There is a news story in B&C today on a letter we just sent to the Obama transition team: DTV Transition Call Center Would be Ready by Feb. 17, says NCTA.

As the story notes:

[President-elect Barack Obama's] transition team met with industry and government stakeholders in Washington last month to get a status report on the transition, and concluded more needed to be done to make sure viewers predicted millions of calls about the transition could be answered in a timely fashion.

So, we’ve responded with this letter, which I have now posted to NCTA’s website. It’s addressed to Tom Wheeler, who headed NCTA from 1976-84 and is currently the Transition Agency Group Leader for Obama’s Presidential Transition Team. The letter reports that efforts to provide a national, coordinated DTV transition call center would be ready by February 17, the current date for the transition to take place.

The plan calls for the use of up to 7,000 live operators during a period leading up to and for several weeks after Feb. 17, efforts that would require expenditures of approximately $20 million of out-of-pocket costs, most of it expended by the cable industry, and would include contracting third-party capacity, integrating and purchasing trunk line capacity, the hiring of English and Spanish speaking live agents, training, and the development of scripts.

These efforts will be ready to go if the current transition date of Feb. 17 stays in place; but have been engineered with the flexibility to change if the transition date is extended (as is being discussed by some).

We’ve written about the so-called “Digital Migration” on quite a few occasions (Check this post for links). Again, for the short version, there are two transition taking place right now – the digital TV transition for full-power, over-the-air television stations, and the cable industry’s efforts to transition analog channels onto digital cable tiers, in order to reclaim bandwidth and serve consumers with more and better services.

Since the word “digital” is in both of these transitions, even though digital TV and digital cable are two different technologies, some confusion has occurred. For example, earlier this week, Thomas Kraemer wrote on his blog:

I was surprised to see Comcast doing a mandatory switch to digital cable at the same time over-the-air TV is switching to digital. I thought they would phase it a year later as a way to keep cable customers. At first I thought they might be trying to exploit the confusion over the digital TV transition to free up some bandwidth by eliminating analog TV channels that they could replace with more profitable bits.

See also Brier Dudley at the Seattle Times writing on his blog.

In fact, cable’s transition has been happening for some time and will continue after February. Some consumers have mistakenly assumed that cable’s assurances that its customers need probably do nothing during the DTV Transition were incorrect.

Good news today for all those folks. NCTA has sent letters up to Congress today to announce some moves that should help clear up the confusion. First, here’s a relevant quote from our letter:

… we recognize that the overlap between cable’s digital migration and the broadcasters’ DTV transition scheduled to occur on February 17, 2009, inescapably adds a layer of complexity and the potential for consumer confusion.  We are determined to address those issues.

The cable industry has gone to extraordinary lengths to help make the broadcasters’ DTV transition as seamless as possible for consumers.  Our industry was the first industry to run a national education campaign on the DTV transition and has already aired over $225 million in public service announcements entirely devoted to educating consumers about the broadcasters’ transition and the availability of converter boxes and government-supplied coupons.  Alone among multichannel video programming distributors, cable operators will also ensure that all commercial must carry broadcast signals are formatted for both digital and analog customers in accordance with rules set by the FCC (rules that were, in fact, based on a voluntary plan first proposed by the cable industry).

Even with those efforts, the cable industry has been asked to consider taking additional steps to help smooth the DTV transition. In response to these requests, cable operators represented on the NCTA Board of Directors (who own and operate cable systems serving ninety percent of the nation’s cable subscribers) have committed to the following:

