AIDING THE FINAL PUSH OF THE
DIGITAL TRANSITION
Andrew L. Shapiro*
INTRODUCTION
The transition of television broadcast signals from analog to digital-a development which carries multiple benefits to consumers, the
telecommunications industry and the government'-has occurred at a
sluggish pace. The December 31, 2006, deadline for broadcast television stations to permanently switch from analog to digital transmission
and surrender their analog spectrum to the government, as mandated by
Congress in the Balanced Budget Act of 1997,2 will definitely be
missed.3 As a result, Congress enacted the Digital Television Transition
and Public Safety Act of 2005 ("DTV Transition and Public Safety
* B.A., Political Science, Washington University in St.Louis, Spring 2004; J.D. Candidate,
Benjamin N. Cardozo School of Law, Spring 2007. I would like to thank Professor Daniel A.
Crane for all his advice and help in composing this note. I would also like to thank the entire
staff of the Cardozo Public Law, Policy, and Ethics Journal for all their work, particularly all
those editors who have helped to guide this work to its Final destination.
I For a good discussion of these benefits, which include providing consumers with television of superior audio and visual character, and the return of the analog spectrum to the government, see generally, Digital Television Transaction Act of 2005, S. 1932, 109th Cong. § 3402
(2005) (engrossed amendment as agreed to by House, Dec. 19, 2005); see generally, MICHAEL
SILBERGLEID & MARK PESCATORE, THE GUIDE TO DIGITAL TELEVISION (2d ed. 1999) (discussing the technical advantages of digital television technology).
2 47 U.S.C. § 309(j)(14)(A) (2005) ("A television broadcast license that authorizes analog
television service may not be renewed to authorize such service for a period that extends beyond
December 31, 2006."). Note that failure to meet this deadline may be legally acceptable since a
number of loopholes leading to extensions of the deadline are listed under § 309(j)(14)(B). The
most notable of these loophole extensions is that broadcasters within any television market may
delay return of their analog spectrum until more than 85% of the television households in that
market subscribe to a multichannel video programming distributor ("MVPD")-mainly meaning cable and satellite providers as defined by 47 U.S.C. § 522 (2005)-that carry digital transmissions of all the broadcast stations in that market and possess either a television set capable of
receiving digital transmissions or a set-top box capable of allowing an analog television set to
receive digital transmissions.
3 See infra Part L.A (discussing how and why this deadline will be missed); see also Digital
Television Transition Act of 2005, S. 1932, 109th Cong. § 3402 (2005) (discussing that the
85% loophole of the Balanced Budget Act of 1997 could indefinitely push back the deadline for
transition; "[e]xperts forecast it will take many more years to meet the 85-percent test
nationwide").
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Act") as part of the Deficit Reduction Act of 2005.' The DTV Transition and Public Safety Act will set a new hard date for both the switch
and the return of the analog spectrum 5 as well as provide a plan for
preparing the public for the termination of analog broadcasting on that
date.6
While not referencing the provisions of the Cable Television Consumer Protection and Competition Act of 1992 ("CTCPCA")7 which
established the initial "must-carry" versus "retransmission" scheme,8 the
enacted DTV Transition and Public Safety Act seemingly alters the
scheme to require digital "must-carry."9 That is to say, beginning on
February 17, 2009, the DTV Transition and Public Safety Act requires
that cable and satellite operators carry a broadcaster's digital signal in
the event that the broadcaster chooses the option of "must-carry." This
would alter the original "must-carry" provisions, which only provided
for the statutory carriage of analog broadcast signals. Such alteration is
4 Deficit Reduction Act of 2005, S. 1932, 109th Cong. (2006) (enacted).
5 See S. 1932, 109th Cong. § 3002(b) (2006) (enacted) ("The Federal Communications
Commission shall take such actions as are necessary to terminate all licenses for full-power television stations in the analog television service, and to require the cessation of broadcasting by fullpower stations in the analog television service, by February 18, 2009..."). Note that this new
deadline is not subject to any possible extension and will be enforced whether or not the public
is adequately prepared. S. 1932, 109th Cong. § 3002(b) (2006) (enacted).
6 The original version of the DTV Transition and Public Safety Act, entitled simply the
Digital Television Transition Act, included a far more complex plan for preparing the public for
the impending transition. Digital Television Transition Act of 2005, S. 1932, 109th Cong.
§ 3402 (2005) (engrossed amendment as agreed to by House, Dec. 19, 2005). Whether or not
the pared down version of this plan, or even the original more complex plan itself, will be
successful in preparing the public in such a short amount of time will be one of the main issues
this note addresses.
7 47 U.S.C. §§ 534-535 (1999).
8 The CTCPCA set forth a scheme by which a local broadcaster could choose either to: 1)
require that a cable operator "must-carry" its broadcast signal on the cable systems operated by
the operator within the broadcaster's local market; or 2) refuse the ability to require "mustcarry" instead opting to require the cable operator to secure "retransmission" consent from
broadcaster at a cost (either monetary or in some sort of other concession). Importantly, the
CTCPCA's "must-carry" provision applies only to a broadcaster's analog signal. Under it, a
broadcaster cannot require that a cable operator "must-carry" its digital signal, much less require
"dual-carriage"-that it carry both. See generally, 47 U.S.C. % 534-535 (1999) (addressing the
formalities of this scheme).
9 Inference of such an amendment can be derived from S. 1932, 109th Cong. § 3410,
which requires a cable operator to carry a broadcaster's primary video stream and programrelated material in the digital format transmitted by the broadcaster if the broadcaster "permits
the cable system to carry without compensation any other programming broadcast by that station
that is carried on that system." S. 1932, 109th Cong. § 3410(a)(11)(A)(ii) (2005) (emphasis
added).
2006] AIDING FINAL PUSH OF THE DIGITAL TRANSITION
341
only logical given the cessation of all analog broadcasting. In addition,
given the current minimal penetration of television sets capable of receiving digital signals," ° cable and satellite operators will presumably
have to convert each broadcaster's digital signal into a separate, new
analog signal in order to continue serving their customers effectively.
That signal would be viewable on analog television sets and would have
to be carried in addition to the digital signal for the foreseeable future,
until digital penetration is sufficient to allow its termination." Accordingly, the enacted DTV Transition and Public Policy Act in essence enforces a de facto regime of "dual-carriage" ' 12 in a form not previously
foreseen.
Traditionally, the concept of dual-carriage formerly called for by
broadcasters' 3 would have required cable and satellite providers to carry
a broadcaster's digital signal, along with its analog signal, whenever a
broadcaster chose the option of "must-carry" under the CTCPCA.
Broadcasters pushed for dual-carriage under the assumption they would
still transmit analog signals along with their digital ones as a result of
various loopholes that activate extensions to the CTCPCA transition
deadline. Conversely, the dual-carriage will exist in an environment
where broadcasters are only transmitting digital signals. As such, it is
novel in that it switches the basic "must-carry" provision to require the
carriage of broadcasters' digital signals rather than analog signals, and
10
Only 5.9% of American television households have a digital television set. Press Release,
David Gunzerath, Estimates Related to the Broadcast-Only TV Households and Sets, and DTV
Households with Over-the-Air Digital Broadcast Reception Capabilities, National Association of
Broadcasting, at 5 (Aug. 11, 2004), available at http://www.nab.org/newsroom/PressRel/Filings/
OTAAtt81104.PDF.
11 Under the proposed version of the DTV Transition Act, such conversion was required on
behalf of cable and satellite provisions through January 1, 2014. This provision has been subsequently deleted as a matter of procedure. See infra Part III.A. In this note, the proposed Digital
Television Transition Act ("DTV Transition Act") will be referred to differently than the enacted
version, the Digital Television Transition and Public Policy Act ("DTV Transition and Public
Policy Act"). The language of the enacted version has been greatly altered because of the Byrd
Rule. See infra Part II.
12 This term refers to the fact that the cable or satellite provider will have to carry two
separate signals for each broadcaster. In layman's terms, this means that the provider will be
forced to devote two separate "channels" to the same local broadcast network.
13 See Comments of the NationalAssociation ofBroadcasters,the Association for Maximum Service Television, & the Association of Local Television Stations, FCC CS Docket No. 98-120
(Oct.12, 1998) at 10-13; see also Staff Discussion Draft on the Transition to Digital Television:
Hearing Before the H. Comm. on Energy and Commerce, 107th Cong. 37 (2002) (statement of
Michael Fiorile, President and CEO, Dispatch Broadcast Group, on behalf of the National
Association of Broadcasters).
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5:339
[
then creates the duality aspect by essentially requiring cable and satellite
providers to deliver a second, separate analog signal to be created by the
providers themselves through a process of down-conversion."
In the past, broadcasters had backed the traditional concept of
dual-carriage, asserting that it would advance the digital transition and
increase the penetration of digital television in consumer households.
Specifically, they argued that in order for the digital transition to move
forward, cable subscribers must be guaranteed access to digital signal in
order to foster the purchase of digital sets and to entice broadcasters to
aggressively and successfully make the transition. 15 The DTV Transition and Public Safety Act overtly achieves the objective of guaranteeing
cable subscribers access to digital signals. However, specifically with regards to consumers, it is debatable whether there will be a smooth transition towards digitalization.
It may be said that the substantial result of the DTV Transition
and Public Safety Act is to replace Congress's initial marketplace ap16
proach to the digital transition with a government-engineered model.
This note will address whether this new model can succeed, based on
substantial facilitation by the government, where the marketplace seemingly failed. 17 In particular, shortcomings in the DTV Transition and
Public Safety Act will be examined in order to predict whether its provisions can realistically be expected to hasten the digital transition and
lead to its completion. Special attention will be given to the revisions of
14
Under the DTV Transition and Public Safety Act, broadcasters will cease transmitting
analog signals on February 17, 2009. Under the proposed version of the act, cable and satellite
providers were additionally required to deliver a signal viewable on analog televisions between
the termination date and January 1, 2014, by converting the broadcasters' digital signals into an
analog transmission either at the head-end or through set-top boxes. The enacted version of the
act has eliminated this requirement, but, given market realities, cable and satellite providers will
realistically be required to follow it nonetheless.
15 Comments of the National Association of Broadcasters, the Association for Maximum Service
Television, & the Association of Local Television Stations, FCC CS Docket No. 98-120 (Oct.12,
1998) at 10-13; see also Staff Discussion Draft on the Transition to Digital Television: Hearing
Before the H. Comm. on Energy and Commerce, 107th Cong. 37 (2002) (statement of Michael
Fiorile, President and CEO, Dispatch Broadcast Group, on behalf of the National Association of
Broadcasters) (laying out the broadcast industry's argument that dual-carriage is essential for a
successful transition to digital broadcasting).
16 John Eggerton, 2007 DTV Date Has Some Backers, But.
BROADCASTING & CABLE,
Oct. 5, 2005 (quoting Martin D. Franks, Executive Vice President, CBS Television), available at
http://www.broadcastingcable.com/article/CA6263606.html?display=breaking+News&referral=
SUPP (last visited Sept.12, 2006).
17 Perhaps it is not fair to say that the marketplace "failed" to achieve the efficient transition
to digital, given that it was never afforded the benefits of dual-carriage.
2006] AIDING FINAL PUSH OF THE DIGITAL TRANSITION
343
the enacted act and their effect. Additionally, given the widespread legal
debate over the constitutionality of Congress's initial "must-carry"
scheme, this note will analyze the constitutionality of the DTV Transition and Public Safety Act's provisions.
I.
THE DIGITAL TRANSITION BEFORE THE
DTV
TRANSITION AND
PUBLIC SAFETY ACT
A.
The Stalled Digital Transition
In a recent panel discussion,' 8 Susan Fox' 9 accurately conveyed the
problems that have befuddled the transition to digital television when
she half-jokingly stated: "I think that the only possible thing that is
harder than keeping three children moderately healthy during cold and
flu season is getting all aspects of the digital television transition actually
moving at the same time.""
It is clear that the transition from analog to digital transmission of
broadcast signals, mandated by Congress in the Balanced Budget Act of
1997,21 has been hampered by a lack of cooperation between the various
industry parties involved, most notably between broadcasters on one
hand and cable and satellite companies on the other.2 2 Simply stated,
the cable and satellite industries' reluctance to include the digital signals
of local broadcast stations along with the analog signals of those stations,
as well as their reluctance to offer multi-casting options 23 to consumers,
18
The Journey to Convergence: Challengesand Opportunities:Symposium on DigitalMigration,
Symposium Panel Response: Digital Broadcast Symposium, 12 CoMMLAW CONSPECTUS 183
(2004) [hereinafter Symposium].
