Defining Visions: So Much for Innovation

When the FCC voted to allow cable companies to drop some digital channels, it also struck a blow against creative competition.

In his final days as chairman of the Federal Communications Commission, Michael Powell led a vote that struck a blow against innovative use of digital television. Despite numerous pleas from even his Republican colleagues in government, he pushed the commission to vote on–and defeat–a request from broadcasters to require cable operators to carry all of their digital programming.

From the earliest days of the transition to digital TV, broadcasters have searched for ways to make money from the use of their digital channels–profits to help offset the significant expense of buying a raft of new digital equipment and, in some cases, even a new tower for the digital channel's transmitting antenna.

In Washington, DC, where I live, at least three stations have been experimenting with multicasting–dividing a 6MHz channel into four or more standard-definition channels carrying separate content instead of airing one high-definition channel. Some of these additional channels have carried news or educational programming, some have offered home shopping and other programming I have not seen. (To be honest I seldom have time to look.)

In any case, the broadcasters have for years asked the FCC to require cable operators to carry all of their digital programming, no matter how they chose to divide the channel. The logic behind this is two-fold. First, no matter how many program streams a station chooses to air, the total bandwidth consumed can never exceed 6MHz–the space allotted to each TV station, the space a cable operator is required to carry.

Second, almost three-quarters of the nation's TV viewers receive their local TV stations from a cable system. If a TV station offers five programming streams, and four of them are not available to 75 percent of its viewers, how long will the station continue multicasting? Not long, obviously.

Four years ago, the FCC voted to deny the broadcasters' request for digital "must-carry" for all the channels a TV station offers. At that time, however, the commission said the decision was tentative, given that multicasting was in an early, experimental stage.

This time, Powell is only a few weeks away from leaving his job. True, the FCC has five commissioners, and the chairman has only one vote. But at the commission, the chairman has extraordinary power. For example, he sets the agenda for each meeting. So he can hold an item off the agenda until he knows he has the votes for the outcome he wants.

As he seemed intent on pushing this item forward in his final days, even Senator Ted Stevens, the Alaska Republican who chairs the Commerce Committee (which oversees the FCC), urged him to hold off the vote. A staff member said the senator believes there is a lot of interest in the varied programming broadcasters offer on their multiple channels. Stevens' was just one of many, varied voices calling for a delay until the new chairman comes in.

The National Association of Broadcasters, of course, lobbied heavily for approval of the must-carry rule. Industry heavyweights met with each of the commissioners in early February and afterward put together a carefully worded statement saying they believed these commissioners "appreciate" that allowing cable operators to strip away multicast services will "thwart or cripple the launch of competitive services." The broadcasters also asserted that some of the commission members were not happy about pushing for a vote now.

In a public letter, the NAB, never known for understatement, said: "Multicasting will be stillborn, and the FCC will have resigned over-the-air television viewers to single-stream television viewing, despite the capabilities of new DTV technology."

Nonetheless, when the issue came up for a vote in mid-February, four out of the five commissioners voted to refuse digital must-carry. Powell said he believed carriage of digital channels should be the subject of business negotiations, not government mandate. And a few weeks ago, the cable industry did come to an agreement with public television to carry their multicast programming, which is non-commercial and usually educational.

The cable industry celebrated the FCC vote. Robert Sachs, the outgoing head of the National Cable & Telecommunications Association, cooed with contentment and then boasted that cable operators across the country, on their own initiative, were already carrying about 500 digital channels. Broadcasters countered by saying the boast rang hollow because cable operators were actually carrying fewer than one-third of the available digital stations– 1,356 digital channels are now on the air.

"In Washington," said NAB President Eddie Fritts, "there are no final victories and no final defeats. NAB will be working to overturn today's anti-consumer FCC decision in both the courts and the Congress. We look forward to the fight."

They may find a sympathetic ear in Congress because this question is tied to another one before the FCC and the Congress: When will the digital transition end? The broadcasters have said they would agree to an early end to the transition if they could be assured that all of their digital channels would be carried by cable.

Congress remains determined to end the transition soon. At the same time, it is vulnerable to lobbying from the broadcasters. Congress is unlikely to change the date for the end of the transition if the broadcasters are dead-set against it. So I can foresee some sort of trade: A hard and fast end to analog broadcasting, in exchange for a comprehensive, Congressionally mandated must-carry rule.