Copyright 2002 Gannett Company, Inc.
TV makers and cable companies have tentatively reached a landmark agreement aimed at kick-starting the tepid rollout of digital high-definition TV (HDTV) — and eventually eliminating the need for cable set-top boxes, say people close to the matter.
The deal sets national standards that will let TV makers embed cable-box technology in new sets. Digital TVs will then be able to receive HDTV signals via cable — they generally cannot today — which is how 72 million of the 105 million U.S. TV households get programming. And the TVs could receive digital-cable service without the now-required digital set-top box.
The overall effect would be to remove most of the hurdles, and extra equipment, involved in making full use of an HDTV set and in receiving digital-TV programming of all kinds via cable.
"This would address the last hurdle in the digital TV (transition)," says Dave Arland of TV maker Thomson.
The deal, five years in the making, is expected to go this month to the Federal Communications Commission, which must pass rules to implement it. A three-year phase-in starting in 2004 is expected.
Only 4.8 million households have digital TVs, and most of those don't even have digital-broadcast tuners to receive HDTV signals over the airwaves. Customers use the sets to watch DVDs. Nearly half the USA's 1,300 TV stations beam at least some prime-time shows in crystal-clear HDTV.
The FCC in August required TV makers to start putting digital-broadcast tuners in all new TVs between 2004 and 2007. TV makers resisted at the time, saying it would boost the price of TVs and be of little use because most homes get their TV via cable.
This deal addresses that. Today, the few digital-cable systems that transmit HDTV use analog links to hook set-top boxes to digital TVs, preventing consumers from getting the full benefit of the higher-grade pictures. Some cable systems supply special HDTV set-top boxes at about $10 a month, but few consumers order them.
The pact sets standards ensuring that all cable systems can send HDTV signals and all digital TVs can receive them.
"We want a retailer to be able to say, 'Yes, your HDTV set is cable-ready,' " Arland says.
Digital-cable systems already have committed to showing at least five channels in HDTV next year. And all cable systems are expected to convert to digital.
The agreement helps ensure that 85 percent of consumers will get digital TV by 2006. An added benefit: The digital pact sets standards to permit TV makers to build technology into sets so cable subscribers can get premium channels. Customers who move would simply plug their new cable system's security card into the TV.
To get the digital deal, cable firms gave up demands that new TVs be certified by their researchers, a move that would have slowed product delivery, Communications Daily says. They also compromised on proposals to limit home recording of digital programs.