From: "Richard Brittain" <[email protected]>
To: <[email protected]>
Date: 9/23/2006 11:52:55 PM
Subject: Comments on Digital-to-Analog Converter Box Assistance Program
My comments on the Digital-to-Analog Converter Box Assistance Program
proposal:

A. Eligible U.S. Households

The Act and its legislative history do NOT authorize NTIA to impose ANY
eligibility requirement, especially (a) the proposed exclusion of cable and
satellite subscribers or (b) any kind of means testing. The Act doesn't
even use the term "eligible household", much less define it; NTIA has no
authority to create such a category.

The conference report clearly states that coupons are to go "to each U.S.
household that requests to participate in the program" (direct quote),
subject only to the application and mailing requirements, the
two-coupons-per-household limit, and the overall fiscal limits for the
program. Any other limit not only violates the Act; it also ignores the
concerns of the GAO Challenges Report (which clearly rejected means
testing), increases administrative costs and challenges astronomically, and
would create an artificial surplus of coupon funding since there will be
more coupons than "eligible households". That not only contradicts the
Congressional directive to apply administrative savings towards more
coupons, but also encourages fraud, waste and abuse through trafficking of
coupons and/or boxes by "eligible households".

There are many possibilities where people that currently subscribe to cable
or satellite will need a converter box:

* Many people have a second, battery-operated TV for use if the power
goes out; virtually all of these are analog, and it will likely be years
before similar DTVs are available at an affordable price. It would be a
travesty to public safety if these TVs are turned into paperweights merely
because they are analog and the owner can't get a converter box due to
having cable or satellite on his or her main TV. (This is my situation; I
have a small TV hidden away for this very purpose, in addition to a
full-fledged HDTV connected to digital cable service and an over-the-air
antenna as backup.)
* Many people who subscribe to cable or satellite also use
over-the-air antennas in case their service goes out; that is common in
severe-weather situations, especially for satellite. Excluding these people
from the program would be a further travesty to public safety. (I would be
in that group except that my HDTV does have an ATSC tuner.)
* Many people have "ordinary" second or third TVs that are not
connected to cable or satellite; without a converter box they too will
become paperweights, though that won't cause the same public-safety issues
as the prior two categories.
* Finally, it is likely that many cable subscribers will be forced to
upgrade to digital cable to retain local channels after the 2009 shutoff of
analog TV. This is due to an FCC rule, ironically insisted on by
broadcasters, that bars digital cable systems from "down-converting" digital
signals to analog at any point shy of the set-top box (though I understand
the FCC is reconsidering). Though the NAB sells it as protecting HDTV, it
will cause a loss of service of far greater magnitude than the shutoff
itself by ending local channels for those without digital cable boxes (or
DCR sets which have failed in the market). If this happens, since there are
no plans for most cable systems to eliminate analog cable for cable
channels, I suspect many customers displaced by this change will not pay for
the "upgrade" to digital cable, but rather will want to switch to
over-the-air reception with or without analog cable; thus it is
inappropriate to exclude them from the program. (Satellite isn't subject to
the "down-conversion" ban, so this won't be an issue there.)

(Note: I am also aware that many satellite customers cannot receive local
channels because their satellite provider doesn't offer them in their
market, or in a few cases, because they live outside the limited range of
the satellite transponder, or "spotbeam", that carries their local channels.
However, even if it isn't clear in all parts of the proposal, the literal
wording of the "no cable or satellite customers" restriction says these
customers are eligible, since they do not receive local channels by
satellite, even though they subscribe to satellite service. Even though I
believe that restriction is illegal and should be removed, at a bare minimum
it should be carefully worded to clarify that those people are eligible.)

Contrary to the proposal's statement, the conference report's statement that
14.86% of U.S. TV households "relied exclusively" on over-the-air broadcasts
was not a limitation on the program; rather, it illustrates Congressional
intent that the proposed fiscal limits ($990 million to $1.5 billion) should
be sufficient to fund the program without imposing eligibility requirements.
14.86% works out to around 16.1 million TV households; in comparison, the
fiscal limits would provide anywhere from 22.25 million to 33.5 million
boxes (more if administrative savings is applied to more coupons as Congress
intended). Even if there are 21 million such households (as NTIA assumes),
the funding is clearly more than needed to cover them. From those figures,
it is clear that Congress believes the funding is sufficient to open the
program to "all comers"; if Congress is wrong, it's their responsibility,
not NTIA's.

Furthermore, with the FCC's just-completed AWS-1 auction netting around
$13.7 billion for less-desirable spectrum (AWS-1's spectral qualities are
similar to the current 1900 MHz PCS band, but the freed TV spectrum will be
more like the 800 MHz cellular band), I suspect the Treasury will earn more
than enough from auctioning the freed spectrum to cover additional
Congressional appropriations in the event more than 33.5 million boxes are
needed to satisfy "all comers". Speaking of which, the fact that TV viewers
of all ages, races and income levels are being asked to bear the hardship of
losing analog TV, in order to free up valuable spectrum that the government
will make money on, is plenty of reason to pay for converter boxes for all
households, as Congress intended.

