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Digital Voices

Still Charting the Digital Broadcasting Future:
An Update on the State of the DTV Transition

This week marks the third anniversary of the release of recommendations made by the President's Advisory Committee on Public Interest Obligations of Digital Television Broadcasters (PIAC). Created in October 1997, President Clinton charged the 22 members of PIAC to study and recommend to Vice President Gore the public interest responsibilities that should accompany broadcasters' receipt of digital television licenses. The members represented the broadcasting and computer industries, the public interest community, academia and labor. Their conclusions came in a report, Charting the Digital Broadcasting Future, released on December 18, 1998. The report included 10 recommendations to the Federal Communications Commission, Congress, the administration and the broadcast industry.

PIAC made a series of powerful public interest recommendations that portend diversity of free expression, quality governance, responsiveness to disasters, intelligence of political discourse, vitality of local communities, opportunities for education and instruction and accessibility by the disabled. It recognized that the transition from analog to digital was not just a technological change -- it represented a societal change.

The release of the recommendations, however, came at a trying time for the nation. President Clinton was to become the first elected president to be impeached by the House of Representatives and, at the same time, was ordering air strikes in Iraq. The events of September 11, 2001 have similarly focused the nation's attention on matters of security, keeping many other public interest issues in the background.

The Spectrum Crunch and Digital TV Licenses

Earlier this year, the FCC created an interagency task force to examine the transition to digital television -- a process that is moving much slower than policymakers had hoped. In announcing the creation of this DTV Taskforce, FCC Chairman Michael Powell said

This is a task force born of the need to take a hard look at where we are in the DTV transition and to make any midcourse corrections necessary. We must be aware of the financial impact of the [Sept 11] attacks on media companies. We must be aware of the impact of consumer spending. We must be aware of the needs of public safety and other wireless services for additional spectrum. Above all, we must be mindful of our place in the broader community. In a sign that the DTV transition could be further delayed, Powell hinted that DTV conversion deadlines are likely to be extended:

The DTV transition is a massive and complex undertaking. Although I'm often asked what the FCC is going to do to 'fix' the DTV transition, I believe that a big part of the problem were the unrealistic expectations set by the 2006 target date for return of the analog spectrum. This Task Force will help us re-examine the assumptions on which the Commission based its DTV policies, and give us the ability to react and make necessary adjustments.

In 1997, the FCC decided to grant existing, full-power television stations additional spectrum to facilitate the transition to digital. Broadcasters were to air both analog and digital signals until 2006, at which point broadcasters would then return one spectrum allotment to be auctioned subsequently for new uses.

The value of the broadcaster's spectrum has grown, too. Earlier this year, a deal appeared to be in the works that would have moved the U.S. Department of Defense from the spectrum bands it currently uses over to new spectrum bands. Funding to re-equip military technology would have come directly from auction revenues paid by wireless companies. But with the new focus on national security, any changes in DoD allocations are off the table for now. As a result, all spectrum became more valuable, and broadcasters seem eager to make a profit from a resource for which they paid nothing -- and, in turn, save on DTV conversion and simulcast costs.1

In another move that exemplifies the sweeping effects of the September 11 attacks, the FCC this fall adopted new rules that will allow TV stations occupying channels 60-69 to relinquish their right to broadcast prior to the completion of the digital TV transition and delay the switch to DTV on their remaining allotment until Dec. 31, 20052 or later.3 Paxson Communications and several other broadcasters are negotiating with wireless companies for those spectrum allotments. Twelve media companies will profit from this rule change, headed by Paxson, which owns 18 of the 142 affected stations. Estimates value the spectrum at hundreds of millions, if not billions.4

FCC officials say the rules change were necessary to speed the introduction of new "third-generation" (3G) mobile Internet services because broadcasters aren't obligated to relinquish spectrum before 2006. The government plans to auction the spectrum still in use by broadcasters on a date yet to be determined, and many officials are worried that uncertainty over wireless companies' ability to utilize the spectrum quickly would diminish the government's revenue from the bidding.

But lawmakers appear to be growing weary of the competing factions of the media sector that are slowing the transition to digital television. At a private meeting in October, Rep. Billy Tauzin (R-LA) and several other top members of the House Commerce Committee asked executives from the television, motion picture and consumer electronics industries to hammer out their differences -- or face congressional intervention. Some of the more contentious issues include copy protection, digital must-carry obligations, cable interoperability standards and deadlines to go "all digital."

"It seems like we're 95% there," one participant said. "But negotiations on copyright protection, cable interoperability and standardized design are still dragging on. The last yard still needs to be crossed."

Public Interest Obligations Take a Back Seat

Last December, the FCC collected publics comment on two key components of the public interest obligations of broadcasters: children's programming and public disclosure of public service programming and activities. Although these proceedings were closed last winter, the FCC has still not ruled on them. They are indicative of the fading priority the FCC is putting on defining the public interest obligations of digital broadcasters when the service is in its formative years.

In looking over the 10 PIAC recommendations, little movement has been seen since last year. (See Benton's second anniversary report for more information.) One of the primary PIAC recommendations dealt with increasing diversity in broadcasting. In fact, we may soon find that the deplorable state of broadcasting diversity may even get worse.

