The Great DTV Antenna Bill: Comparing 8VSB, COFDM, and DBS Consumer Access Costs

"In the case of over-the-air television homes and broadcast television dependent television sets in cable homes real incremental consumer costs are likely to be incurred to receive DTV services. These costs also apply to cable homes which wished to receive DTV service but which had not been upgraded to digital cable service."

(*: The comparison with DBS is strictly speaking unfair, as DBS is a platform providing a variety of broadcast, cable and premium television services.)

SUMMARY

Little attention has been paid to the incremental one-off costs to the US consumer of using 8VSB, COFDM or DBS to receive digital television service.

These costs are incremental one-off antenna and installation costs to receive either over-the-air digital television or digital television via Direct Broadcast Satellite services, which would necessarily be incurred by consumers using television sets not connected to a digital cable system.

(In the case of the 70 million US TV homes, and over 170 million TV sets, connected to cable it is likely that these homes will receive DTV service through cable ‘must-carry’ or negotiated commercial arrangements.

Purely for illustrative purposes, the costs of providing indoor antenna DTV reception are estimated for 8VSB and COFDM DTV. In the case of 8VSB a new as yet to be developed smart-steerable antenna is believed to be needed, which may cost around $50 per unit in volume. In the COFDM case existing passive indoor antenna, which may or may not be present in the home, are suitable for DTV reception. For comparative purposes it is assumed that all COFDM DTV homes would need an indoor antenna costing $10 per TV set.

The total 8VSB indoor antenna bill would, in this hypothetical case be, $8500 million versus a COFDM indoor antenna bill of perhaps $1700 million.

This is a five to one consumer cost advantage for COFDM in 70% of US television homes connected to cable. Coupled with the ease of receivability of COFDM demonstrated by Sinclair Broadcast Group and operationally encountered in other industrialized countries, this is a major economic advantage even in the non-broadcast television market segment. )

In the case of over-the-air television homes and broadcast television dependent television sets in cable homes real incremental consumer costs are likely to be incurred to receive DTV services. These costs also apply to cable homes which wished to receive DTV service but which had not been upgraded to digital cable service.

The 8VSB DTV antenna bill for all non-cabled US television sets is around $14 billion. This includes the twenty five million over-the-air television homes, the estimated sixty million television sets in those homes, and a minimum of fourteen million television sets in cabled homes which depend on over-the-air television for at least one television set.

The COFDM DTV antenna bill, for equivalent coverage and access, is around $2 billion, for the same television universe as described above.

The DBS antenna bill is around $7.5 billion to serve the estimated twenty-five million homes and the estimated sixty million television sets outside the cabled universe, with local DTV service.

If COFDM and 8VSB DTV are mandated side-by-side, US COFDM DTV broadcasters will enjoy a seven to one economic advantage with consumers in terms of one-off access cost. This advantage is even higher given that the 70% of US homes connected to cable will also have very low cost access to COFDM DTV services via conventional indoor antennae.

This has striking implications for the uptake of DTV service in the United States, given that consumers are likely to choose the lowest cost and minimum inconvenience route to acquiring DTV service wherever they live.

DBS is a less expensive access route to receive DTV services to US over-the-air consumers than 8VSB over-the-air DTV enjoying a cost/HH/set/tv service delivered advantage of nearly twenty to one, although this advantage narrows over COFDM DTV to under three to one.

However the main supply side constraints are that around 800 transponders would be required to provide full HDTV rebroadcast via DBS of every US broadcast television station from a single satellite orbital slot. This makes it technically infeasible and commercially non-viable. A more appropriate commercial strategy is to offer the major television markets for DBS retransmission of local broadcast television services, probably providing service at SDTV format. This is now well underway.

DBS takes the hassle out of installation issues, and is a lower cost route to DTV than 8VSB. It preserves existing service functionality such as zapping and, for dual receiver models, there are no problems with simultaneous VCR usage whilst watching another service or the Picture-In-Picture feature. DBS offers a wider choice of services, provides generally reliable and high quality service, and has a subsidized business model to drive penetration unlike free-to-air DTV. The downside is that DBS cannot economically offer nationwide digital access to local broadcast TV.

This partially explains why, with only DBS and 8VSB currently mandated in the United States, DBS is currently outselling 8VSB DTV by a factor of over seventy-to-one annually, as the preferred consumer route to access digital television services.

The introduction of COFDM DTV would be likely to fundamentally alter this competitive mix. Simplicity, ease of access and use, and lower one-off set-up costs than VSB along with the seamless real-time preservation of current television service functionality such as channel zapping, VCR taping and PIP displays (the last two with dual digital tuners receivers).

This hassle-free DTV solution, combined with the unique revolutionary prospect of true mobile DTV, makes COFDM DTV a commercially viable, easy to install and use, digital terrestrial television system with the maximum chance of consumer acceptance.