Though I empathize with the commenter that questioned the definition of
"household" by mailing address, I think that requirement is needed to meet
Congress' intent (backed by the GAO Challenges Report) that mailing
addresses be the primary means of verifying eligibility and limiting
participation to two boxes per household. NTIA may wish to create a special
application process for multiple "households" at a single address; however,
the main process must assume one "household" per mailing address in order to
meet Congressional intent, and adding a special process may add
impermissibly to administrative costs.

The "first-come, first-served" rule should be adopted as proposed; that is
the only way this program can be implemented as Congress intended.

B. Coupon Value and Use Restrictions

I believe Congressional intent was to issue a paper coupon with a UPC
coupon-type barcode, which brick-and-mortar retailers and coupon
clearinghouses can handle in the same fashion as manufacturer's cents-off
coupons; that would minimize the cost of the overall program. (Generally,
that type of coupon does not have a serial number.) Though some commenters
(and the NTIA proposal) think more is needed to prevent fraud, waste and
abuse, the fact is that misuse of manufacturer's cents-off coupons is
already prosecuted as mail fraud (since coupons are redeemed through the
mail); I'm afraid any additional requirements would only drive up
administrative costs while only creating new avenues for fraud, waste and
abuse.

It should be noted, however, that this type of paper coupon would be
cumbersome for Internet retailers to use; therefore, NTIA may wish to create
an alternative system for them. As part of the application, the consumer
would elect between a traditional coupon and an "e-coupon" code (which would
be mailed to meet Congressional requirements); the latter could be entered
on Internet retailers' websites and redeemed electronically. However, that
would likely see higher administrative costs than a paper-coupon solution.

If NTIA insists on requiring certification for retailers, an electronic
coupon card (which, again, must be mailed) would likely be better than a
paper coupon; that would permit real-time authentication for all
transactions, much like EBT cards (as one commenter said).

The rules should reflect the express Congressional limitation of one coupon
per converter box. However, I think the return language could be loosened
up a bit without undermining the program. For example, if there is more
than one kind of box (as my comments below assume), any exchange might not
be "even", but it should be "value for value" (i.e., the $40 should be
applied to the other eligible box as it was to the first one). It may also
be possible to consider a return in exchange for a reissued coupon; however,
that may be too complex to implement. Finally, if there isn't something out
there to prevent black-market trafficking in boxes, the whole return issue
may be for naught.

C. Application Process

I strongly support this section as proposed (mail, phone, and Internet),
except for the certification as to over-the-air reception which is contrary
to the Act (see A. above). I believe that the right technical partners can
help NTIA handle any fraud, waste and abuse issues, as well as provide the
most cost-effective ways to carry out the mail and phone options.

D. Coupon Expiration

If the paper-coupon option is used, given the Congressionally-mandated
3-month expiration date, it is imperative that the expiration date be
printed on the coupon, as has been proposed. Lack of a printed expiration
date would force all retailers to verify their coupons with NTIA by phone or
electronically, which would dramatically increase administrative costs. In
this case, the coupon should be "issued" for expiration purposes 3 days
after mailing, as proposed.

The only way in which "date of receipt" could be feasibly used as the
"issued" date is if an electronic coupon card is used and is activated by
phone or Internet like credit cards; in that case, the date of activation
would be the "issued" date.

E. Digital-to-Analog Converter Box

The proposal is both too complicated (by mandating a remote control and
composite video & stereo audio outputs, as well as an EAS requirement not
imposed by the FCC) and too simple (by apparently not allowing any
input/output other than Type F connectors, composite video and stereo audio,
or the ability to receive analog channels thru either the box's tuner or a
"passthru" circuit to the TV).

I have little direct comment on power requirements for converter boxes;
however, I do think they should be written so as not to prohibit
battery-powered boxes, which would be a necessity for battery-powered TVs
(like the one I have).

Though I see the point of the comment about reception standards, I'm afraid
his proposal is too technical for implementation. This program is about
putting DTV reception equipment in homes, not testing equipment only radio
engineers can understand. This is supposed to be like a "black box"; adding
too many bells and whistles only makes the boxes more expensive and less
useful. (Not to mention that it would violate the "necessary" requirements
of the Act.)

The FCC only imposes EAS requirements on broadcasters themselves; there is
no EAS requirement for broadcast TVs. Therefore, there should be no EAS
requirement for converter boxes. On the other hand, reception of channels
2-69 (All-Channel Receiver Act), closed captioning, and "V-chip"
functionality are FCC requirements for some or all TVs, and the minimum-size
requirement in FCC rules for closed captioning and "V-chip" (13 inches) is
likely inappropriate for a converter box; thus they should be part of the
standard.

