blood of commercial television stations and at present their business is less than robust. Many local television stations are reporting a 30% decline in local revenue. Viewers of local newscasts have seen the commercial load decreased substantially. Automobile, Real Estate, and Retail advertising has been drastically reduced.

All the time television stations have been converting to digital they have been required to continue to transmit their analog signals, too. The electrical power to broadcast is one of the largest single expenses in a TV station’s operating budget. Individual station power bills vary widely because, depending upon the assigned channel number, the power can range from 100,000 watts to 316,000 watts. Also, the electricity rates are different market to market.

I talked with a Chief Engineer friend at a local NBC UHF affiliate was told that to continue to transmit in both analog and digital until June 12, 2009 his station would have to spend at least an additional $25,000.00, which could result in further cuts to their staff. His station’s authorized analog power level is 3770 KW. Considering the state of our economy, we certainly should not do anything that will potentially cause additional unemployment.

Frankly speaking, I support the decision of my local television stations to exercise their option to stick to the original conversion date of February 17th, because if you have not acted to address the reception issue by now, you must be living in a world of isolation. Will there be some dislocation? Surely, but there will be some even after June 12, because some people still will not take the necessary action until it is absolutely necessary.

It has been reported recently that 681 television stations will convert to digital on or before February 17, and thus the majority of stations will wait until June 12th. Most of the stations converting early are below the top 50 market rankings, and that is logical because they have felt the impact of the revenue drop more than the major market stations. Remember it costs the small market stations about the same as the major market stations to convert their equipment, but they have far less revenue potential. The top 50 markets represent 67% of total television viewing households.

Again, our government has acted in their personal best interest, because they did not fund the digital converter box coupon program adequately, which was not advantageous to broadcasters or the viewing public. I know from personal experience that the politicians are the very first individuals that appear at the door of the television stations looking for free air-time to promote their personal interests, but they ignore the stations in their ongoing need to curb expenses. Again our politicians have grandstanded and disregarded the impact of their actions. Depending where you reside, great confusion and television viewing disruption will be wide spread until at least June 12th and no doubt beyond. Thank you Congress, you screwed it up again.

COMMANDER GRANGER

1 comment:

Ensign EP said...

I was unaware that some stations will make this decision to go ahead with their digital broadcasting even though there has been a delay in the official start date. Do you think their advertisers will have an issue with this decision - since they may lose a small percentage of viewership of their commercials?