Hearing of the Telecommunications and the Internet Subcommittee of the House Energy and Commerce Committee - Advancing the DTV Transition

Federal News Service June 2, 2004 Wednesday

Copyright 2004 The Federal News Service, Inc.
Federal News Service

June 2, 2004 Wednesday

LENGTH: 20838 words

HEADLINE: HEARING OF THE TELECOMMUNICATIONS AND THE INTERNET SUBCOMMITTEE OF THE HOUSE ENERGY AND COMMERCE COMMITTEE SUBJECT: ADVANCING THE DTV TRANSITION: AN EXAMINATION OF THE FCC MEDIA BUREAU PROPOSAL

CHAIRED BY: REPRESENTATIVE FRED UPTON (R-MI)

WITNESSES:

W. KENNETH FERREE, CHIEF, MEDIA BUREAU, FEDERAL COMMUNICATIONS COMMISSION; EDWARD O. FRITTS, PRESIDENT AND CHIEF EXECUTIVE OFFICER, NATIONAL ASSOCIATION OF BROADCASTERS; ROBERT SACHS, PRESIDENT AND CHIEF EXECUTIVE OFFICER, NATIONAL CABLE & TELECOM ASSOCIATION; RICHARD DALBELLO, PRESIDENT, SATELLITE BROADCASTING & COMMUNICATIONS ASSOCIATION;

GARY SHAPIRO, PRESIDENT AND CHIEF EXECUTIVE OFFICER, CONSUMER ELECTRONICS ASSOCIATION;

GLORIA TRISTANI, MANAGING DIRECTOR, OFFICE OF COMMUNICATION, THE UNITED CHIEF OF CHRIST, INC.; THOMAS LENARD, SENIOR FELLOW AND VICE PRESIDENT FOR RESEARCH, THE PROGRESS & FREEDOM FOUNDATION

LOCATION: 2123 RAYBURN HOUSE OFFICE BUILDING, WASHINGTON, D.C.

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Mr. Walden.

REP. GREG WALDEN (R-OR): I'll reserve my time for questions, Mr. Chairman.

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REP. GREG WALDEN (R-OR): Thank you very much, Mr. Chairman.

Mr. Ferree, one of the issues that I've heard from broadcasters when it comes to getting signals allowing distant signals in the market where there isn't digital penetration of adequate level, the problem exists in some rural communities that a lot of their audience in the market is actually served by translators. Can you update me on where the FCC is in filling that gap so that translators can actually broadcast digitally and when would broadcasters be able to take advantage of that?

MR. FERREE: Sure. Happy to do that, Congressman. We have an ongoing proceeding on low power TV and translator. The transition for those stations as well, we expect to resolve that this summer, hopefully at the July agenda meeting. And in terms of the transition time for those stations, it has to be congruent of course with whatever we do for the full power stations, whether this plan or something like it is adopted or not. And at the same time, we're trying to make it as financially un-burdensome on the translator and low power TV station as possible. So we're balancing those concerns. But the issue-the item should be resolved this summer.

REP. WALDEN: But obviously there are markets where this is a major problem?

MR. FERREE: Yes, sir.

REP. WALDEN: And do you think that the rulemaking you've entered into, not this one but the one before us today, sufficiently provides time for that transition, given the fact that broadcaster couldn't today go file an application for a translator to broadcast digitally? I mean, and still meet the various deadlines that are out there?

MR. FERREE: If I understand the question, yes, I do. The timeframes we've proposed here, we think are very realistic and would result in a nationwide transition and would not lead to any kind of burden or hardship on these rural or small markets.

REP. WALDEN: Would those broadcasters be able to use the same frequency they're now broadcasting in analog in or would they have to be assigned a new frequency for their translator and how will that analog digital piece work?

MR. FERREE: Those are issues in the proceeding as well, whether-that is to say whether they could flash cut on their existing station which some would like to do or whether they will be assigned a second station to sort of make a transition the way the full power stations have. For the latter course, we really have to complete the first transition and recover some of those stations from the full power analog broadcasters if we're going to be assigning second stations to the low power TV.

REP. WALDEN: And so, if I am a broadcaster in Medford, Oregon and I rely on translators to serve a wide part of my viewing audience, if you do decide I have to get a second frequency, then what would the timeline be on application processes for those translators? Will they be subject to auction? How will that be handled? Because I know in the radio side, translator window open, translator window closed. It's probably many years before that happens again. Can you give me some sort of timeline there?

