Digital TV Facts: The Latest

Digital TV reception isn’t always child’s play, as regular DTV Facts readers know. Nonetheless, over-the-air viewers have been told that the simple addition of a $50 converter box will usher their old analog TVs into the digital era by Feb. 17, 2009. That’s the standard line from Washington and broadcasters—well, from practically everybody.

Behind the scenes, though, broadcasters and retailers have their doubts:

Even if “late adopters” get the message about the turnoff and apply for their $40 subsidy for a converter box, there are concerns about the boxes themselves. Electronics manufacturers say ATSC (Advanced Television Systems Committee)-compliant receiver chips are in their fifth generation of development and can reliably receive DTV signals on small indoor antennas, but there is no guarantee that the latest chips will be in low-cost DTV set-tops. That may mean that people who buy the boxes will need to replace their “rabbit-ear” antennas with specialized indoor antennas or even install a rooftop antenna.

“You have no way of knowing what generation of chip you’re buying,” notes Ira Goldstone, chief technology officer for Tribune Broadcasting. “If you’re buying an HD set today, it doesn’t say ’second-generation ATSC tuner’ on it.”

CBS VP of Advanced Technology Bob Seidel says his network has seen a broad range of performance in DTV tuners it has tested over the years, and he believes differences in quality will get wider as companies from China and Taiwan enter the digital-to-analog converter-box market. “Some manufacturers will be looking to enter the market with the lowest possible cost,” says Seidel. “So instead of the $5 tuner, they might go with the $1.25 model.”

The suggested $40 rebate and projected $50 total cost of the boxes is unrealistic, he adds, noting that CBS research indicates that the price of the parts and the technology licenses for such set-tops will add up to $40 per box before the retail markup.

Circuit City Chairman Alan McCollough, for one, doesn’t like the idea of a converter box in the first place, because DTV set-tops are already a high-return item at the retail chain.

While doubt is prudent, it’s still way too early for despair. The market for converters will be large enough that consumers should eventually have some decent choices.

• Link: Broadcasting & Cable