Mixed Signals

Brandweek, July 10, 2000 by Stephen A. Booth

The pawning of extra bandwidth by broadcasters to Net startups is the latest controversy in the HDTV expansion.

Biblical Esau, son of Isaac, sold his patrimony for a bit of soup. In a plan that seems equally hairy to some, several broadcast groups are pawning parcels of their government-given digital television (DTV) bandwidth to startups that plan to use the air-space to beam Internet data to PCs instead of couch-potato fare to boob-tubes.

The plan has generated increasing controversy, all the way from network executive suites to Capitol Hill, and is the latest teapot tempest in the so-far stumbling DTV build-out. Network poobahsu don't want their affiliates to mortgage out bandwidth until their own DTV deployment strategies are firmly in place. Meanwhile, solons in Congress have become increasingly alarmed that station owners won't use the free boon of publically-owned spectrum to transmit ad-supported digital eye candy, but instead will flip their broadband land grant to make a buck on datacasting services--possibly subscription-based.

QUICK REVENUE COULDN'T HERTZ

In the effort to launch high-definition digital TV (HDTV) in the United States, each station was given an additional 6 megahertz (MHz) channel of public spectrum to supplement its analog broadcast slot. The prospectus sold to Congress by the various engineering committees was for film-like HDTV broadcasts with cinematic digital surround-sound-a movie theater in every home delivered free, over the air, to advanced DTV sets. Meanwhile, the business side of broadcasting had been trying to find a financial model in DTV entertainment, but so far has only seen cash flowing out for infrastructure expenses. Whence came the interest in devoting part of the bandwidth to something that could generate some quick revenue, such as datacasting.

Although Congress didn't intend to dole out precious slices of publically-owned spectrum so broadcasters could pull a lend-lease deal, it's debatable whether legislators can do anything to prevent stations from renting out some of their bandwidth for ad-supported or fee-paid datacasting--including streaming video from the Web. The Federal Communications Commission (FCC), empowered with rule-making for DTV, does not require stations to use all of their free bandwidth to broadcast HDTV.

The FCC mandates only that stations use some of the DTV channel to transmit high-resolution digital pictures over the air. These may be in a format described as "standard definition" TV (SDTV).

To put the tech-talk quickly in context, an HDTV signal is considered to be a broadcast with 1,080 interlaced lines (1080i) or 720 progressively-scanned lines (720p). Subjectively, each delivers about quadruple the resolution of 480i analog TV. At 480 progressively-scanned lines, SDTV doubles the resolution of analog TV. The foregoing descriptions are simplifications, as DTV offers additional visual enhancements owing to the lack of distortion and other artifacts that affect analog TV.

Bottom line? As far as the FCC is concerned, a broadcaster needs only to transmit a single SDTV program within its DTV channel to fulfill its commitment. More to the point: Each 6 MHz channel can transmit digital data at a rate of 19.2 megabits per second (19.2 Mbps)-which is full HDTV resolution. SDTV requires much less bandwidth: about 5 Mbps. Therefore, a station might "multicast" four SDTV programs simultaneously within its signal (and designate them as channels A/B/Cm). Or, it may fulfill its obligation to the FCC by transmitting a single SDTV program, and use the leftover bandwidth for whatever it likes. If that means using the balance of the bandwidth for datacasting, the FCC could not care less.

CABLE CRIES FOUL

But some, mainly cable TV operators, plan to make a stink over what they perceive as a violation of the spirit, if not the letter, of the law. As cable sees it, terrestrial broadcasters would be using the free bandwidth to enter new business--to cable's disadvantage. Moreover, since broadcasters are demanding that the government force cable operators to carry their DTV signals (as they're required to do with analog broadcast channels), cable operators fear they'll be compelled to become delivery boys for the broadcasters' new products. Robert Sachs, president of the National Cable Television Association, summed up his constituency's position on the DTV must-carry policy during April's convention of the National Association of Broadcasters. "It's about an attempt to misuse a government rule to give broadcasters an economic advantage in a competitive new commercial business," Sachs said. Broadcasters, he said, want government to "mandate free access over cable systems to them so they can launch new competitive data services and channels." Sachs turned up the flamethrower at last month's meeting of the N.Y. Cable Club, where he reiterated cable's complaints and said HDTV stands for "Hustling Data to Viewers."

However, not everyone sees DTV datacasting as an evil thing. Some parties view the airwaves as a viable way to build and expand Internet access--especially to broadband-challenged rural areas--without the investment needed to deploy new cable and telco links to supplement the increasingly overloaded point-to-point architecture of the Web.