19 Susan Fox, at the time of the statement, was serving as the Vice President for Government
Relations for The Walt Disney Company, parent company of broadcaster, ABC. Prior to joining Disney, Ms. Fox was Deputy Chief of the FCC's Mass Media Bureau, and served as the first
head of the commission's Digital Television Taskforce. Id.
20 Id.
21 47 U.S.C. § 309 (1998).
22 See generally, Digital Television Transition Act of 2005, S. 1932, 109th Cong. § 3402
(2005) (engrossed amendment as agreed to by House, Dec. 19, 2005).
23 Multicasting is a practice in which a broadcaster splits the bandwidth assigned to its
digital signal, using it to deliver multiple signals (separate "channels" with different content).
This is made possible because, due to the compression technologies behind digital technologies,
a broadcaster's digital signal can be delivered at a size that would not take up the entire allotted
bandwidth. In fact, it seems to be the case that a broadcaster can deliver a High-Definition
("HD") digital signal and still have room left over in its bandwidth to deliver a lower quality
digital signal. Alternatively, a broadcaster could instead choose to transmit up to four or five
Standard-Definition ("SD") digital signals using his bandwidth. However, broadcasters need the
support of cable and satellite providers should they wish to multicast because while a broad-
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has slowed experimentation by broadcasters with digital television technologies and the penetration of digital television sets with consumers. 24
Therefore, it is certain that Congress's deadline for the digital transition,
set at December 31, 2006,25 will be missed since digital television set
ownership penetration in consumer households is nowhere near the
amount required for the deadline to take effect.26
In contrast, the outlook for DTV overall is far less grim. Broadcasters, by and large, have fulfilled their duty to begin broadcasting their
signals digitally, which is perhaps the most difficult and certainly the
most expensive step in transitioning to DTV. The next step is the
rather simple delivery of this signal to consumers.2 7 This requires the
widespread use of digital television sets with necessary digital receivers as
well as the ability of consumers to receive digital signals via the methods
the vast majority of Americans receive broadcast signals-through cable
and satellite providers. 28 However, providers have been reluctant to
caster's ability to transmit signals as they choose over their bandwidth is unimpeded, it is the
provider's choice whether or not to provide a slot for a signal within its channel line-up. Under
current "must-carry" rules, a broadcaster may only force a provider to carry one signal, despite
the fact that requiring a provider to carry all of a broadcaster's multicasts would not be excessively burdensome since the size of all the multicasts combined would not exceed the size of the
bandwidth already allotted to the broadcaster. Multicast "must-carry" would require a provider
to carry all of a broadcaster's multicasts and had been pursued by broadcasters who see multicasting as a valuable opportunity to expand their revenue streams. See SILBERGLEID & PESCATORE, supra note 1, at 259; see also John Haring, et al. Strategic Policy Research, Cable System
Capacity: Implication for Digital Television Must-Carry 23, Comments to the FCC on behalf of
the National Association of Broadcasters, Docket No. 98-120 (Oct. 1998).
24 See Comments ofthe NationalAssociation of Broadcasters, the Association for Maximum Service Television, 6 the Association of Local Television Stations, FCC CS Docket No. 98-120 (Oct.
12, 1998) at 10-13.
25 47 U.S.C. § 309(j)(14) (1998). "A television broadcast license that authorizes analog television service may not be renewed to authorize such service for a period that extends beyond
December 31, 2006." Id.
26 See Symposium, supra note 18, at 197 (explaining that various industry experts shared their
opinion that the deadline would not be reached, and made varying predictions for its completion, some expressing that the transition in certain markets could be completed at the earliest in
2008, others predicting the transition to last until 2020); see also Digital Television Transition
Act of 2005, S. 1932, 109th Cong. § 3402 (2005) (discussing that the 85% percent loophole of
the Balanced Budget Act of 1997 could indefinitely push back the deadline for transition;
"[e]xperts forecast it will take many more years to meet the 85-percent test nationwide.").
See Deficit Reduction Act of 2005, S. 1932, 109th Cong. (2006) (enacted).
27 See Digital Television Transition Act of 2005, S. 1932, 109th Cong. § 3402 (2005) (engrossed amendment as agreed to by House, Dec. 19, 2005).
28 The latest figures show that approximately 87% of American television households subscribe to some form of cable or satellite service. See National Cable & Television Association,
Industry Overview-Statistics and Resources, http://www.ncta.com/Docs/PageContent.cfm?
2006] AIDING FINAL PUSH OF THE DIGITAL TRANSITION
345
carry these signals, preferring not to "waste" channel capacity on digital
signals that: 1) offer the same content as analog signals that they have
already been made available to customers; and 2) most customers do not
have the hardware to appreciate. 29 Accordingly, the consumer adoption
of DTV has represented a "classic chicken and egg problem;"' 3 1 consumers do not want to purchase the necessary hardware until they can be
certain that digital signals will be available to them, while providers do
not feel it necessary to deliver those signals since consumer demand is
relatively low, especially since so few consumers own the necessary
hardware.31
By enforcing digital "must-carry" upon providers, the DTV Transition and Public Safety Act aims to speed along the digital transition by
mandating a hard date for the switch. While it does not examine or
address why the market failed to increase digital television set penetration in American television households to the degree Congress expected,
it does correctly conclude that the market could never independently
accomplish the transition Congress envisaged. 2 As such, with the DTV
Transition and Public Safety Act, Congress has intervened to achieve
advances the market itself could not realize.
B.
The Need for Transitional Dual-Carriage
Had Congress examined why the DTV transition did not occur as
planned, it would have seen that much of the blame lies in the ineffecpagelD=86 (last visited Jan. 20, 2006) (citing A.C. Nielsen Media Research statistic that, as of
September 2005, cable penetration in American television households is 66.3% and that there
exists an estimated 110,200,000 television households in the United States). See Satellite Broadcast Communication Association, Industry Overview-Facts and Statistics, http://www.sbca.
com/index.asp (last visited Jan. 20, 2006) (addressing that as of June 2004 there were
23,443,700 satellite service subscribers, an amount that accounts for 21% of American television
households).
29 Laurence H. Tribe, Why the Commission Should Not Adopt a Broad View of the "Primary
Video" CarriageObligation, National Cable & Telecommunications CS Docket 98-120 (July 9,
2002), available at http://www.ncta.com/DocumentBinary.aspx?id=215.
30 Dionee McNeff, Comment, Principles or Puffery? The Validity of the Cable Industry's Dual
CarriageArguments and Their Impact on Public Television in the Digital Television Future, 13
COMMLAw CONSPECTUS 169, 169 (2004) (comments of former FCC Chairman Michael
Powell).
31 Only 5.9% of American television households have a digital television set. Gunzerath,
supra note 10, at 5.
32 Given that Congress targeted the date of transition originally at December 31, 2006 but
set a requirement of 85% digital television set penetration for it to take action, one may assume
that Congress had reasonable expectations that 85% of American television households would
own a digital television set by that date. See 47 U.S.C. § 309(j)(14)(B) (2005).
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[Vol.
tive "must-carry" laws still in operation today. The "must-carry" provision of the Cable Television Consumer Protection and Competition Act
of 1992, 33 while a frequent topic of constitutional debate, is in reality a
woefully outdated provision with minimal market application. It no
longer serves an important, if any, role in the broadcasting industry. By
amending this provision to require digital and multi-casting "mustcarry," the Federal Communications Commission ("FCC"), or Congress
if necessary, 34 could have taken an important and necessary step in aiding broadcasters with the completion of the transition to digital television as mandated by Congress.
In the past, such an extension to dual-carriage would have been
vehemently opposed by the cable and satellite industries, 35 but, given
recent technological and business developments, it may currently be
more acceptable.3 6 In fact, an additional benefit of a dual-carriage
scheme is that it prevents the establishment and spread of lower-quality,
technically obsolete, multi-channel video programming distributors
("MVPD"). These lower quality MVPDs may be extremely competitive
in price but, from a technological perspective, could never meet such
stringent requirements. 37 Additionally, while the opposition has alluded
to the fact that any dual-carriage theme would be an unconstitutional
burden upon MVPDs, this note will illustrate that dual-carriage, in both
its traditional form and the form it will now take as result of the DTV
Transition and Public Safety Act, is, in fact, constitutional under the
Supreme Court's decision in Turner Broadcasting System, Inc. v. Federal
Communications Commission (" Turner I").38
33 47 U.S.C. §§ 534-535 (1999).
34 It is not particularly clear whether the FCC would on its own expand "must-carry." As
discussed later on, to be deemed constitutional, it was necessary for these provisions to be passed
by an act of Congress. See infra Part V. Regardless, the administration of these provisions has
since been left to the FCC. Whether or not the FCC could make such a sweeping change to the
provisions, though, is debatable.
35 This opposition has been voiced through the industries' trade organizations, most notably
the National Cable & Telecommunications Association ("NCTA") and the Satellite Broadcasting & Communications Association ("SBCA").
36 This note will spend time explaining, in depth, various aspects of the current television
marketplace which lend support to this suggestion, especially the changes that digital cable technology have led to.
37 This statement is particularly targeted at Internet Protocol Television ("IPTV") services
which deliver television programming to consumers through phone lines. See LAWRENCE
HARTE, INTRODUCTION TO IP TELEVISION (IPTV): WHY AND How COMPANIES ARE PROVIDING TELEVISION THROUGH DATA NETWORKS,
38
520 U.S. 180 (1997).
IP
TELEVISION BASICS
82-83 (2005).
2006] AIDING FINAL PUSH OF THE DIGITAL TRANSITION
347
The inadequacy of the current "must-carry" provisions is perpetually overlooked despite the fact that when viewed from an industry perspective, the inadequacy is quite clear. The first "must-carry" rules were
instituted by the FCC in 1962 as a result of the worry that broadcast
television would be threatened by the spread of cable.3 9 This concern
was well placed, given local broadcasters' low level of sophistication during the era and the fact that, at its inception, cable capacity averaged
only around twelve channels.40 By the time Congress instituted "mustcarry" in 1992, however, such a worry was unrealistic. In the 1992
cable marketplace, where the majority of local broadcast affiliates are
owned by multi-billion dollar corporations and more than eighty percent of cable systems have a bandwidth of 750 MHz or more-pushing
average channel capacity over one hundred channels-any worry that
cable providers would refuse to carry broadcast signals is misplaced. 4'
The greatest defect of the vast majority of analyses made regarding
"must-carry" is the failure to observe aspects of actual practice.4 2 Specifically, they made the incorrect assumption that of all the provisions included in the CTCPCA,4 3 it was the "must-carry" provision that was
the victory for broadcasters and, in turn, a defeat to cable companies.4 4
To the contrary, it was the ability to require retransmission consent that
was the main victory for broadcasters, who had long been lobbying to
receive compensation from cable companies that were profiting from the
redistribution of broadcast signals. For the reasons discussed above, the
39 In 1962, the FCC required rural cable companies to carry local broadcast stations as a
condition to being granted microwave licenses necessary for their operation. Four years later this
rule was extended to all cable companies. See Carter Mountain Transmission Corp. v. FCC,
321 F.2d 359, 361 (D.D.C. 1963) (holding that these FCC requirements were
unconstitutional).
40 The low capacity made the devotion to six-plus spots to local broadcasters unlikely without such a requirement.
41 Most recently, the NCTA estimated that while fifty percent of stations opt for "must-
carry" status, even those opting for "must-carry" have becoming increasingly interested in
switching to requiring retransmission consent as the new round of negotiations comes around
based on their success in negotiating with DBS and telephone companies. John M. Higgins, TV
Grudge Match Reignites, BROADCASTING & CABLE, Oct. 3, 2005, available at http://www.
broadcastingcable.com/article/CA626201 1.html?display=news (last visited Sept. 12, 2006).
42 See Thomas W. Hazlett, Digitizing "Must-Carry" Under Turner Broadcasting v. FCC, 8 S.
CT. ECON. Riv. 141, 162-163 (1997); see generally, Harris J. Aaron, Note, I Want My MTV:
The Debate Over DigitalMust-Carry, 80 B.U.L. REv. 885 (2000).
