Thursday, October 04, 2007

17 Months and Counting: What's Changed?

Once again, the 17th has come and gone, and it's now less than 17 months until the current "hard" date (2/17/09) on which analog broadcasting is supposed to cease. This is the 18th of 35 planned monthly recaps of developments affecting the various players (laid out in my first few posts) in this story, meaning that we have gone more than half the distance that remained when we started this blog in March of 2006. Despite the name of this blog I do cover some stories (like the growth of HD) that are not directly transition-related (but strike me as being of interest to transition-watchers). Due to my recent trip to Japan, this will be a bit more compact and focused (and late) than usual. That said, here's some of what happened (or was commented on) between 8/18 and 9/17 (with one obvious exception). As usual, major news sources for this update include Multichannel News, Engadget HD, TV Week, TWICE and TVPredictions.com.

THE PUBLIC - We focus this time on two efforts to educate the public, one from broadcasters (the National Association of Broadcasters, or NAB) and the other from the cable industry (the National Cable & Telecommunication Association, or NCTA) . The NAB has announced their plans to send local stations four to six 30-second PSAs by the end of the year, but the plans are light on details (such as whether they'll air in prime time or will mention cable as option for keeping existing sets useful) so far. For now, they'd like to keep it vague, rejecting suggestions that the FCC impose specific time or message requirements. The NCTA already has its PSAs online, although at the time they were made their promises to "take care of all that transition stuff for us" was only true for digital-cable customers, as pointed out by the NAB (this has now changed; see GOVERNMENT below).

Do people pay more attention to high-def advertisements? I certainly do (although the novelty is certain to wear out eventually), and I'm not alone, as this survey shows.

GOVERNMENT - A major concern for transition-watchers has been the fate of analog-cable customers after 2/17/09, when analog broadcast signals (the heart of any analog cable package) are scheduled to go away. The FCC has now acted, but not without having to make some compromises. FCC Chairman Kevin Martin's original plan was to require cable companies to convert digital broadcast transmissions to analog for analog customers (thus "dual carry") once analog transmissions were shut off, unless the company has converted (like Comcast in Chicago) to all-digital transmission. This plan simultaneously protected those customers from a rude awakening on The Day, while giving cable companies a powerful incentive to force the smaller inconvenience of a digital STB on those very same customers. However, threats of court action from the NCTA have resulted in a compromise whereby these provisions are effective for three years only (starting on 2/18/09), although the FCC does reserve the right to extend that. The FCC also backed off on measures designed to preserve picture quality by eliminating bandwidth-saving techniques such as compression and statistical multiplexing. Also, systems with less than 552 MHz may apply for waivers. I'm not sure how much this weakens the incentive to go all-digital; hopefully, the evolution of the marketplace will provide incentives of its own.

Another problem regarding the overall transition has surfaced; both DirecTV and Echostar (Dish Network) now say they may not have time to make the equipment changes necessary to capture all the local broadcast digital stations (unlike cable, they have to do this for the whole country, not just one area) by the transition date. A bit late in the day to be bringing this up, no? They seem to be asking for a delay in the transition date. I doubt they'll get it, but what else can be worked out? We'll be watching this one!

Cable, satellite, what have we forgotten? Oh yeah, over-the-air analog watchers, the group most likely to be negatively impacted by the transition. Anybody doing anything for them lately? One group that would like to try is the Save Our Sets Transition Coalition, which proposes a social compact whereby participating service providers offer to provide holders of converter-box coupons free analog broadcast TV service for seven years, in return for retransmission-fee concessions from broadcasters. Something of a long shot here, but who knows - something could come of it.

In news regarding other mandates, Comcast seems set to appeal the FCC's denial of their waiver request (exempting three of their STBs from the CableCARD mandate), and the FCC set a date (January 16, 2008) for the beginning of the auction for the spectrum reclaimed in the transition.

BROADCASTING - While there are still only few local newsrooms broadcasting HD news (a bit more than 50 at last count), they tend to clump together - that is to say, a prime incentive to convert your newsroom appears to be the fact that your local competition has already done so. That's why Cleveland had three as far back as January, and why Tampa now has two. While we're on the subject, you might be interested in Ben Drawbaugh's behind-the-scenes look at a local HD newscast.

Also making ground on the broadcast HD front is football, with CBS going all-HD with their coverage of SEC college games.

