Order Code RS22217
Updated August 12, 2005
CRS Report for Congress
Received through the CRS Web
The Digital TV Transition: A Brief Overview
Lennard G. Kruger
Specialist in Science and Technology
Resources, Science, and Industry Division
Linda K. Moore
Analyst in Telecommunications and Technology Policy
Resources, Science, and Industry Division
Summary
Congressional policymakers are seeking a way to accelerate the nation’s transition
to digital television and to expedite the transfer of radio frequency channels from the
broadcast industry to public safety and commercial users no later than 2009.
Broadcasters are holding spectrum in the 700MHz band (channels 52-69) that they
would be required to relinquish after the transition to digital television (DTV) is
achieved. Without a hard deadline, the transition to digital television has been
postponed. Meanwhile, public safety officials want 700 MHz spectrum that has been
assigned to them, but not delivered, in order to build new interoperable networks, while
the commercial wireless industry would like access to the spectrum for new services.

The scope of a bill to clear spectrum and facilitate the transition to digital televison
is under discussion in the House and Senate. Although policymakers continue to discuss
different proposals for legislation, it appears that consensus has been reached on several
points. For example, there is general agreement to set a firm date for the clearing of 700
MHz spectrum; to use $4.8 billion of auction proceeds toward Congressional
commitments to reduce the budget deficit by 2010; and to take measures so that TV
viewers will not lose access to television programming. The steps needed to achieve the
latter remain a major point of disagreement, within and outside Congress. Because of
the intention to use spectrum funds to meet the Budget Resolution (H.Con.Res. 95),
many believe that the major points of a DTV transition act could be included as part of
the reconciliation process. Bills introduced that deal with the transition to digital
television and spectrum use include H.R. 1646 (Representative Harman), S. 1268
(Senator McCain), and S. 1600 (Senator Snowe). This report will be updated.

The transition to digital television has two major policy components. One set of
policy decisions is concerned with how best to move television broadcasters and their
viewers to digital technology. Other key policy issues deal with radio frequency spectrum
management and allocation. The public interest goals for these paths are not well aligned,
Congressional Research Service ˜ The Library of Congress

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presenting Congress with difficult choices to achieve its overall objective of completing
the transition. Briefly discussed below are key points about the transition process:
background, the impact on broadcasting, spectrum policy, and recent legislative activity.1
I. Background. The process of regulating the introduction of digital television
(DTV) technology extends over more than a decade.
! DTV is considered the most significant development in television
technology since color television because of features such as better
picture resolution and the more efficient use of spectrum. DTV also
allows a broadcaster to offer multiple programs (multicasting) or a single
program of high definition digital TV. The United States and countries
throughout the world are actively seeking to replace existing over-the-air
analog TV with DTV broadcasting.
! The Telecommunications Act of 1996 (P.L. 104-104) provided that
eligibility for DTV licenses should be limited initially to existing
broadcasters. Digital signals cannot be transmitted with existing analog
television technology. Therefore, broadcasters were issued additional
licenses for new, DTV broadcast channels while continuing to broadcast
on existing channels during the transition period. The old, analog licenses
were to be returned to the federal government after the transition to DTV.
! In the Balanced Budget Act of 1997 (P.L. 105-33), Congress set a
deadline of December 31, 2006 to complete the transition from analog to
digital television but allowed several exceptions that can extend that
deadline. The most critical exception is the establishment of a threshold
of 85% for the percentage of households, by market, that must be able to
receive digital signals before the licenses for analog broadcasts must be
relinquished.
! Given the slower-than-expected rate of adoption for DTV in American
homes, few believe that the goal of over-the-air digital television in 85%
of American households by 2006 will be reached. As a result — under
the Balanced Budget Act — television stations will be able to broadcast
both analog and digital signals indefinitely.
! Switching from analog to digital broadcast means that broadcasters will
begin to broadcast exclusively on channels assigned for digital use;
broadcasts in analog mode would be ended. Viewers with conventional
(not DTV) sets would lose over-the-air broadcast TV unless they either
installed a set-top converter box to convert digital signals to analog
formats, or subscribed to a cable or satellite service that can
accommodate both technologies.
1 Detailed information on these topics is available in CRS Report RL31260, Digital Televison:
An Overview, and CRS Report RL32622, Public Safety, Interoperability and the Transition to
Digital Television.

