The New Dynamics of Retransmission Fees? . . . HD News is future Existence Insurance

Retransmission fees are forecast to rapidly grow from $1.4 billion in 2011 to an estimated $3.6 billion in 2017, with full service HD News/ENG TV stations poised to getting the lion’s share.

The FCC rules that regulate retransmission agreements were established following the passing of the Cable Act of 1992 (long name: Cable Television Consumer Protection and Competition Act). The Cable Act gave local broadcasters two options to be carried on cable TV (now MVPD Multichannel Video Program Distributor): (1) elect to negotiate with cable operators and give retransmission consent to carry signals for a negotiated fee, or (2) elect to be covered under must-carry provisions without receiving any compensation. TV broadcasters are required to choose one option in “elections” every three years. Over the last nearly twenty years, market developments have tilted bargaining power to the advantage of the major TV networks for compensation, which in 2012 will receive more than 50% of the total retransmission compensation pie through their O&O stations.

But, what will really happen to Retransmission Fees by 2017?

If the Congress passes legislation to allow the FCC DTV Spectrum Grab and Auction to go ahead based on voluntary “spectrum sell-back” by some TV broadcasters, the “selling” broadcasters will no longer be OTA and thus no longer be broadcasters entitled to retransmission fees. Of course, as a part of the “Spectrum Grab and Auction” process, the FCC will be required to materially modify its rules now based upon the Cable Act of 1992, which may (or may not) guarantee the “selling-going-out-of-OTA-business” broadcasters must-carry rights on MVPDs, at least for a limited period of time.

A Relationship between Local HD News and higher Retransmission Fees?

Can we make a credible showing that a TV station delivering “full service” HD news achieves substantially higher retransmission consent revenues than a TV station with no local news or content? The Author says yes.

Let’s look at ION Media Networks, the largest U.S. TV network in terms of TV stations owned (60) and in reach of TV households OTA (65%)

ION Media owns/operates the largest group of broadcast television stations (60) in the United States, including full power stations in all Top-20 DMAs and in 37 of the Top-50 DMAs. These stations are operated as a nationwide integrated programming network known as “ION Television”. The network’s programming lineup consists mainly of syndicated TV series, feature films and a limited amount of other entertainment and sports programming. The stations also broadcast so-called infomercials. Revenue is derived from these infomercials and from commercial advertising sales. All 60 full power TV stations each provide one HD channel as OTA primary, plus two additional simulcast channels. ION’s business model does NOT seem to include traditional newscasts or other local content delivery.

The Author lives in Los Angeles where he is served by Time Warner Cable (TWC), and ION KPXN-DTV Ch.38 is carried on the TWC HD Tier as Ch.410, with the SD/analog version on Ch.21. The two OTA simulcast sub-channels (Qubo and ION Life) are not carried on TWC, as such is not required by any FCC regulation. ION is currently not a publicly traded company, thus operational financial details are not made public such as retransmission fees collected if any. But for the last year public information was available (2007, before ION became a private entity), ION annual revenues were about $230 million. Retransmission income was not found in the 2007 SEC filing. Following the 2008/2009/2010 recession, if ION’s 2011 revenues will come in around $300 million, that will be an average of $5 million for each of 60 TV stations.

What about the Big 4 O&O Stations?
As a comparison, the 28 CBS O&O stations are expected to produce 2011 revenues exceeding $1.6 billion, or $57 million average for each station, including each station receiving an average of nearly $9 million in retransmission fees. (CBS O&Os are detailed below.) These are really the two extremes, where we can easily see the difference in revenue potential between a major TV network O&O “full service” news station and a “no-news, no-local-content, no-Big 4 affiliates” syndication-mostly station.

And the Group owned affiliated TV stations?
In between these two extremes are the major Group TV Station Owners and their major network affiliate stations with nearly all stations delivering “full service” local newscasts. One such “typical” major pure-play group owner is publicly listed Belo Corporation, with 20 full power TV stations of which 9 are in the Top-25. Belo reported revenues of nearly $700 million in 2010, averaging around $35 million per station. Belo received about $50 million in retransmission fees in 2010 or $2.5 million average per station.

Look at above chart. The BLUE column shows major pure-play Group owners with the large majority of their TV station properties in the Top-50 DMAs, with all stations being “full service” news outlets and Big 4 Network affiliates. The difference between Big 4 Network O&O stations (RED column) higher average (~$50 million) and Group station average (~$30 million) is that many of the Big 4 O&O stations are in the Top-10 DMAs (and very few are in lower than the Top-30), which increases the average revenue number significantly. The average independent TV station (ORANGE column) in the Top-50 DMAs, without news and without any Big 4 affiliation, seems to be in the average annual revenue range of $5 million.

HD News = Higher Ratings = Higher Retransmission Fees
The amount of retransmission compensation follows the overall ratings and DMA ranking, with Big 4 Network O&Os leading with average retrans fees of about $8 million per station (16% of total average revenues), followed by the Group owned Big 4 affiliated stations with an average of $2.5 million (8% of total revenues), while retrans fees for Group owned stations without newscasts and without Big 4 affiliation seemingly fall far behind with insignificant retrains fees in comparison to “full service” HD news stations in the same DMAs. The actual numbers for such “no-news” stations are much more difficult to ascertain as detailed financial data is often not published, such as is the case with privately held ION Media. The Author speculates that a number of such stations elect must-carry rather than retransmission consent, as the station may not carry much weight in negotiating for retrans fees.

CBS O&Os expect receiving $250 million in 2012. . . just in Retransmission Fees

If the industry forecasts are right, the straight line growth year-on-year on the above graph forecasts total retransmission fees of $1.8 billion for 2012.

CBS announced earlier this year that their TV Station Group expects to receive at least $250 million in 2012 in retransmission fees from cable, satellite and telco TV service providers (MVPDs). CBS’ TV Station Group comprises 28 O&O TV stations, making the average of fees received about $9 million per TV station (forecast for 2012). This looks very good. Let’s look at more CBS detail:

CBS Television Stations include sixteen (16) that are part of the CBS Television Network, eight (8) affiliates of The CW Network, three (3) independent stations and one (1) MyNetworkTV affiliate. Major market “full service news stations” are WCBS-TV (New York), KCBS-TV and KCAL-TV (Los Angeles), WBBM-TV (Chicago), KYW-TV and WPSG-TV (Philadelphia), KTVT-TV and KTXA-TV (Dallas-Ft. Worth), KPIX-TV and KBCW-TV (San Francisco), WBZ-TV and WSBK-TV (Boston), WUPA-TV (Atlanta), WWJ-TV and WKBD-TV (Detroit), KSTW-TV (Seattle), WTOG-TV (Tampa-St. Petersburg), WCCO-TV (Minneapolis, and Minnesota satellite stations KCCO-TV and KCCW-TV), KCNC-TV (Denver), WFOR-TV and WBFS-TV (Miami), KOVR-TV and KMAX-TV (Sacramento), KDKA-TV and WPCW-TV (Pittsburgh) and WJZ-TV (Baltimore).

The Author has no reliable data as to the breakdown of fees to be received by each TV station, as retransmission agreements are generally confidential. But one can assume that the New York City flagship station WCBS receives by far the largest amount of retransmission compensation. The New York DMA counts some 7.5 million TV households of which more than 6 million are cable, satellite or telco TV subscribers. At an average monthly MVPD (Multichannel Video Program Distributor) subscription price of $90 ($1,080 per year), the total annual MVPD TV subscription take in the NY DMA is over $6 billion (of course excluding broadband and IP telephone revenues). At $0.60 retransmission fee per month per (full paying) subscriber, WCBS may take in an annual whopping $40+ million in 2012 just in retransmission fees. This one WCBS flagship station may be responsible for more than 16% of the total $250 million retransmission revenues expected by CBS in 2012. In Pittsburgh (DMA #24), the smallest market for a CBS O&O “full service news station” (KDKA), with about 1.2 million TV households of which about 1 million are MVPD subscribers, the same computation produces annual 2012 retransmission fees of about $7 million.

The 100 or so Big 4 O&O TV Stations receive about 50% of all Retransmission Fees

We have looked at CBS, which has been very vocal about the need to substantially increase retransmission fees. So has FOX. The total number of the O&Os operated by the Big 4 TV networks is about 100 TV stations. ABC, FOX and NBC will each approach the 2012 $250 million to be achieved by CBS, thus the Big 4 will together receive an estimated $900 million or 50% of the total forecast $1.8 billion in retransmission fees to be paid by the MVPDs in 2012.

Industry experts estimate that as much as 70% of the total pie will go to TV stations located in the Top-30 DMAs, mostly to “full service” HD news stations, leaving only about $500 million to be shared by many hundreds of TV stations around the country. PBS stations do not generally ask for retransmission compensation, as they are non-profit, funded by government appropriations and private grants and donations.

Fighting for Retransmission Dollars: HD News & Live HD ENG build audience and market leadership

We establish above that the local TV station consistently leading in the local DMA audience race is in the best position to negotiate for the most in retransmission compensation, whether directly with local MVPDs or through its Group Station Owner negotiating with national or regional MVPDs. The three (3) primary areas where TV stations may increase audience share are:

  • Deliver network programming with higher audience appeal, which is NOT under the control of the TV station or the Group Station Owner (but is a function of network affiliation)
  • Deliver syndication programming with higher audience appeal, which is often controlled by its Group Station Owner making package syndication deals covering all of its TV station properties
  • Deliver local news, weather, sports and traffic with higher audience appeal, which is materially a function of local TV station control and operations

Delivering highly attractive local content, in the form of news, weather, sports and traffic, is the only primary activity available to (and fully controlled by) the local TV station which may substantially improve audience share. And the HD News set and live HD ENG capabilities make up the foundation for a successful local news operation. The local station executive team will no doubt score high marks at the Group Station Owner’s HQ when achieving a substantial and lasting rating boost through a clever implementation (or expansion) of HD news, enabling the Group Station Owner to demand higher retransmission fees.

HD News & Live HD ENG promote network and syndication shows . . . and feed the website !

Local TV stations’ promotional efforts of its network, syndication, local program and website content are greatly aided by successful HD News activities, with an opportunity to create a positive circle of audience awareness and support.

Can you imagine a local TV station’s website without local news, weather and traffic? The local competitive advantage is obvious, as, without news, weather and traffic, the website becomes just a TV program guide but only for its own channel. And the future revenue growth potential of a successful local TV station website is an important consideration in the longer term, together with the stronger retransmission compensation position of a full service TV station. HD News and live HD ENG is really a competitive and financial necessity.

(HD) News REVIVAL at TV Stations: HD Studio Cameras and HD News Camcorders are now highly cost effective

After the difficult years of 2009 and 2010, TV broadcasters are bullish on local news again, fueled by (a) the realization that a TV station without significant local content may not be relevant in a few years as most prime time and syndie shows may be available directly to homes through the OTT/ internet, and (b) the potential local revenue gains establishing or expanding local news shows a very attractive ROI now that the cost of HD news facilities have dropped substantially, in terms of both equipment acquisition and operations. From major markets like New York to smaller markets like Boise, TV stations are expanding local news efforts. Nearly all major market news stations have already converted to local HD studio and most of those have transitioned to live HD ENG. But, overall, below the Top-25 markets, there are hundreds of news stations in process of transitioning or planning to go HD in 2012.

