The Orange County Register questions the FCC's 1997 digital television mandate, citing high receiver costs, uncertain consumer benefits, and the controversial decision to give broadcasters free digital spectrum licenses. Economist Thomas Hazlett argues the transition should be market-driven rather than federally mandated.
Digital Television Raises Troubling Questions
Source: The Orange County Register
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Apr. 6--There is a large potential for greater services to be broadcast
over the airwaves under the Federal Communications Commission's decision
Thursday to introduce digital television. Eventually it would become the
only option for consumers.
As promising as digital television sounds, the decision, years in the making, also raises some troubling questions. For one, will the new services be worth the potentially stiff new costs to consumers? According to some estimates, the price of digital televisions could drop from $5,000 to "only" around $3,000 by the time that digital television is the only choice available; this news isn't likely to be very comforting for television watchers of middle or low income. Then, there are no guarantees that additional services will be passed along to consumers, free of charge. The analog transmission that is currently used in TV broadcasting takes up much more of the airwave spectrum than digital does. Considerably more information can be packed into a digital signal. So in addition to their traditional free-transmission broadcasting, TV stations might be able to offer scores of additional channels on a pay- per-view basis, or data services for computer users, for instance. Broadcasting a sharper picture is only an option for stations. Finally, the greater capacity of digital signals makes the government's decision to give these channels away to the TV stations a questionable policy, to put it mildly. Auctioning them to high bidders would establish their market value and -- who knows? -- might even yield resources to finance a tax cut or some other socially beneficial purpose. Also dubious is the fact that even after the digital-signal licenses are given out free, a great proportion of the airwave spectrum -- by some estimates, nearly one-half in many markets -- will continue to be unused. The government apparently has acceded to pressure from television networks and other commercial interests that don't want these signals opened up to potential competitors. "Among the possible uses of that spectrum would be for Internet traffic, to relieve clogged on-line services," UC Davis Professor Thomas Hazlett, former chief economist with the Federal Communications Commission, told us on Thursday. "But the government's following a protectionist policy of keeping this airwave capacity off limits." Mr. Hazlett also takes issue with the FCC's plan to force, rather than merely allow, television broadcasters to switch to digital. "There's no proof digital will be good for consumers. If it did prove popular, it would develop on its own, without a federal mandate." This is one picture that's far from clear. The airwaves shouldn't be immune from such considerations of supply and demand, where consumers, not the government, decide what they want and how much they'll pay for it. |
