Panasonic

CEA Wants to Eliminate Free HDTV

June 6th, 2011 · 14 Comments · Cable TV, Connected TVs, News, Satellite TV

CEA Hates free HDTVLast week the Consumer Electronics Association released the results of a study (PDF) where they found that even though the number of US cable TV households is dropping, over-the-air (OTA) HDTV household reception isn’t increasing. In fact, it’s decreasing as well.

CEA’s opinion? Do away with OTA HDTV altogether, and sell off the bandwidth.

In other words, eliminate free television reception.

What?!?

The methodology of this survey wasn’t elaborately explained. Merely that it was a phone survey (cell and landline) of 1,256 adults conducted in December 2010. The question was:

“Please think about all the different TVs in your household and the ways in which you receive television programming, such as cable, satellite, fiber to the home or an antenna that may mount on your roof or an antenna that sits on or near the TV. Thinking of all the televisions that are in your home, which of the following describes how your household receives its television signals?”

CEA claims to have weighted the data to “reflect the known demographics of the population under study. In this survey, weights were applied to cases based on gender, age, race and geographic region,” according to Chris Ely, Manager of Industry Analysis. The margin of error was 2.8%.

I’m not going to go all Nate Silver on this survey, but it’s clear that CEA’s assumption is that because OTA reception is trending downwards, that eventually it will reach zero. We at HD Guru feel that this is a false premise. To assume that everyone in this country who owns a television can or wants to pay for television service is foolish. By CEA’s own numbers, 9 million households currently rely exclusively on OTA reception. In other words, CEA would eliminate the only way 9 million households currently get TV reception.

Incidentally, CEA’s study not only has lower numbers for how many people rely on OTA, but is also the only one that finds these numbers dropping. I, for one, would like to see the demographics of the sample base. For example, here is a study by Knowledge Networks that finds 14% of US households still use OTA as their main source of TV reception. Their breakdown of demographics makes for an even more interesting story, which we’ll get to in a moment. The National Association of Broadcasters (NAB), their own slant decidedly pro-broadcaster, has already begun trying to push back.

Why does “pro-business” have to be “anti-consumer?”

CEA’s agenda is biased towards their members, that’s to be expected. What is surprising is the significant pro-Republican tilt CEA has developed over recent years. Think we’re making that up? Here’s a quote about the Republican tech plan from CEA President Gary Shapiro.

“CEA applauds the Republican Technology Working Group’s 2011 Technology Priorities. Providing additional spectrum for wireless broadband, completing free trade agreements and increasing the number of highly skilled workers here on visas are common-sense measures that will provide an immediate boost to investment and the economy, and will create America jobs. The troubling economic news over the last few days underscores the urgency of these issues – we do not have time to waste. CEA urges Congress to place laser-like focus on this pro-innovation agenda to give the dynamic technology industry more tools to lift America out of our economic doldrums.”

Where we at HD Guru feel the need to make a fuss is when any agenda trends on the side of being anti-consumer, regardless of what party it stems from. Asinine falsehoods about one party being the party of “business” is best left to the mindless demagogues (IMHO both parties are in the pockets of big business).

“Over-the-air TV was once the defining distribution platform,” said Gary Shapiro, CEA president and CEO. “But using huge swaths of wireless spectrum to deliver TV to homes no longer makes economic sense. Congress should pass legislation to allow for incentive auctions so free market dynamics can find the best purposes for underused broadcast spectrum, such as wireless broadband.”

Let’s be clear here. Once this bandwidth is sold, it is gone forever. The government won’t be able to ask for it back if some future need arises. If over-the-air transmissions cease, the government won’t be able take the bandwidth back and restart them.

More Issues

Eliminating HDTV has other consequences as well. Let’s start with the most obvious first. Over-the-air HDTV is vastly superior in picture quality than what’s available to most consumers with cable and satellite. A recent (and arguably un-scientific) survey I conducted of 2,400 CNET visitors found that 35% of them are dissatisfied with the quality of their HD service . With the exception of FIOS, no service provider offers the picture quality potential of over-the-air broadcast.

That’s not to say all OTA stations offer superb picture quality, it’s just that it’s possible, if the station desires. It’s easy to see a situation where an MP3-like situation of “good enough” when it comes to HD, if the bandwidth is forcibly limited.