JVC is the 2010/2011 market leader in HD ENG camcorders and HD studio cameras in terms of quantities of products delivered to a record number of TV stations across the U.S. JVC has concentrated its ProHD professional camera line to be cost effective yet entirely professional, in one family of products suitable for HD studio, HD ENG/EFP and HD Hyperlocal. In addition, its compressed streaming output, widely available file-based work flow and instant editing capabilities have propelled ProHD to be the most implemented HD News and HD ENG format among Group Station Owners over the past several years.

Fast Forward to 2017:
New dynamics for Retransmission Fees?

The Author does not claim to be a Soothsayer, but the handwriting seems to be on the wall for a number of issues relating to the future of television. Let’s analyze some of the major issues, going fast forward towards 2017:

How many TV Stations on the air (OTA) in 2015?
The FFC “DTV Spectrum Grab and Auction” of taking 120 MHz from the TV broadcasters in the 600 MHz band is scheduled for transition in 2015, IF Congress goes along passing the appropriate legislation in 2011/2012. It is likely that many non-news TV stations may voluntarily turn in their 6 MHz DTV channels to the FCC for promised compensation and that the remaining TV stations keeping their spectrum will be repacked to accommodate perhaps less than 1,000 TV stations to remain on the air after 2015. (Currently, there about 1,780 full power TV stations OTA across the U.S.) To be a relevant “real OTA” TV station after 2015, the station really needs to deliver substantial local content including HD news, weather, sports and traffic to the local audience.

TV Everywhere rules in 2015
TV Everywhere (at any time) will be largely developed by 2015, expecting to provide live and time shifted access to all prime time and syndication TV programming over the internet/OTT, where the TV Networks may no longer rely on local affiliate TV stations to exclusively deliver network programming. New business models must be developed for the local TV stations which MUST include local content in the form of HD news, weather, sports and traffic, and perhaps mobile television through Mobile DTV and/or through 4G smartphone/ tablet streaming arrangements with wireless providers, and not to forget the increasingly important TV station website.

Fiber-to-the-Home (FTTH) trumps Cable TV by 2017?
The many hundreds of TV channels delivered all the time to Cable TV subscribers through HFC (Hybrid Fiber Coax) delivery systems is a waste of bandwidth, as each subscribing TV household generally and largely limits their regular TV watching within the household to twenty (20) “favorite” channels or less. The 20-channel mix may vary from month to month or from quarter to quarter, but there is no need to present all 500+ channels to each of the STBs in the home, all the time. Telco IPTV does the same, however, both Cable TV and Telco IPTV is now starting to use an emerging technology called SDV (Switched Digital Video) applied to conserve bandwidth from the neighborhood distribution hub to the subscriber home by only delivering that one channel (or those several channels) being watched at any given time. This frees up a large amount of “last mile(s) bandwidth” and makes it possible to supply many more subscribers from each neighborhood distribution hub and/or apply the bandwidth saving to other broadband services.

The STB communicates with the hub, delivering only the TV channel called for by the STB which is controlled by the viewer. This is similar to OTT, where a discreet stream of (requested) compressed video is delivered from the nearest OTT provider hub (being local, regional, or national) with the appropriate unique IP address for the OTT device located in the (requesting) home. The OTT device may be an IP STB, a ROKU box, a HULU/VUDU/Netflix IP capable Blu-ray player, a PC or Mac, or an Internet-capable HDTV set. A majority of TV viewers may in 2017 watch more TV at any one time through OTT/FTTH delivery than through “traditional” MVPD delivery, which may include prime time (first-run) TV shows delivered directly OTT, perhaps bypassing the local affiliate TV stations as the “middlemen”, or at the minimum making affiliate TV stations non-exclusive outlets.

Reverse Affiliate Fees and share of Retransmission Fees
Back in “the good old days”, the TV networks were making handsome payments to their affiliates for carrying the network programming. In recent years, the TV networks have turned the tables by demanding and receiving “reverse affiliate fees” from the stations, and recently demanded a share of the retransmission fees paid by the MVPDs to the local affiliate stations. This continuous pressure exerted by the TV networks to extract ever higher payments from the local TV stations is unsustainable in the longer term, and may be the preamble to the TV networks seeking alternate “OTT channels” of delivery of their prime time programming to the TV homes, at first allowing dual delivery through the “old” affiliates and the “new” OTT channel, but eventually cutting out the “old” and exclusively deliver through a new technology/revenue model. By 2017, it is probable that such a new technology/revenue model will have emerged, where local affiliates no longer can rely on being (exclusive) local outlets for the TV networks.

Future Existence Insurance:
Local HD News, Live HD ENG and Streaming Website

Strong market, technology and regulatory forces will cause material changes to the various TV industry business models over the next five years. A large shift in the way TV is received by the viewers, by a significant decline in “traditional” MVPD delivery to a majority of consumers viewing TV delivered OTT, may actually reduce the total Retransmission Fee pie, as program compensation to the TV networks takes a different form and “middleman” compensation to the local affiliate station may be made redundant. (Discussed above)

“All politics is local”, again quoting the late Tip O’Neill (D-Mass), former speaker of the House, as the Author states that “Most news, weather and traffic of interest is local”. National and international news are provided by the major TV networks as well as by CNN and other cable news organizations, seeking “bundling” with local news to reach maximum audience. The local viewers are first and foremost interested in local news, weather and traffic, thus a local TV station news leader has the foundation for a successful future existence and is best positioned to negotiate profitable relationships as new technology/revenue models and opportunities emerge, whether with TV networks, MVPDs, wireless broadband providers or ISPs.

Conclusion:
HD News optimizes short, medium and long term revenues . . . preserves future options

The shorter term opportunities lie in the traditional TV station business model where increased ratings produce increased ad revenues and retransmission fees.

The medium term opportunities, made possible through “full service” local HD news leadership, include maintaining relevancy as an OTA TV station in turn preserving the OTA tool necessary to build out the Mobile DTV and to lead local content streaming OTT, in concert with website success.

The specific long term opportunities are difficult to predict at this time, but it is certain that a local OTA TV station with “full service” HD news, Mobile DTV, local content streaming OTT, and an interactive website has indeed preserved a maximum of future options, compared with a TV station without news and local content.

# # #

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WELCOME

Joe D'Amico Vice President - Broadcast Sales

Joe D’Amico
Vice President – Broadcast Sales

Hi and welcome to the JVC Broadcast website. We’re delighted you’re here and like to share the reasons why so many broadcasters have chosen JVC for their ENG and studio applications. Of course the picture quality of a camera is number one on the list of items to be considered when moving to new equipment.  But, with today’s cameras, it’s more than picture quality.  Workflow is mostly what differentiates ENG cameras, and JVC is leading the industry with an IP based workflow that enables broadcasters to be first on-air, and first on-line with breaking news.

A BIT OF HISTORY

JVC technology used to produce our latest ProHD broadcast cameras predates back to the very first affordable HD camera produced by JVC. Introduced in June 2003 the JY-HD10 Camcorderrevolutionary JY-HD10U camcorder utilized high quality MPEG2 encoding and native 1280×720 resolution. The development of this advanced technology was nurtured by customers with broadcast needs and a vision of the future economic reality broadcasters were facing with the transition to HD. Our customers today, benefit from nearly 10 years of product development of MPEG2 and smaller advanced image processors that have developed beyond expectation. Today MPEG2 is utilized in ENG/EFP cameras from JVC, Sony and Canon and supported by leading editing manufacturers including Apple, AVID, Adobe and Edius. JVC’s vision and years of experience have provided the basis for todays advanced JVC ProHD cameras that have been adopted by the top broadcasting groups and stations throughout the United States.

WHAT MAKES JVC VALUABLE TO YOU

firstonair

 

First on-air, First on-line  is the nexus that brings JVC ProHD value to our broadcast customers. Our unique IP based workflow allows news crews to stream live content from a breaking news story directly to air, or to a website while recording a full HD file for later editing and broadcast.  Files can be uploaded to the station directly from a JVC field camera giving the broadcaster a competitive advantage over other stations in the market.

EXCLUSIVE PRODUCTS FOR BROADCASTERS

Our ProHD Broadcaster is a IP hub that allows multiple cameras to stream to a single ingest point, and then be routed to various decoders, and even to other stations within the group.

JVC BROADCAST IS DEDICATED TO SERVE YOU THE BROADCASTER FIRST

At JVC Broadcast we endeavor to provide a blanket of security to your operations to complement our ProHD cameras and monitors with the following:
  • JVC owned & maintained hot-swap onsite loaner cameras (for those stations that adapt ProHD)
  • Dedicated Broadcast Service Depot offering quick turnaround
  • Free overnight shipping into and out of our Broadcast Service Depot (within warranty period)
  • Broadcast dedicated & password protected asset tracking website that includes:
    * Model purchase history with asset tracking by serial number including service history of camera fleet
    * Free electronic service manuals, schematics, parts lists, instruction manuals & supplemental Information
    *Electronic repair request and auto printing shipping label to our Broadcast Service Depot
  • Affordable extended factory warranties
  • Free Initial Setup and training of all station personnel that utilize ProHD cameras & monitors
JVC Broadcast is dedicated to serve our broadcast customers to insure they receive the full value and security that only JVC Broadcast can deliver. We understand urgency and limited resources and how this can affect your operation and reflection on your station and group. Our entire organization is dedicated to your support from the moment you make the decision to adapt ProHD as your HD equipment choice.

OUR WEBSITE

Our website is not just pages with product information. It’s a combination of product information and active blog articles that hopefully bring relevance to your operation and timely topics within the industry. We hope you find our website informative and interesting and please, contact me directly if you have any comments or suggestions. In the meantime enjoy the latest informative addition to our blog, The future is wireless mobile news and with the introduction of our GY-HM800 series, JVC again leads the way with the first wireless ENG camera.

Best always,

Joe D’Amico

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COUNTDOWN TO NAB 2011 — Issue 4

FCC’s “DTV Spectrum Grab” and Auction … and HD News?

Public policy must support national economic expansion, but not damage local employment. HD News operations employ the vast majority of broadcast personnel in major local TV markets.

The Shrinking TV Broadcasting Spectrum

One year ago (March 15, 2010), the FCC submitted the National Broadband Plan (NBP) to Congress and made the 300+page report public. Although the NBP in the preamble talks about broadband in terms of both wired and wireless, it quickly turns into a National “Wireless” Broadband Plan where the word spectrum is the key common denominator in nearly all detailed discussions in the report, and largely meaning “wireless spectrum”. There is NO MONEY for Uncle Sam in the “wired spectrum”, as FTTH spectrum cannot be auctioned off!