43 47 U.S.C. §§ 534-535 (1999).
44 Similar requirements were placed on satellite companies. Satellite Home Viewer Act of
1988, Pub. L. No. 100-667, 102 Star. 3949 (codified as amended at 17 U.S.C. % 101, 111,
119, 501, 801, 804 and 47 U.S.C. §§ 605, 612, 613 (2006)).
CARDOZO PUB. LAW, POLICY & ETHICS I
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"must-carry" provisions of the CTCPCA of 19924" have been, for the
most part, practically moot since their inception. From the act's inception, the majority of broadcasters have instead decided to demand retransmission consent under 47 U.S.C. § 325 (b) over "must-carry. "46
By 1992, when Congress decided to step in and mandate "mustcarry," the economic reality was that cable and satellite providers simply
could not realistically refuse to carry broadcast channels and expect to
attract consumers, given the popularity and ratings of broadcast programming.47 Limited attempts to do so proved to be disastrous.4 8 To
the contrary, the strong need for cable providers to carry broadcast television, combined with a broadcaster's right to require consent for retransmission, has allowed broadcasters to not only demand fees in return
for the permission to retransmit their signals but also to demand carriage of their digital signal as a condition for this consent.4 9 In fact, due
to the rising demand for digital cable content, 50 providers often must
pay an additionalfee for the rights to the digital signal. Common indusU.S.C. §§ 534-535 (1999).
See John M. Higgins, TV Grudge Match Reignites,
45 47
BROADCASTING & CABLE, Oct. 3,
2005, available at http://www.broadcastingcable.com/article/CA6262011 .html?display=news
(last visited Sept. 12, 2006) (discussing how only weaker stations, lacking sufficient leverage to
demand retransmission, have demanded "must-carry").
47 The ratings for broadcast programs consistently dwarf the ratings of cable networks despite the fact that the top twenty cable networks are available to eighty percent of all American
television households. Kagan Research LLC., Cable Program Investor, availableat http://www.
ncta.com/Docs/PageContent.cfm?pageID=281 (last visited Jan. 20, 2006). For example, for the
week of January 9, 2006 through January 15, 2006, the highest rated cable program, USA
Network's WWE Raw, received a rating of 3.6, according to the Nielsen Media Reports, available at http://www.top5s.com/tvcable.htm (last visited Jan. 21, 2006), while during the same
week, 111 broadcast network programs received higher ratings according to the Nielsen Media
Reports, available at http://www.calendarlive.com/tv/cl-wk-tvratingsl9jan 19,0,6990338.html
story?coll=cl-tvent-uti (last visited Jan. 21, 2006).
48 The development of Direct Broadcast Satellite ("DBS") in the early 1990s was greatly
stunted by the inability of providers to secure the rights to retransmit broadcast signals. Additionally, Time Warner Cable of New York's refusal to carry ABC in 2005 lasted only one day as
a result of consumer pressure.
49 In an FCC report regarding the passage of 2004's Satellite Home Viewers Extension and
Reauthorization Act ("SHVERA"), it was discussed that "[s]ince the Commissioner's decision to
deny broadcasters the ability to assert dual and multicast must-carry, broadcasters have begun
using their retransmission consent negotiations to negotiate carriage of their digital signals, thus
furthering the digital transition by increasing the number of households with access to digital
signals .. ."John Eggerton, FCC Leaves Retrans, Exclusivity As-Is, BROADCASTING & CABLE,
Sept. 12, 2005, available at http://www.broadcastingcable.com/article/CA6256178.html?display
=breaking+News&referral=SUPP (last visited Sept.12, 2006).
50 See infra Part I.C (discussing the rising demand for digital content).
46
2006] AIDING FINAL PUSH OF THE DIGITAL TRANSITION
349
try practice has been to "trade" permission for the rights to the analog
system, so long as the digital signal is carried as well, in return for cable
carriage of broadcaster-owned cable channels 5 1 instead of monetary
52
fees.
C.
The Digital Cable Effect
Another shortcoming of most analyses of digital "must-carry" is
the failure to take into account the effects of digital cable.53 The cable
industry's argument, that "must-carry" infringes on its ability to make
programming decisions by forcing them to drop cable programming to
make room for their "must-carry" obligations, was presented in the
1997 Turner IP4 decision when the average cable system could support
over one hundred channels. Given this capacity, the requirement to
Every major broadcast network is owned by an entity which owns cable channels. The
Warner Brother Network ("WB") is owned by Time Warner operators of CNN, The Turner
Television Group, and Time Warner Cable. Note that at the time of this publication, shareholders are aggressively pursuing the spin-off of Time Warner Cable as an independent company.
CBS, in the past, had been owned by Viacom which operates the MTV cable group (MTV,
VH1, Comedy Central, etc) and the Showtime cable group, as well as another broadcast network- UPN. CBS Television was spun-off as an independent company in February of 2006,
leading to CEO Les Moonves' public declaration that CBS would be seeking monetary compensation in return for retransmission consent moving forward. NBC operates two cable news
networks (MSNBC and CNBC), home shopping networks (Shop NBC) and is currently owned
by General Electric, owner of the Universal Entertainment group. ABC is owned by the Walt
Disney Company which operates cable channels (ESPN, Disney), some branded with the ABC
name (ABC Family). FOX is owned by NewsCorp, which operates cable channels including the
FoxSports group, FoxNews, FX, and the Fox Family Channel.
52 An FCC report regarding the passage of 2004's Satellite Home Viewers Extension and
51
Reauthorization Act ["SHVERA"], discussed how "broadcasters use their retransmission power
to secure carriage of affiliated non-broadcast networks (say ABC Family along with ABC Network).. " In addition "the report ... concede[s] . . . linkage that went 'beyond what Congress
envisioned.'" John Eggerton, FCC Leaves Retrans, Exclusivity As-Is, BROADCASTING & CABLE,
Sept. 12, 2005, available at http://www.broadcastingcable.com/article/CA6256178.html?display
=breaking+News&referral=SUPP (last visited Sept.12, 2006); see also John M. Higgins, TV
Grudge Match Reignites, BROADCASTING & CABLE, Oct. 3, 2005, available at http://www.
broadcastingcable.com/article/CA626201 1.html?display=news (last visited Sept. 12, 2006).
Retransmission consent is a powerful tool for companies owning both broadcast stations and cable networks. One MTV Networks executive recently told me that losing
retransmission consent is the only downside in the Viacom split. Using the power of
CBS and UPN's TV stations, MTV has been able to drive distribution of a slew of
start-up networks, from VH 1 Classics to Noggin.
Id.
53 It is important to note that many previous analyses of "must-carry" neglect to discuss
digital cable technology simply because they were written prior to its widespread availability.
54 520 U.S. 180 (1997).
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[
carry local broadcast stations was realistically a minor burden. That is
not to suggest that, given the 1997 averages, digital "must-carry" would
have been a minor burden. In fact, given the increase in cable channels
in the late 1990s, a requirement to carry double the amount of local
broadcast stations would have been a great infringement. However, this
burden has been eliminated by the spread of digital cable, the availability of which has grown at a rate that could not have been predicted in
1997.55
By compressing signals digitally and then decompressing them
upon delivery via a set-top box, digital cable technology greatly expands
56
the amount of programming that any given cable system can deliver.
As a result, the number of channels a cable system can offer is almost
limitless. In fact, given their now "infinite" bandwidth, cable and satellite companies are scurrying to find as much programming as possible in
an attempt to compete with one another. As a result, nearly all digital
57
cable markets have been penetrated by digital broadcast signals.
II.
PASSAGE OF THE
DTV
TRANSITION AND PUBLIC POLICY ACT
Despite certain expectations that the FCC may have been poised to
finally address the issue of "must-carry" and its role in the DTV transition, 58 it began to look as if 2005-2006 would see very little activity
55 Digital cable, which was non-existent in 1997, has more than doubled in subscribers in
just the four years between 2001 and 2005, to the point where, as of June 2005, approximately
23% of American television households are digital cable subscribers. National Cable & Television Association, Industry Overview-Statistics and Resources, available at http://www.ncta.
com/Docs/PageContent.cfm?pagelD=312 (last visited Jan. 20, 2006) (demonstrating statistics
that, as of June 2005, digital cable penetration in American television households had increased
to 26.3 million subscribers from just 12.2 subscribers in 2001). Adding in that 21% of American television households subscribe to satellite services, Satellite Broadcast Communication Association, Industry Overview-Facts and Statistics, available at http://www.sbca.com/index.asp
(last visited Jan. 20, 2006), which offer the same or similar capacity as digital cable, it is the case
that currently nearly half of all American television households subscribe to a digital MVPD of
some sort.
56 See National Cable & Telecommunications Association, Broadband Services-Digital
Cable, available at http://www.ncta.com/Docs/pagecontent.cfm?pagelD=91 (last visited Jan. 21,
2006).
57 87% of all American television households, whether or not they subscribe to the service,
are passed by cable services which offer HDTV signals. National Cable & Television Association, Industry Overview-Statistics and Resources, available at http://www.ncta.com/Docs/
PageContent.cfm?pagelD=86 (last visited Jan. 20, 2006).
58 Tania Panczyk-Collins, Powell Wants to Wrap up Outstanding DTV Issues by Year End, 4
WARREN'S CONSUMER ELECTRONICS DAILY 1 (2004) (suggesting that the FCC may be poised
to address the issue of digital must-carry in 2004-2005).
2006] AIDING FINAL PUSH OF THE DIGITAL TRANSITION
351
concerning broadcast carriage rights. In particular, early in 2005, the
FCC decided to stay the course and pass a version of the Satellite Home
Viewers Extension and Reauthorization Act5 9 which added minimal
changes to the current scheme. 6' Alas, somewhat surprisingly and unconvincingly, 6 ' beginning in October of 2005, both houses of Congress
began to investigate the possibility of addressing the DTV transition as
part of the Deficit Reduction Act of 2005. The result was the inclusion
of separate versions of the DTV Transition Act6 2 within both the
House's and Senate's proposals for the Deficit Reduction Act, which
was submitted in the end of October. 63 Perhaps even more surprisingly,
the houses were quick to agree to an engrossed version of the act by the
end of the year despite a seemingly massive inequity concerning the
amount of funding granted for the project.64
Passage of the proposed DTV Transition Act was subsequently
delayed for various reasons, some of which have led to significant alterations in the text of the Act. First, passage was delayed to some degree
because the Gulf Coast hurricanes of 2005 had pushed back some legislative and regulatory timetables, including the budgetary process. 65 Additionally, passage was delayed because of lingering political divisions
66
over indecency and the digital transition.
59 Satellite Home Viewer Extension and Reauthorization Act of 2004, Pub. L. No. 108-447,
118 Stat. 3393 (codified as amended at 17 U.S.C. §§ 101, 111, 119, 122, 803 and 47 U.S.C.
§ 307, 312, 325, 338 to 341 (2006)).
60 See John Eggerton, FCC Leaves Retrans, Exclusivity As-Is, BROADCASTING & CABLE, Sept.
12, 2005, available at http://www.broadcastingcable.com/article/CA6256178.html?display=
breaking+News&referral=SUPP (last visited Sept.12, 2006).
61 See John Eggerton, 2007 D TV Date Has Some Backers, But..., BROADCASTING & CABLE,
Oct. 5, 2005, availableat http://www.broadcastingcable.com/article/CA6263606.html?display=
breaking+News&referral=SUPP (last visited Sept. 12, 2006).
62 Both the House and Senate proposed acts which were entitled the "Digital Television
Transition Act." H.R. 4241, 109th Cong. (2005); S. 1932, 109th Cong. (2005). The title of
the enacted version was amended to the "Digital Television Transition and Public Safety Act."
S. 1932, 109th Cong. (2006) (enacted).
63 The House of Representatives passed the Digital Television Transition Act of 2005, H.R.
4241, 109th Cong. (2005), two days after the Senate passed their version of the bill, Digital
Television Transition Act of 2005, S. 1932, 109th Cong. (2005).
64 The original House proposal granted $850 million to aid the transition, whereas the Senate's proposal granted in excess of $3 billion.
65 John Eggerton, Blame It on the Weather: Why Washington Ends the Year with Unresolved
Issues, BROADCASTING & CABLE, Jan. 2, 2006, available at http://www.broadcastingcable.com/
article/CA6295754.html?display=news (last visited Sept. 12, 2006).