The combination of COFDM DTV with DBS would provide a wireless digital television system offering easy access to local broadcast, superstation and national subscription television services.

 

 

 

1 Introduction

A great deal has been written about the relative merits of COFDM and 8VSB in a transmission context. However, there has been very little discussion to date of consumer access economics, in particular the one-off incremental capital costs required to receive DTV service or the retention of long-established functionality features such as instantaneous channel zapping, PIP and VCR usage.

The arguments in the transmission context have centred on Gaussian C/N ratios, peak-to-average transmitter power, overall coverage (not ACCESS), impulse noise and ability to resist natural impairments due to echoes, flutter or fading. It now appears, on the basis of the empirical measured evidence provided by Sinclair and others, that arguments advocated by 8VSB proponents to exclude COFDM from use in the United States no longer have any validity at the DTV transmission level. Sinclair’s recent reports and submissions available via http://www.sbgi.net/dtv cover many of these issues in great depth and these are widely reported by the technical literature and a plethora of Internet web sites.

However very little attention has been paid to consumer functionality and access economics in the DTV context until now. Sinclair’s FCC petition for expedited rule making to press the case for COFDM touches on these issues, but does not quantify the incremental costs involved to US consumers across a range of markets for acquisition of DTV services and the completion of DTV service access outside cabled areas.

This is surprising as these considerations form a fundamental component in assessing the prospects for DTV service in the United States and its acceptance by US consumers. Much of the raw data is available in the Sinclair FCC petition, is readily accessible from other public sources including the Internet and from dealers.

The fundamental differences at the consumer level between 8VSB and COFDM are that the 8VSB system, in general, requires a 30-ft outdoor mast, and directional Yagi antenna. Further in markets where DTV stations are not colocated, a rotor is also required. In the case of 8VSB indoor antenna reception, to date, 8VSB has been plagued by poor and inconsistent performance. There have been suggestions from many quarters, including the recent OET report to the FCC, that indoor 8VSB reception with more advanced receivers would require some form of advanced steerable indoor antenna.

The COFDM system has been designed to work with existing indoor antenna over very wide angular swathes of rotation, with existing omnidirectional outdoor antenna in City and Grade A contours and with conventional fixed rooftop directional antennae. As seen later this has a marked bearing on access economics and the overall cost to the consumer. This may prove central in any discussion of the future prospects for both systems. It is instructive to compare the cost of providing DTV service via DBS as a benchmark for comparison since this is a preestablished digital television system in widespread usage in North America and other countries.

 

2 Functionality implications of 8VSB DTV systems REQUIRING ROTORS and outdoor antenna

In television markets where 8VSB DTV stations are not physically colocated or adjacently sited a rotor is usually required for the 8VSB outdoor antenna. Approximately 40% of USTVHH are likely to be affected. This leads, as the Sinclair FCC submission notes, to loss of the following established consumer functions:

1. Instantaneous channel zapping as the rotor has a finite latency time of six degrees per second. For stations 180 degrees apart the wait time is at least thirty seconds.
2. VCR taping will be impossible for physically separated DTV stations unless two antennae and rotors are fitted.
3. Picture in Picture will fail for non-colocated DTV stations due to the directionality requirements of 8VSB.
4. In the case of multiset homes each TV set will require its own dedicated antenna and rotor. The alternative is to provide a fixed antenna farm on the roof and install a distribution system.
5. The current 8VSB units require several seconds to lock onto a DTV signal once the antenna is oriented for optimum signal.

Overall this represents a fundamental loss of functionality compared to conventional NTSC broadcast service and to cable competitors. The question has to be asked whether consumers will accept this level of service disutility in the DTV domain from broadcast television service when competitor systems are not faced with this problem.

In the case of COFDM DTV service a rotor is not required in the City and Grade A contour, which enjoy high signal strength, as the system operates effectively with omnidirectional outdoor antennae and with indoor antennae over a very wide angular swathe. Sinclair confirmed these properties of COFDM in its recent empirical tests in Baltimore, and this is well known from the COFDM DTV services operating in other countries. It is expected that in fringe areas viewers will have already installed outdoor antennae for analogue NTSC service and these can be reused to receive COFDM DTV services, provided that DTV service is broadcast from these stations. The operational results, after almost have a million installations of the COFDM DTV service in the UK in under a year, indicate that COFDM works first time out of the box with 90% of existing antennae. In particular large highly directional antennae systems are not generally required.

COFDM works with the existing fixed antenna orientation toward the transmitter tower whereas numerous tests have revealed that an 8VSB antenna often has to be moved away from the direct signal path to successfully decode a DTV signal. This is because 8VSB equalizers cannot cope with very strong dynamic ghosts or nulls present in the direct path: hence the use of rotors with 8VSB to reduce the input signal to a level acceptable to the receiver. In the case of COFDM, all forward and reflected path signals are additively integrated by the receiver due to the system’s inherent multipath management properties.