The NBP outlines a goal for the FCC to re-assign (or make available) an additional 500 MHz for mobile broadband use within 10 years, of which 300 MHz (in the spectrum from 225 MHz to 3.7 GHz) should be made available within 5 years.

But the real troubling statement for TV broadcasters is FCC’s recommendation on page 76 stating that: “The FCC should initiate a rule making proceeding to reallocate 120 MHz from the broadcast television (TV) bands”.

Look at this Chart. Subject to the FCC being successful in reallocating 120 MHz, the TV broadcasters will have lost 312 MHz or 75% of its UHF channel spectrum from 1982 to 2012. In 1982, 84 MHz was given to the cell phone industry. The 700 MHz band (108 MHz) was removed from the TV broadcast spectrum over several years with completion in 2009 (DTV transition). And now the proposed 120 MHz GRAB and auction in 2012, with proposed transition by 2015. (Recall that UHF channel 37 has been assigned to radio astronomy for many years, and it is located in the FCC Grab 120 MHz spectrum. Thus there are only 17 UHF channels remaining if Ch.37 does not count in the specified 120 MHz FCC Grab.)

The FCC moves to eliminate “Over-the-Air DTV Spectrum” for 682 TV Stations

There are about 1784 “full power licensed” DTV stations operating in the U.S. in 2011, which by spectrum currently breaks down as follows:

Presuming that the FCC is successful in reclaiming the “600 MHz band” (UHF Ch.31—Ch.51 consisting of 120 MHz of spectrum, not counting Ch.37 assigned to astronomy), 682 currently operating full power DTV stations need to be relocated or shut down This is more than 50% of all operating UHF stations.

To relocate all 682 stations to the remaining VHF/UHF DTV bands is a technical impossibility under the current DTV broadcast regulations. This Issue 4 shall not attempt to detail possible long term technical solutions to this problem. Those discussions are for another day.

The solution in the mind of the FCC seems to be to ask TV stations to voluntarily give up their OTA spectrum in exchange for unspecified compensation. Under a full compliance scenario, and where the current OTA ATSC format is maintained, including all current DTV OTA channel assignments below Ch.31 without “squeezing” in more OTA channels in the remaining DTV spectrum, 682 TV stations must “voluntarily sell” their spectrum to the FCC or vacate by other arrangements.


In this scenario, a total of about 1100 ATSC TV stations will be able to remain OTA after the proposed 2015 transition.

Public Spectrum Policy must favor important local economic activities, after nation-wide priority

The FCC creates a definite serious spectrum shortage in the OTA DTV broadcasting field, as a direct consequence of preventing a possible (even unlikely) shortage of wireless broadband spectrum. The Author does NOT believe that we are soon facing a wireless broadband spectrum shortage. As a matter of record, the forecast rapid growth of mobile television/video watching over wireless broadband, used by FCC partly to justify the GRAB of 120 MHz of the DTV UHF spectrum, is so far not materializing. And just consider Qualcomm’s shut down of FLO TV and the very slow adoption by broadcasters to put Mobile DTV on the air.

FCC states in the NBP that the relocation of 120 MHz from the DTV broadcast spectrum to wireless broadband providers will greatly benefit the society and create economic growth in the future years. That is FCC’s primary driver of the spectrum relocation proposal in the NBP. It is obvious that public policy must prefer economic growth over stagnation or inefficient allocation of public spectrum resources.

FCC knows that any major spectrum auction (like the 700 MHz band auction in 2008) is only for larger rich companies. Of the $19 billion in proceeds in 2008, Verizon and AT&T counted for $16 billion or 84%, and #8 (Cellular South) on the winners list paid $191 million for several local spectrum. FCC administers public policy by getting maximum for the spectrum, which shuts out small business.

Public policy obviously trumps equal opportunity for small business in spectrum cases, now that TV OTA spectrum will no longer be in ample supply.

It then follows that, in any given local television market, a larger successful “full service newscast” TV station with 100, 200 or even 300 employees is much more important to the local economy than the “infomercial-rerun” TV station without significant local content delivery and perhaps less than 10 employees. Based on local employee ratio, the “full service newscast” TV station may be over 10 times economically more important than the infomercial-rerun TV station.

Again, it naturally follows from there that, if there currently are twenty (20) OTA (over-the-air) full power DTV stations in a given larger DMA, and IF there are only ten (10) OTA channels available after the FCC has “grabbed the 120 MHz”, the ten (10) largest local economic activity DTV stations should be allowed to continue OTA while the ten (10) smallest local economic activity DTV stations should be OTA de-licensed. This approach seems on its face to be in the best interest of the local economy, by avoiding to interrupt the DTV stations with the highest local employment level. The TEST is purely (local) economic based: What is your annual local payroll? Not program or ethnic oriented. Not whether it is a commercial station or a public station. Not whether news DTV station A is better than news DTV station B.

The only reason for the TEST is that the public spectrum is to be used for maximum positive impact on the local DMA economy in the shorter and longer term. What will the losing DTV station do? (In addition to possible sue?) Accept a mandate that the de-licensed DTV stations must be carried by the local cable or satellite TV system for a minimum time period, and/or device a delivery scheme to deliver their signal by broadband.

Local HD-News operations enable TV Stations to lead local economic growth

A major market TV station with “large scale” HD news operations may contribute to the local economy, just in annual payroll terms, in excess of $20 million, while a smaller “infomercial-rerun/non-news” station’s annual local payroll may only be 10% of that, or even less. It is obvious that the “large scale” HD news stations are much more essential in protecting and growing the local economy than the “infomercial-rerun/non-news” stations. In addition, the HD news stations generally serve a significantly larger local audience OTA in rating terms than do the non-local-news stations. And OTA reach to local TV households is generally materially superior for the much larger HD news stations operating at maximum ERP and HAAT at the long established common TV transmitter location, while the smaller non-news stations may be disadvantaged (by choice) in ERP, HAAT and transmitter location.

Today’s successful and profitable “large scale” newscast TV stations make smart decisions when it comes to replacing the old standard definition camcorders, cameras and newsroom systems, as the recent developments in HD news acquisition, file-based editing and play-out equipment and systems have greatly improved time-to-air, ability to do live HD ENG, and producing for the 3 television screens while capital and operating costs are declining. Just look at the market leading solutions from JVC, where the ProHD camera/camcorder line-up is the choice of more Group TV Station Owners than any other local broadcast-oriented HD product line.

The Los Angeles DMA:
The Nation’s #1 spectrum grab headache

The Author resides in Los Angeles (DMA #2) where the FCC says there are currently 26 full power licensed DTV station on-the-air, of which 16 are transmitting on a “doomed channel” in the range Ch.31 through Ch.51. Remember the saying “you cannot get there from here”? That’s the size of the Los Angeles spectrum problem. The 10 DTV stations NOT on a doomed channel includes KABC-7 (Ch.7), KCAL-9 (Ch.9 partial duopoly with KCBS-2), KTTV-11 (Fox Ch.11), KCOP-13 (MyFox Ch.13 in partial duopoly with KTTV=11), and the recent ex-PBS station KCET (Ch.28).

A large market duopoly operation (like KCBS/KCAL and KTTV/KCOP in Los Angeles) may each employ 200 to 300 persons, and a large portion of those positions are good paying jobs in the talent, newsroom and technical fields. At the other end of the spectrum are the automated infomercial-rerun (non-news/non-local-content) TV stations employing very few, perhaps at lower pay, and not significantly contributing to the local economy. The local infomercial TV stations may run mostly national infomercial programs with much less economic benefit to the local community.

The major Los Angeles TV stations needing relocation (which perhaps should “worry”) include KCBS-2 (Ch.43), KNBC-4 (Ch.36), KTLA-5 (Ch.31), KMEX (Univision Ch.34), KWHY (Telemundo Ch.42), and then KTBN (Trinity religious station on Ch.33) and KOCE (the major/full service PBS affiliate on Ch.48). This means that at least five (5) major commercial newscast stations, all of which are believed to operate at or near maximum allowed ERP, need to relocate to below Ch.31, in addition to KOCE and possible KTBN if it passes the “high-local-employment” test.

There happens to be five (5) non-major/non-news DTV channels currently in operation in the remaining UHF band (Ch.14—30) which are likely to be classified as NOT being material in local economic terms, and all of which are carried by cable. The Author will not mention call letters. As in many other major markets, relocation and possible de-licensing will be a very difficult and messy undertaking. In the LA DMA, there is no OTA transmission on the VHF-low band. The four (4) TV stations transmitting on VHF-high band are all major HD news operations (KABC-7, KCAL-9, KTTV-11, KCOP-13) which will presumably stay where they are. Thus we can presume that the only OTA spectrum in the LA DMA where the “high-local-employment” TV stations can relocate to is UHF Ch.14—30, but only after “low-local-employment” TV stations have “voluntarily sold out” to the FCC or having been de-licensed by other FCC authority.

The Los Angeles DMA impossibility:
Fitting 16 pounds in a 6-pound bag

A total of sixteen (16) TV stations operate OTA in the spectrum to be reclaimed (Ch.31—51) of which at least five (5) have major news operations, one (1) is a large religious station (KTBN), and one (1) is the major PBS network affiliate (KOCE). If we add the ION “movie station” (KPXN), at least eight (8) DTV stations would probably not “voluntarily sell out” to the FCC, but rather be reassigned to the Ch.14—30 UHF band if channels become available.

BUT … there are ONLY six (6) UHF channels licensed in the spectrum Ch.14—30 for the LA DMA, of which three (3) transmit from Mt. Wilson main LA TV antenna farm (Ch.18, 28, 29) while the other three (3) transmit from Ventura County (Ch.24), San Bernadino (Ch.26) and Twenty-nine Palms (Ch.23). Adjacent channel interference is minimized between Ch.24 and Ch.23 as they are about 150 miles apart. Note that co-located adjacent DTV channels (in the same antenna farm, i.e. on Mt. Wilson) generally do not produce adjacent channel interference, thus Ch.28 and Ch.29 are co-existing.

Let’s say that five (5) “low-local-employment” TV stations end up vacating their spectrum for “carrots or sticks” in the Ch.14—30 band, while at least eight (8) stations are “competing” to fill those five (5) channels. The “Local Economic Importance Test” says that the five large commercial HD news stations (most important to the local economy) will be assigned to the five available channels, absent any other “technical solution scheme” by the FCC.

Possible Scenario: The Los Angeles DMA will be served by only ten (10) OTA ATSC DTV stations after the FCC proposed 2015 transition, requiring sixteen (16) currently operating DTV stations to be de-licensed and go off the air. Of the 10, four (4) may be unchanged in the VHF-high band (KABC-7, KCAL-9, KTTV-11, KCOP-13), but who will be re-licensed on the current UHF assignments of Ch.18, 23, 24, 26, 28 and 29? KCBS, KNBC, KTLA, KMEX, KWHY and KOCE are the TV stations with likely highest score on the “Local Economic Importance Test” assigning local public interest priority.