66 Id.
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Mainly, though, the Act's passage was delayed by the greater battle
over the Deficit Reduction Act of 2005.67 In particular, the passage of
the larger Deficit Reduction Act of 2005, as a whole, was setback due to
the parliamentary invocation of the Byrd Rule by Senate democrats.
The Byrd Rule, named after its author, Senator Robert Byrd (D-WV),
may be used to challenge impertinent language added to a reconciliation
bill such as the Deficit Reduction Act of 2005. Under the Byrd Rule,
the Senate is prohibited from considering extraneous matters as part of a
reconciliation bill, since the purpose of such a bill is only to reconcile
spending levels with revenue levels. 68 If proposed language steps outside
of this primary purpose, it can be challenged as a point of order. Stated
simply, the Byrd Rule prevents any non-revenue related language to be
included within any budget reconciliation bill. As a result of the Deficit
Reduction Act's invocation, passage was delayed to strip away any extraneous language.
More importantly, beyond just delaying passage of the DTV Transition Act, the invocation of the Byrd Rule stripped the text of the Act,
eliminating all the non-budgetary provisions that had been included in
the originally presented versions of the Act. 69 The effect is that the
version of the DTV Transition Act, signed by the president, leaves a
handful of unresolved issues, including ones that were seemingly resolved before the Byrd Rule revision. These unresolved issues will be
discussed below.
As a result of the delays just discussed, the Deficit Reduction Act of
2005 was not signed into law until February 8, 2006, by President
George W. Bush. 7 1 It included a greatly pared down version of the
proposed Digital Television Transition Act with the amended name, the
67 The controversial budget bill that was adopted by the narrowest of margins, fifty-one to
fifty (despite a strong Republican majority in the Senate), after Vice President Dick Cheney cast
the deciding vote. See Steve Labaton, Senate Passes Bill to Convert to Digital TV N.Y. TIMES,
Dec. 22, 2005, at C9.
68 U.S. House of Representatives Committee on Rules-Summary of the Byrd Rule, availa-
ble at http://www.rules.house.gov/Archives/byrd-rule.htm (last visited March 6, 2006).
69 John Eggerton, Blame it on the Weather, BROADCASTING & CABLE, Jan. 2, 2006, available
at http://www.broadcastingcable.com/article/CA6295754.htnl?display=news
13, 2006).
70
Bush Signs DTV Bill into Law,
(last visited Sept.
PRIMEDIA INSIGHT BROADCAST ENGINEERING ONLINE
EXCLUSIVE, Feb. 14, 2006, available at http://www.broadcastengineering.com/news/highlights/
bush-drv-bill/index.html.
2006] AIDING FINAL PUSH OF THE DIGITAL TRANSITION
353
Digital Television Transition and Public Safety Act.7 1 Regardless of the
delays in passage, the short history of the DTV Transition Act is still a
startlingly quick conclusion to the decades-long transition. Precisely
why Congress decided to suddenly take action in regard to DTV is unclear. The cynical observer could point to it as being an attempt by a
beleaguered Republican Congress to grab positive headlines.
The proposed version of the DTV Transition Act was framed as
being a step towards preventing disasters like the terrorist attacks of September 11, 2001, and Hurricane Katrina. 7 2 Particularly, the Act was
passed under the rationale that a quick transition was needed so that the
analog spectrum, given by the government to broadcasters, could be returned to the government and then handed over to emergency firstresponders. Senator John McCain (R-AZ) lobbied for an amendment
to the Act that would have pushed the date up two years on the basis
"that Katrina communications problems had only put a finer point on
his years-long push to get broadcasters' analog spectrum back for police,
fire and other emergency communications. '73 To what extent emergency rescue workers having access to the analog spectrum for the purposes of communication that could actually aid them in an emergency is
questionable. Regardless, it seems to have driven Congress to act where
it had not for many years. 74
71 Digital Television Transition and Public Safety Act of 2005, S. 1932, 109th Cong. § 3001
(2005).
72 The original text of the DTV Transition Act devoted a large section towards the discussion of Congress's findings that a hard deadline would facilitate a quicker digital transition and
return of the analog spectrum. It then discussed how this would be beneficial since public safety
officials "desperately needed more spectrum to better communicate with each other in times of
emergency." Digital Television Transition Act of 2005, S. 1932, 109th Cong. § 3402 (2005).
This language is not present in the adopted version of the Act as a result of the Byrd revision,
but it nonetheless sheds light on Congress's intent. The fact that the title was amended to the
"Digital Transition and Public Safety Act" further reflects this intent.
73 John Eggerton, Commerce Sets 2009 Hard Date, BROADCASTING & CABLE, Oct. 20,
2005, available at http://www.broadcastingcable.com/article/CA6276546.html?display=
breaking+News&referral=SUPP (last visited Sept. 12, 2006).
74 The proposed act has also proven to be a great vehicle for pork-belly politics with huge
sums being devoted to emergency workers in the districts of the act's backers. Particularly questionable is "$200 million for coastal Indian tribes affected by hurricanes, and $75 million for
EAS (in this case an aviation service that benefits rural states like those of many on the committee)" that was included in the original bill. John Eggerton, Commerce Sets 2009 Hard Date,
BROADCASTING & CABLE, Oct. 20, 2005, available at http://www.broadcastingcable.com/article/CA6276546.html?display=breaking+News&referral=SUPP
(last visited Sept.12, 2006).
Both of these grants have been questioned by Senator Byron Dorgan (D-ND) and Senator John
Kerry (D-MA), who retorted by suggesting that if the EAS was to be given funding through the
354
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In order to achieve the goal of returning the analog spectrum back
to the government so that it may assign portions of it over to emergency
workers while raising funds75 through the auctioning of other portions, 76 the DTV Transition and Public Safety Act calls for the termination of all analog broadcasting licenses and the cessation of analog
broadcasting by full-power stations by February 17, 2009 (the hard
date).77 This will result in broadcasters delivering their signals only in
the digital format, despite the fact that only a miniscule percentage of
American television households possess a digital television set 78 capable
of receiving digital broadcast signals.
As a result, the bulk of the DTV Transition and Public Safety Act
is devoted to the institution of a scheme to make sure that American
television viewers will be able to continue viewing the programming of
their favorite broadcasters. Whether or not the scheme will prove successful is arguable. Certainly the invocation of the Byrd Rule, which
"stripped the DTV bill of all but the hard date and subsidy," 79 weakened the scheme as originally proposed by eliminating considerable provisions. For it to succeed, it seems evident that the FCC will have to
take action to plug the holes left in the DTV Transition and Public
Safety Act's transition scheme caused by the Byrd Rule revision. 8
bill, why not the Coast Guard (an agency that is far more relevant to his home state of Massachusetts than the EAS). Id.
75 The Senate has estimated the auctioning of the recovered analog spectrum could raise up
to $10 billion for the federal government, although a sizeable portion of that sum would be
needed to finance the DTV Transition Act provisions that would allow for the transition and
return of the spectrum to occur so rapidly. John Eggerton, Commerce Sets 2009 Hard Date,
BROADCASTING & CABLE, Oct. 20, 2005, available at http://www.broadcastingcable.com/
articlelCA6276546.html?display=breaking+News&referral=SUPP
(last visited Sept. 12, 2006).
76
Digital Television Transition Act of 2005, S. 1932, 109th Cong. § 3404 (2005).
77
Digital Television Transition and Public Safety Act, S. 1932, 109th Cong. § 3002 (2006)
(enacted); Bush Signs DTV Bill Into Law, PRIMEDIA INSIGHT BROADCAST ENGINEERING ONLINE EXCLUSIVE, Feb. 14, 2006, available at http://www.broadcastengineering.com/news/
highlights/bush-drv-bill/index.html.
78 Only 5.9% of American television households have a digital television set. Gunzerath,
supra note 10, at 5.
79 John Eggerton, Blame it on the Weather, BROADCASTING & CABLE, Jan. 2, 2006, available
at http://www.broadcastingcable.com/article/CA6295754.html?display=news (last visited Sept.
13, 2006).
80 See John Eggerton, DTV Bill Signed Into Law, BROADCASTING & CABLE, Feb. 8, 2006,
available at http://www.broadcastingcable.com/article/CA6305689.html?display=search+Results
&text=dtv+bill+signed+into+law (last visited Sept. 12, 2006) (discussing the need for the FCC
to step in and enforce broadcast public interest obligations in quoting Charles Benton of Capitol
Broadcasting, a member of a media working group of the FCC's Consumer Advisory Commit-
2006] AIDING FINAL PUSH OF THE DIGITAL TRANSITION
III.
355
THE NEW TRANSITION SCHEME
Realizing the hardship and unlikelihood of compliance that would
result from requiring the one hundred million-plus American television
households to rush out and purchase a digital television set by the hard
date, Congress, in the original text of the DTV Transition Act, proposed
a scheme that would have ensured that viewers could continue to watch
broadcast television on their analog television set. This scheme was to
be threefold: 1) it required MVPDs (cable and satellite providers) to
carry a second version of each broadcast signal converted into a format
viewable on an analog television set through January 1, 2014; 2) it
granted $990 million to subsidize the purchase by consumers of up to
two digital-to-analog set-top conversion boxes; and 3) it created a complex and extensive consumer education plan that it hoped would finally
81
jump-start the sale of digital television sets to consumers.
This scheme has been critically altered as a result of the Byrd Rule
revision. The DTV Transition and Public Safety Act, as passed, restricts
itself only to enforcing a hard date for the transition to digital and providing funds for various programs, including the converter box subsidy
program. The complex and extensive consumer education plan, viewed
as an essential component of the scheme's success, has been eliminated. 82 But, more importantly, so has the requirement that MVPDs
(cable and satellite providers) carry a converted signal, along with the
required digital signal that can be viewed on an analog television set
through January 1, 2014.
Beyond the public interest deficiencies that will be discussed below,
the scheme, as currently composed, contains five operational deficiencies: 1) it places too much reliance on the fact that the vast majority of
consumers receive television signals from MVPDs; 2) it fails to address
the issue of signal conversion; 3) it fails to accord for the sort of contee (CAC) as saying, it "is ... time for the FCC to get its act together and to complete its
work.").
81 Digital Television Transition Act of 2005, S. 1932, 109th Cong. § 3402 (2005) (engrossed amendment as agreed to by House, Dec. 19, 2005).
82 The elimination of the consumer education requirements is particularly interesting.
While, under the Byrd Rule, the language included prior that placed requirements on members
of the Consumer Electronics had to be eliminated, the government itself could have taken up
the responsibility. The government certainly could have appropriated the funds to support such
a consumer education scheme, but, for the most part, it chose not to do so. The only form of
consumer education for which there is funding is $5 million for informing the public of the
subsidy programming. Digital Television Transition and Public Safety Act of 2005, S. 1932,
109th Cong. § 3005 (c)(2)(A) (2005).
356
CARDOZO PUB. LAW, POLICY & ETHICS J
sumer education program needed
is arguably insufficient to achieve
to first responders and Congress's
purpose of facilitating emergency
A.
[
[Vol.
5:339
for the success of such a scheme; 4) it
its goals; and 5) it makes no reference
intent to retrieve the spectrum for the
communications.
Reliance on MVPDs and the Lack of a Conversion Requirement
The original text of the DTV Transition Act included a provision
that would have required cable and satellite operators to convert each
broadcaster's digital signal into a separate, new signal that would be
viewable on analog televisions. Under that provision, MVPDs were required to carry that converted analog signal in addition to the digital
signal until January 1, 2014, five years after the hard date for transition.13 This provision was eliminated in the final version of the DTV
Transition and Public Safety Act. Its deletion could prove to be the
undoing of Congress's scheme to successfully prepare consumers for the
termination of analog broadcasting within three years.
The original scheme put forth by Congress was highly dependent
on the stipulation that cable and satellite providers would furnish their
customers with an analog signal, at least through 2014, providing a
minimum of eight years for consumers to respond to the cessation of
analog broadcast transmissions. Approximately 87% of American television households subscribe to either some form of cable or satellite service. 84 Accordingly, Congress placed confidence in the presupposition
that only a minority of Americans would be adversely affected by the
switch to digital broadcasting and elimination of analog signals. Therefore, Congress set in its scheme to provide further only for that minority
that did not subscribe to either cable or satellite service. In particular,
the converter box subsidy program was devised only to provide converter boxes for that minority that did not subscribe to either cable or
satellite service, since it was assumed that cable and satellite companies
would provide for their subscribers.
