Path: bloom-picayune.mit.edu!snorkelwacker.mit.edu!americast.com!americast.com!americast-post Newsgroups: americast.twt.news From: americast-post@AmeriCast.Com Organization: American Cybercasting Approved: americast-post@AmeriCast.com Subject: Costly clarity Date: Sun, 8 Nov 92 15:50:37 EST Message-ID: \SE A;MONEY \HD Costly clarity \SH HIGH PRICE OF HIGH-DEFINITION TV COULD TURN OFF CONSUMERS \BY Kent Gibbons \CR THE WASHINGTON TIMES Dick Williams sees the future clearly, and it is expensive. As general manager of WDCA-TV, Channel 20, he is looking at a $3 million to $5 million outlay in the next several years on a technological gamble. It may be more expensive than that. He's nervous. The gamble is called high-definition television, or HDTV. When it arrives in the United States, possibly in 1995, it will bring a picture much clearer than that of conventional television and audio that sounds like a compact disc. The risk to Mr. Williams and station owner Paramount Communications will come in spending millions of dollars on equipment to produce and transmit programs that can be picked up by HDTV but not by the more than 90 million conventional TV sets now in homes. Some TV station owners think they've found a way to hedge that risk. After introducing HDTV programming, they want to expand regular television programming to emulate cable television but without the monthly bills. Another option is putting radio frequencies now used for regular television to a different use - possibly transmitting sports scores or stock updates to home computers or competing against existing companies for cellular telephone service. The increased revenue from advertising or service fees, the station owners believe, would defray the startup costs for HDTV programming. HDTV sets haven't jumped off store shelves in Japan, where the price has dropped from $30,000 to $8,000 and HDTV programming is on the air eight hours a day. The sets were barely visible at last month's electronics show in Osaka. U.S. HDTV sets are expected to start out costing $3,000 to $5,000, but many broadcasters aren't sure they'll catch on here any faster. Mr. Williams' doubts come partly from personal experience. At a trade conference, he saw a demonstration of HDTV next to standard television, known as NTSC for the National Television Standards Committee, which adopted it in 1941. "I'm in the business, and unless I was told to look at the lines of resolution and the dots, I couldn't tell the difference," he said. "Is it pretty? Does it pop out at you? Yeah," he said. "But who's to say we couldn't take the technology we have now and make it pop out too? Not as much as that, maybe, but enough so that you might not really tell the difference." No one knows how long it will take for HDTV to catch on in a big way. Looking for precedents, some point to the introduction of color television in the 1950s. It took more than 12 years for color to reach 10 percent of American homes. The nation's viewers were content to watch Jackie Gleason, Ed Sullivan and Perry Mason in black and white rather than pay hundreds of dollars for sets while color programs were gradually coming on the air. Dale Cripps, editor of the HDTV Newsletter in Portland, Ore., said the jump in price to HDTV sets should be about the same as the increase consumers faced with the first color sets. Those sets cost about $400 wholesale in 1954, according to the Electronic Industries Association, compared with $140 for a black-and-white set. In today's dollars, the cost of those color models would be about $1,600. "But there's a big difference," Mr. Cripps said. "The first color sets were not all that good. They were pretty iffy. HDTV's going to be absolutely outstanding the day it hits the showroom." Even boosters say HDTV sets will be expensive for years. "The challenge is, can the price get below $2,000 by the year 2000," said Robert Rast, head of HDTV development for General Instrument Corp. of San Diego, which makes cable TV converters and satellite communications equipment. To penetrate 10 percent of the 92 million American homes, the sets probably will have to cost less than $1,000, he said. That won't happen until the next century, he said. Broadcasters look at such forecasts and cringe. With only a few viewers, there's no financial incentive to spend the money to make HDTV a reality. Enter the plan to use part of the public airwaves to offset the costs of starting HDTV programming by competing with cable television. "What they [broadcasters] really want is choice, to fill the insatiable need for programming," said David Bross, editor of HDTV Report, a newsletter published in Potomac. Today, each TV station transmits programs into a six-megahertz slice of the radio ether. Those slices are the TV channels. The way the Federal Communications Commission wants to introduce HDTV is by adding a second channel to match each of the 1,699 channels now in existence around the country. Owners of current stations