Bill Gates Predicts Broadcast TV will soon be made Irrelevant by Internet TV. Perhaps not; Cable and Satellite could get their first.
The most important statistic in assessing the value of a service is its usage by its target population. In the case of local television broadcasting that is of course the percentage of television households (TVHHs) that watch the service directly over-the-air (OTA). These homes fall into two categories. The first is TVHHs that depend entirely on the OTA service. They are referred to as OTA-only TVHHs. The other group, much less important from a commercial standpoint, is TVHHs that subscribe to cable or satellite service but have one or more TV sets that receive the OTA service.
From the time of the launch of the broadcasters' $12bn DTV service back in November, 1998 to today, the percentage of OTA-only homes has fallen from 30% to 10%!
With analog TV broadcasting scheduled to end Feb. 17, 2009 and over ten million OTA-only homes yet to establish a reception capability for the replacement DTV service of who greater than 50% will encounter DTV reception difficulties.
The percentage of TVHHs that rely exclusively on the OTA service could be as low as 5% after the broadcasters complete their transition to DTV seven months from now, making the OTA service and thus the local TV broadcasters "irrelevant" without waiting for Internet TV!
TV dealers, at least in the Washington, D.C. area have not helped the cause! They generally regard the upgrading of the broadcasters' OTA service to digital as a wasteful investment in yesterday's TV delivery service in this the cable/satellite dominant age.
I found no TV dealer, large or small, that would or could demonstrate the OTA DTV service!
The big three TV dealerships, Best Buy, Circuit City and Radio Shack evidently have exclusive deals, two with the two satellite TV companies and one with the local cable TV company that contractually prohibits them from demonstrating the broadcasters' OTA DTV service. Their salesmen, as one would expect in such circumstances, know little and care less about the OTA DTV service.
Congress, the FCC, nor and the broadcasters' lobbyists, all based in Washington, D.C., appear to be unaware or uncaring of this alarming state of affairs.
The TV industry does not in any forum acknowledged the evaporation of OTA-only TVHHs.
The FCC report, published in February of every year for the past twelve years that reliably indicates the percentage of OTA-only TVHHs as compared to cable and satellite homes was not promulgated this year!
The last National Association of Broadcasters (NAB) convention before the broadcasters turn-off their analog OTA TV service held in April of this year had numerous panel discussions on matters of concern to their members but not one on the implications of a disappearing OTA-only viewership.
Almost $20bn was successfully bid in the auction this year for the 80 Mhz of spectrum the broadcasters will vacate when they transition to DTV. What is the remaining 300 Mhz worth?
Might the FCC decide to end the OTA service at 5% OTA-only coverage and thereby generate a huge sum for the government coffers through a second spectrum auction?
The cost/benefit to the broadcasters of providing the OTA service continues to drop. Would they support the termination of the service under the right terms?
The net effect of the above would be the end of OTA broadcasting without any help from Internet TV.
Why anyone would want to buy a TV station today is puzzling. But then, they may have heard of FreeDTVPlustm
FreeDTVPlustm is the only viable business platform if local broadcast TV is to survive and broadcasters are to remain as broadcasters in the coming Internet TV age.
A critical key to the success of FreeDTVPlustm is that it must enjoy the overwhelming endorsement of the broadcasters in the first instance and the encouragement of the FCC, Congress and others subsequently.
Secondly, it must incorporate the Internet in order to prevent being succumbed by it as cable and satellite service in their current forms most surely will!
Some of the major features of the FreeDTVPlustm concept are as follows:
o FreeDTVPlustm would provide the broadcasters with a unique opportunity to control the Internet's inevitable encroachment into television rather than being supplanted by it.
o FreeDTVPlustm would enable the local broadcasters to deliver Internet and other interactive services through the local broadcasters directly to proprietary home DTV sets.
o FreeDTVPlustm would deliver Internet and other interactive services furnished through the local broadcasters directly to proprietary home DTV sets.
o FreeDTVPlustm by the uniqueness of its architecture would no longer be threatened with extinction by cable and satellite.
o FreeDTVPlustm would benefit from the fact that the local TV broadcasters would still provide the only free national and local TV programming service.
o FreeDTVPlustm would secure the cooperation of the consumer electronics industry in the, manufacture and marketing of FreeDTVPlustm service-specific DTV sets.
o FreeDTVPlustm Inc., would be a single purpose organization, charged by the broadcasters to create and maintain a broadcaster-centric nationwide multi-faceted DTV service platform that would survive and thrive in the Internet TV age.
The TV broadcasters really have no future as broadcasters lacking the adoption of the FreeDTVPlustm business concept outlined above.