MR. FERREE: I can't give you a very precise timeline. We're aware of those concerns. Again, we've got to balance the hardship versus the get them to the end of transition as well kinds of issues. And you know, again, if we're going to assign second frequencies to those channels, we've got to complete the first transition and do the repacking that was referred to earlier.

REP. WALDEN: Well, it leads me to this issue then on the calls by some that say that, in markets where there isn't adequate penetration, you can bring in a distant network signal via another type of carriage, cable or satellite. It doesn't seem really fair if, on the other hand, you get broadcasters who can't fully serve their market digitally because they can't have access to the translators. You see, am I making my point here?

MR. FERREE: I guess you're making your point. Was there a question for me that I was supposed --

REP. WALDEN: No. I just want to make a point because I think it's a real issue in some markets around the country, where you could get run over by the notion, if you can't serve an adequate percentage of your audience, then we're going to allow other stations that are digital to come in and provide a distant signal. It just doesn't seem fair. That's all. They're in a bit of a catch 22.

Mr. Fritts, could you talk about what you think the response of consumers is going to be the day they wake up and their analog set no longer works? I've toyed with the idea that maybe the best thing we could do, if we're really bold, is change the deadline to say, oh, October 10, October 31st of an even numbered year, and then we'll measure audience reaction when the analog set no longer works. And I just wonder about this issue, where consumers are going to go.

MR. FRITTS: Well, we share that concern obviously and we are hopeful that we don't have a time when consumers wake up and they don't have a television set. We're hopeful that this Congress, that this committee will lead the way in setting the parameters or setting forward the structure by which we can seamlessly move through this transition. We have some ideas on that which we have submitted.

But obviously, you can't take care of the 15 percent until you satisfy the 85 percent. So it seems to me the largest concern of this committee is satisfying the 85 percent. Then I think Mr. Shapiro and Mr. Sachs and myself and our respective industries will find a way to resolve that 15 percent.

REP. WALDEN: Mr. Sachs, let me ask you, just on the cable systems, what percent of your cable systems now have the capability to distribute their programming digitally?

MR. SACHS: Probably 85 to 90 percent have upgraded to digital which means they're probably still using 550 megahertz analog and then another 200 megahertz digital.

REP. WALDEN: What would the impact be if you are mandated, like broadcasters are, to have all your programming in digital if we're going to drive to this fully digital distribution --

MR. SACHS: Well, today, it would be a huge consumer impact because you'd be imposing on your customers the obligation to have a set-top device or multiple TV sets in their home. So I think we could give you the arithmetic. But I think you're talking 10, 20, 30 billion dollars, that range, order of magnitude.

REP. WALDEN: Is that obligation not the same though for consumers today who receive their TV over-the-air when the analog cutoff occurs?

MR. SACHS: No, because I think, under the bureau plan, they've proposed providing the option of converting the signal at the head-end of the analog, if we were to --

REP. WALDEN: I'm talking about the over-the-air receivers. We have 15 percent out there that don't get their TV via cable or satellite.

MR. SACHS: Correct.

REP. WALDEN: Isn't the obligation that you would have, if you were forced to go all digital and get rid of analog the same placed on the consumers that consumers have with broadcast when they lose the analog? They're going to have to get a converter.

MR. SACHS: Today, broadcast only customers would have to get converter devices for each analog TV set that they have.

REP. WALDEN: And in an all-digital cable environment, that would be the same requirement. I'd have to get a converter for my analog TV.

MR. SACHS: Or, I mean, some signals may be converted to analog and other, if the cost is low enough of digital set-top equipment, the operator may want to provide that to all its customers. But we're not at those price-points today.

REP. WALDEN: I realize my time's expired, Mr. Chairman. Thank you.

REP. UPTON: I want to thank all of you today. You answered a lot of good questions. We have made quite a bit of progress on this. We appreciate your time and the many hours of our roundtable discussions as well. I would just note that I talked to former chairman Billy Tauzin yesterday. He's looking forward to grabbing this issue by the horns there when he returns back to Washington, perhaps as early as next week.

So I look forward to his continued involvement on this issue as well. I would just note that we're tentatively planning another hearing, particularly as it relates to the Berlin transition, probably next month. And we look forward to your input there. We have votes now, multiple votes.

So, this hearing is now adjourned. Thank you very much.