would qualify for one new channel for each channel they own. The catch is that the second channel has to be used for "advanced television." The FCC wants broadcasters to transmit the same programming in current television on one channel and in HDTV on the other. Broadcasters will have to begin transmitting HDTV signals within six years of getting the extra channels. They must completely change over to HDTV within 15 years. Eventually, when consumers abandon the older TV form, the extra channel must be returned to the government. The broadcasters depart from the FCC's concept by suggesting that they should be allowed to offer different programming on the regular TV and HDTV channels. Some are calling it "multichannel TV." They would offer their cable alternative to regular TV viewers, broadcasting several programs at the same time in their space on the airwaves. Through a technical innovation called digital compression, stations can broadcast more than one program in the space assigned for a single channel. TV images and sounds are translated into the computerized language of ones and zeroes, and those bits of data are squeezed together. HDTV needs data compression because the higher-quality picture requires a lot of information. But the same techniques can be used to pack the equivalent of four or more current programs into the airwaves that today carry a single channel. One firm says its process would fit 16 current programs into a single channel, said Michael Schwartz of Cable Television Laboratories Inc., a testing site in Boulder, Colo. Expanding the programming on regular television would create new vehicles for advertising revenues to recover cash paid for the new antennas, cameras, videotape recorders and other equipment needed for HDTV. So far, the idea of using the older channels differently is just a notion floated by the broadcasters' trade group, the National Association of Broadcasters. No formal request has been made with the FCC. John Abel, the NAB's executive vice president for operations, said the multichannel system would have two big advantages over cable: * Multichannel broadcast television would be a cheaper way to get extra channels, although some channels carry pay-per-view services in addition to free programs. * Multichannel would be wireless and thus could be viewed on portable sets outside the home. Mr. Abel envisions all-sports channels for fans at football games. Consumers could use the freed airwaves to call up selected stock prices or sports scores on home computers or to make cellular phone calls, he said. Creating multichannel programming would not be easy. The signals would have to be compressed and transmitted, then converted into conventional television in the home. That would require a new set or a decoder "black box," similar to what many cable subscribers use. Mr. Abel said some manufacturers have estimated the black box would cost about $50. No one has tested the system, and no one knows whether consumers would prefer it to cable. "There's nothing available for broadcasters to experiment with," Mr. Rast of General Instrument said. And would there be enough quality programming to fill the channels and draw advertisers? "Could you in a sense create more viewers by having more variety?" Mr. Cripps said. "[Broadcasters] don't have an answer; they don't have any way to gain an answer. They don't have any programming at this point at a low enough cost to even experiment with it." But few doubt that HDTV will become a reality. "We will do it, and we will do it partly for competition because our cable friends will have this right alongside or, in some places, ahead of us," said Mr. Williams of Channel 20. "And stations in markets this size can probably grudgingly afford to do this." That's because there is enough advertising revenue in an area the size of Washington, but that might not be the case in many smaller markets, he said. Broadcasters have won a little breathing room, easing their concerns a bit over the HDTV gamble. In September, the FCC gave station owners six years, up from five, to begin transmitting HDTV signals after the commission picks an HDTV standard and assigns extra channels. The broadcasters want more flexibility, including their multichannel plan. But industry analysts think the government will not be overly rigid in pushing HDTV. The FCC said it will periodically review the rules it sets for the HDTV conversion. Analysts and industry watchers say that means the government will let stations take longer to change over if HDTV doesn't catch on quickly. "My guess is that regulators are going to be accommodating as better information becomes available," Mr. Rast said. "I don't think the poor broadcasters are going to be victimized if HDTV's a dud." This article is copyright 1992 The Washington Times. Redistribution to other sites is not permitted except by arrangement with American Cybercasting Corporation. For more information, send-email to usa@AmeriCast.COM