PROGRAM PROVIDERS - The biggest story this month continued to be the struggle by program providers to add capacity, but most of that story was about waiting. Everyone knew the game was about to change with the launch of the first wave of new DirecTV HD channels, but no one knew exactly when. In early September, it was learned that a separate HD-only tier (consisting of HDNet, HDNet Movies, Universal HD, MHD, MGM HD and Smithsonian HD) would be created, with a separate $4.99 charge for the six non-simulcast channels. As the 17th drew near, word got around that the 19th would be Launch Day, but no dice. It finally happened on the 26th. I'll have more to say about that next time, but for now you can see what viewers are saying over at AVS Forum.

Moves in response were surprisingly modest during this period. Dish Network added some HD PPV channels, while Cox in Virgina prepared for future moves by deploying switched video.

No further updates regarding legal issues between providers, but we do have one franchising story. A vote intended to fulfill an earlier promise to cable companies to extend them some of the fast-track treatment now given to telcos (such as the requirement that local government act on applications within 90 days) was cancelled without explanation by FCC Chairman Martin. Whether this is simply a timing issue or something more significant remains to be seen.

In other provider news, Comcast will be eventually using other platforms besides Motorola for its TiVo service (still to show up here in New England, which is supposed to get it first), Verizon is shooting a series of infomercials for its FiOS service and AT&T's U-Verse service has passed the 100K mark in subscribers.
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HD NETWORKS - As you might expect, things have picked up on this front since last time. Two new channels couldn't wait for DirecTV, and launched without them, although in CNN HD's case, it was a question of "if a channel launches and no one is carrying it, does it actually exist?" (They have been making up for lost time lately, having just been added by Comcast.) Meanwhile, History Channel HD launched, but with an actual provider (Dish). Big Ten Network also launched, but without the Comcast deal they've been craving, though they've been made welcome on DirecTV, AT&T's U-Verse, and Dish. Of course, there was plenty of launch activity after the 17th, which we'll get into next time.

There were also a number of announcements of yet-to-debut channels. One of the main frustrations for HD enthusiasts is the paucity of real HD content on simulcast channels (i.e. channels that have the same programming as their SD counterpart). Well,you won't have to look for the HD content on CNBC HD+, since there won't be any HD, just additional graphics filling up the 16:9 frame, with the SD feed in a 4:3 window, and no current plans to move towards real HD. Oh well, at least it's not stretched. In contrast Fox Business Net will be in HD from its October 15 launch.

Also putting more HD into their simulcasts will be Travel Channel HD, whose schedule will be 95% high-def when it launches in the first quarter of next year, and Weather Channel HD, which will kick things off October 1 with two long form series in HD, followed by the debut of its HD studio sometime in June (in the long run, the goal is 90% HD).

In existing-channels news, things may be looking up in terms of real HD content at A&E, which is taking another run at original series drama, and Starz is doing likewise. Another problem being addressed is the extreme rerun-heaviness of MHD's schedule, which should get a bit of relief from this new concert series. And five HD networks are back on the air after a fire at their uplinker.

MANUFACTURERS - We start this time with the previously-reported Paramount/Dreamworks announcement that they would join the HD-DVD exclusives club, which already seems to turned back the tide of momentum stirred up by the Blockbuster Blu-ray-exclusive announcement two months ago. Regardless of the possible financial incentives connected to the deal, you can't deny the cost (in terms of the content you won't be seeing) of choosing one format over the other has just gotten much closer to even, and that points towards a protracted struggle. Still, it could have been even worse for Blu-ray - it could have been Warner. Though there've been reports that Warner is also considering an offer to go HD-DVD exclusive, it looks like the most prominent of the format-neutral studios is staying that way, at least for now. Still, it's interesting to note that their "Total HD" dual-format disc is on hold indefinitely.

There were some positive indications for Blu-ray, 'tho; stand-alone player sales seem to be going their way recently, although HD-DVD still ahead year-to-date. In other developments, the fourth quarter will see lower-priced ($999) combo players from LG (their second, and this one actually supports HD-DVD interactive features), as well as from Samsung. And niche/global market format HD VMD plans to launch in October. Speaking of global markets, China has announced CH-DVD, its own local variant of HD-DVD.

As always, there is still some hardware news not related to NextGen DVD. TiVo owners got some good news recently; if the FCC listens to a proposal from the NCTA, a device that will enable TiVo (Series 3 & HD) and similar devices to support switched video. LCD prices may be lower than CRTs of the same size by this holiday season. And the fruits of the CableCARD mandate are beginning to show up - here's an example of the boxes that will soon be competing with cable company STBs.

That's all for this monthly recap. I hope to be back to a normal schedule next time. See you then!

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