“Common Ownership” FCC Rulemaking:
Only ONE of the Duopoly OTA?
OR Duopoly share ONE OTA channel?

Here is an interesting “discussion point”: In the Los Angeles DMA, there are currently two major duopolies occupying four (4) full power OTA channels: KCBS-2/KCAL-9 and KTTV-11/KCOP-13. Their local news operations are significant, using common resources and in-part talent. In an environment of severe spectrum shortage, is it fair and good public policy to allow both TV stations in the duopoly to maintain separate full power OTA channels? The FCC may NOT think so, particularly when both stations in each duopoly are carried on local cable and satellite TV.

As KCBS-2 needs to vacate Ch.43, a possible FCC “common ownership” mandate for KCBS is to share Ch.9 with KCAL as technically provided for in the ATSC DTV rulebook. Both KCBS and KCAL are currently using 1080i, which, in a 50/50 share of the available net 18 Mbps (gross 19.4 Mbps in one 6 MHz DTV OTA channel), will give each station only 9 Mbps encoded 1080i in MPEG-2 ATSC. This is NOT sufficient to transmit KCBS in network quality HD OTA. “Forced” by the FCC, perhaps owner CBS decides for KCBS to transmit OTA on Ch.9 and for KCAL to just be on cable? Perhaps the FCC will give CBS two options: (1) Both KCBS and KCAL on the same Ch.9, OR (2) KCBS to assume Ch.9. FCC may dictate NO “proceeds share” to CBS, as NO OTA channel is freed up for a third party?

Fox’s KTTV-11 is OTA on Ch.11 while duopoly partner KCOP-13 is on Ch.13. Same FCC two options to Fox: (1) Both KTTV and KCOP on Ch.11, OR (2) KTTV to remain alone on Ch.11 (while KCOP is just on cable). In this case, Fox may receive “proceeds share” as Ch.13 is freed up for a third party.

Fox TV stations are 720p, thus it is possible to operate two HD signals simultaneously at 9 Mbps OTA each maintaining good quality ATSC MPEG-2 transmitted HD signals for both KTTV and KCOP, however, the HD duopoly will consume nearly all of the 19.4 Mbps gross channel bitrate, leaving NO space for Mobile DTV.


Again, the Author points out the apparent advantage of 720p60 over 1080i60, as 9 Mbps encoding is sufficient for progressive 720p60 to deliver fair HD OTA quality, while it is NOT sufficient for interlaced 1080i60.

What about Public Television OTA?

The Los Angeles DMA has four (4) non-commercial public television full power licensees: KOCE (Ch.48—now the exclusive full service PBS affiliate in the LA DMA), KCET (Ch.28—NO longer the PBS affiliate, just resigned), KLCS (Ch.41—Los Angeles Unified School District), and KVCR (Ch.26—San Bernadino Community College District). Obviously, the only full service PBS network affiliate KOCE must have priority OTA, thus it may make sense that one (or both) of the other two (2) PBS stations in the remaining UHF OTA band must surrender their license to first benefit KOCE, and, second, to benefit a commercial station with significantly higher score on the “Local Economic Importance Test”, and the two vacating PBS stations shall then receive a “share of auction proceeds”.

FCC giveth and FCC taketh away:
The 600 MHz Band Spectrum Auction

TV OTA broadcasting over UHF began in 1949, but did not become commercially viable until 1965 when the FCC implemented the regulation that all TV sets sold in the US must be capable of receiving UHF channels 14 through 83 OTA, in addition to the VHF channels. FCC authority was given when Congress passed the “All-Channel Receiver Act” in 1961.

In March 2008, FCC conducted what was labeled the most successful spectrum auction to date, selling 52 MHz (of the 62 MHz offered) in the 700 MHz DTV band for $19 billion. The 700 MHz band (Ch.52 698 MHz—Ch.69 806 MHz) was finally vacated by the broadcasters in June 2009 (the final DTV transition).

FCC’s NBP (National Broadband Plan) released a year ago proposes yet another “spectrum grab” from the broadcast spectrum in the 600 MHz band (Ch.31 572 MHz—Ch.51 698 MHz) for a total of 120 MHz. (Note that Ch.37 is not a DTV channel but has been assigned to astronomy for many years, thus 572 to 698 MHz is actually 126 MHz.). FCC’s logic seems to say that if the 2008 52 MHz auction brought in $19 billion, then a 120 MHz auction in 2012 will bring in proportionally $44 billion. The Author does not think so …

Permitted usage for the 700 MHz (and 600 MHz) band is broad and flexible

We quote FCC’s statement of Permissible Operations for the 700 MHz band as posted on the FCC website:

“The 700 MHz Band licenses may be used for flexible fixed, mobile, and broadcast uses, including fixed and mobile wireless commercial services (including FDD- and TDD-based services); fixed and mobile wireless uses for private, internal radio needs; and mobile and other digital new broadcast operations. These uses may include two-way interactive, cellular, and mobile television broadcasting services.”

“Fixed broadcast uses” and “digital new broadcast operations” are permitted.

There are additional technical requirements, but considering that Qualcomm operated their FLO TV nationwide (primarily in major markets) multi-channel mobile television service on a UHF Ch.55 utilizing a cell-based single frequency network (SFN) of transmitters with ERP up to 50 kW, obviously conforming to FCC technical requirements, “digital new broadcast operations” is permitted. FLO TV is closing down as this is written for lack of public interest. AT&T has agreed to purchase the Qualcomm Ch.55 nationwide spectrum (including related 700 MHz spectrum) for $1.9 billion last month. In round numbers, it appears that one nationwide UHF TV channel (6 MHz) is valued at about $1 billion by this deal.

There are 20 UHF channels available in the 600 MHz band, with permitted usage expected to be the same as for the 700 MHz band. On a nationwide basis, to get a total of $44 billion in one swoop in the proposed 2012 auction, each nationwide 6 MHz UHF channel must sell for $2.2 billion, to proportionally match the $19 billion in proceeds from the 2008 auction for the 700 MHz band. Again in round numbers, the FCC hopes to get about $2 billion for one nationwide UHF TV channel (6 MHz), or double the market value indicated by the Qualcomm-AT&T deal.

Offer it … but will they come?
And who will pay the big bucks?

A part of the 120 MHz spectrum in the 600 MHz DTV band is likely to be set a side for government communications, thus lets assume that a net of 108 MHz will be offered at the proposed 2012 auction. Wireless broadband spectrum is generally offered in paired blocks, as frequency spacing between the paired block is required to prevent interference by the downlink transmitter into the uplink receiver, generally cell tower mounted side-by-side. Accordingly, unless the FCC make special provisions for single 6 MHz spectrum blocks “upon request”, the 108 MHz band holds 18 single 6 MHz blocks, or 9 paired blocks of 12 MHz (2x 6 MHz). Fewer larger blocks may be offered by FCC, but as we are primarily in the TV business, let’s in here operate with 6 MHz “channel” blocks. As a nationwide TV UHF 6 MHz channel seems to be worth a minimum of $1 billion (established by the AT&T-Qualcomm deal) and a maximum of $2 billion (established by the 700 MHz band 2008 Auction), while paired blocks (each pair 12 MHz) seem worth between $2 billion and $4 billion. The average worth for the nationwide 108 MHz seems then to be about $27 billion, as average value per 6 MHz channel is $1.5 billion.

Although single 6 MHz blocks may be offered in nationwide packages, most wireless broadband paired blocks are historically often offered by regions (i.e. Midwest, Northeast, etc.) or by metropolitan areas. Thus any FCC auction participation for large spectrum chunks are often complicated and requiring lots of preparation.

So, who will bring the $27 billion checks in 2012?
Verizon CEO Seidenberg stated in 2010 that there may NOT be a spectrum crisis anytime soon. Seidenberg is not likely by that statement to bring any big checks, like the $10 billion he brought FCC in 2008. AT&T, expecting to just have closed the T-Mobile acquisition (see “Stop the Presses” below) and paid out at least $25 billion to Deutsche Telekom before the proposed 2012 auction, is not expected to spend big on spectrum in 2012. Sprint is not cash rich. None of the Big 3 wireless providers support a 2012 auction for the 600 MHz band. They all want to wait, in the Author’s opinion, and the FCC already recognizes this problem.

It seems to be an opportune time for the major TV broadcast networks and the likes of Google, Microsoft and Apple to buy nationwide UHF channels for a reasonable price. Even if the Big 3 wireless providers do show up collectively with $10 billion (each buying a paired block), 12 single 6 MHz nationwide channels remain for the TV broadcast networks and others to buy for $1.5 billion each (?).

Will the major TV Networks each buy a nationwide TV channel?
Imagine, to prepare for a future OFDM-based nationwide OTA TV delivery to replace the current ATSC/DTV OTA operations, ABC, CBS, Fox and NBC each buying a 6 MHz nationwide TV channel in the upcoming 600 MHz band auction? And, additionally, Univision and others may throw their hat into the ring, even some of the big cable channels? It’s possible.

Will Google, Microsoft, Apple buy a nationwide TV channel?
Google TV? MS TV? Apple TV? Collectively, these three giants have cash holdings exceeding $130 billion. Imagine a future Google TV set-top-box with a built-in OTA tuner/receiver to not only receive the new nationwide Google TV channel (or MS or Apple), but also possible future OTA OFDM TV channels transmitted by others. A partnership with the major TV networks? If Google, MS and/or Apple sell the $99 STB with built-in OFDM OTA TV receiver, such may enable a relatively rapid adoption by the TV households of a new digital OTA TV broadcast delivery of the major TV networks. It’s possible.

Will Verizon, AT&T, Sprint buy most of the 600 MHz band?
Verizon has spent in excess of $15 billion over the past 5 years on spectrum, inclusive of nearly $10 billion spent buying 700 MHz spectrum in the 2008 auction. AT&T has also spent in excess of $15 billion over the past 5 years, including nearly $7 billion in the 2008 auction and the $1.9 billion for the Qualcomm spectrum last month. Sprint has invested about $10 billion while T-Mobile has invested about $5 billion according to Author’s estimation. Not likely.

Stop the Presses:

AT&T is acquiring T-Mobile for $39 billion

AT&T announced on March 20, 2011 it is buying T-Mobile USA from the German parent for $39 billion, subject to regulatory approvals. It may take as much as one year to close the deal. At least $25 billion will be in cash, with balance paid in AT&T stock such that Deutsche Telekom will own between 5 and 8% of AT&T. This acquisition will seriously affect AT&T’s cash position and lines of credit, thus it is likely that AT&T will come to the FCC’s proposed 2012 auction with “limited cash” to spend. As a matter of speculation, AT&T may quietly (behind the scenes) push any 600 MHz auction out to 2013 or even 2014 which may also suit Verizon.

FCC to share auction proceeds with 682 “doomed” TV stations?