83
84
S. 1932, 109th Cong. § 3410(a)(11)(C) (2005).
See National Cable & Television Association, Industry Overview -Statistics
and Re-
sources, http://www.ncta.com/Docs/PageContent.cfm?pageID=86 (last visited Jan. 20, 2006)
(citing an A.C. Nielsen Media Research statistic that, as of September 2005, cable penetration in
American television households is 66.3% and that there exists an estimated 110,200,000 television households in the United States); see also Satellite Broadcast Communication Association,
Industry Overview -Facts and Statistics, http://www.sbca.com/index.asp (last visited Jan. 20,
2006) (addressing that, as of June 2004, there were 23,443,700 satellite service subscribers, an
amount that accounts for 21% of American television households).
2006] AIDING FINAL PUSH OF THE DIGITAL TRANSITION
357
While the enacted version of the DTV Transition and Public
Safety Act has significantly increased the size of the subsidy for converter
boxes, 85 it is clear that, after the hard date, the transition scheme is still
dependent on MVPDs providing their customers with both the required
digital signal and a converted analog system. Such reliance places the
success of the scheme in a precarious position given the removal of the
conversion requirements from the DTV Transition and Public Safety
Act; any provider's decision not to provide an analog signal could prove
disastrous.86 Furthermore, it is a deficiency that cannot be easily corrected by the FCC, since the agency lacks the authority to create "must87
carry" provisions.
B.
The Lack of a Sufficient Consumer Education Program
In order for the transition to be successful and painless, the public
must be sufficiently educated about the effects of the process. In particular, the "[c]onsumers first will need to understand whether their televisions sets will be affected. ' 88 But while many agree that the biggest
challenge to a successful transition is consumer education,8 9 the enacted
The passed version of the act provided $1.5 billion subsidy for "a program through which
households in the Untied States may obtain coupons that can be applied towards the purchases
of digital-to-analog converter boxes..." S. 1932, 109th Cong. § 3005(c)(1) (2006) (enacted).
This was an increase from the $990 million subsidy included in the engrossed version of the act.
S.1932, 109th Cong. § 3405(a)(3)(E)(i)(I) (2005). In analyzing the magnitude of this subsidy
though, it is important to remember that the Senate believed the federal government should
have provided $3 billion for the purpose of subsidizing converter boxes. John Eggerton, DTV
85
Subsidy CoversAllAnalog-Only Sets, BROADCASTING & CABLE, Oct. 19, 2005, available at http:/
/www.broadcastingcable.com/article/CA6276041 .html?display=search+Results&text=drv+subsidy+covers+all+analog (last visited Sept. 12, 2006) (discussing the Senate's original proposal for
a $3 billion subsidy).
86 More realistically, one could foresee cable and satellite providers requiring customers to
subscribe to more expensive, digital cable services to gain access to converted analog signals.
Giving cable and satellite companies leverage to charge customers increased rates is surely poor
public policy.
87 The requirement to offer a converted signal would be a "must-carry" requirement. Since
it has been established through various judicial decisions that the FCC does not have the power
to enforce analog, "must-carry," it can be similarly assumed that the FCC would not have the
power to require dual "must-carry." See infra Part V.
88 Scott Feira, With DTV Conversion, Devil's in the Details, TELEVISION WEEK, Feb. 20,
2006, at 7. Also highlighting the fact that "[m]ost television sets will not be [affected by the
switch to digital transmission]-there are no more than 80 million of the 285 million television
sets in the United States receiving analog over-the-air broadcasts, according to the National
Association of Broadcasters." Id.
89 Id. ("The biggest challenge may be educating consumers about the DTV TRANSITION");
see also Megan Downs, D TV Transition Must Begin With Consumer Education, PanelSays, CoM-
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CARD OZO PUB. LAW, POLICY & ETHICS J
[[Vol. 5:339
version of the DTV Transition and Public Policy -Act eliminated the
complex and well-thought-through consumer education plan that was
included in the proposed version of the act. 90 This could prove to be a
fatal deficiency.
This deficiency has already garnered attention and criticism. Dana
Litchfield, aide to Representative Bart Gordon (D-TN), has stated that
the deletion of the consumer education plan "will be a difficult hurdle
to confront." 91 Ms. Litchfield went on to explain the "lack of [consumer] education . . . was a big downfall of the budget bill because it
could not have public policy attached. [Legislators] are aware that this
92
was a huge problem.
Scott Feira of Television Weekly similarly pointed out this deficiency
by comparing the planned transition in the United States to the successful transition to digital broadcasting that occurred in Berlin, Germany
in 2003. In comparing the two, Feira wrote:
[i]n the first major DTV TRANSITION, which occurred in Berlin in
2003, consumer education efforts were extensive - a mailing to every
household, a hotline, flyers, newsletters, a Web site, advertisements on
buses and subways and scrolling television messages. Almost $1 million was spent to educate 3.4 million Berliners. This sort of effort will
not be possible in the United States - only $5 million has been appropriated to educate almost 300 million Americans. Figuring out how to
best use these limited funds and to enlist the private sector in disseminating accurate information about the DTV TRANSITION will be
crucial.
93
Given this comparison, one can only imagine the difficulty that will
exist in educating and preparing the public for the hard date which is
just three years away.
Others have been far less concerned with the removal of the consumer education plan from the passed act, arguing that consumers will
Feb. 13, 2006 (discussing the statements of the panelists ts the Alliance
for Public Technology's annual forum who stated "a nationwide effort is needed to educate
consumers about the transition to DTV," and that "additional action is needed to make sure
consumers are informed about converter boxes and how they'll be obtained.").
90 See generally, Digital Television Transition Act of 2005, S. 1932, 109th Cong. § 3409
MUNICATIONS DAILY,
(2005) (explaining the substance of the original consumer education plan).
91 Downs, supra note 89.
92
Id.
93
Feira, supra note 88, at 7.
2006] AIDING FINAL PUSH OF THE DIGITAL TRANSITION
359
still receive the education they need through the consumer electronics
industry itself. Paul Gluckman and Anne Veigle, writing for Consumer
Electronics Daily, have examined how the "CE [(Consumer Electronics)]
and other industries may well bear a large burden for educating the
public about the Feb. 17, 2009, analog TV cutoff,"9' 4 but that "for the
CE industry and others, for which enactment of a hard DTV TRANSITION date is a long-sought victory, the burden is one they're ready to
shoulder." 9 5 In particular, the consumer electronics industry most assuredly presumes that, with a hard date in hand, they will have an easier
time marketing digital technology to the public. In fact, the Consumer
Electronics Retailers Coalition, according to its counsel Robert
Schwartz, "has 'consistently viewed the setting of a hard analog cutoff
date as the most important single element toward making consumers
aware of, and completing, the DTV TRANSITION."' 9 6 As such, "it
'welcomes the fact that one has now been set by law .... ,
However, in order to provide for a seamless transition, the consumer electronics industry has "[its] work cut out for them."9' 8 Specifically, "[iun addition to the funding that would be required for a massive
campaign, CE would now also seem to have the onus of drafting standardized product labeling, merchandising articles and other point-ofsale materials to warn the public about the implications of the 2009
hard date." 99 The consumer education plan included in the proposed
version of the DTV Transition Act included stringent package labeling
and in-store signage requirements for television set manufacturers and
retailers, which would have included warning consumers "about the im94 Paul Gluckman & Anne Veigle, Onus for DTV Hard Date Education Now Falls to CE,
Other Industries, CONSUMER ELECTRONICS DAILY, Feb. 3, 2006.
95 Id. One must remember that attached to the "burden" of consumer electronics retailers to
inform consumers about the digital transition scheme is the opportunity to market new products. Additionally, some in the consumer electronics industry stand to benefit from the availability, for purchase, of bandwidth in the analog spectrum. For example:
Microsoft is pleased "the date for the transition is finally complete and appreciates all
the effort that went into giving this important issue all appropriate consideration,"
said Andy Moss, the company's senior dir.- policy & standards. "The industry can
now move forward innovating with confidence and the certainty required for managing our businesses."
Id. Not to be lost in Microsoft's statement though, is its desire to acquire space in the analog
spectrum for use with internet technology.
96 Id.
97 Id.
98 Id.
99 Gluckman & Veigle, supra note 94.
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[Vol.
pending shutoff of the analog service." ' 0 0 This language was completely
stricken from the enacted DTV Transition and Public Safety Act.
As a result, there is a need for the FCC and consumer electronics
industry to come together and formulate a product-labeling scheme to
make the digital transition painless, seamless and successful. In the past,
the consumer electronics industry has "never been fond of product labeling mandates," '' but it seems to be the case now that it is "willing to
work with the FCC on mutually acceptable voluntary language for
warning labels and other materials."'0 2 In particular the
CEA and the Consumer Electronics Retailers Coalition (CERC) have
told Congress they support a requirement for a standard informative
label once a hard date for the end of the DTV TRANSITION has been
enacted. They've urged the FCC to await the enactment of DTV legislation before proceeding with any labeling requirement. CE makers
have said they would need 120-180 days to include labels on products
themselves - as opposed to packaging - to incorporate the labeling step
into the manufacturing cycle. A 90-day period would be needed if a
label were designed as a sticker to be placed on the outside of product
03
packaging, they've said.'
The FCC seems to agree with the consumer electronics industry
that setting a hard date aids in educating consumers, and that a product
labeling scheme is required. Concerning the FCC's role in educating
consumers, Eloise Gore, assistant chief of the FCC Media Bureau's Policy Division, said that "the hard deadline has made the FCC's role easier, because the agency has specific information to give consumers
instead of a vague, rolling deadline that was discussed previously."1' 04
Additionally, the FCC has said it places prime importance on consumer
awareness of whether a television can receive digital signals or not.
Accordingly, the FCC has supported the idea of a product labeling
scheme on the basis that "it would further consumer education if manufacturers and retailers provided point-of-sale and other marketing information to consumers and/or clearly label new television sets." 10 5 But
100 Id.; see also Digital Television Transition Act of 2005, S. 1932, 109th Cong. § 3409
(2005).
101 Gluckman & Veigle, supra note 94.
102
Id.
103
Id.
104 Downs, supra note 89.
105 Gluckman & Veigle, supra note 94.
2006] AIDING FINAL PUSH OF THE DIGITAL TRANSITION
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while the FCC has vowed "to address these issues expeditiously,"""' it
has yet to take any positive steps in creating the sort of regulatory
scheme needed to provide consumers with the information they need.
The FCC's expectation that in the interim the consumer electronics industry will take it upon themselves to educate the public, without a
mandate from the government, is misplaced.
Additionally, while some argue that the consumer electronics industry can be successful in educating the public, others have expressed
serious doubt that this will be the case. Gene Kimmelman, Senior Director of Public Policy for the Consumer Union, has expressed doubt
that the consumer electronics industry will be able to handle the enormous burden placed on it to inform the public of how to make this
transition work. 10 7 He has also suggested that, as a result of a failure to
educate the public, Congress may, at some point, find it necessary to
delay the hard date, and that, if business does not do a good job, "we're
going to [be] facing potentially a huge backlash as we approach the
deadline."'0 8
Lastly, one must question how successful the consumer education
program included in the original act would have been, even if it were
kept intact. While there is no reason on the surface to question the
structure and provisions of the consumer education program-in fact,
on paper it seems to be quite well formulated-if it should be this easy
to educate consumers and have them react accordingly, this note simply
asks, why was such a program not instituted ten years ago when the
original deadline was set? If all it takes for consumers to understand the
DTV transition is a program like this, and, if Congress actually expects
this understanding to lead to the majority of American television households switching the digital television sets in their homes, it is puzzling
why such a simple action was not taken at an earlier date.
C.
The Sufficiency of the Subsidy for Converter Boxes
The enacted DTV Transition and Public Policy Act provides for a
federally funded $1.5 billion subsidy to "implement and administer a
program through which households in the United States may obtain
coupons that can be applied toward the purchase of digital-to-analog
106
107
Id.
Id.