• Digital Migration “Quiet Period.” To minimize consumer confusion during the DTV transition, operators will delay the substitution of digital versions of existing analog channels from December 31, 2008, to March 1, 2009, except to the extent necessary to free up bandwidth to comply with the requirement to carry broadcast signals in both analog and digital formats or meet contractual carriage obligations.
• Analog Broadcast Basic Tier. Operators that offer dual carriage of broadcast signals would make access to the analog broadcast basic tier available under a promotional offer to new customers who subscribe just to that tier. This offer would be available beginning December 31, 2008, and would continue for at least 120 days after the proposed quiet period – through June 30, 2009. The service would be provided at the promotional price for at least one year after the customer subscribes.
• No Additional Charge for Equipment or Service. Recognizing that there is likely to be continuing consumer confusion even after the February 17, 2009 broadcaster DTV transition, operators would also provide the following additional assistance to all-analog cable households during and for at least 120 days after the proposed quiet period – through June 30, 2009 – to help them manage cable’s digital transition. If, during this period, an operator removes the analog version of a PEG or other channel from the broadcast basic or expanded basic tier and replaces it with a digital version of the channel on either of those tiers, the operator would make available to all-analog households, upon request, at least one free device that enables those households to view the channel. The device provided under this program would remain free for at least one year. There would also be no additional service charge for at least one year for the affected channel or, at the operator’s option, the broadcast basic or expanded basic tier where the digital version of the channel has been placed. Individual operators may choose to continue this program after June 30, 2009, or to initiate other similar programs after that date.
• Clear and Conspicuous Customer Notification of Any Channel Migration. Whenever operators cease transmitting analog PEG or cable programming services and begin offering those channels only in digital, they will provide clear and conspicuous notice to affected subscribers and franchising authorities not less than 30 days in advance. The notice would also inform subscribers that they have at least 60 days to avail themselves of the offers described above.

I hope this will help consumers during an admittedly confusing period.

There are adults today who have never known a world without cell phones, color television or ATMs. These are people who have had cable television all of their lives (not to mention Internet access, DVRs, DVDs, and so on for a shorter period of time). This actually presents significant challenges to the cable industry.

To people who have always had cable, there is no difference between an over-the-air (OTA) broadcast channel and cable offerings. However, in both the business and regulatory environments, the difference between OTA television and cable matters. The business models are different, the ad revenue streams are different, the content regulation is different. Whether you run a local TV station or a cable system, a broadcast network or a cable net, you live with these differences everyday.

To viewers, those differences are invisible. They cruise around the channel lineup, probably not paying any attention when they’re tuned to a cable channel and when they’re looking at a broadcast station. They may be vaguely aware the rules for swearing vary between basic cable and networks like NBC, CBS, ABC, Fox, or the CW – although, as broadcast standards have changed over the years, the differences aren’t as stark as they used to be. Even if they see that distinction, they may not know this is because broadcasters use the public airwaves, while cable programmers do not.

Another example: If a cable programmer – Animal Planet, Comedy Central, Turner Classic Movies – wants to be carried by a cable operator, then that network has to make its pitch. It has to demonstrate the value it will deliver and then an agreement is negotiated. An OTA broadcaster can choose between Must Carry or Retransmission Consent status in order to gain carriage. As NCTA President & CEO Kyle McSlarrow pointed out in testimony earlier this year, “it’s not a free market negotiation.” For example, if negotiations between a cable operator and a broadcaster go badly, that operator can’t turn to an out-of-market broadcaster that carried the same programming.

You can argue that the average viewer doesn’t need to know the difference. They watch what they want to watch and they don’t care whether the programming is cable or broadcast. But you cannot ignore the impact of these differences. They can be seen all the time.

I’ve mentioned the issue of must carry/retrans, which I blogged about earlier when clashes between Time Warner Cable and broadcaster LIN TV were in the news. I’ve written multiple times about the distinction between the broadcasters’ Digital TV Transition and the cable industry’s migration to digital; just recently, my colleague Michael Turk responded to a Consumers Union letter that seemed to combine the two. I’ve written about the so-called “cord-cutters,” who aim to get all their TV via the Internet; I mentioned how little cable programming is available online as compared to broadcast television – an issue which is a direct result of their differing business models. (Will Richmond writes about this issue in more detail today.)

When discussing television, and the impact of various policy proposals, it is useful to be aware that the telecommunications and television industries are still rooted in historical traditions, no matter how much it seems like all the old rules are gone. While public policy may eventually catch up with the rapid changes of the last decade, we’re not quite there yet. We must remain cognizant of that in applying a one-size-fits-all model to services that vary greatly – whether you can see the differences or not.