Though the Act doesn't expressly address the ability to receive analog
channels thru the converter box, not including such functionality would
likely limit the usefulness of converter boxes--especially prior to February
17, 2009. (Since low-power TV stations are not legally subject to the
deadline, this might be an issue in some places even after that date.)
Though such a feature may seem contrary to the Act's definition of
"digital-to-analog converter box", it's obvious from a real-world standpoint
that this was not the kind of functionality Congress wanted to prohibit.
Therefore, I think the regulations should require that each box enable
analog-TV reception without disconnecting the box through either (a) a
"passthru" of analog signals if the box is turned off (likely for cheaper
boxes), (b) an integrated NTSC tuner (likely for more expensive boxes), or
both.

It should be noted as well that some older TV sets still have 300-ohm ribbon
leads and screw terminals instead of Type F connectors. Therefore, I
suggest that the following standards be included to assure that the
converter boxes are compatible with these TVs, as well as to provide
appropriate cabling:

*

For input, if the box doesn't have screw terminals, it should be
required to come with a 300-to-75 ohm VHF/UHF combiner, and a short Type F
cable to connect it to the box. (Since the 300-ohm system usually separated
VHF and UHF, and UHF functionality is important for DTV, it must have both.)
*

For output, the box must have a Type F output, and come with a
longer (6' or more) Type F cable and a 75-to-300 ohm VHF-only transformer.
(The RF cable from box to TV must be Type F; a ribbon lead would turn the RF
modulator into an illegal transmitter. If the box has a combiner instead of
screw terminals, it will need two Type F cables--a short one for the input,
a longer one for the output.)

I think Congress only intended to permit remotes, not require them; however,
there may be other real-world reasons for requiring a remote (such as to
provide the minimum ATSC functionality).

I think composite audio and video should be optional, not a requirement,
because it could make the box more expensive and is not absolutely necessary
to connect to analog TV receivers (all of which have either a Type F
connector or a screw terminal). However, this should be coupled with a
decision as to whether or not to require a box's RF modulator to support MTS
stereo. Since it's my understanding most RF modulators do not include MTS
stereo capability, if the box doesn't have MTS stereo in its RF modulator,
it may need composite stereo audio to support stereo TVs. I would also
permit S-video as an optional output.

Finally, we shouldn't forget those with "HD-ready" TVs without ATSC tuners;
if they have NTSC tuners, they "receive and display signals only in the
analog television service", so they qualify for boxes under the Act. I
think you should consider (as an option) more expensive boxes with component
outputs which support "HD-ready" TVs, potentially all the way to 1080i.
Though some might think that contravenes the "necessary" language of the
Act, the very existence of "HD-ready" TVs is a good argument against that,
along with the fact that component video is an analog (not digital) signal.
In the long run, it might be wasteful for NTIA to buy analog-output boxes
for them, only to be replaced with HD-capable boxes later on when they
realize what they're missing. On the other hand, I think DVI or HDMI
outputs would violate the "necessary" language; they're truly digital, and
most TVs with those also have component inputs, ATSC tuners, or both.

F. Retailer Certification

At a minimum, retailers must be reimbursed for the cost of redeeming the
coupons; otherwise they will not participate. A handling charge of 8 cents
per coupon is common with most manufacturer's cents-off coupons today, most
of which are of much smaller value than this program's $40 coupons; I
believe such a handling charge is reasonable, and would add only minor
administrative costs (less than $3 million in a worst-case scenario).

I don't think retailer certification is really necessary; improper
redemption of coupons can be pursued by the Postal Inspection Service as
mail fraud, or by the Justice and/or Treasury Departments as wire fraud,
just as with other coupons. NTIA retailer certification costs would come
out of the coupon budget, thus reducing the number of coupons available; the
costs for other agencies to pursue mail or wire fraud charges would not.
However, certification would likely be necessary for any "e-coupon" regime.

G. Consumer Education

I generally agree with the proposal. In today's TV market, $5 million isn't
that much; therefore, it needs to be leveraged as much as possible.

I suggest that the most important use of the $5 million is to produce public
service announcements (PSAs) for distribution thru the Ad Council, as well
as thru time paid for by other interested stakeholders, especially NAB and
its allies. (Given the risks if this doesn't succeed, it is hard to imagine
that the broadcasting and consumer-electronics industries won't help.) Even
if my argument that the proposed eligibility rules are illegal is correct,
the clear target market for this program is those who watch broadcast TV,
especially over-the-air; therefore, the best way to reach them is thru that
very medium. Though I agree that other media (print, Internet, etc.) should
be included in the mix, PSAs over broadcast TV are the most targeted and
cost-effective way for NTIA and other interested stakeholders to reach the
target audience; they clearly provide the most "bang for the buck" here.

I also generally agree with the comments that suggested a Hispanic component
for the education program. The U.S. Spanish-speaking population is arguably
more likely to rely on over-the-air broadcasts than the population as a
whole, especially from Spanish-language broadcast networks like Univision or
Telemundo. Indeed, it may be a wise use of the $5 million for NTIA to focus
on PSAs for the Hispanic market, since private stakeholders will likely pay
for a flashier ad campaign (PSAs and/or outright ads) for the general
population.

I would prefer that my email address not be posted on the website for
anti-spam reasons, though I understand if the rules require it.

Sincerely,
Richard B. Brittain
Little Rock, AR