108 Id.
362
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converter boxes .. ." 9 This was an increase from the $990 million
subsidy included in the engrossed version of the Act,'1 ° although it remains half the size of the $3 billion subsidy called for in the senate's
original draft of the DTV Transition Act. 1 1'
Under the Act, the National Telecommunications and Information
Agency ("NTIA") is responsible for administering the program" 2 and
may devote $160 million of the $1.5 billion subsidy for "administration
expenses. ' 113 The coupons will provide $40 for the purchase of a converter box," 4 which is currently estimated to cost consumers approximately $55."' Two coupons may not be used toward the purchase of a
single converter box, 1 6 and all coupons expire ninety days after issuance. 1 7 Under the terms of the Act, households may request up to two
coupons beginning January 1, 2008, and ending March 31, 2009.118
Lastly, while the Act is unclear exactly as to procedure, it appears they
would be available on a first-come, first-served basis.1 19
It is open to debate whether this subsidy created by Congress for
the funding of conversion boxes is sufficient. The legislation has been
sharply criticized by consumer groups, which argue that the program
will not be sufficient and "that many viewers will be surprised when
they find that their television sets no longer work.' 120 For example,
Jeannine Kenney, Senior Policy Analyst at Consumers Union, has stated
that:
"[t]he consumer compensation program established in this program is
unworkable, unfair and unacceptable to consumers [] . .." "[i]t provides only a fraction of the funds needed to compensate consumers for
the costs of a digital transition they never asked for. And by requiring
1932, 109th Cong. § 3005(a)(1) (2006) (enacted).
110 S. 1932, 109th Cong. § 3405(a)(3)(E)(i)(I) (2005).
109 S.
111 John Eggerton, DTVSubsidy Covers AllAnalog-only Sets, BROADCASTING & CABLE. Oct.
19, 2005 available at http://www.broadcastingcable.com/article/CA6276041.html?display=
search+Results&text=dtv+subsidy+covers+all+analog (last visited Sept. 12, 2006) (discussing the
Senate's original proposal for a $3 billion subsidy).
112 Gluckman & Veigle, supra note 94.
113 S. 1932, 109th Cong. § 3005(c)(3) (2006) (enacted).
114 S. 1932, 109th Cong. § 3005(c)(4) (2006) (enacted).
115 Feira, supra note 88, at 7.
116 S. 1932, 109th Cong. § 3005(c)(1)(B) (2006) (enacted).
117 S. 1932, 109th Cong. § 3005(c)(1)(C) (2006) (enacted).
118 S. 1932, 109th Cong. § 3005(c)(1)(A) (2006) (enacted).
119
120
Gluckman & Veigle, supra note 94.
Labaton, supra note 67, at C9.
2006] AIDING FINAL. PUSH OF THE DIGITAL TRANSITION
363
consumers to jump through restrictive hoops to request vouchers,
those who most need compensation will be the least likely to receive
it."
12 1
In sum, the $1.5 billion that has been appropriated for the converter box subsidy, after administrative expenses, provides for approximately 33.5 million coupons. In tandem with the assumption that
MVPD subscribers will not have a need for converter boxes, the subsidy
seems sufficient given that there exist "no more than about 20 million
households dependent on over-the-air broadcasting as their sole source
. 122 Accordingly, "the program is
of television program delivery .
theoretically large enough to get at least one subsidized converter box to
each household at risk of losing access to programming in the DTV
TRANSITION." 123
Congress has clearly relied on the assumption that consumers who
are already cable and satellite subscribers will not take advantage of the
subsidy program.124 Such reliance is precarious. First, such a calculation
neglects the possibility of households that subscribe to cable or satellite
service on one television set using the subsidy to acquire boxes for other
televisions in the household which are not attached to the cable or satellite service. Second, it neglects the possibility of subsidy coupons for the
purpose of resale or acquisition of converter boxes. Lastly, and most
importantly, it presumes that MVPDs will be providing a converted
analog signal to its customers, absent the provision requiring such conversion as included within the proposed version of the Act. 12 5 Given
that there is no longer such a guarantee that MVPDs will be providing
the converted signal through January 1, 2014, even if it is predicted that
MVPDs will provide a converted analog signal, MVPD subscribers are
not prevented from acquiring coupons and using them to acquire converter boxes as a precautionary manner.
121
Id.
122 Feira, supra note 88, at 7.
123
Id.
124 This presumption is illustrated where the Act implies:
[T]he deadline will have little impact on most television households. The vast majority of households already subscribe to cable or satellite services. Allowing cable and
satellite operators to convert digital broadcasts into an analog-viewable format will
enable their subscribers that wish to continue using analog televisions to do so.
Digital Television Transition Act of 2005, S. 1932, 109th Cong. § 3402(1)(D) (2005).
125 S. 1932, 109th Cong. § 3410(a)(1 1)(B) (2005).
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It is unknown how the government plans to get those in most
need-non-MVPD subscribing households without a digital television
set-"to the front of the line for subsidy coupons, ahead of the owners
of the up to 60 million other sets that may be affected by the DTV
12 6
To the contrary, "[s]everal features of the program...
TRANSITION."
make it less likely, rather than more likely, that the coupons will go to
those most in need." 12 7 As such, the Act is flawed in that it "does not
prioritize distribution of the coupons based on whether over-the-air
broadcasting is a household's only source of programming or based on a
household's income. Indeed, the law does not even restrict distribution
of the coupons to households that have a television that receives over128
the-air signals."'
As of now, Congress's only plan to make sure that the people in
most need of the coupons actually acquire them is to make the process
of obtaining coupons deliberately cumbersome, hoping that those not in
need of the coupons will be turned-off by the procedure. Coupons will
not be mailed to every household automatically or made available at
post offices. Instead, consumers will have to make a special request for
coupons, which will then be sent to them via the United States Postal
Service. Interestingly, "[w]hile this complexity is intended to discourage
those who do not need a subsidized converter box from getting one, the
effect may be just the opposite."'1 29 That is because those consumers best
suited to navigate through the purposeful "red tape" are those least likely
to be in need of the subsidy's assistance. Furthermore, the subsidy program was designed to make use of the internet where possible. Again,
this may have the effect of giving preference to those least in need of the
coupons, since those in need of the coupons are likely those with the
least access to the internet.
D.
Failure to Address Intent to FacilitateEmergency Communications
The enacted DTV Transition and Public Safety Act is additionally
flawed in that it does not make specific reference to Congress's intent to
reacquire the analog spectrum for the purpose of facilitating emergency
communications. To the contrary, while the enacted Act does provide
126 Feira, supra note 88, at 7.
127 Id.
128 Id.
129 Id.
2006] AIDING FINAL PUSH OF THE DIGITAL TRANSITION
365
some funding for emergency communications,1 3 1 it does not ensure that
the recovered analog spectrum will be placed in the hands of emergency
first responders. At best, the Act simply upholds the exemption to 47
U.S.C. § 309's public auction requirement for analog spectrum licenses, 131 which allows Congress to grant analog spectrum licenses for
132
use by public safety services outside the competitive bidding scheme.
But given the demand from business interests to acquire analog spectrum licenses, there is certainly no guarantee that any amount of the
spectrum will be withheld for emergency first responders.
Various companies have been seeking the spectrum licenses that
the broadcasters must return to the government when the transition is
completed.1 33 Particularly, the licenses are in high demand because the
analog spectrum could be used to expand a variety of wireless and
broadband services. 134 Accordingly, high-tech companies have universally praised the DTV Transition and Public Safety Act.' 35 Furthermore, the Congressional Budget Office estimates that the auction of
130
Section 3007 provides $30 million for the New York City 9/11 Digital Transition. Sec-
tion 3010 provides $156 million for the National Alert and Tsunami Warning Programs (of
which at least $50 million must be used for the creation of a tsunami warning and coastal
vulnerability program). Section 3011 provides $43.5 million to fund an Enhanced 911 service.
S. 1932, 109th Cong. §§ 3007, 3010, 3011 (2006) (enacted).
131 47 U.S.C. § 309(j)(1) (2005) (requiring competitive bidding for analog spectrum licenses); see also S. 1932, 109th Cong. §3003 (a)(2)(v) (2006) (enacted).
132 47 U.S.C. § 309(j)(2)(A) (2005).
133 Labaton, supra note 67, at C9.
134
Id.
135
Id. (quoting the statements of Janice Obuchowski, executive director of the coalition,
which includes AT&T, Dell, Cisco Systems, I.B.M., Intel, Microsoft, Qualcomm and Texas
Instruments)
"[t]hese historic House and Senate votes turn the fate of this spectrum from an impasse to a breakthrough"
. . "Senate
.
approval of a DTV hard date opens a new frontier for U.S. wireless
technology development, with consumers, first responders and TV viewers all emerging as winners. We are confident that final Congressional action will write the final
chapter of the DTV
TRANSITION."
Id.; see also Heather Forsgren Weaver & Jeffrey Silva, Bush Signs DTV Bilh RCR WIRELESS
NEWS, Feb. 13, 2006, at 14 (quoting Rhett Dawson, president of the Information Technology
Industry Council).
"Today's victory has been a long time coming, and is a critical win for innovation and
public safety. Our nation's high-tech companies gave their full support to this effort,
and with a strong bipartisan effort, the job finally got done" .
Because the DTV
TRANSITION will lead to more products, improved public safety and economic gains,
the American public will see direct benefits. With the confidence and certainty of
having a hard date, America's high-tech companies will go full-steam ahead with new
products and services that make use of this prime spectrum. The resulting innovation
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[Vol. 5:339
those airwaves to private interests could generate between $10 billion
36
and $20 billion; private estimates have reached as high as $30 billion.'
Given this strong private demand for the analog spectrum licenses, and
the lack of any reference to Congress's intent to provide emergency first
responder with access to the analog spectrum, such as the proposed version of the DTV Transition Act had, it is highly unlikely that the analog
spectrum will be used for the purpose of facilitating emergency communications as Congress had originally intended.
IV.
PUBLIC POLICY DEFICIENCIES IN THE DTV TRANSITION ACT
A.
Failure to Address Conversion and Advance the Cause of
High-Definition
The originally proposed DTV Transition Act was fatally flawed in
that it only went so far as to require that cable and satellite providers
carry digital signals in the Standard Definition ("SD"), rather than the
High Definition ("HD") format. This would have frustrated the development and deployment of HDTV technologies. While the Act would
have still required broadcasters to finally switch to digital transmission
by not forcing cable and satellite providers to carry a HD signal, broadcasters lack the incentive to take on the lofty cost of creating programs
in the superior HD format.
This distinction between SD and HD is missing from the enacted
version of the DTV Transition and Public Safety Act, a casualty of the
Byrd Rule revision. David Rehr, president of the National Association
of Broadcasters ("NAB") has interpreted this as a victory for broadcasters, and has praised the act's passage, stating:
"with today's enactment of the budget reconciliation bill and its digital television provisions, we have crossed an important threshold. NAB
is pleased that Congress adopted many pro-consumer DTV measures
in the legislation, and we're encouraged that the bill thwarted cable
industry attempts to degrade the quality of HDTV pictures to
consumers." 137
will benefit consumers and businesses, and ultimately lead to an even stronger Ameri-
can technology sector."
Id.
136
Weaver & Silva, supra note 135, at 14.
137 John Eggerton,
DTV Bill Signed Into Law,
BROADCASTING & CABLE, Feb. 8, 2006,
available at http://www.broadcastingcable.com/article/CA6305689.html?display=search+Results
&text=drv+bill+signed+into+law (last visited Sept. 12, 2006).
2006] AIDING FINAL PUSH OF THE DIGITAL TRANSITION
367
Rehr takes the position that since the Act does not specifically allow for MVPDs to convert an HDTV signal into standard digital television, they are precluded from doing so. Realistically, the Act's silence as
per this issue could be interpreted as either a prohibition or a permit to
convert the HDTV signal. Given the legislative history, and the fact
that the provision which allowed for the conversion from HD signals
into SD signals was eliminated as a matter of procedure rather than
policy, it is fair to presume that such conversion is permitted under the
enacted DTV Transition and Public Policy Act. Accordingly, the Act is
deficient in that it does not explicitly require the carriage of HD digital
signals. If Congress was serious about its efforts to "bring consumers
and the economy the benefits of the DTV transition faster[, 138" mainly
sharper and wider pictures and CD-quality sound, it would have flatly
disallowed the ability of cable and satellite to convert HD signals created
by broadcasters into lesser SD signals.
B.