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! In the Intelligence Reform and Terrorism Prevention Act (P.L. 108-458),
Congress expressed its sense that 1) it must act in the first session of the
109th Congress to establish a comprehensive approach to the timely
return of spectrum held by the broadcasters and that 2) any delay in doing
this would delay planning by the public safety sector that is to receive
some of the spectrum for new communications systems. (Sec. 7501.)
! Spectrum released in the transition process that has not already been
allocated could, for example, be assigned for additional public safety use,
for licenses for advanced wireless services (auctionable for revenue to the
Treasury), or for unlicensed (free) use.
II. DTV and Broadcasting. Several studies, such as those mentioned below, have
indicated that only a small percentage of consumers have digital tuners and that many are
unaware of the impending transition. Much of the debate over the transition to DTV is
how to assure access to broadcast programs.
! According to the National Association of Broadcasters, there are
currently 280.5 million analog televisions in United States. Of these, 73
million rely on over-the-air broadcasting.2
! A key issue in the digital transition is that the millions of analog
televisions that rely on over-the-air broadcasts will no longer work once
the analog signal is turned off. According to a Government
Accountability Office survey, 19% of U.S. households (21 million) do
not subscribe to a cable or satellite service and rely exclusively on over-
the-air broadcasting. The GAO found that low-income, non-White, and
Hispanic households are more likely to rely on over-the-air television
broadcasting.3 The Federal Communications Commission (FCC)
estimates that 15% of TV households are exclusively over-the-air.4 The
Consumer Electronics Association (CEA) has estimated that less than
13% of TV households currently rely on over-the-air TV broadcasts.5
2 Comments of the National Association of Broadcasters and the Association for Maximum
Service Television, Inc., In the Matter of Over-The-Air Broadcast Television Viewers, FCC, MB
Docket No. 04-210, August 11, 2004.
3 See U.S. Government Accountability Office, Testimony before the Subcommittee on
Telecommunications and the Internet, Committee on Energy and Commerce, House of
Representatives, Digital Broadcast Television Transition: Estimated Cost of Supporting Set-Top
Boxes to Help Advance the DTV Transition, February 17, 2005. Available at
[http://www.gao.gov/.new.items/d05258t.pdf]. Viewed July 7, 2005
4 FCC, Annual Assessment of the Status of Competition in the Market for the Delivery of Video
Programming, Report FCC 05-13, MB Docket No. 04-227, released February 4, 2005.
5 Statement of Gary Shapiro, President and CEO, Consumer Electronics Association, before the
House Committee on Energy and Commerce, Subcommittee on Telecommunications and the
Internet, May 26, 2005. Available at [http://energycommerce.house.gov/108
/Hearings/05262005hearing1533/Shapiro.pdf]. Viewed July 9, 2005.

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! In June 2005, the Consumers Union and the Consumer Federation of
America issued a joint study6 that estimated that approximately 16
million households would lose all TV reception when analog signals are
cut off . Based on an estimate of a $50 price to purchase a converter box,
the report concluded that “the direct government-imposed costs on
consumers to preserve the usefulness of [analog television sets] would be
$3.5 billion or more.”
! The GAO estimated that the cost of assuring over-the-air broadcasting by
supplying converter boxes to households that only have analog television
could total from $460 million to $10.6 billion, depending on a number of
variables such as the cost of the boxes and the number of households
eligible to receive assistance.7 The GAO cost estimates do not include the
cost of implementing a subsidy program.
! Policy issues include whether some form of financial assistance
(subsidies or tax credits, for example) should be provided by the federal
government to enable over-the-air households to purchase converter
boxes or digital televisions; whether such assistance should go to low-
income households exclusively or to all households; whether subsidies,
if warranted, should be financed by proceeds garnered by auctioning the
analog spectrum; how much funding a subsidy program would require,
and how much revenue is likely to be raised by auctioning the
commercial portion of the reclaimed analog spectrum.
! Many cable households might wish to continue to use analog televisions
after the transition. Cable companies might offer converter boxes to
these customers. As an alternative, it is possible that cable providers
might seek authority from Congress to “downconvert” the digital signal
of selected local broadcast stations to analog format. To serve customers
with digital televisions, cable providers would continue to provide digital
signals as well (in other words, “dual carriage”). Under this scenario, a
key issue is whether (and how) Congress should mandate which local
broadcast stations would receive the benefit of “dual carriage” to cable
customers, and for how long. A related issue is whether cable systems
should be required to carry any or all digital multicasted channels
transmitted by commercial broadcasters.
! The National Association of Broadcasters has announced that it expects
“Congress will pass a DTV bill this year with a hard date for turning off
analog television with minimal consumer disruption. NAB's priority
6 Estimating Consumer Costs of a Federally-Mandated Digital TV Transition, Consumers Union
and Consumer Federation of America, June 29, 2005at [http://www.hearusnow.org/fileadmin
/sitecontent/DTV_Survey_Report-Final_6-29-05.pdf]. Viewed August 10, 2005.
7 GAO-05-258T, pp. 14-15.

