Permanent linkIt seems odd that wireless is the holy grail of all
transmitted media except TV: Wireless broadband, wireless networks, wireless
phones--as in, the demise of land lines. Television alone has migrated the
other way. Very few domiciles lack a snake of coaxial cable, and because of
that, many folks argue that wireless TV is no longer necessary.
It may not be, if only in the sense that TV’s not exactly “necessary” the way
water and food are “necessary.” But relegating TV to wires so cell phone
companies can charge people subscriptions for the public airwaves seems
backward.
A massive, nationwide infrastructure already exists for wireless television.
That infrastructure was completely retooled in the last few years at the behest
of the federal government. It’s now been live for 140 days.
It’s the only television transmission system whereby high-definition
programming isn’t crushed into foggy blur. It’s a shame broadcasters didn’t
shout that fact from every one of their transmitters, but that train done left
the station. It’s onward, into a future where bureaucrats and lobbyists are
busy rolling up the tracks.
The medium is under siege, there’s no doubt. Yet another “study” was rolled out
this week asserting the spectrum is worth more for broadband than broadcasting.
It doesn’t say to whom, however. The government coffers argument is a joke. Whatever
money the government might make from it at auction has already been spent 192
times.
The projected economic benefits assume ubiquity, and ubiquity requires
infrastructure. There are millions of Claudville, Va.’s across the country
skipped over by broadband providers now. That’s not going to change under a nationwide
plan. Those communities will have to develop their own strategies, as
Claudville did--one in which local broadcasters participate at some level.
There’s also that $62 billion that wireless providers supposedly would pay for
the broadcast spectrum licenses. All cap ex ends up coming out of customers’
pockets. That’s just business. That’s just $201 for every man, woman and child
in the country. Toss in construction costs, marketing, lobbying, bonuses and
incidentals, and you probably have $1,000 per person.
Phone bills will skyrocket. That’ll be fun.
There’s also scads of WiFi pockets around the country already generating
millions for carriers. It’s unlikely that those will be jeopardized.
Nationwide wireless broadband is a
good idea, but not dictated by the Pharaohic school of management, “so let it
be written, so let it be done.” The very fact that communities like Claudville,
Va., had no Internet provider into 2009 suggests nationwide access is more than
a matter of spectrum. It’s economics. No service provider in business is there
to make things cheaper for their customers. I am typically reminded here that
long-distance calling is cheaper than it once was, but I pay the phone company
five times what I did when long-distance calling cost so much per minute. My
phone use is precisely the same.
This assault against broadcast television is just gathering momentum. There’s
little being said about the competitive element it provides for cable TV, and
what will happen to cable bills once it’s gone.
There’s a mantra in much of Washington, D.C. that no one would notice if
broadcast TV went away. Meanwhile, nearly 35 million coupons were redeemed across
the country for over-the-air digital TV receivers. Chances are, someone might
notice if wireless TV goes away.
Permanent linkHello Gordon Smith! You have your
work cut out for you. The FCC is now fully engaged in killing off broadcast
television, deploying its bureaucrats to get a feel for who might want to give
up their spectrum license for a cut of auction proceeds. This might not wash
with the guys on the NAB board, who are actual broadcasters (as if John McCain
would ever let it happen).
Debt holders are another story. Broadcast bankers might like the idea of a cash
payout for spectrum, and Washington clearly has no problem giving money to
banks.
The spectrum reclamation movement is in full flush, and as such, rife with
distortion.
The first and most persistent is that broadcasters get the spectrum for free.
They receive licenses in return for fulfilling public obligations, and in turn,
the public has access to free TV. The infrastructure to provide that service is
by no means free, nor was the recent government-mandated upgrade to digital
transmission. The billions just spent to create digital broadcasting was also
intended to free up spectrum, which it did--Chs. 52-69. Most of it, as
expected, went to Verizon and AT&T, and is not yet built out. Another 10
MHz hasn’t even been auctioned off.
Some of the pressure to give up spectrum is coming from the wireless giants,
who started the gambit. Verizon’s lobby in Washington is one of the most
powerful. It is second in influence only to Rupert Murdoch, who has to merely yawn
and stretch to get an administration to sit up and roll over.
Then Motorola got into the game, blaming the 9/11 deaths of first responders on
a dearth of spectrum. The loss of life was tragic, no doubt, but the spectrum argument
was disingenuous. Emergency communications had long suffered from incompatible
technology standards and disparate jargon. And on that fateful day, someone
failed to switch on a transmitter.
Now Google, Microsoft, Dell, et al, have skin in the game, and they’ve made the
Verizon team look like a bunch of geezers in seersucker slacks. Google did
nothing but pretend to bid on spectrum and got nationwide access to it for
free. Absolutely free. No strings attached. No public interest obligations.
Nothing. White space. Free.