On Thursday, NCTA responded to the Senate Commerce Committee in regards to a Consumers Union complaint about cable’s migration to a digital platform. The CU has questioned the impact of our migration on the simultaneously occurring digital transition for broadcast signals. In the letter, we sought to specifically address the Consumers Union allegations that our migration is an attempt to surreptitiously game the broadcast transition to fleece our customers.

My co-author Paul has written repeatedly on the distinction between cable’s migration to a digital platform and the broadcasters’ transition to digital broadcast. While the two share one common element – the movement from increasingly obsolete technologies to delivery methods that greatly increase consumer value – they are two completely different events.

You can refresh your understanding of the differences between the two by reviewing any of the following posts.

• Clearing up the DTV Transition
• The two digital transitions
• Separating the two transitions
• Once more – there are two transitions…
• More DTV Confusion

Without dwelling on the point, cable’s migration away from an analog platform to digital began years ago, in the mid 1990’s. Since 1996, cable has spent $130 billion dollars to create a robust platform not only for digital delivery of video, but to also provide valuable services like high-speed Internet and telephone service. We have been upfront about our plans to migrate our delivery to digital and the fact that 60 percent of cable customers now have digital is a pretty good indication that consumers also like it.

Cable operators could have simply set a date, contacted their customers and said, “On this date, you’ll need a box. If you don’t have one, you won’t get cable.”  Instead, we took a gradual, phased approach to the upgrade in an effort to cause minimal disturbance to our customers.  We recognize that no matter how carefully we manage the switch to digital some customers will be inconvenienced. Even a gradual shift to this new technology will cause some disruption.  However, the industry has done all it can to be upfront about the process, and to ensure that the unfortunate overlap of our ongoing migration and the rapid shift in broadcast technologies do not harm our customers.

Many of the complaints about our move from analog to digital center around the fact that customers will be required to obtain a set-top box, while they do not currently need one. This is true.  Note that all of cable’s competitors – satellite video services, Verizon, etc. – run on all-digital platforms and require every subscriber to obtain a set-top box.  By contrast, many cable companies plan on retaining at least some analog services.  No box will be needed to receive those services.

In contrast to cable’s digital migration, the DTV switch will occur on a flash-cut basis on set date, February 18, 2009.  The DTV transition was handled that way out of necessity – needing to free spectrum for emergency services and others – there has been a fair amount of confusion and fear of possible disruption. We have worked tirelessly to minimize the effects of that rapid change on consumers. We joined with the National Association of Broadcasters, the Consumer Electronics Association and a host of other organizations to educate consumers. We have aired public service announcements valued at hundreds of millions of dollars, and used many other tactics to help ensure that the American people are not inconvenienced by the cut over from analog to digital broadcasts.

The fact that a hard date was set for the DTV transition just as cable’s migration began accelerating does not mean that the two events are related.

Like the DTV shift, however, ours is also being done out of necessity. Our companies have millions of customers who are looking for faster Internet, less expensive phone service, increased hi-def viewing options, and more video-on-demand content. To meet that demand, it is critical for cable operators to free up the space consumed by analog channels.

Technologies like DOCSIS 3.0 – cable’s wideband Internet service – make use of the freed analog space. For example, for every four analog channels, DOCSIS 3.0 channel bonding can deliver 160 mbps – typically 10-50 times faster than current cable Internet service. In video terms, for every channel delivered in analog, cable operators can deliver 6 digital channels.

Analog channels, viewed through that lens, end up costing cable operators more in terms of lost opportunities for other services. They become more expensive to maintain, and that expense increases rapidly.

Think about it this way. Horse-drawn carriages were once a popular method of getting around. As people adapted to the new technology of automobiles, things began to change. Different types of road construction may have increased wear on parts. Parts for the old buggies may have been harder to obtain, or more expensive. The technology simply outpaced many consumers who were loyal to what they knew.

This migration is no different.

Today’s telecommunications platform requires hardware to connect. The cable industry (through CableLabs) has worked with the consumer electronics industry to develop technology to allow you to connect to digital service without a STB – first with the one-way Digital Cable Ready sets and now the interactive tru2way televisions. The first sets with this technology are already for sale in Denver and Chicago.  We are confident that consumers will find tremendous value in the digital services you will be able to get using these devices.