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continues to be the prevention of cable companies from blocking
consumer access to local TV programming.”8
III. Spectrum Policy. The completed transition process will free up 60 MHz of
spectrum in addition to freeing spectrum already allocated for public safety or sold for
commercial use. Among the uses proposed for this 60 MHz are: to provide additional
spectrum for public safety use; to assign spectrum for unlicensed use; and to auction
licenses for the channels. Although the three uses are not mutually exclusive, it is
assumed that the spectrum will bring substantial sums from an auction and therefore less
spectrum to auction could mean lower proceeds from the auction.
! The Intelligence Reform and Terrorism Prevention Act requires the FCC
to prepare a study for Congress evaluating whether additional spectrum
should be made available for public safety and homeland security
wireless communications. (Sec. 7502, due December 2005.)
! Some of the channels to be vacated by broadcasters have been assigned
to public safety and some have been auctioned for advanced wireless
communications services. There is widespread interest in using the
remaining, unassigned channels for broadband wireless.
! Some of the companies that are interested in promoting wireless
broadband have created the High Tech DTV Coalition.9 Coalition
members have concluded that the release of spectrum at 700 MHz will
“spark growth in the U.S. high-tech sector,” especially the market for
advanced wireless services, a category that includes DTV broadcasting
to next-generation wireless phones and computers.10
! The authority of the FCC to hold spectrum auctions is currently set to
expire in September 2007. In Congress were to set a hard date for the
transfer of analog spectrum, it could also address an extension of the
FCC’s authority to auction this spectrum.
! Although estimates vary, spectrum auctions of frequencies in the 700
MHz band have typically been projected to gross $20 billion to $30
billion.11 Revenue potential is dependent on a number of factors,
8 “Statement,” NAB Newsroom press release, June 29, 2005 at [http://www.nab.org/newsroom
/pressrel/statements/062905_CU-CFA_Survey_Statement.htm]. Viewed July 6, 2005.
9 Members include Alcatel, Aloha Partners, AT&T, Dell, Cisco Systems, IBM, Intel, Microsoft,
Qualcomm, Texas Instruments and a number of associations. Source, Press Kit, High Tech DTV
Coalition, April 27, 2005.
10 “Analysis of an Accelerated Digital Television Transition,” prepared by the Analysis Group,
sponsored by Intel Corporation, May 31, 2005 at [http://www.itic.org/reports/DTV
%20Transition%20Report.pdf]. Viewed June 29, 2005. For a brief discussion of some of the
technologies, see CRS Report RS20993, Wireless Technology and Spectrum Demand: Advanced
Wireless Services.
11 “Analysis of an Accelerated Digital Television Transition,” page 6.

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including timing of auctions and the date at which spectrum will be
cleared and available. The Congressional Budget Office has reportedly
set a benchmark estimate of $10 billion in revenue from auction of this
spectrum.12
IV. Legislative Activity. Policymakers in the 109th Congress propose to allocate
$4.8 billion from 700 MHz auction funds toward meeting a Budget Resolution to reduce
the federal deficit by the end of FY2010.13 They would like to accomplish this in a
manner that maximizes the amount of 700 MHz spectrum available in a timely manner
while minimizing the cost and inconvenience to TV-viewers and the television industry
that might result from the transition.
! Beginning with the 107th Congress, Representative Jane Harman has
introduced the HERO Act in each Congress, this legislation would assure
the release of spectrum for public safety use (H.R. 1646, 109th
Congress).
! Senator John McCain has introduced the SAVE LIVES Act (S. 1268,
109th Congress) that would release all the encumbered spectrum and fund
subsidies to cover some of the costs of transition, among other
provisions.
! Representative Joe Barton (Chairman, Committee on Energy and
Commerce, House of Representatives) and Senator Ted Stevens
(Chairman, Committee on Commerce, Science, and Transportation,
Senate) are reportedly preparing bills covering the release of spectrum
and the transition to DTV.14
12 “Estimates Vary on Value of Spectrum,” by Drew Clark, Technology Daily, August 2, 2005.
13 For the House Committee on Energy and Commerce, the commitment could be
$14,734,000,000 for fiscal years 2006 through 2010; H. Con. Res 95, Concurrent Resolution on
the Budget for Fiscal Year 2006, Title II, Sec. 201 (a) (2) (C). Reportedly the House would use
$4.8 billion of spectrum auction revenue to help meet this goal, see, for example, “DTV Bill to
be Subsumed in Budget Bill,” Communications Daily, July 8, 2005.
14 “NAB Thwarting Return of Spectrum, McCain Says,” Communications Daily, June 15, 2005.

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