Failure to Address Multicasting
In regard to the hot-bed issue of multicasting, the language of the
DTV Transition and Public Safety Act does not, despite conversation
that it would, 139 alter the "must-carry" provisions to require cable and
satellite providers to carry a broadcaster's multicasts. This failure to provide for multicasting "must-carry" is not the result of the Byrd Rule
revision. To the contrary, whereas the enacted version is silent as to
multicasting, the proposed Act in § 3410140 outwardly refused to enact
multicasting "must-carry" when it stated "a cable operator of a cable
system in that market shall carry the station's primary video stream and
program-related material in the digital format transmitted by that station...."
"1141
The failure to require multicasting "must-carry" is a great mistake,
since it would benefit consumers and broadcasters alike if a mechanism
existed to aid the spread of multicast capabilities. Conversely, requiring
cable and satellite providers to make multicast signals available to their
customers would produce only a minimal burden. In particular, it
138
139
Digital Television Transition Act of 2005, S. 1932, 109th Cong. § 3402(4) (2005).
At one point, it was predicted that broadcasters would be given the option to require
"must-carry" of one multicast signal, in addition to their primary stream.
4
140 Digital Television Transition Act of 2005, S. 1932, 109th Cong. § 3 10(a)(ll)(A)
(2005).
141 Digital Television Transition Act of 2005, S. 1932, 109th Cong. § 3410(a)(1 1)(A) (2005)
(emphasis added).
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would aid struggling broadcasters by providing a new revenue stream,
while providing broadcasters a medium to deliver important messages to
the public in a timely fashion.' 4 2 As Larry Mitchell, spokesman for the
Alliance for Rural Television (on behalf of the Coalition for a Smart
Digital Transition) argued, "[i] nclusion of multicast must carry language
in final bills will prevent cable from stripping out valuable multicast
[It] will ensure that elderly, rural, and minority reprogramming ....
sidents will not be deprived of access to vital information. "143
C. Applicability to Low Capacity MVPDs
The proposed DTV Transition Act was blemished due to: 1) the
carved out exception for lower-capacity MVPDs (i.e., cable systems with
a capacity fewer than 550 MHz are exempted from the Act); and 2) its
failure to even address IPTV providers. Whether or not these exceptions will be allowed under the enacted DTV Transition and Public
Safety Act is unclear since the language itself is silent. What is clear is
that such an exception could be highly detrimental to the public. If
Congress is serious about supporting DTV, it should apply the carriage
provisions of the Act universally. It would be even better if MVPDs
with lower capabilities would either have to take on the financial obligation of improving themselves to the technological standard set by the
Act or face going out of business. There is no reason for Congress to aid
technologically obsolete services.
V.
THE CONSTITUTIONALITY OF DIGITAL "MUST-CARRY"
A.
The Turner Decisions
The acceptance of "must-carry" as a constitutionally permissible
carriage requirement on cable and satellite providers is not the result of a
lack of effort by the opposition to convince courts otherwise.1 44 Since
142 With regards to multicasting, what is often overlooked is that just as the government
would like to use the analog spectrum for communications between emergency workers, broadcasters could also use their multicast signal to deliver up-to-the-minute emergency information
to the public at large. In fact, due to the local nature of broadcast entities, they are perhaps best
suited to deliver specified weather and transit emergency information.
143 John Eggerton, Smart Coalition Pushesfor DTV Bill, BROADCASTING & CABLE, Oct. 7,
2005, available at http://www.broadcastingcable.com/article/CA6266219.html?display=
breaking+News (last visited Sept. 12, 2006).
144 See, e.g., Carter,321 F.2d 359; Turner Broad. Sys., Inc. v. Fed. Commc'ns Comm'n, 512
U.S. 622 (1994); Turner Broad. Sys., Inc. v. Fed. Commc'ns Comm'n, 520 U.S. 180 (1997);
Satellite Broad. and Cable Ass'n v. FCC, 275 F.3d 337 (4th Cir. 2001).
2006] AIDING FINAL PUSH OF THE DIGITAL TRANSITION
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the earliest "must-carry" laws of the 1960s, the cable industry-later
joined by satellite providers-has vigorously contested their constitutionality, scoring many victories along the way. In the end, though,
they were unsuccessful in convincing the Supreme Court that "mustcarry," as required by congressional statute, was a violation of the First
Amendment.14 5
The constitutionality of "must-carry" under the First Amendment
was examined only after the 102nd Congress enacted its own version of
"must-carry" in the CTCPCA of 1992.146 Immediately after the enactment, the cable industry mobilized to voice the argument that "mustcarry" was unconstitutional on the basis that it was an infringement on
their First Amendment right of free speech. Rounds of legal battles
would determine that there was no such infringement.
The alleged unconstitutionality of these provisions was found in
the cable industry's following argument: by forcing them to carry local
broadcast channels, they were forced to use up channel capacity that
47
they could have otherwise used for cable networks of their choosing. 1
They argued the "must-carry" rules in such a scenario "clearly impinge
on cable system programming discretion. '"148 The Supreme Court rejected this argument in the controversial Turner decisions, Turner BroadcastingSystem, Inc. v. FederalCommunication Commission (" Turner 1')1'9
150
and Turner IL
The Court in Turner I established that the activities of cable operators are acts of speech "entitled to the protection of the speech and press
provisions of the First Amendment."' 15 ' Accordingly, the Court applied
intermediate scrutiny, as occasioned in United States v. O'Brien,1 52 to
145
See, e.g., Carter, 321 F.2d at 359.
146
Pub. L. No. 102-385, 106 Stat. 1460 (codified as amended in scattered sections of 47
U.S.C. (2006)). The question of why "must-carry" was finally adopted in 1992, far after it
became clear that the nature of the television market did not require such a protection for
broadcasters, leads one to conclude that the retransmission consent aspects, included in tandem
with the "must-carry" scheme of the CTCPCA, were the focus of broadcast industry's lobbyists
who pushed for the act. That is, of course, unless already at this early stage (digital broadcast
requirements were not enacted until 1998) both broadcasters and providers saw that the enactment of "must-carry" would lead to digital "must-carry," which is advantageous to broadcasters
and detrimental to providers.
147 Turner I, 512 U.S. at 634-644.
148 Hazlett, supra note 42, at 146.
149 512 U.S. 643-644.
150 520 U.S. 180.
151 Turner 1, 512 U.S. at 637.
152 391 U.S. 367 (1968).
370
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determine the amount of free speech protection to be afforded 153 because the Court deemed "must-carry" provisions to be content neutral
on their face. 1 54 Under the intermediate scrutiny test, a governmental
action is constitutional so long as it advances an important governmental interest without burdening free speech more than necessary for the
achievement of that interest.151
The Court found that "must-carry," as applied by the CTCPCA,
advanced three particular governmental interests. 156 These interests, according to the CTCPCA, consist of: 1) preserving local television and
its benefits; 2) promoting the dissemination of information by diverse
media sources; and 3) promoting fair competition in the television delivery marketplace. 15 7 It additionally found these to be important governmental interests, arguing that maintaining various media outlets
"promotes values central to the First Amendment" and noting that "promoting fair competition is almost always an important governmental
58
interest."1
The Court in Turner I did not complete the inquiry since the record was incomplete and lacked the evidence necessary to determine
whether "must-carry" helped Congress achieve these acceptable interests
and whether "must-carry" infringed on free speech more than what was
necessary to achieve those interests.' 5 9 As such, the case was remanded, 6 ° only to be brought back before the Court three years later to
adjudicate those very questions.
In Turner II, the Court addressed: 1) whether "Congress' predictive
judgment that the must-carry provisions further important governmental interests" was accurate; 6 ' and 2) whether "must-carry provisions do
not burden substantially more speech than is necessary to further the
governmental interests they promote."' 6 2 In its decision, the Court
agreed with the district court below, which granted summary judgment
153
Turner I, 512 U.S at 662.
Id. ("So long as [the regulations] are not a subtle means of exercising a content preference,
speaker distinctions of this nature are not presumed invalid under the First Amendment.") Id. at
643-645.
155 Id. at 662.
154
156
157
158
Id. at 663-68.
47 U.S.C. % 534-535 (1999).
Aaron, supra note 42, at 895-96.
159 Turner 1,512 U.S. at 668.
160 Id.
161 Turner I 520 U.S. at 181.
162 Id. at 182.
2006] AIDING FINAL PUSH OF THE DIGITAL TRANSITION
371
in favor of the government 6 3 on the basis that "[t]he majority determined 'Congress drew reasonable inferences' from substantial evidence
before it to conclude that 'in the absence of must-carry rules, 'signifi'
cant' numbers of broadcast stations would be refused carriage.'" 164
Accordingly, Justice Kennedy, writing for the Court, held that "the mustcarry provisions are consistent with the First Amendment."' 6 5
As to whether "must-carry" burdened more speech than was necessary for the achievement of these interests, the Court again deferred to
Congress's evidence166 that "[t]he burden imposed by must-carry is congruent to the benefits it affords[,]' 1 67 especially given that "significant
evidence adduced on remand indicates the vast majority of cable operators have not been affected in a significant manner.' 6 8 The Court similarly dismissed the cable operators' claims that other regulatory and
technical systems could have been developed to achieve a less intrusive
outcome.' 69 This dismissal relied on the basis that "[t]his Court's preceSee Turner, 910 F. Supp. at 755.
Turner II, 520 U.S. at 187 (quoting Turner, 910 F. Supp. at 742).
165 Turner II, 520 U.S. at 181.
166 The Court noted:
163
164
Judgments about how competing economic interests are to be reconciled in the complex and fast-changing field of television are for Congress to make. Those judgments
"cannot be ignored or undervalued simply because [appellants] cas[t] [their] claims
under the umbrella of the First Amendment." Appellants' challenges to must-carry
reflect little more than disagreement over the level of protection broadcast stations are
to be afforded and how protection is to be attained. We cannot displace Congress'
judgment respecting content-neutral regulations with our own, so long as its policy is
grounded on reasonable factual findings supported by evidence that is substantial for a
legislative determination. Those requirements were met in this case, and in these circumstances the First Amendment requires nothing more. The judgment of the District Court is affirmed.
Id. at 224-225 (quoting Columbia Broad. v. Democratic Nat'l Comm., 412 U.S. 94, 103
(1973)) (citation omitted).
167 Turner II, 520 U.S. at 182. This evidence includes that:
[cable] operators have satisfied their must-carry obligations 87 percent of the time
using previously unused channel capacity; 94.5 percent of the cable systems nationwide have not had to drop any programming; the remaining 5.5 percent have had to
drop an average of only 1.22 services from their programming; operators nationwide
carry 99.8 percent of the programming they carried before must-carry; and broadcast
stations gained carriage on only 5,880 cable channels as a result of must-carry.
Id.
168 Id.
169 These other proposed options were listed within the decision and are worth noting. They
include:
a more limited set of must-carry obligations modeled on those earlier used by the
Federal Communications Commission; use of so called A/B switches, giving consum-
372
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dents establish that it will not invalidate the preferred remedial scheme
merely because some alternative solution is marginally less intrusive on a
' 70
speaker's First Amendment interests.'
The decision in Turner II was reaffirmed in Satellite Broadcasting
and Cable Association v. FCC.17 ' The Fourth Circuit again determined
the appropriate standard of review to be intermediate scrutiny, noting
that "[h]ere, the satellite carriers repeat many of the same arguments for
strict scrutiny that were examined and rejected in Turner I. Although
the satellite carriers labor to distinguish that case, their effort ultimately
fails.' 1 72 Particularly, the Fourth Circuit reexamined the content neutrality of "must-carry" and, like the Supreme Court in Turner I and I,
held that "the burdens of the rule do not depend on a satellite carrier's
choice of content 173 . . . even though the rules were meant to protect
independent broadcast stations,"' 74 and hence were content neutral and
subject to a level of intermediate scrutiny established in United States v.
1 75
O'Brien.
In its application of the intermediate scrutiny test, the Fourth Cir-
cuit in Satellite Broadcastingand Cable Association v. FCC, like the Supreme Court in Turner II, afforded great deference to congressional
findings in answering the question of whether "must-carry" advanced a
ers a choice of both cable and broadcast signals; a leased-access regime requiring cable
operators to set aside channels for both broadcasters and cable programmers to use at
a regulated price; subsidies for broadcasters; and a system of antitrust enforcement...
