Commerce Shapes $1.5B Plan for Digital TV Aid

Earlier this year, Congress established a converter-subsidy program in an effort to mitigate the effects of the digital television transition on millions of consumers that, according to the National Association of Broadcasters, possess 73 million analog TV sets not connected to cable or satellite. The Department of Commerce is several weeks away from soliciting public comment on the $1.5 billion subsidy program to help consumers purchase converter boxes to run analog television sets after the cessation of analog TV broadcasting in early 2009. Congress has ordered Commerce's National Telecommunications and Information Administration to supervise the program, but lawmakers gave NTIA director John Kneuer just a few instructions on how to allocate the money and how to limit ways consumers may use it. As a result, NTIA is planning to issue “by late July” a Notice of Inquiry (NOI) that would seek public input on program details, NTIA spokesman Ranjit De Silva said last Monday. The Office of Management and Budget has the document under review, he added. coupon program without eligibility criteria could threaten to exhaust the $1.5 billion fund and force millions of low-income consumers either to fund 100% of their converter box costs or shop for TV sets equipped with over-the-air digital tuners. According to the U.S. Census Bureau, the U.S. has 105 million occupied housing units. If each one sought to redeem two $40 coupons, the box program would cost $8.4 billion. The program would cost $1.6 billion if NTIA were to restrict eligibility to just the 20.5 million households that are broadcast-only. NTIA could cut the cost even more if only broadcast-only homes that met an income test were eligible.
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