Imagine paying $556 million for a house and
then the seller — after cashing your check — says you have to wait an
extra four months before you can move in. That's sort of like what is
happening to Qualcomm Inc. The San Diego-based company paid more than a
half-billion dollars in a government airwaves auction last year for the
right to use radio frequencies currently occupied by television
broadcasters.
Qualcomm was one of several dozen
bidders who paid a total of $19 billion in the auction. The
broadcasters are supposed to get off those channels no later than
February 17. And once they do, old fashioned televisions that get their
signal with an antenna won't work any longer.
But before
the bidders can take possession, the broadcasters have to move off. The
government wants to delay the move until June 12; the Senate voted to do so Monday.
Why?
The coupon program that is supposed to keep over-the-air television
viewers from losing their signal has run out of ready cash. The coupons
($40 each, maximum two per household) are being used to offset the cost
of converter boxes, which cost around fifty bucks. The boxes translate
digital signals to analog signals for people with non-digital sets that
use antennas for reception.
The $1.34 billion available for
coupons has been committed but not all of it has been spent. Only about
half the coupons that have been distributed have been redeemed. It
takes three months for unused coupons to expire and as they expire,
more funds become available for new coupons.
The National
Telecommunications and Information Administration, which runs the
program, started a waiting list on January 4. As of this writing, there
is a backlog of 2.5 million coupon requests.
Since those
people probably aren't going to get their coupons in time, it could add
up to a lot of angry phone calls on February 17. President Obama and
Congress have noticed. Obama made a delay all but inevitable when his
transition team penned a letter on January 8 to the Democratically
controlled Congress asking for one. (Because the transition date is
law, Congress has to pass a law to change it.)
While the
legislation now moves along in the House, getting the coupon program
running again is another story. That will take money, and at the
moment, the Obama administration's economic stimulus plan is the
favored vehicle. The plan calls for $650 million for the coupon
program. But the uncertainty over when the stimulus plan will pass is
also driving the delay.
Meanwhile, people and companies are
counting on getting those frequencies NOW. Qualcomm, for example, wants
to continue rolling out "MediaFLO," its mobile television service and
is ready to throw the switch on transmitters in several markets come
February 18.
Additionally, for the past year, the
government, the broadcast television industry, the cable television
industry and others have been telling viewers ad nauseum that February
17 is THE DAY. Even now, stations are running infomercials and screen
crawlers using that date. But if the government wasn't serious when it
said February 17, why should we believe it is serious about June 12?
And
making this public relations nightmare even worse is the fact that some
of those airwaves that will be vacated are designated for emergency
responders. It's one thing to delay the airing of an episode of "Knight
Rider" on a cell phone — it's something else to get a couple hundred
thousand firefighters mad at you.
Posted: 2/11/2009 12:00 AM
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