Id. at 183.
170 Id. at 182.
171 Satellite Broad. and Cable Ass'n, 275 F.3d 337 (examining the constitutionality of Satellite
"must-carry").
172 Id. at 353.
173 Id. at 354.
174 Id. at 355 ("The burdens of the rule do not depend on a satellite carrier's choice of
content, but on its decision to transmit that content by using one set of economic arrangements
rather than another. Accordingly, we hold that the carry one, carry all rule is content neutral on
its face.") Id. at 354.
175 Id. at 355
Here, the satellite carriers do no more than point to legislative history indicating that
Congress had the same purpose in enacting SHVIA and that Congress continued to
appreciate the distinctive value of local broadcast programming. This is not enough to
establish that SHVIA has a content-based purpose. We conclude, then, that the carry
one, carry all rule should not be subject to strict scrutiny. At most, it is a content
neutral measure that imposes incidental burdens on speech and is therefore subject to
intermediate First Amendment scrutiny under United States v. O'Brien. ...
Id. (citation omitted).
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legitimate public interest in a meaningful way. Instead of conducting a
discursive analysis of the evidence itself, the court simply held that
Congress reasonably concluded that the carry one, carry all rule addressed a real threat to the government's interest in preserving a multiplicity of broadcast outlets for over-the-air viewers. That interest
therefore survives the first part of the O'Brien inquiry: it is substantial,
and it is genuinely advanced by the carry one, carry all rule.' 76
This willingness to embrace the level of deference established by Turner
II in a separate, but complimentary, decision sheds important light on
how a court might handle an examination into the constitutionality of
digital "must-carry."
B.
Opposition to Turner II
The Court's decision in Turner II is not without controversy.
Many parties and commentators have grasped onto aspects of the disnot
sent, arguing that the interests advanced by "must-carry" should
177
speech.
free
to
right
the
in
allow for Congressional interference
Justice O'Connor, joined by three others in her dissent, criticized
the majority on a number of grounds. First, the dissent alleged that,
contrary to the Court's earlier holding in Turner I, must-carry laws were
in fact content-based and should have been subject to a strict scrutiny
examination. 78 Justice O'Connor wrote that "[t]he course of this litigation on remand and the proffered defense strongly reinforce my view
that the Court adopted the wrong analytic framework in the prior phase
of this case."' 79 More importantly, the dissent concluded that under the
strict scrutiny test, Congress would fail in convincing the Court as to
the constitutionality of its must-carry regulations. 8 °
Second, even accepting that an intermediate scrutiny examination
should apply in the Turner I decision, the dissent argued that "the Court
misapplie[d] the 'intermediate scrutiny' framework it adopts."' 8' In particular, the dissent felt that the majority had given too much deference
to Congress's judgment as to the strength and importance of the inter176
Id. at 362.
177
See Hazlett, supra note 42, at 146; see also McNeff, supra note 30, at 192.
178
Turner I 520 U.S. at 230.
179 Id. at 229 (O'Connor, J., dissenting).
180 Id. at
249-251.
181 Id. at 229.
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ests advanced by "must-carry," as well as its evaluation of the success of
its scheme to advance these interests.' 82 Accordingly, O'Connor wrote
the following in regards to the majority decision:
I fully agree that promoting fair competition is a legitimate and substantial Government goal. But the Court nowhere examines whether
the breadth of the must-carry provisions comports with a goal of
preventing anticompetitive harms. Instead, in the course of its inquiry
into whether the must-carry provisions, are "narrowly tailored," the
principal opinion simply assumes that most adverse carriage decisions
are anticompetitively motivated, and that must-carry is therefore a
measured response to a problem of anticompetitive behavior. We ordinarily do not substitute unstated and untested assumptions for our
independent evaluation of the facts bearing upon an issue of constitu83
tional law. 1
Many commentators, besides the cable industry, which have based
their appeals to both Turner I and Turner II on ideas represented in the
dissent, have agreed with the dissent that the decision in Turner is in fact
a poor judicial ruling that neglected to examine the realities of the television broadcast industry. While not arguing against the constitutionality of "must-carry," this note has questioned the necessity of the
legislation in regards to the actual business environment.18 4 Particularly,
complaints have arisen out of the Court's finding that "must-carry" is
content-neutral "even as Congress advertised the must-carry rules as a
means to advance broadcast over cable-originated speech."" 5 In addition, in-depth investigations have been conducted alleging that the public interests Congress thought it was advancing, such as localized news
coverage and political debate, in broadcast television over cable televi86
sion, were non-existent. 1
182
Id.
Although we owe deference to Congress' predictive judgments and its evaluation of
complex economic questions, we have an independent duty to identify with care the
Government interests supporting the scheme, to inquire into the reasonableness of
congressional findings regarding its necessity, and to examine the fit between its goals
and its consequences.
Id.
185
Turner I 520 U.S. at 232 (citation omitted).
See supra Part I.C.
Hazlett, supra note 42, at 150.
186
On the basis that cable television may be superior in providing the type of informational,
183
184
educational, and new programming, Congress thought it was protecting broadcast television.
2006] AIDING FINAL PUSH OF THE DIGITAL TRANSITION
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Still, the greatest criticism of the Turner II decision stems from the
amount of deference the Court showed Congress (there being a "general
consensus... that the Court in Turner II allowed for a heightened level
of deference to Congress' review of the need and effectiveness of mustcarry, above and beyond what is typical in cases dealing with free
speech"). 187 Whether it is in fact the case that the Court's deference in
Turner 11 substantially departs from its earlier reviews of legislative output is a question that requires a greater examination of the Supreme
Court's free speech rulings. 188
C.
The Constitutionality of the DTV Transition and Public Safety Act
Given the deference the Court has given to Congress's various
"must-carry" schemes in the past, short of a retrenchment by the Court
in its interpretation of the standards under which "must-carry" is to be
judged, it seems clear that Congress's passage of "digital must carry"
through the DTV Transition and Public Safety Act would withstand any
constitutional interrogation. 189 Additionally, the DTV Transition and
Public Safety Act is aided by the fact that it is an act of Congress, not
the FCC, 190 despite the earlier indications that it would be the FCC
that would institute and administer the switch to digital "must-carry"
and that it would have done so without much controversy.191
See id. at 179 (arguing that "[t]he public interest gains from promoting broadcasting via mustcarry are essentially nil because 'local' and 'public affairs' programming is not featured on stations benefiting from must-carry, and must-carry imposes, rather than remedies, anti-competitive market structure.") Additionally, Hazlett's comparison of broadcast and cable programming
allegedly found that "[a]s a general proposition, public interest programming is more likely to be
done on cable channels than on broadcast channels," and that "[t]he conventional wisdom is
that local broadcast news is of very poor quality and, despite must-carry, is getting worse." Id.
Whether Hazlett's allegations are correct at all, though, is questionable, especially in a post-9/11
environment in which the importance of news coverage has increased.
187 Michael D. Fitzgerald, Note, ConstitutionalLaw - CongressionalRegulation of Cable Television - Upholding The Must-Carry Provisionsof the Cable Television Consumer Protection and Competition Act of 1992, 65 TENN. L. REV. 319, 357 (1997).
188 Such an examination is not within the scope of this note.
189 See Hazlett, supra note 42 ("What is clear . . . is that under Turner II regulators are
virtually unconstrained by constitutional considerations. TurnerII gave substantial deference to
Congress in enacting must-carry regulations and explicitly rejected the need for independent
evaluation of the goals sought, methods employed or effects induced.").
190 Past attempts by the FCC to pass "must-carry" rules have been overturned on the basis
that such actions were not within the FCC's power and jurisdiction. See Carter, 321 F.2d at
361.
191 Prior to the DTV Transition Bill that surfaced, somewhat surprisingly in both the House
and the Senate toward the end of October, there had been discussion that the FCC would be the
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Additionally, whereas an institutionalized dual-carriage requirement may have stretched the deference afforded by the Court in regards
to "must-carry" in the past, it is doubtful that the cable and satellite
industries could successfully challenge the de facto dual-carriage scheme
that results from the DTV Transition and Public Safety Act. Furthermore, the DTV Transition and Public Safety Act does not take the step
of requiring multicasting "must-carry," a possibility' 92 the cable and satellite industries had strongly opposed. 93 Such a requirement may not
have received the deference afforded to "must-carry" in the past.
In all, the new "must-carry" requirements enforced by the DTV
Transition and Public Safety Act should receive the same deference from
the Court provided to "must-carry" in the past. Just as important, it
seems that the cable and satellite industries will not even challenge the
new requirements. In fact, Kyle McSlarrow, president of the National
Cable & Telecommunications Association, connoted that the cable industry would have even tolerated the compulsory dual-carriage scheme
of the proposed DTV Transition Act in stating that "[o] ur industry will
accept the dual-carriage obligation of limited duration in the bill, ...
[w]e are willing to make this significant concession expressly to facilitate
Congressional action returning broadcaster's analog spectrum for important uses like public safety and facilitate the consumer transition."' 94
one to address digital "must-carry." See Notice of Proposed Rulemaking in the Matter of the
Transmissions ofDigital Television Broadcasts,Amendments to Part 76 of the Commission's Rules
in CS Docket No. 98-120, 13 FCC Rcd. 15092, 15102, P15 (1998) (In which the FCC laid
out a number of possibilities for changes to the "must-carry" rules). See Panczyk-Collins, supra
note 58 (discussing how then FCC Commissioner Powell proposed for the FCC to make
changes to the "must-carry" rules); but see John Eggerton, FCCLeaves Retrans, Exclusivity As-Is,
BROADCASTING & CABLE, Sept. 12, 2005, available at http://www.broadcastingcable.com/
article/CA6256178.html?display=breaking+News&referral=SUPP (last visited Sept.12, 2006)
(discussing current FCC Commissioner Kevin Martin's comments in regards to the FCC's decision to leave the "must-carry" laws as they are which hinted that the FCC would make changes
only if Congress initiated them).
192 In an FCC release regarding the passage of SHVERA, it was suggested that "'[ijf broadcasters are [to be] limited in their ability to accept in-kind compensation, they should be granted
full carriage rights for their digital signals, including all free over-the-air digital multicast
streams....' John Eggerton, FCC Leaves Retrans, Exclusivity As-Is, BROADCASTING & CABLE,
Sept. 12, 2005, available at http://www.broadcastingcable.com/article/CA6256178.html?display
=breaking+News&referral=SUPP (last visited Sept.12, 2006).
193 Multicasting "must-carry" was strongly opposed in the cable industry's Tribe Memorandum. Tribe, supra note 29.
194 John Eggerton, House DTV Draft: Subsidy, No Must-Carry, BROADCASTING &
CABLE,
Oct. 21, 2005, available at http://www.broadcastingcable.com/article/CA6276788.html?display
=breaking+News&referral=SUPP (last visited Sept.12, 2006). Such is in contrast to the state-
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CONCLUSION
With the passage of the Digital Television Transition and Public
Safety Act, Congress is taking a strong step towards completing the transition to digital broadcasting. Yet, it is clearly not without defect. It
remains to be seen if Congress's decision to switch from a marketplace
approach to a government-engineered model will prove wise since, while
it is clear Congress will be donating a considerable amount of funds to
aid the transition, it is unclear whether the government will be successful in generating those changes that the marketplace previously resisted.
Given the simplicity of the DTV Transition and Public Safety Act's
plan, and the principle that Congress believes the Act can lead the public towards the acceptance of DTV solely with a hard deadline, we are
left wondering if such a hard deadline had been previously set (instead
of the soft deadline which will soon come and pass) would the transition
have been completed without the need for the expensive subsidies for
which the American taxpayers will now have to account for.
ments of Matt Polka, President, American Cable Association, in association with a proposal by
the FCC, to trade broadcaster's retransmission rights for multicast "must-carry." See John Eggerton, FCC Leaves Retrans, Exclusivity As-Is, BROADCASTING & CABLE, Sept. 12, 2005, available at http://www.broadcastingcable.com/article/CA6256178.html?display=breaking+News&
referral=SUPP (last visited Sept. 12, 2006) (suggesting a reluctance to take on any multicasting
obligations in saying that while it reflected Chairman Martin's desire to encourage digital carriage, it was only "'something that we would explore with our board and board members.'")
This illustrates just how important it may prove to be that the DTV Transition Act opted not to
enforce multicast "must-carry."