In the case of DBS service a dual LNBF system and more complex STB is required to allow two television sets to view separate television services, a multiroom distribution system and two subscriptions are required. This leads to incremental higher costs than those incurred for a single feed DBS system to one television set. In practice DBS is a very simple and reliable professional installation, as static and dynamic multipath effects are not encountered.

Underlying assumptions

It is assumed that DTV must-carry retransmission or commercial carriage agreements will be secured between individual market DTV broadcasters and cable operators carrying digital services. However it will be several years before all 70% US TV homes connected to cable have access to digital services.

The Sinclair FCC submission reveals, at page 31, of these cabled homes that 20% of all television sets are using off-air only. Therefore in the 70% of cabled homes, 14% are dependent on off-air broadcast for AT LEAST one television set. This translates to at minimum 14 million television sets, which will be affected directly by DTV transmissions in cable homes.

It is further assumed that the cost, in volume, of 8VSB or COFDM DTV receivers will be the same. This is because the price of the STB is dominated by the HDTV components and in the case of a digital television by the display. In identical volume markets 8VSB and COFDM chips would be the same, although COFDM is likely to be less expensive because it is now slated for use in over three hundred million TVHH worldwide. Therefore, at the consumer level, comparative consumer access economics for DTV service is based ENTIRELY on the capital cost of additional antennae, distribution systems and, if required, amplifiers for television antennae system.

In the case of DBS the access costs for single and multiset homes are well defined at the SDTV level. For HDTV services additional adapter modules are required which plug into the receivers, and shortly high-end DBS units will likely be equipped with some form of HDTV output. For the purposes of ready comparison at the access level we ignore the difference in HD/SD costs, solely to examine the minimum antenna, installation and distribution costs for acquisition of basic DTV service via DBS retransmission.

 

3 DTV Cost impact on cable homes

It is assumed that most cable homes are within the City and Grade A contours of each major market. This is a reasonable working assumption given that cabling relies on the economics of density to construct a viable business, and is therefore centered in densely populated urban and suburban areas. It is also valid for the purposes of the calculation, which follows, as homes in the City and Grade A contour will generally be able to receive an indoor DTV signal due to the high signal strength.

The cost impact on the estimated minimum 14 million TV sets in cabled homes using off-air broadcast service only is striking:

For these televisions an 8VSB DTV receiver will, in all probability, requires a new >smart= indoor antenna as has been widely suggested. It is difficult to put a firm figure on these devices in the absence of a real technical specification for a proven product. Given the level of software required, the need for local intelligence and a Network Interface Unit allowing the 8VSB receiver to automatically control this smart antenna, in volume we could plausibly assume that each smart antenna would retail @ say $50/unit. This translates to $700 million minimum for these 14 million TV sets. In addition current 8VSB receivers would have to be either modified or replaced in order to work with the smart antenna.

In the case of COFDM DTV, COFDM reuses existing indoor antenna: therefore the net marginal cost is NIL for broadcast only TV sets (located in cable homes) connected to a COFDM DTV service. It is assumed these sets will already have an indoor antenna.

Therefore, even in cabled homes which were previously thought not to have been directly impacted by the DTV transition, use of different DTV modulation standards has a negative cost impact to US consumers of $700 million for 8VSB compared to COFDM. The main reason is that COFDM is seamlessly compatible with existing indoor antennae whereas 8VSB is not.

 

4 Impact on over-the-air broadcast homes

4.1 8VSB access costs

There are an estimated 25 million TV homes in the US dependent on over-the-air broadcasting. Statistics indicate that 60% of TV markets have colocated TV transmission towers (and therefore, in principle, no rotors for 8VSB are needed) and 40% are not colocated. Therefore about fifteen million homes require a new 30 ft mast + highly directional Yagi antenna costing, say, $300, that is around $4500 million dollars. In principle this antenna configuration should be able to serve ALL the television sets in the home with DTV service provided that a distribution system is implemented AND each TV set is either a DTV TV or has an attached STB.

The remaining ten million homes may require the more expensive mast + rotor + directional antenna costing around $400. It is assumed, in the absence of firm data, that 50% of these homes will already have a rotor and therefore the lower 8VSB figure can be used in those cases, although a highly directional Yagi antenna will still be needed. Therefore the total costs are likely to be of order $3500 million.

Note that these figures, for these homes, are solely for single TV set installations and should be multiplied by the US national average of 2.4 TV sets per household to reflect the impact on multiset homes. This is because each separate TV set will need its own mast and rotor in the case of markets where stations are NOT colocated, in order to retain independent viewing options. The 8VSB DTV solution has a cost impact of around $8400 million in incremental one-off consumer access costs for DTV service in non-colocated markets serving all television sets.