If white-space broadband networks work properly without taking out TV signals,
most broadcasters are for it. Claudville, Va., is a perfect test bed. No
carrier was going to string Claudville, Va., at the foot of the Blue Ridge. It
will be interesting to see if people in the area experience TV interference,
and if they have any idea what might be causing it. Chances are, since
Claudville’s network just does backhaul in white space from fixed points, there
won’t be much of a problem.
But the launch itself will be held up by proponents as proof positive that
white-space devices work, bar none. The fox’s nose is in the door.
Broadcasters will have to be nimble in this environment. A head-on battle won’t
do. They’ll lose. Too many people get cable and satellite. The notion of
over-the-air television is a waste of spectrum to a generation that needs it for
texting in traffic. What truly is a “waste” of spectrum is arguable, of course.
If you’re a carrier or you have stock in one, not getting subscription fees
from spectrum is one form of waste. If you’re a tech giant or a stockholder,
it’s not having an operating system that rules the airwaves.
Why it is that Americans want to pay for something that ostensibly belongs to
them, I’ll never quite now. But that’s just a reflection of the press and the
blogosphere, which are one and the same these days. I’m not so sure that all of
America is really fine with the cessation of free TV for all time. The public
deserves to realize what’s really going on in Washington, D.C., and they
deserve to know that if broadcast TV goes away, it’s never coming back.
Permanent linkLet’s hope we hear about mobile DTV as much as
we heard about Jay moving to prime time. The Advanced Television Systems Committee
last night approved the standard for transmitting mobile DTV over the air. The
effort was nearly two-and-a-half years in the making, giving Verizon a
significant head-start with VCast.
The wireless carrier doesn’t break out its VCast subscriber numbers, but with
nearly 88 million cellular subscribers, it’s safe to bet there’s a few million.
MobiTV, which won an Emmy for its mobile TV technology, is carried by AT&T and Sprint. It surpassed 6 million subscribers worldwide in February.
The incumbent carriers mean some stiff competition for broadcasters, who have
their own advantages.
One is that Verizon led with data; VCast initially was launched on the
carrier’s data network and video forever buffered on the user end. Subscribers
fled. It relaunched on MediaFLO, a far more reliable distribution technology.
Now MediaFLO’s parent, Qualcomm, is making handsets specifically to receive
MediaFLO content--FLO TV.
All of these services cost money. All are subscriber based. The great hope of
mobile broadcast DTV is that it will be ad-supported and therefore free. This
could work, except it will take lots of
loud barking!
Mobile broadcast receivers are expected to show up at the Consumer
Electronics Show in January, but they should be in the market now. Broadcasters
should be slathering manufacturers with Dom and filet mignon to get receivers
to market. They should comp premium air-time to push them for the holiday
season. They should be pushing free mobile DTV incessantly, the way NBC let
every living being on the planet know that Jay Leno would appear in prime time
this season.
There should not be one single life-form in the known universe who remains
unaware that mobile television can be had for free. Because free means squat
anymore without some form of cache attached. This is the United States of
Marketing. Even the best ideas sink without sufficient marketing. Remember
terrestrial DTV, with the best-quality, high-definition video available of any
system--for free? Yeah, that went over big, didn’t it. Who knew? A handful of
geeks and techies, that’s who.
Mobile DTV could work. It could very well be the revenue stream that saves the
broadcast television industry--if people know about it. Having a couple of
anchors push the service in a few newscasts is not enough. Billboards. Air
time. Sponsored extreme athletes. Pink as a spokeswoman. The ATSC M/H comet.
Ads at bus stops, in local neighborhood rags, on the radio, in the air from
smoke-trailing biplanes.
Just this once, I hope this industry uses the power of its own platform to
predicate its success rather than the petard-hoisting that was terrestrial DTV.
It’s OK to take a lesson from HBO. C’mon. Feel the noise.
Permanent linkIt’s that time of year when days get shorter and
lawmakers in Washington have less time to spend an enormous amount of money. The
pace of hearings accelerates and bills are churned out like sausage before
Oktoberfest. Irrational legislation based on what seem to be logical premises get
thrown into the mix. Such concepts often become law not because of contextual
merit, but because of what’s attached--earmarks.
Jim Harper of the Cato Institute maintains WashingtonWatch.com,
where he tracks every bill proffered in each Congressional session. Harper
holds an annual earmark contest, imploring followers to ferret out the pork
lawmakers tack onto bills for pet projects. Among the prizes for this year’s
sleuths, an Amazon Kindle, an iPod Shuffle and a “deluxe regular fruitcake.”
