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FCC May Block Some Moves to Digital TV Before June (Update2)

By Todd Shields

Feb. 11 (Bloomberg) -- U.S. regulators may block some television stations seeking to switch to exclusively digital broadcasts next week because many viewers aren’t ready, the head of the Federal Communications Commission said.

“We’re going to have to consider some prohibitions,” Michael Copps, acting chairman of the agency, told reporters in Washington today.

The agency yesterday said 39 percent of major TV stations intend to abandon traditional analog signals by Feb. 17, the deadline that Congress set three years ago and relaxed in a vote last week. Today President Barack Obama signed the legislation, which lets stations continue analog service until June 12.

The law “ensures that our citizens will have more time to prepare for the conversion,” Obama said in a statement. “Millions of Americans, including those in our most vulnerable communities, would have been left in the dark if the conversion had gone on as planned.”

More than 5.8 million households, or 5.1 percent of all homes, can’t receive digital signals, the Nielsen Co. said on Feb. 5. Viewers with analog TV sets connected to antennas need to attach digital equipment to make sure they continue to get pictures once stations make the switch.

In 17 television markets serving 2.3 million households, all stations have said they want to cut analog service next week, according to FCC figures released today. If the FCC grants all the requests it has received, viewers in 34 markets serving 7.4 million households would be left with no analog service from the four major TV networks, according to the agency.

Dislocation and Confusion

“Dislocation and confusion are coming on Feb. 17th and 18th,” Copps said. He said regulators would devote “special scrutiny” to broadcasters in markets where many TV stations intend to abandon analog signals next week.

“They’re going to have to have truly compelling reasons,” Copps said.

Large markets will still have analog signals because the four major networks -- ABC, CBS, Fox and NBC -- are maintaining digital and analog signals through June 12 on stations they own, Copps said.

Stations cutting service are balancing the cost of providing analog signals against the risk of losing audience, said David Donovan, president of the Washington-based Association for Maximum Service Television, a broadcast industry trade association for technology issues.

“It’s not that they want to: They simply have no choice,” Donovan said in an interview.

He said stations can spend $3,500 to $30,000 monthly on electricity to keep analog transmitters running.

Holding Down Costs

“They want to save money,” Marci Ryvicker, a New York- based analyst for Wachovia Capital Markets LLC, said in an interview. “By switching to all digital and shutting off analog, their costs should go down.”

Congress voted Feb. 4 to extend the deadline to June 12 to give viewers more time to get ready.

An estimated 2.15 million households are on a waiting list for $40 subsidy coupons to help buy converter boxes that translate digital signals for analog TV sets, the government program that issues the coupons said today.

To contact the reporter on this story: Todd Shields in Washington at tshields3@bloomberg.net

Last Updated: February 11, 2009 17:36 EST

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