Without a benchmark for OTA quality, what’s to stop cable and satellite providers from further reducing their quality? If OTA is eliminated or minimized, what would that do to the broadcast stations in each market? Do these “free market dynamics” mean the end of local TV stations? How much local advertising revenue will they lose when they have a smaller potential audience?

And let’s not mince words, the people left out in this situation are the poor and elderly, both of whom are statistically much more likely to rely on OTA. Also, according to the Knowledge Networks study, a third of Spanish-language dominant households use OTA exclusively.

Whether you use OTA or not, do you feel spectrum should be sold off to private industry?

I look forward to your Republican talking point comments. Please cite sources or you’ll be deleted.

The CEA responds.

 

—Geoff Morrison and Gary Merson

– Follow Geoff on Twitter @TechWriterGeoff
Have a question for the HD Guru?
HD GURU|Email

Copyright ©2011 HD Guru Inc. All rights reserved. HDGURU is a registered trademark.

Tags:

14 Comments so far ↓

  • JAS

    Thank you HD Guru.

    I have read several petitions to the FCC submitted by the large MVPD’s (including telco’s) and their related lobbying groups pressuring the FCC to hand over the existing television broadcast spectrum to the ‘pay-to-play’ MVPD’s. So it comes as no surprise that a large lobbying entity such as the CEA is likewise pushing an agenda that is consistent with that of the influential service and content providers. I also suspect that MVPD’s, who in fairness are continually being pressured by content owners to pay higher and higher content acquisition costs, (i.e. “retrans” contracts,) are also attempting to ensure that any Mobile DTV system will be firmly under their control.

    Counter to the MVPD’s and their related lobbying groups, including the CEA, I continue to see consumers abandoning their costly pay television services, particularly amongst cable TV subscribers, in favor of high-reliability over-the-air broadcasting and free or low-cost TV and video content over IP – whether wired or wireless. At the very least as a means of cost control, it is extremely important that broadcast television be allowed to continue unabated for the good of consumers. I only hope that broadcasters fully understand the importance of their role in the new paradigm.
     

  • analyst1

    Here is some pyschology statement (babble) from the CEA:

    “American households are not cutting their pay television service. CEA research finds only one in ten households (10%)
    report they are either ―very likely‖ or ―likely‖ to cancel their pay television service. In addition, despite increasing options
    for viewing content, the television remains the standard CE device for most Americans. However, the growth of options
    for viewing television content – from televisions to computers to smartphones – will only help content providers expand
    viewership. ”

    The fact is that CEA does not wish to loose any percentile of their business. They are trying to feed us the 10 percent theory. What if it is 5 percent or 25 percent. Will they not try to save paid content?
    The general consensus over the internet is “Dump the Cable in favor of other options including OTA, HuluPlus, Netflix.

  • analyst1

    Many a times I ask myself who can you trust?

    Sometimes the answer falls on the lap, this time it is worded differently. CEA is a name that you can’t trust.

  • analyst1

    CEA is not fighting the battle for the consumer.

    CEA wants to preserve the rights of its members to charge the general public, so the public does not have a choice to choose between paid content and free content. If CEA members think that is their right to force mandatory billing, think about the right of the public to choose. CEA’s view are contentious and can be challenged.

  • analyst1

    Eliminate OTA and make Cable guy happy? Sure that what is happening these days for the Nations Health Care Plan. Opposing the mandatory plans are advocates of the so-called-right-to-choose. Time and again Mr Obama has announced if you want to keep your Medicare, you are at liberty to choose so.
    Both the cable guy and the profitable Insurance companies are on slippery slope.

    Any business lost is like a death in the family for them. The broadcast (Networks) are not afraid of Cable competition, it is the Cable guy fight to the death to preserve his clients. Why should the cable guy settle for a slice when he can have the whole cake.

  • Albert

    We can not do mobile internet with wires. Mobile internet has to take priority over being couch potatoes. TV isn’t good for us anyway. If you insist, download your video over the internet or get cable TV. Be glad that you CAN run a wire, and stop hogging a precious resource.

  • Nicolaus

    While the CEA study cited may be factual, their proposition that OTA TV could be sold off is untenable. This is because the U.S. radio spectrum (which includes TV) is regulated, not owned, by the federal government. Companies and individuals are granted use of these frequencies with the explicit intention that they provide a free and accessible service to the public.

    Even if they could formulate a plan to a sell off a public-owned trust, I don’t see how they could circumvent the mandate of the Emergency Alert System. It requires that the largest portions of specific states or areas have access to emergency information. Also, that the president be able to speak to a majority of the population within ten minutes of a nationwide problem. Clearly, this would not function without free television transmission.