We have established that 682 licensed full power DTV stations (of a total of 1,784) must be taken off the air in order to maintain the current ATSC-DTV 6 MHz assignment of 12 VHF channels (54—72/76—88/174—216 MHz) and 17 UHF channels (470—572 MHz) without any efforts to repack or squeeze in more ATSC-DTV channels than the current 1,102 DTV licenses assigned those remaining 29 channels nationwide. To significantly expand the number of VHF OTA licenses is not a viable option, and channel sharing will reduce HD OTA picture quality and eliminate bits for Mobile DTV (unless a whole new OTA OFDM transmission scheme is implemented, which will take a decade).

The value of voluntarily relinquishing full power DTV licenses:

It is not important whether the 682 DTV licenses to be “voluntarily relinquished or recaptured” come from below Ch.31 (the remaining VHF/UHF channels) OR from above Ch.30 (the 600 MHz band to be auctioned), OR from a combination of below and above. In a given DMA, the “relinquish value” of a “below Ch.31 license” and a “above Ch.30 license” should perhaps be the same. A DTV license relinquished on Ch. 24 means that a DTV licensee above Ch.30 wishing to remain OTA may relocate to Ch.24. However, the value of a 6 MHz slice of spectrum in Los Angeles (DMA #2, 5.7 million TV Households) is multiple times higher than the value for the same slice in Johnstown-Altoona (DMA #102, 294,000 TV Households).

Sharing Proceeds DMA-by-DMA:

A wholesale reassignment and repacking of DTV licenses across the U.S. will be very costly, complicated and time consuming. Time is of the essence, thus DTV channel vacation and reassignment should first be attempted DMA-by-DMA.

Chicago (DMA #3—16 licensed DTV stations) has eight (8) DTV stations located above Ch.30, while New York (DMA #1—23 licensed DTV stations) has eleven (11), and Los Angeles (DMA #2—26 licensed DTV stations) has the most of any DMA with sixteen (16) DTV stations located above Ch.30 probably making it the most difficult DMA to clear just with “incentive proceeds sharing”. With only ten (10) currently operating DTV licenses below Ch.31, sixteen (16) DTV OTA licenses must be retired to maintain the “status quo” of ATSC-DTV in Los Angeles. This is a local problem which must be solved locally, as a “voluntary vacation” of a DTV station anywhere else will NOT help Los Angeles. It will take a lot of incentive funding to have 16 DTV stations (out of a total of 26) in one DMA surrender their licenses. That is why each DMA must be handled as a separate issue, but with sharing of nationwide proceeds proportional to size of the DMA and to number of licenses requiring to be retired. The top “DTV OTA spectrum problem DMAs” are:

NO sharing of proceeds with DTV stations in DMAs where NO station occupies any channel above Ch.30?

To share in the auction proceeds should be limited in each DMA to the number of DTV licenses required to clear the 600 MHz DTV spectrum for that DMA. The logic and fairness here is that there is no local need for any vacated 6 MHz spectrum. 28 DMAs are void of “above Ch.30” licenses, with the highest rank being Corpus Christie, TX at DMA #129. This will eliminate a lot of administrative services and frivolous compensation for voluntary license surrender where such surrender does not result in another station remaining OTA. The exception is if such surrender will enable a neighboring DMA to use the channel.

Will Congress act in time?

The 112th Congress convened on January 3, 2011. At least three (3) Spectrum related bills introduced in the prior 111th Congress expired at the end of that term, as they were never voted on. The following new and re-issued spectrum bills have been introduced since late January:

  • S.415 (The Spectrum Optimization Act). A 4-page bill by Sen. Warner (D-VA), it would give the FCC the authority to conduct auctions of voluntarily relinquished spectrum, and proceeds being shared with relinquishing licensees
  • H.R.911 (The Spectrum Inventory and Auction Act of 2011) introduced by Rep. Barrow (D-GA), requiring FCC to conduct a “spectrum inventory and public report” before any auction.
  • S.455 (The Reforming Airwaves by Developing Incentives and Opportunistic Sharing Act – “RADIOS Act”). A re-issue bill by Sens. Kerry (D-MA) and Snowe (R-ME) which original bill died in the prior Congress. By far the most detailed, at 51 pages.

It is now April. Congressional campaigning for the November 2012 federal elections (including the presidential election campaign) will start by November 2011 (just about six months away), after which no congressional candidate will commit to difficult political positions. There are still millions of voters getting free TV OTA! A candidate’s support for future elimination of free TV OTA will not be a beneficial position in any campaign. Congress is not likely to act in time, as the major commercial interests including trade organizations on the telecom side may not want a 2012 auction after all.

Read my lips: NO 2012 Spectrum Auction

The Author believes that there will be no 2012 600 MHz Band Spectrum Auction, for the following reasons:

  • Congress will NOT pass any bill in time this year permitting the “spectrum grab” and any immediate 2012 auction (in part due to the Republican-controlled House not wishing for the Democrat-controlled Senate and Administration to get “2012 election brownie points” for possibly bringing in many billions of dollars to the Treasury)
  • Verizon is not likely to bring any really big checks to any 2012 auction, because CEO Seidenberg stated in 2010 that there may not be any (wireless broadband) spectrum crisis anytime soon. (Verizon has 32 MHz of 700 MHz band spectrum near nationwide)
  • AT&T is not likely to bring any really big checks to any 2012 auction, because AT&T will just have paid out $39 billion in early 2012 to close on the acquisition T-Mobile USA, after a long governmental approval process, and because AT&T just acquired nationwide 700 MHz spectrum from Qualcomm which lifts AT&T near nationwide 700 MHz spectrum holdings to 32 MHz, equal to Verizon’s.
  • Sprint may wish to buy some 600 MHz spectrum, but, with less cash available, may not see fit to spend the many billions of dollars required to buy enough to make sense, and Sprint’s investment in Clearwire/Clear enables Sprint to use part of the 150 MHz owned by Clear in the 2.5 GHz band
  • Google may come to the table if there is an 2012 auction, but is not likely to encourage the FCC for a 2012 auction. (Microsoft and Apple may be less interested in acquiring nationwide spectrum)
  • The major TV networks may come to the table if there is an 2012 auction, but will not encourage the FCC to hold a 2012 auction

When will the 600 MHz auction happen? Probably in 2013, and with still time for the TV broadcasters to lobby Congress and the FCC. It always takes longer to restructure major government-licensed industry segments. FCC proposes a final 600 MHz band transition to wireless broadband by 2015. The Author suggests 2020, and the “spectrum overhaul” includes provisions for a new “free-over-the-air” TV delivery system for homes and mobile.

Eight (8) more years of ATSC:

Let’s presume that the TV broadcasters and the FCC agree on one issue: The ATSC 8-VSB OTA format will stay as is through this decade, to protect the many billions of dollars worth of television sets with built-in OTA ATSC tuners so far purchased by the consumers (and still being sold) and to prevent the waste and consumer headaches associated with yet another “NTIA set top box coupon program”. And if they don’t agree, it will take through this decade anyway before a new OTA broadcasting format is implemented. We have eight (8) more years of ATSC 8-VSB OTA, so let’s use the remaining OTA spectrum (after any FCC DTV spectrum grab) in the best possible way: “In the Public’s best local interest, according to Public Policy by applying the Local Economic Importance Test”.

Local HD News earns OTA channel?

The overall local TV station business model for success does not change. Maximum audience share requires local HD news, live HD-ENG, weather and traffic. And the substantial payroll required for a large local TV station doing full newscasts, often with hundreds of employees, wins the Local Economic Importance Test (as compared with the infomercial/re-run station) and thus gets priority for the limited OTA channels available. It’s clearly Public Policy at the local level.

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COUNTDOWN TO NAB 2011 — Issue 3

Is Mobile Television the future panacea for TV Broadcasting?

After 60+ years of over-the-air TV delivery, the TV broadcasters have earned the right to provide Mobile Television … if they want to.

“On-the-road” Television Viewing means Local News: Stationary and Moving

Let us in this Report define the term “Mobile Television” as we expect this TV delivery service to be in the future. Portable TV sets have been around for many years, including that smallish plastic ball with the 7” B/W picture tube, often powered from a car battery at the campsite. Pictured below is a JVC Videosphere TV from the 1970s, with pull-out rabbit-ears antenna and chain carrying handle. This is obviously NOT Mobile Television. It’s portable but viewing mode is stationary, as the old analog NTSC OTA transmissions did not support a continuously moving TV receiver. In 1970, JVC advertised that the Videosphere “turned you on even when it was turned off”.

Even the “new” ATSC DTV over-the-air (OTA) format developed in the early-mid 1990s was not designed to support a continuously moving DTV receiver, as it had enough challenges in the conquering of multipath problems reaching stationary antenna/receivers. Yes, a number of portable DTV flat screen receiver/displays have come to market over the past several years, intended for the portable (even handheld) but stationary enjoyment of local DTV ATSC transmissions. Are there occasions where the viewer is able to receive DTV OTA on the handheld display while moving in a car, bus or train? Yes, but it generally requires an unobstructed direct line of sight to the DTV transmitter tower, which will not be available for very long in a moving vehicle.

A typical product offering of several years ago is the “Portable Pocket Digital TV” by a leading on-line merchant pictured right. At $199, it offered a 4.25” 16:9 screen with 480 x 272 resolution and, of course, a built-in ATSC DTV receiver only able to receive DTV OTA reliably when stationary. On its website, the on-line merchant states “we regret that this item is no longer available”.

Assertion #1: Portable, pocket and personal TVs have never been a substantial part of the total viewing TV audience.

Just look at Prime Time Viewing in 2010: about 70% of all 116 million U.S. TV households are watching some type of TV at home during prime time weekdays, on the average. That means that 30% are doing something else, either at home or away. The Author is certain that most of those 30% are NOT watching portable, pocket, personal or mobile TV.

Will a sufficient market develop for a dedicated Mobile DTV-only receiver/display?

The Author “introduced” the new Mobile DTV (Mobile DTV format or originally ATSC M/H) in the prior Issue 2 of the ProHD Executive Report. The Mobile DTV system enable full power DTV stations to “interleave” what is likely to be lower resolution (max SD) mobile television signals with their primary ATSC HD OTA home delivery TV signals. The Mobile DTV sub-signal may be received, error corrected, decoded and displayed while the receiver/display is travelling at speeds up to and exceeding 100 MPH. Unfortunately, the primary ATSC (H)DTV signal, although received while moving, will NOT produce sufficient continuous data to be reliably decoded, as the original ATSC format was never intended for “a moving/ traveling receiver”, We will not expand further on the technology in this issue, as is it sufficient to say that Mobile DTV seems to work well operationally and technically in delivering sub-HD mobile television to fast moving receivers/displays in resolutions of 416×240 (basic), 624×360 (enhanced) and 832×480 (maximum).