Over the last 20 years, deregulation has led to consolidation of media ownership in troubling ways. Minority and female ownership of media outlets is shrinking out of existence. In 2000, just 175 minority broadcasters owned 426 stations, or about 4% of America's 10,577 commercial radio stations, and just 23 full power commercial television stations -- that's only 1.9% of the country's 1,288 TV outlets.

Even with data like these, FCC Chairman Powell is wielding his 3-1 Commission majority to deregulate media ownership rules even further. The public interest question before the FCC is how to best promote diversity of programming, political discourse, localism and equal employment opportunities. Corporate lobbyists argue that policymakers should rely on commercial market forces, but public interest advocates know and must convince the FCC that in a democratic society, the flow of information is too important to entrust to commercial forces alone. These advocates are asking the FCC to retain ownership rules that prevent the accumulation of market power and maintain the checks and balances between different media, preserving independent views and the widest possible dissemination of information from diverse and antagonistic sources.

A Digital Promise

Another primary PIAC recommendation dealt with increasing digital educational content. The Digital Opportunity Trust Fund is a new idea developed by and propagated by Newton Minow and Larry Grossman; the concept could help deliver on the potential innovative uses of digital technologies (including DTV) for education, lifelong learning, civic and cultural uses. The proposal calls for allocating an expected $18 billion in upcoming spectrum auctions to capitalize a trust fund that would provide monies to convert the wealth of information housed in the nation's noncommercial organizations into digital formats that could be easily shared with students and lifelong learners. The idea is meant to fill the hole between digital divide efforts that concentrate on hardware and connections (the E-Rate, for example) and the dearth of funding devoted to digital content, software, and tools for K-12 education and lifelong learning. The work of educating people about and advocating for the trust is conducted by The Digital Promise.

The trust has, from its introduction, received substantial support. Leaders of the Library of Congress, the Smithsonian Institution, the National Science Foundation, various national and local organizations and high-tech companies have endorsed the concept. Supporting organizations include the Association of American Universities, American Council on Education, American Library Association, American Association of Museums, California State Library and California Library Association, Federation of American Scientists and Window to the World Communications Inc.

In the post-9/11 world, the idea of the Digital Opportunity Trust Fund is both more important and, at the same time, potentially a tougher sell to Congress. Even before the drastic events of September, advertiser-supported Internet sites were going under and the economic downturn since then has only accelerated the trend with advertising dollars drying up. The result could be an enormous content divide for educational content. Wealthy schools will always be able to afford expensive online and other media content. But poor schools that have relied on advertiser-based educational content could be left out in the cold. The fastest-growing digital divide could be the educational content divide.

But finding the spectrum to auction, given the needs of the military and broadcasters' slow march to digital, may be hard to accomplish. This means that it is highly unlikely that any significant new spectrum will be made available for auction. If it is made available, given current federal deficit spending, it is likely to be used to fill the deficit created by the recent tax cut. Even in the face of these tough odds, however, Newton Minow remains optimistic that the trust fund can be capitalized. He often reminds people that our country's two biggest investments in education -- the Land Grants College Act of the Lincoln Administration and the G.I. Bill -- were passed during times of war.

For individuals and organizations interested in supporting the Digital Opportunity Trust Fund concept, Digital Promise is asking for the following:

A formal endorsement of the proposal Examples of how public interest/noncommercial communications could benefit from the trust A quote that could be used in promotional materials

More information is available via the trust's digitalpromise.org Web site.

Conclusion

The events of September 11 have taught many lessons -- one of which is a reminder that the political landscape is always in flux. New priorities arise, displacing issues that do not seem to need immediate attention.

The work of PIAC was to study and make recommendations on how best to balance both commercial and public interest needs so that digital television grows into a service that is valuable for the entire nation. Television's reaction to September 11, with non-stop coverage of the events, showed its importance in conveying information and beginning a dialogue of healing. The PIAC recommendations aimed to ensure that television can always fulfill this and other public service roles.

Although September 11 has raised many important issues that the nation needs to address, we cannot lose sight of long-term opportunities to shape our emerging digital environment to serve our quality of governance, intelligence of political discourse, diversity of free expression, vitality of local communities and opportunities for education and instruction. With many leaders now focused on issues of security and economic recovery, public interest advocates will continue to remind policymakers -- and broadcasters -- of their responsibilities to longer-term issues. Digital television must serve the public interest and not just those of commercial forces.

Notes

1 Broadcasters had been mandated to simulcast digital and analog programming over the next few years.
2 Generally, broadcasters had to provide a DTV signal by May 2002.
3 They have the right to request additional extensions if U.S. DTV household penetration is less than 70%.
4 A Wall Street analyst recently told television station owners that broadcast spectrum is worth twice as much as the combined stock value of all of the country's television stations.

Related Web Sites

Charting the Digital Broadcasting Future
http://www.benton.org/PIAC/report.html

PIAC Legacy Project, hosted by the Benton Foundation
http://www.benton.org/PIAC

Federal Communications Commission
http://www.fcc.gov

Digital Promise
http://www.digitalpromise.org

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