The total 8VSB DTV incremental consumer access costs, in the over-the-air broadcast tv market sector for all television sets, is therefore around $12900 million, or $215 for each 8VSB DTV connected television set.

4.2 COFDM access costs

In the case of COFDM, omnidirectional outdoor antennae (most likely encountered in the City and Grade A contours), AND existing fixed rooftop antennae in Grade B and beyond can be reused. Experience from other countries indicates that COFDM works with 90% of existing fixed rooftop antennae and because of its multipath rejection properties it works over very wide angular swathes.

It has been claimed that because COFDM needs a higher C/N threshold than 8VSB coverage will be restricted compared to 8VSB DTV. These claims were not borne out in practice during the course of the Sinclair trials in the far-field, where despite a measured 2dB C/N advantage to 8VSB, COFDM DTV was received at every far-field site that 8VSB was received at. The difference in minimum input signal levels is 2-4dB depending on proponent claims.

Even if this argument is ascribed meaningful validity in the real world, this threshold difference is easily rectified by a setback preamplifier costing $35 (to provide a gain of say 12dB with noise figure of less than 2.5dB). In addition COFDM is helped by amplification as the echo signals are also amplified and add together constructively whereas, as has been seen repeatedly, this causes major problems for the 8VSB DTV signal if very strong echoes are amplified.

For the sake of argument, in a fair comparison, it is assumed that all twenty-five million over-the-air US TV homes need this preamplifier for COFDM DTV service. In practice this is a very pessimistic assumption, as many homes will already have high-gain antennae and masthead amplifiers in fringe areas. In extremis it is also possible to consider the case of masthead amplifiers: but these are unlikely to be necessary for a 2-4dB difference in margin, on a like-for-like average ERP basis. This is particularly the case given that fade margins are required to be 6dB, typical antenna downlead losses are 6dB, and the gain of a modern antenna is +10dB.

As COFDM does not need rotors and works over wide angular swathes its RF output can be daisy-chained around the house to feed multiple television sets. This simplifies multi-set distribution system economics. In the case of COFDM it is assumed that, in the 10% of cases where additional antenna work is required, the higher 8VSB figure should be used reflecting a high-gain antenna or masthead amplifier.

Therefore twenty five million homes require a preamplifier @ $35 = $875 million + 2.5 million homes @$400 require new antennae, translating to a total cost of around $1875 million. Note that this is the total figure for multiset homes as COFDM conveniently ‘daisy chains’ because of its angular acceptance properties of incoming DTV signals.

Therefore the consumer cost per COFDM DTV set accessed is around $31, compared to around $215 for each 8VSB DTV set accessed.

3. DBS access costs

We can also consider the case of DBS, in the event that DBS is allowed to provide access to local broadcast TV services. Excluding STB costs, the antenna cost and installation per single DBS set/TVHH is around $150 and for multiset DBS, including a multiroom distribution system, this is around $300.

Of course in every case the additional consumer attractor to DBS is the much greater diversity of national television services provided over either COFDM or 8VSB DTV. In the case of DBS the notional incremental costs are around $3750 million if only one TV set is enabled, or $7500 million counting all twenty-five million homes in this sector as multisethomes.

These figures are striking, taking into account multiset homes, and show the power of the COFDM systems ability to reuse existing indoor and outdoor antenna types and its omnidirectional receivability in City and Grade A contours.

 

 

5 The Great DTV antenna bill

The following table summarizes the incremental costs, over and above receiver equipment, incurred by consumers for all television sets to have DTV service added in the over-the-air and broadcast television service received —in- cable home market sectors:

(*: The comparison with DBS is strictly speaking unfair, as DBS is a platform providing a variety of broadcast, cable and premium television services.)

It is the difference in costs between COFDM DTV and 8VSB DTV, which is striking. This is attributable to COFDM=s seamless compatibility with existing indoor and outdoor antennae, its near omnidirectional receivability in City and Grade A contours and powerful multipath rejection properties. Note that the 8VSB claimed coverage advantage in the far field, attributable to a nominal 2-4dB C/N difference, has in fact been canceled out by the assumption that preamplifiers would be used in all COFDM over-the-air DTV homes. This, in reality, is a pessimistic assumption.

This table underscores the likely difference, attributable to marginal capital cost considerations, in the acceptance of over-the-air DTV service in those market segments outside the cable retransmission sector.

Note that in cable homes, within City and Grade A contours, the vast majority of cable connected users would also have potential access to COFDM DTV by purchasing a simple indoor antenna for a few dollars. This has clear implications for the commercial viability of DTV broadcasters and the closure timetable for analogue NTSC.