While there will, as mentioned, be some customers who are inconvenienced during our migration, cable has done all it can to keep the number impacted, and the disruption they experience, to an absolute minimum. Cable continues to feel the pressure of competition from both satellite and the phone companies. Our customers have choices, and we do not take that for granted. We work every day to provide great products with great value, and strive to keep every customer happy.

As the Feb. 17 date gets closer, we not only see more coverage of the DTV Transition, we also get more confusion about what the transition is and what it is not. For our part, the cable industry has run an extensive consumer education campaign to alert cable and non-cable viewers about the changes coming next February.

So far, that includes TV advertising valued at $200 million. Not only has NCTA produced PSAs, but cable companies have also produced spots explaining the transition.  We have created a consumer website aimed at educating the public and participated with broadcasters, satellite companies and the telcos in multi-industry outreach to make sure consumers experience little disruption during the switch.

I want to make one key point here: A key component of our advertising campaign was directed at helping people learn how to get digital television without the use of cable. We were directly promoting a competing technology.

You can find our DTV spots at NCTA’s YouTube channel. Our advertisements were promoting the NTIA’s TV Converter Box Coupon Program, which allowed you to request a coupon that can be used to obtain a converter box so that you could receive digital TV on your analog set through an antenna. Our PSAs didn’t even promote our DTV website (Get Ready for Digital TV), but rather the NTIA’s www.DTV2009.gov.

At any rate, despite that education campaign, there are still many people confused about the DTV transition. So, let’s walk through the essentials.

The DTV Transition concerns the nation’s full power over-the-air broadcast TV stations preparing to switch to an all digital system in 2009. It is not cable’s transition.

As part of easing the move, some cable operators are promoting low-priced tiers called “lifeline service” for customers looking for an alternative for rabbit-ears reception of television. We also crafted a voluntary carriage commitment so that full power broadcast TV stations would be available on cable’s analog tiers for three years.

Given all of this, I was dismayed to see a new editorial from Consumer Reports magazine, entitled “Confused about cable?” The piece argues that cable operators are “using confusion about the forthcoming digital TV transition” to raise rates.  The “confusion” they’re referring to is the confusion between the DTV switch and cable’s own transition from analog delivery to digital.

While the broadcasters are converting to digital broadcast transmission due to government mandate, cable is transitioning to digital compression to serve our customers better.

I’ve written about this issue multiple times:

• Clearing up the DTV Transition
• The two digital transitions
• Separating the two transitions
• Once more – there are two transitions…

Bottom line: The broadcasters have their transition, we have ours. Cable’s efforts to move analog channels to the digital tier in order to free up bandwidth has been going on for years and will continue after Feb. 17 has come and gone. The two transitions have nothing in common, since digital cable and digital broadcast television are two separate technologies that only have the word “digital” in common.

Here’s an example. The CU article starts this way:

Should they sit down now to watch the Animal Planet channel, Heather Shorr and her daughters would no longer see snow leopards—just snow. Shorr, a Connecticut homemaker, says their cable provider has moved the channel onto a digital tier.

That’s a cute pun on “snow,” but it makes no sense. If Animal Planet was on channel 34 on the analog tier and it was moved to channel 112 on the digital, you wouldn’t see snow. You’d probably just see a different channel in its place. The use of the word “snow” probably makes the confusion worse by making it sound like a DTV Transition issue, when it is not.

Cable companies will eventually migrate all customers to digital, since multiple analog channels can be compressed into the space of one digital channel.  That additional capacity can be used to deliver more HD channels, faster Internet connection speeds or other services to come.

While the timing of the two transitions is unfortunate, and it has created a a little bit of a brouhaha, the fact is the DTV transition was supposed to be done quite some time ago, and our digital transition had begun before Congress set the hard date for the DTV switch (digital cable is a decade old).

Despite all that, we’ll keep plugging away, so that consumers can have a clear sense of the issues.  We will do all we can to ensure consumers (and reporters) have all the information they need to tell the two transitions apart, and to understand them both.