But “Mobile Television” watching is not just through Mobile DTV by local broadcasters, but also on Smartphones, portable PCs and Tablets primarily through 4G in the future. The differentiation between Mobile DTV and 4G-TV is obviously in what kind of TV programming is available through the various providers.
Assertion #2: Local content (news, traffic, weather) is of more interest to the local TV audiences during commuting hours than non-news nationally distributed or syndicated TV programs. (Local TV stations with news operations have a substantial advantage over smartphone 4G providers.)


Thus, “Mobile Television” is emerging to be available in four types of portable displays, with variants available for in-car installations, on top of the dashboard, in the dashboard, in the headrest and as flip down ceiling mount then often with integrated Blu-ray/DVD players. There are already hundreds of millions of laptops, netbooks, tablets and smartphones in the U.S., and hundred of millions will be sold in the future. At the start of 2011, there were probably just a few thousands Mobile DTV units out in the hands of the consumers. And remember that any laptop, netbook and tablet can be turned into a highly capable Mobile DTV receiver/display by plugging in a Mobile DTV USB stick (announced by Hauppauge and others).

Yes, it is possible for the Mobile DTV receiver/display to be turned into a 4G-capable broadband wireless device, but only if such 4G service is offered by a wireless provider, in which case they rather build the Mobile DTV receiver chip-set into the smartphones OR perhaps offer an in-Car 4G/Mobile DTV device.

There are nearly 300 million active cell phones and Smartphones in the U.S. because of a basic established consumer need that telephone contact (and text messaging) should be available anytime anywhere. A dedicated Mobile DTV-only receiver/display unit will always be a consumer’s second priority to a smartphone and probably also to a cell phone.

Assertion #3: Substantial market success of Mobile DTV voids the need for a dedicated Mobile DTV receiver/display, as success may cause some or all leading broadband wireless providers to build-in Mobile DTV receiver capabilities in their 4G smartphones and 4G USB Sticks, while mediocre Mobile DTV market performance produces non-interest by the broadband wireless providers and by the manufacturers of the dedicated Mobile DTV receiver/displays. The Author forecasts that there will NOT be sufficient market demand for a dedicated Mobile DTV-only Unit in the longer term.

How many DTV Stations will really broadcast Mobile DTV in 2011?

“All politics is local” is a well known phrase first coined by the former speaker of the U.S. House of Representatives Tip O’Neill (D—Mass). We may confirm below that Mobile DTV success is likely required based on fresh local content, requiring HD acquisition and production solutions such as offered by JVC’s professional and cost effective ProHD cameras/camcorders. “Is most Mobile Television local?”

Assertion #4: Mobile DTV success must be based on successful local HD news operations including live HD-ENG over the TV stations primary OTA HD channel, substantially simulcasting local HD news coverage scaled to Mobile DTV.


Broadcast Mobile DTV is based on local coverage by DTV stations choosing to deliver Mobile DTV service as one or more “sub-M/H-channels” interleaved with the OTA transmitted primary (H)DTV channel. Presuming that any major local TV station (which are likely to have extensive news operations, with weather and traffic reports) will not significantly compromise the quality of their primary network affiliated HD delivery to homes, the total number of Mobile DTV channels available from each major local TV station will let’s say average less than 2. DTV stations transmitting 1080i may be limited to 1 Mobile DTV channel because of the higher compressed bitrate required for true 1080i picture quality as compared with 720p, out of the total ATSC 19.4 Mbps available.

Local DTV stations without significant news operations may offer several lesser quality SD digital channels OTA (DTV multi-casting), generally with very low local audience share, and some may not go to maximum ATSC ERP power but with just enough coverage to qualify for “FCC must-carry or retransmission consent” on the local cable and satellite TV systems for their primary DTV channel. These independent TV stations are generally low-cost operations without the ability to generate interesting local content, thus Mobile DTV service established by independent (non-news) TV stations may be to do simulcast of lesser quality SD channels.

But remember that the OTA addition of any one Mobile DTV channel by any such multi-casting (non-news) DTV station will likely require the removal of one DTV SD (multi-casting) channel. And by not having maximum allowed DTV ERP, Mobile DTV over-the-air coverage may be mediocre and thus have little or no audience value. And there is no “FCC must-carry/dual-carry mandate” for the Mobile DTV service or for the multi-casting SD.

Mobile DTV over DTV VHF channels may not perform as well for moving Mobile DTV receivers as over DTV UHF channels, as larger physical antennas (or electrically equivalents) are required for reliable reception, as the wavelength for VHF DTV Ch.2 (54—60 MHz) is a whopping 5.4 meter (~17 feet) while VHF DTV Ch.13 (210—216 MHz) is still 1.4 meter (> 4 feet).

A quarter lambda whip antenna for Ch.2 is 4 feet long while the whip for Ch.13 is about 1 foot. This compares with the wavelength for UHF DTV Ch.30 (566—572 MHz) being about one half meter with a quarter lambda whip being only about 5 inches. It is easy to recognize the difficulty in the integration of a VHF-capable receiving antenna into a handheld smartphone as a pull-out whip antenna of any significant length is obviously far from practical. Compare with a built-in antenna equivalent to a Ch.30 whip at 5 inches, which UHF antenna technology is already here in many millions of cell and smartphones.

There are 482 DTV stations with OTA on VHF channels 2—13 according to the FCC as of July 1, 2010, or nearly 30% of all full power DTV stations in the U.S. That leaves about 1,300 DTV stations currently with OTA on UHF channels 14—51, but unfortunately, the FCC’s National Broadband Plan issued last March announced that the FCC is proposing to reclaim 120 MHz of DTV spectrum, from DTV channels 31—51. There are about 665 DTV stations currently transmitting on UHF channels 31—51, which local DTV stations are likely to consider the unlikely relocation to a lower UHF channel in the face of the “FCC threatened” 600 MHz (Ch.31—51) spectrum auction before investing to initiate Mobile DTV transmissions in 2011.

OMVC = Open Mobile Video Coalition:
The essential industry driver of Mobile DTV


About OMVC (from OMVC website www.omvc.org):

In 2007, transmission of full-motion digital television signals to mobile and handheld devices was proven technically feasible. Leaders of the broadcasting industry came together to make mobile digital television a reality; they formed the Open Mobile Video Coalition (OMVC) to accelerate the development and rollout of mobile DTV products and services, maximizing the full potential of the digital television spectrum. Today the OMVC truly represents the industry, with members that own and operate more than 900 commercial and public television stations nationwide. OMVC is a private industry group.

It is essential that there is an industry group exposing and driving the broader commercial opportunities in Mobile DTV in the most promising direction. The Author has been and is highly supportive of the TV station broadcasters’ right to develop and provide comprehensive mobile television service into the future, but the Author seeks to address, analyze and present the issues independently from the OMVC perhaps resulting in different approaches for the group station owners. There is also a possibility that the Author’s independent detailed analysis of TV market forces may result in conclusions that Mobile DTV, as currently configured and promoted, is not a future panacea for TV station broadcasters. We’ll see later in here.

Analyzing OMVC Data:

The OMVC website (www.omvc.org) includes a page “Mobile DTV Station Guide” (downloaded on 1/24/11) listing 60 DMAs (out of a total of 210 DMAs per Nielsen) in the U.S. listing the DTV stations providing Mobile DTV service and/or planning to launch Mobile DTV service in 2011. The underlying count of interest is somewhat labor intensive to get to, but the Author was able to arrive at the following table.

The numbers were deciphered from OMVC data available on its website on 1/24/11 and from a supplemental Excel kindly supplied to the Author by the OMVC. The analysis shows that there are 52 DTV stations currently delivering Mobile DTV service to its DMA coverage area as of January 2011. In addition, there are 112 DTV stations planning to initiate Mobile DTV service in 2011, expecting the number of DTV stations providing Mobile DTV service to reach 164 by the end of the year.

That’s 164 Mobile DTV station in 60 listed DMAs, or (nearly) 3 DTV stations in each DMA on the average. Other interesting observations are that 37 are expected to be VHF Hi-band DTV stations, but only 2 VHF Lo-band DTV stations. There are about 1,780 full power licensed DTV stations in the U.S., thus we can state that approximately 10% of all DTV stations will be delivering Mobile DTV service by the end of 2011. The Author sees 10% as disappointing.

Assertion #4: Any Mobile DTV success will first be measured locally, DMA by DMA, and only after that review national success. Currently, Washington DC consumers enjoy a total of 7 DTV stations offering Mobile DTV service, 5 in Charlotte, 4 in Orlando and 3 in Seattle and in Philadelphia.

OMVC initiated Washington DC trials (“OMVC 2010 Consumer Showcase—Washington DC”) involving several hundred persons equipped with “personal size” Mobile DTV receivers/displays in 2010. The results of the trials so far indicate that “mobile television prime time” starts at noon, peaks at 3PM, and declines to the noon-level by 8PM. This is a difficult analysis as the “sample population” may be too small and the demographics are not detailed. Tentatively, Mobile DTV viewership interest rapidly climbs during lunch hour, maintains high interest until mid-afternoon perhaps by extending the lunch hour Mobile DTV watching. After which there is lesser but still significant interest through the commuting hours from 4PM to 7PM. Many questions come to mind: (a) were most if not all participants gainfully employed in full time day jobs? (b) How many were public transport commuters and how many private car commuters? (c) Why was there a peak of viewing interest starting as early as 3AM in the morning? (d) Full time all day employees are not permitted to watch TV on the job, thus it is puzzling that Mobile DTV watching remained at lunch peak levels in the afternoon.

Competitive TV Program Offerings:
Broadcast Mobile DTV vs. 4G Mobile Television

We continue in here to analyze and try to define the term “Mobile Television” as we obviously expect mobile TV delivery to grow in the future. Although the daytime work force at large, school children and students may try to “sneak view” TV programs during the day, enabled by the availability of TV programs on “personal-sized TVs” (which include viewing on smartphones as well as Mobile DTV devices), such viewership is not consistent or material in the overall picture. If the viewer is not permitted to watch TV (at school or at work), then such “sneak view” should perhaps not be audience rated and should not be material in the determination of commercial success.

TV Everywhere

Comcast (cable) and Time Warner (not cable TW) announced TV Everywhere initiative in 2009, and it was initiated by 2010 and adopted by a number of media companies. TV Everywhere is simply a verification system that allows television service providers to authenticate current subscriptions of those who wish to access television programs over broadband wireless (and wired) on demand internet television services, that they are already paying customers, for instance of Comcast cable. So, if you are a Comcast cable subscriber and you’re sitting on the bus with your smartphone wishing to watch a HBO movie (HBO is a Time Warner company) over your 4G internet connection, the access process will presumably include authentication by Comcast that you are a HBO-tier subscriber, and then allow you smartphone (or 4G USB stick-on-a-laptop) access to watch HBO. TV Everywhere is really a “joint scheme” by MVPD (Multichannel Video Program Distributors) and TV program/channel providers to make it more difficult for broadband wireless (and wired) providers to increase market share of their “OTT partners”. For example, HULU and Netflix are not cable channels, thus direct competitors to cable TV delivery, so TV Everywhere attempts to limit the need for accessing (and subscribing to) HULU and Netflix while in a mobile environment by making it easier (and perhaps free) to access cable channel programming instead. But … will you pay the 4G wireless provider for the internet data bandwidth used for TV Everywhere programs? Probably.