    In this case the CEA has really stepped out of bounds by suggesting that their constituents might monetize one of the few things truly not-for-sale.

  • HiFiFun

    I use Windows Media Center 7 htpc as a server to record shows for every room in the house.
    Google, Apple, Samsung and Sony want to force us to watch advertising, just like they are with our cell phones.

    OTA offers true one-way anonymous viewing. Consumers retain root or administrator privledges to stop greedy corporations to forcing their control and households from losing their privacy. Someone will be combining all the Google data and then know selling everything about you. People need to fight this tracking. For example I turn my smart phones GPS off when I’m not using it.

    The CEA also fought energy standards on TVs. Damm idiots. They stand for republican, big business without the morals or ethics. Are they an agent of the devil selling off our constitutional right to privacy?

  • Joseph

    Hey I use OTA only due to money constraints. I got a HDTV and the picture quality of the 10 HD channels I have is miles ahead of my dish and cable friends. I hope this doesn’t go away, Im living on school loans and have a difficult enough time paying the internet bill. Even the bandwidth that houses my 25 other non-HD channels would be auctioned off.

    Personally, my big beef is that the US government made us buy converter-boxes about 5 years ago with the promise of free HD in the future. Now I have an HD TV and they are going to renege on their promise? Hardly fair.

    Im a free market guy. So I get it might be used more efficiently and so on. My issue with this is public access. If there is a natural disaster how are they going to inform us? Will we just have to have our radio on when it happens? Will I need to use the internet? TVs right now (granted this may change) are more likely to be on. Both me and my wife’s parents and remaining grandparents use OTA broadcasts, one with an HDTV and one with a converter-box. I feel that this kind of legislation would reduce this demographic to radio only for emergency broadcasts. Also FYI things like prisons, homeless shelters, and other low or fixed income populations use just OTA, not deeming public or charity dollars fit for dish and cable hands. If the OTA stuff is profitable off of commercials and not taking public money (PBS funding, whole different issue), throw all these groups a bone.

  • Chris

    Why is it that when I get my Google HDTV alerts, yours are the only ones I feel compelled to click on? Catchy headlines or insightful journalism about topics that matter? I think it’s the catchy headlines. Eliminating OTA HDTV spectrum is ridiculous as are the “trends” identified by this spurious survey. If over the air HDTV reception is decreasing, why are antenna manufacturers such as Antennas Direct seeing triple digit growth year over year? – http://www.bigpicturebigsound.com/HDTV-Antenna-Maker-Antennas-Direct-Enjoys-Triple-Digit-Growth-as-Americans-Cut-the-Cord.shtml – Americans are already nickled and dimed to death by monthly service fees. Don’t force us to also have to pay to watch TV.

  • James

    Why is the content on this site written fairly well, but on HDGURU3D it is just a mess?
    You need to sort out some issues with the 3D content section! It’s borderline ridiculous!
    Just thought you should know in case you haven’t seen it!

  • william garcia

    everyday I’m more surprised with the lack of common sense and inhumanity that rises like bubbles over us, eliminating over the air tv signal will be a direct hit to the hart of most elderly people and poor families that can’t afford cable, yes!!! there are many poor people in our great country…. over the air transmissions are the only way for them to know about the world and get emergency info, get this from them and you will leave them blind. Stop being stupid and profit from what you have, 80 % of the market, greed will destroy you, we will unite and we will win. If there is any politician reading I want to let you know that if you dare to take their side you will be spell from your cozy seat and personal budget forever because we will hunt you down, respect poeple and make this nation greater than it is.

  • Bob

    Why is anyone surprised here? The driving force is money for the few in the business (supported though lobbying efforts yet again), and rather than force the cable and other providers to make sure the very best signal is available as a part of a reasonably priced package and offering of channels the customer desires, the clear goal is to make it easier for providers to make huge profits.

    The customer is, of course, never right in any meaningful way nor is the interest from the government in anyone but business interests.

  • Dave

    You hit the nail precisely on the head when you said such a move will impact the poor and elderly. My 90 year old mother, on a fixed but comfortable income, in south Florida, gets plenty of over-the-air HD TV and loves it. She doesn’t want, need, or care to pay for cable TV. She’s happy with the current system. Noone asked her opinion and I presume noone asked millions of others like her.

Leave a Comment