A Tale Of Two Issues: DTV And TSP Funding

Telecom Policy Report, Feb 23, 2005

Congress, Agencies Debate TV, Public Safety Costs In Wartime

Simultaneously taking place last week in Washington, D.C., were two seemingly unrelated public events -- one a congressional panel on digital television (DTV) and another a seminar on the federal Telecommunications Service Priority (TSP) program for dire emergencies. What these sessions had in common was the way they illustrated a very inexplicable pecking order often seen in government spending behavior and concepts.

Last Thursday, a morning hearing of the House Energy and Commerce Subcommittee on Telecommunications and the Internet considered possible legislation that would abandon outright analog broadcast transmission in favor of authorizing DTV transmission only; congressional representatives openly debated whether nearly 73 million analog receivers will become useless and whether a universal service fund (USF)-type subsidy would be warranted to underwrite digital conversion systems for any or all U.S. consumers.

During the same timeslot across town, the Federal Communications Commission (FCC) sponsored a "summit" on the federally administered TSP program that effectively institutes a type of insurance program for mission-critical telecom circuits to remain operational or to recover swiftly in such emergencies as natural disasters or terrorist attacks. However, the fly in the ointment was that TSP is underutilized because local, county and regional public-safety officials may be unaware or unappreciative of the program's value, unwilling to make the expenditures or uncertain about possible grants associated with TSP.

The monetary differences that surfaced between these two discussions are striking. For the congressional hearing on DTV, the General Accountability Office (GAO, formerly known as the General Accounting Office) had prepared at subcommittee request a number of scenarios for subsidizing analog-to-digital (A-D) conversion boxes for U.S. consumers. Depending on the numbers of households and TVs involved, the GAO price range for the boxes and the timeframes for implementing such subsidiaries extended from a low of $463 million to a high of $10 billion.

Meanwhile, at the FCC session on TSP, a number of speakers said the average per-circuit costs for public-safety organizations to enroll in the program included a $100 upfront cost and a $3 monthly recurring charge. In fact, William Cade, director of 911 and communications center operations for the Association of Public-Safety Communications Officials International (APCO), estimated that, nationwide, a total of about 80,000 such circuits ought to have TSP coverage but only 10 percent, or 8,000, currently do so. If each of the remaining 72,000 circuits were funded at the $100 upfront average cost, the total expenditure would be only $7.2 million - but such federal funding is not a clear-cut matter (this would be $8 million if all circuits were subsidized in some manner or given direct monetary grants).

DTV-Land's Viewing Audience

Congressional consideration - and it is by no means a firm stance - of possible A-D converter subsidies is the latest turn in a long, winding road involving broadcast TV's migration to digital-only transmission. The move would free up analog spectrum currently used by TV broadcasters for future uses to be determined by the federal government; Congress has allocated a portion of the analog blocks for public-safety and emergency purposes, and the FCC would like to see the remaining portion earmarked and auctioned off for wireless broadband Internet access via such technologies as Wi-Fi.

Among the long-standing DTV disputes are whether cable TV operators should carry both digital and analog signals/content from broadcasters and whether cable companies will perform A-D conversions within their "headend" infrastructures or though converter boxes supplied to their subscribers. These debates could be moot if broadcasters must go all-digital, and they also would be side shows compared with the prospect - and political ramifications - of 73 million analog TV sets suddenly unable to pick up any signal due to analog's demise.

A key issue is that the 1996 Telecom Act sets a Dec. 31, 2006, deadline as the "goal" for the shift from digital to analog spectrum with the proviso that 85 percent of U.S. households be equipped with A-D converters, dual A/D tuners or digital-only TVs to receive the digital signals. How this penetration threshold will be measured or estimated remains unclear, but congressmen, FCC officials and industrialists are uncertain that number can be achieved. There have been discussions of further pushbacks of the transition date and transition alternatives.

Nevertheless, House Commerce Committee Chairman Joe Barton (R-Texas) says he is prepared to introduce legislation that establishes Dec. 31, 2006, as the firm deadline, explaining, "We need to expedite the transition so that consumers and the economy can benefit from the full rollout of DTV, and so that we can repurpose the analog spectrum for public safety use and advanced wireless services."