Local TV Station: Internet Simulcast Streaming?

Every major local TV station with newscasts operates their own websites, some with streaming live from time to time. Or the internet surfer can choose the news story videos she wants to play back, or select the weather story video for the day. But what about continuous simulcast streaming in real time of the main ATSC DTV OTA channel? Not a problem, at least not technically. However, legally, the affiliate may not have the rights to distribute the network or syndicated programs over the internet. But the locally originated newscasts should be subject to no such limitation, being able to stream simulcast the news, weather and traffic during morning, midday, late afternoon, early evening and late evening, including national network news feeds with the network’s permission. This is where the broadband wireless providers and OTT folks fall short: No access to comprehensive and professionally produced local TV news, weather and traffic. The local TV station with the best internet streaming of local news, weather and traffic (and add sports news to that) wins the mobile television race, at least locally measured. Because, except for people watching soap operas during lunch break, who will watch mobile television during a working weekday? Very few. And who will watch a movie on a smartphone at 8AM while commuting to work. Very few.

It’s Commuter TV, stupid … or is it?

In the greater Los Angeles area (LA County, more or less the LA DMA) on a typical workday early morning, there are nearly 5 million people commuting to work between the hours of 6AM and 10AM, and returning home between the hours of 4PM and 8PM, of which 3.5 million are driving alone, nearly 1 million in car pools, and about 500,000 go on public transport.

Another interesting statistical consideration for TV station executives is that the purchasing power of the 500,000 public transport commuters are rather low on the average, thus it is quite clear that the desirable audience to be reached over mobile TV by the advertisers is the nearly 4.5 million of commuters driving to work. The local TV stations need to reach the (local) Commuters-by-Car as the primary mobile television audience, as, in LA, this audience is about 8x larger than public transport commuters.

Yes, Mobile TV = Commuters-by-Car TV

The ratios in the New York DMA may be different, with less car commuters and more public transport commuters, particularly with respect to commuters working in Manhattan. But considering the larger NY DMA including Long Island, New Jersey, northern Counties and Connecticut, the commuters-by-car are in the millions and exceeding the total number of public transport commuters. Another consideration is that video reception in subway and car/bus tunnels is likely to be mediocre or non-existing, thus public commuters from the suburbs into Manhattan will lose live OTA coverage once entering Manhattan. The commuters-by-cars on the other hand will want to view news and traffic long before entering Manhattan to decide their best route to get to midtown, whether on Henry Hudson or FDR. No such choices are available or needed for the public commuters.

Assertion #5: The most attractive mobile TV market (for local TV stations) seems to be commuters-by-car from 6AM to 10AM and from 4PM to 8PM, for a total of about 8 hours per weekday, and where the largest audience share is probably drawn to local news, traffic and weather.

It’s difficult to understand and accept the OMVC case study in Washington DC, that Mobile DTV viewership will peak between 2PM and 4PM if the “sample population” were largely employed in full time day jobs. And if the “sample population” were largely stay-at-home moms and retired persons, then they would probably watch TV at home. The Washington DC trials seems to indicate that a relatively small percentage of all Mobile DTV receiver/displays were active at any one time.

Mobile TV Program Choices:
Mobile DTV vs. 4G Broadband Wireless

A Mobile DTV program consumer in a Top-10 DMA like Atlanta (DMA #8, 2.4 million TV homes, 14 full power stations) may have available (once Mobile DTV is substantially developed) a selection of 14 to 20 Mobile DTV channels on his Mobile DTV receiver/display. Let’s say 5 TV channels have full newscast operations and will simulcast news, weather and traffic over Mobile DTV. Outside of commuting hours, most of the Mobile DTV channels will simulcast regular programming of which major league sportscasts will be of significant interest. That is IF the local TV station is permitted to simulcast the major league sports event on the Mobile DTV channel. Remember, a radio network may be spending millions of dollars for the major league rights to reach in-car travelers by radio, and the radio folks will object to mobile video coverage.

A mobile TV program consumer using 4G Broadband Wireless in Atlanta has available hundreds of TV channels and potentially thousands of TV episodes and movies ON DEMAND, many of which will be free if she is a cable TV subscriber (using TV Everywhere privileges). The consumer may even have major league sports coverage available, perhaps even through ESPN if ESPN is participating in TV Everywhere arrangements. Granted, she must subscribe to OTT services like Netflix, HULU etc. and likely pay for excess 4G broadband data transfers if she is watching a lot of mobile TV using 4G. (Such excess charges may be expensive—see below)

The 4G TV consumer can even access the local TV stations’ websites over the broadband wireless internet connection AND view any simulcast of news, weather and traffic IF the local TV stations provides such simulcast internet streaming. AND the 4G wireless provider (Verizon, AT&T, Sprint and T-Mobile) cannot restrict such access to any legal website without violating the recently adopted FCC Net Neutrality Rules. All the wireless provider can do is to charge the consumer subscriber for excess data transfers without discrimination.

What is the monthly data transfer for watching the news, weather and traffic streaming simulcast from a local TV station over the (wireless) internet? Let’s assume watching on an in-dash 7” monitor at a relatively high quality 854x480p30 (wide SD) at 1 Mbps, adding up to nearly 1GB per day (for 2 hours/day wide SD streaming) and 20GB per month commuting 22 days per month. At Verizon’s current excess rate of $10 per GB (over the max plan of 10GB for $80 — Verizon website 2/15/11), assuming that all 20GB is monthly excess, the monthly excess charges will be about $200! ($280 per month for broadband wireless including the base level max plan.) Obviously, NO consumer will pay at those levels for daily local TV station streaming. If we reduce the streaming picture quality to equivalent of near minimum Mobile DTV at 416x240p30 at 0.4 Mbps, the monthly wireless data consumption will be 8GB still costing $160 for the month watching 2 hours per day for 22 working days (8GB adding to the 10GB base level). Still too expensive.

Assertion #6: Cost is the only (potential) advantage of Mobile DTV over 4G Mobile Television, that, once the consumer buys the Mobile DTV unit, mobile TV programming delivery is (supposed to be) FREE, but limited to what program the local TV stations decide to put on the Mobile DTV channels. (But whether “free” is preferred over “a reasonable charge” depends on a number of issues.)

Let’s make a deal:

Local TV station simulcast streaming
over local wireless broadband

What are then the options for the local TV stations, the Group Station Owners and the Network O&O Divisions? Let’s take a major Group Station Owner with TV stations in major markets, all heavy local news operations. The Group could explore making a deal with Sprint (or one or more of the other 3 providers of 4G) for all of their DMAs where:

  • Any Sprint 4G subscriber at any time located (by cell tower ID) within a specific DMA is able to access the Group’s local TV station’s simulcast internet streaming of their main HDTV channel without incurring excess data transfer charges
  • Any Sprint 4G subscriber at any time located outside the specific DMA will not have access to the local TV station’s simulcast

The key here is competitive advantage and positioning of the local TV stations with full news operations, and we can assume that, if one local TV station faces success making such a local deal, then all major TV stations in any top-100 DMA will want the same agreement with the 4G wireless broadband providers for competitive reasons. This may generate a “reverse retransmission fee” environment where the local TV station may pay one or more of the 4G wireless providers a monthly fee for not charging the viewers any excess data transfer charges for watching the TV stations program streaming locally. What will the cable companies say to the TV stations paying the 4G providers, while the cable companies are paying the TV stations?

Not only will such a TV station wireless streaming arrangement cover local mobile displays and smartphones, but can also be used by home TV audience to bypass cable/satellite TV and deliver the same TV station simulcast over the internet to any home where TVs are “net-connected”, subject to the mobile simulcast picture resolution being acceptable viewing on the much larger home HDTV sets. 720p60 would be preferred, with 720p30 being acceptable, while the earlier mentioned wide SD 854x480p30 will work relatively well for the home HDTVs below the 37” screen. We are now getting back to the 720p60 being the preferred HD ENG/EFP format for local TV stations, easily scaling to 720p30 and to 854x480p30.

Triple format simulcast streaming leaving the TV station? Don’t confuse this with a TV station’s website. We’re talking about a separate live scaled streaming over the internet of the main HD channel OTA. Thus, a reasonable approach to get maximum internet audience coverage is to stream three versions concurrently: 720p60 for home viewing on “wired net-connected” HDTV sets, 854x480p30 for wireless viewing on “larger in-car displays”, netbooks and tablets, and 420x240p30 for smartphone viewing. There may be a business model here for the 4G wireless providers. Sprint (and the others) may determine that a sufficient number of local 4G subscribers may each pay $15 per month for the privilege of being able to receive live wireless streaming from all (participating) local TV stations (including related data transfers), which subscription revenues then may reduce or even eliminate any “reverse retransmission fee” demanded by the 4G providers. In the 5 million commuter LA DMA, if 10% subscribe to “local 4G mobile television” each at $15 per month, annual additional 4G revenues just for the LA market will approach $100 million. On a U.S. national scale, with LA DMA being about 5% of the national TV market, this is a $2 billion annual market at 10% subscription penetration, but in the longer term may be significantly larger.

Mobile DTV or 4G Mobile TV? The Author believes the story so far in here is starting to favor 4G Mobile TV. Read on.

The “Big Stick” (M)DTV Antenna vs Hundreds of Local Cell Towers:

The Author is in the start-up phase of testing Mobile DTV reception in the LA DMA, having recently purchased a 7” Mobile DTV/DTV receiver/display as well as an In-Car tuner/receiver (no display). The “Big Stick” DTV antennas of the major TV stations are on Mt. Wilson, at an elevation of about 5,700 feet with “big stick” TV towers going up many hundreds of feet from there, resulting in effective antenna height of about 6,000 feet above sea level. (HAAT is lower due to surrounding hills.) The Author’s home in the San Fernando Valley has line of sight to Mt. Wilson about 25 miles away. HDTV OTA reception with small outside directional UHF antenna produces excellent pictures on 56” HDTV set.

Limited testing at home inside and on-top-of-dash with 7” Mobile DTV receiver/display (using foot-long pull-out antenna) does not yet convince the Author of wide-area reliable Mobile DTV reception. Once in a strong signal area, reliability was very good at interstate highway speeds up to 70 MPH, but, with LA’s many freeways, there were loss-of-picture for miles at a time when driving in “DTV signal shadow areas” while cell phone coverage was still excellent at high speeds. However, the Author has not yet tested reliability of 4G video streaming while moving fast in a car.

Qualcomm’s FLO (mobile) TV, now being discontinued, was based upon a limited number of up to 50kW “cell” transmitters on UHF Ch.55 in any covered metro market, using a OFDM carrier scheme with QAM or QPSK modulation. The commercial failure of FLO is not believed to be because of poor or unreliable reception, as the basic FLO wireless transmission format was developed to provide reliable reception in a moving vehicle at speeds exceeding 130 MPH (200 km/h). As 4G wireless transmission technology is based on OFDM and similar modulation schemes, 4G should have excellent “fast moving” reception capabilities.