Readers tallied up more than 40,000 earmarks comprising billions in spending. The
allocations are all over the board. Rep. Steve LaTourette (R-Ohio) is looking
to get $2 million for a contractor to keep track of the Navy’s stuff. That
Navy. The one with all the navigators. Rep. John Dingell (D-Mich.) is seeking
$2.5 million for pasteurizing egg shells to prevent bird flu just in case it
spreads on egg shells. It might be cheaper just to tell people to wash eggs
before they’re cracked, but that would make sense. Sen. Max Baucus (D-Mont.) is
looking to take $9.5 million back to the great state of Montana for a
hypersonic wind tunnel. Surely the same effect can be achieved between
Constitution and Independence avenues.
The list clearly goes on. Not all earmarks will pass into law, but these things
do influence lawmaking more than the actual issues. There’s one guy on Capitol
Hill that works for the nation. The rest work for an individual state or a
portion thereof. The seeming debates on national issues seemingly followed by
the mainstream press are mostly the stuff of obfuscation. There are people who
go to Washington with every intention of being a pillar of integrity. A couple
of cognacs and a Cohiba later, and the shine wears off the windy car lot back
home. Then it’s game on; time to make a haul for the home constituency.
They call it “Potomac Fever” back in the ’hood. Some legislators get so addled
by it, they start believing themselves. Harper has a tagline for the fruits of
that condition--legislation that promises more than it can possibly deliver.
“And a pony.” E.g., “Congress will eliminate loud TV commercials... and give
you a pony!”
Frankly, I wish Congress would give me a pony, but I can’t imagine what the
poor creature would look like after being legislated into my care. (Shudders.) Neither
can I imagine how slapping a loudness law on broadcasters is going to make the
ad industry stop caterwauling. (The Commercial Advertisement Loudness Mitigation
Act made it past a House subcommittee this week. It would direct the FCC to
create a broadcast loudness standard within a year.)
Advertisers have a long and hallowed history of caterwauling. Outlawing it seems a
bit communist, or at the very least, ridiculous.
First of all, broadcasters have a clue. See, they are people, and they watch
TV, too. They don’t especially enjoy getting blown out of the room by a
hyperactive guy mutilating vegetables and shredding cheese. And they’ve
secretly been working on loudness levels for years. It’s just that there was a
digital transition in there. Despite that being legislated as well, it was one
giant-sized science experiment after which a lot of engineers are still
cleaning up. It was a little like going to the moon, but without the space
travel and those unfortunate Gosselin people. And remember, Neil nearly ran out
of gas before getting to the moon. That could have been a $24 billion
“woopsie,” as there were no Piggly Wigglies on the moon back then.
The DTV transition didn’t have a similar major-league near miss, but rather a
lot of smaller complications to mop up. Restoring reception to households that
lost it has been the primary concern. Making the audio arrive at the same time
as the video has been another, since the two are delivered separately in
digital transmission. That it happens at all is something of a miracle.
Loudness hasn’t really been the most pressing issue in broadcasting lately, but
it’s on the agenda. They’ll get to it without legislation. Honest they will. However,
the effort to criminalize loud commercials is instructive on many levels. 1)
Lawmakers watch TV. 2) They are annoyed by loud commercials. 3) They have not
learned, as my father did the first time he used a remote, to use the mute
button.
Then again, the mute button has no earmarks.
Permanent linkWe’ve already seen what happens to the broadcast
TV business when its primary cash cow gives out. The demise of the auto
industry slashed broadcast ad revenues by 25 percent. Stations circled the
wagons, laying off staff left and right, cutting costs, combining operations
with competitors across town.
Finally, there were a few signals this week that suggesting the worst was over.
New Vision Television exited bankruptcy debt-free, and two more broadcast
groups--Gray and Entravision, came back into compliance with the New York Stock
Exchange. Moody’s deemed the broadcast TV segment “stable,” and Wells Fargo
raved about CBS after the company had taken a pummeling from Wall Street all
year.
The hope now is just to get through the rest of the year without any more blood
loss. The market is already braced for the absence of political ad revenues and
the Olympics bonanza. The football effect is another story. National Football
League games yield some of the highest ratings and related revenues for
networks and local TV stations. The networks, and by association, the stations,
pay dearly for the rights to broadcast the games, but the upside includes
higher ratings for lead-ins and post-game programming.
Clearly, football is good for broadcasting, and the business could use a ray of
sunshine right about now. But football depend mostly on ticket sales, and
ticket sales depend on people who have jobs to pay for them. There are fewer
such folks around these days. Ticket sales are down. As many as 10 teams aren’t
sold out, meaning more local broadcast black-outs, meaning less revenue for
local affiliates.
The ultimate effect of NFL black-outs remains to be seen. It may not be
substantial, but it won’t take a huge hit to have an impact on some stations.
Many are clawing their way back from leveraged, DTV capital upgrades, the
related fixed expenses of running two facilities for so long, and then losing
one of their biggest sources of revenue just as those bills come due. It might
be a good time to implore PBS member stations to replace those coffee mug with
NFL tickets.