There are hundreds of local wireless cells covering the greater LA area, offering good cell phone coverage of “shadow areas”. If a problem is uncovered, the a new cell is installed to accomplish a nearly complete coverage of the metro freeways where the traffic flows (covering those 4.5 million daily commuters). That is the objective of the wireless cell system, to cover the areas where the mobile customers frequently travel. This is NOT the primary objective of the “Big Stick” TV station antenna, which primary objective is to provide the best OTA coverage to maximum number of fixed location households in the DMA. The areas with heavy traffic through hills and valleys, but without significant population, may not be properly served by the “Big Stick” high power antenna, particularly when it comes to fast moving in-car Mobile DTV receivers.

Preliminarily, the Author believes that 4G wireless video streaming will provide significantly better coverage throughout a served DMA than would the “Big Stick” ATSC M/H (Mobile DTV) transmissions.

Fastest Mobile TV adoption:

By 4G Subscribers or Mobile DTV Set Owners?

The Future of Mobile Television

The Author believes that mobile television will grow significantly through this decade, particularly in the area of local mobile television watching. The current Mobile DTV approach is a difficult business model while 4G mobile TV is an easier proposition

The MAIN Reasons why Mobile DTV is a difficult business model:

  • Require users to purchase Mobile DTV receiver (with built-in or separate display)
  • Major DMA market Mobile DTV coverage is likely to have many dead spots along significant traffic arteries
  • Possible early Mobile DTV success is likely to exponentially increase 4G wireless competition in local mobile television delivery, to the detriment of ongoing Mobile DTV consumer adoption

The MAIN Reasons why 4G Mobile TV is an easier proposition:

  • No hardware to buy. Users can receive and display mobile TV programs on existing 4G consumer devices
  • 4G signal coverage generally very good throughout a major DMA along all significant traffic arteries
  • Early 4G success in local mobile television watching is likely to materially damage the ability for Mobile DTV to fully develop commercially

Mobile TV’s success rests with Local News, Traffic and Weather, as does the long term existence of Local TV Stations

In the Author’s opinion, local TV stations without significant news operations will see a very tough competitive environment in the future, as movies-on-demand and syndicated TV episodes becomes more-and-more available through many sources OTT through wired and wireless internet, making non-local-news TV stations “a thing of the past” by the end of this decade.

In the Author’s opinion, the future of Mobile TV by broadcasters must be based on Local News, Traffic and Weather, acquired and produced in HD for the primary DTV channel, and likely simulcast as scaled down internet streaming over local 4G cells, in “joint ventures” with the 4G service providers. Only local TV stations with full HD news operations will flourish as traditional TV stations through this decade.

HD News and live HD ENG make your local TV station highly competitive

Today and tomorrow. The sooner, the better. Accordingly, the Author believes it to be essential for any TV station, with or without a mobile television business model component in its future, to transition to full HD news including live HD-ENG at the earliest time, and to accomplish such in the most cost effective way while maintaining local news leadership with options open for the future. The ProHD family of camera/recorders is one source of highly cost effective HD news acquisition tools. With nearly everything now coming up progressive, shooting and producing in 720p60 for HD newscasts will make your TV station ready to easily scale to any mobile television streaming format, whether your studio and OTA format is 1080i or 720p.

Current and future flexibility, cost effective operations and buying more for less are the virtues of the JVC ProHD range of fully professional HD camcorders and cameras, ideally suited to support a highly competitive local TV station operations for years to come. On Air. On Time. On Budget.

Posted in NAB-2011 | Leave a comment

COUNTDOWN TO NAB 2011 — Issue 2

Local TV Stations shooting HD News and delivering for the 3 Television Screens

It’s 3-Screens, 720p & 16:9; Not 3D

Local success requires HD … primarily cost effective HD News

If your TV station is not into newscasts, there is little need for local shooting of any kind, except perhaps for local HD commercial production as a service to the advertisers. Local news, weather and traffic are the staples of a successful TV station, in addition to sports results reporting. Local newscasts require HD in the studio, HD ENG and HD weather and traffic in order to be competitive and to be a contender for local ratings leadership. But let’s see how the local HD shooting and production relate to the best possible delivery to all of the 3 Television Screens: Home Television, Desktop PC Television, and Mobile/Wireless Television.

Four TV Platforms or Screens?

It is difficult to get agreements among media executives if there are 3 or 4 TV screens (or platforms) in the future. There is little discussion on the subject of Screen #1 being home televisions sets and Screen #2 being PC/Mac (computer) displays, although the PC/Mac displays may be either Desktop PC/Mac or Laptop PC/Mac. The Author herein has decided to classify Screen #2 as home-based PC/Mac desktop PC display (AND laptop PC/Mac used as desktops at home). Screen #3 by some media executives are split into two: (a) Mobile “internet-based” wireless video-capable devices (Screen #3) and (b) the emerging Mobile DTV (Mobile DTV) by ATSC broadcasters (Screen #4). Again, the Author has decided for purposes herein that Screen #3 comprises television watching on all types of “on-the-road” screens attached to mobile wireless devices whether a laptop, netbook, tablet or smartphone, or on any Mobile DTV receiver/display.

The following Table illustrates the Author’s analysis of “The 3 Television Screens”:

All Displays are now Progressive
All Newer Video Formats are Progressive

The last bastion of interlaced TV format is 1080i, standardized in A/53 document by ATSC in 1995 and adopted by the FCC in 1996, together with the progressive 720p. All newer video-capable displays are progressive, including all of the above tabled types of screens. All newer video formats are progressive including the ATSC M/H (Mobile DTV) standardized in 2009 with a basic “small screen” resolution of 416x240p and with a maximum resolution of 832x480p, which is substantially the wide 16:9 SD 480p. 1080i is in use by the TV broadcasters and channel providers primarily affiliated with CBS, NBC and PBS and by the cable systems (and satellite and IPTV systems) distributing those TV signals in their native 1080i format. ABC and FOX are 720p. The most successful cable channel package (ESPN) is 720p, and all OTT streaming TV delivery services are progressive and most offer 720p as the highest streaming resolution.

To convert broadcast quality 1080i to broadcast quality 720p is not difficult these days, however it is still easier to convert from 720p to 1080i (from progressive to interlaced). Does the average “Joe the viewer” see any difference between OTA broadcast in 1080i or 720p even on a larger HDTV? Not really.Whether the local HD acquisition format is 1080i or 720p (or even SD), the engineers and the editors will make sure that the multiple delivery formats are converted and scaled with professional results to best suit the various progressive Screen #3 display targets.

Timely planning for Mobile DTV Delivery:
Lower resolution today … Future 720p60

Qualcomm is discontinuing FLO TV, the mobile multi-channel TV service offered through Verizon, AT&T (limited to a few smartphone models with built-in FLO TV UHF Ch.55 tuner/receiver) and direct from FLO (through dedicated portable/hand-held wireless Ch.55 receiver/display units). Up to 20 TV channels were offered for $10 to $15 per month, resulting in limited public interest over several years of trying. Part of the problem may have been the small screen and poor resolution (320x240p30). Another problem with FLO, in the opinion of the Author, was the lack of local TV news, traffic and weather, as we said before: HD News and live HD ENG make the local TV stations highly competitive.

Accordingly, the Author believes it to be essential for any TV station with a mobile television business model component to transition to full HD news including live HD-ENG at the earliest time, and to accomplish such in the most cost effective way while maintaining local news leadership with options open for the future. The ProHD family of camera/recorders is one source of highly cost effective HD news acquisition tools. With nearly everything now coming up progressive, shooting and producing in 720p60 for HD newscasts will make your TV station ready to easily scale to any mobile television streaming format.

Mobile DTV (Mobile DTV or originally named ATSC M/H) is NOT bandwidth efficient. Because M/H was (obviously) required to receive and reliably decode ATSC M/H (add-on) signal in a fast and continuously moving situation (speeds to 100 MPH), a very robust forward error correction of up to 3 times the net payload is required.

As mentioned earlier in here, Mobile DTV offers the opportunity to deliver a basic 416x240p TV signal to dedicated Mobile DTV receiver/displays, an enhanced 624×360 and a maximum resolution 832×480, interleaved into the 19.4 Mbps 8-VSB ATSC over-the-air transmissions from local TV stations with a reduced bitrate available for the main HD channel and/or SD multicast service.

Learning from the FLO TV experience, assuming one market problem with FLO TV was the small screen and the low resolution, it may be reasonable to conclude that a successful Mobile DTV operation may require at a minimum the 624×360 raster if not the 832×480 to obtain the broadest possible audience in the longer term.

In any top-100 DMA, there are generally anywhere from 4 or 5 TV stations up to as many as 20+ licensed full power stations, meaning that several TV stations may be on the air with Mobile DTV programs in a competitive environment of local news, weather and traffic. Although content and talent are very important, the presented program resolution plays an important competitive role, thus the basic 416×240 is not likely to be competitive. This points to a requirement to shoot and produce local content in 720p, from which scaled down versions to 624×360 and 832×480 can be easily made. The ProHD camcorders, whether the feature-rich GY-HM100 handheld or the brand new GY-HM750 shoulder mount, acquires professionally in 720p and in 1080i (both 59.94) for those TV stations which are 1080i.

Home Screens vs. Mobile Screens:
Required HDTV Screen Resolution

There are two primary conditions required for maximum enjoyment of real HDTV programming:(1) a relatively wide viewing angle (meaning sitting relatively close to the screen), and (2) the screen displaying true HDTV video quality. Every larger consumer HDTV set sold today have a progressive display resolution of 1920×1080 pixels coupled with the ability to display interlaced 1080 processed to progressive presentation with 120 or 240 Hz image refresh rate. The smaller home HDTVs (32” and less) with native 720p displays may or may not offer (or need) similar refresh capabilities. The “Mobile Screens” refer to laptop and netbook screens, and to i-Pad and Smartphone screens.

The Chart above looks at a viewer 8 feet away from a 52” HDTV set with 1920×1080 screen resolution, which produces a normal (horizontal) angle of viewing of about 26 degrees in a home environment. SMPTE recommends minimum 30 degrees for a movie theater, while THX recommends 36 degrees. However, the movie theater “screen resolution” is generally on the order of 4kx2k (4x times 1920×1080) supporting a much (wider angle) closer viewing scenario without “seeing each pixel”. A fully resolved viewing distance is about 7 feet with 52” HDTV with 1920×1080, producing a viewing angle of 30 degrees. But the 8 feet and 26 degrees are more “real life” home HDTV viewing conditions for a 52” HDTV. The Chart shows the approximate screen sizes with equal perceived resolution (1920×1080) as the viewing distance is decreased foot-by-foot down to 1 foot, subject of course to the viewer having good eye sight.

So, viewing a 52” HDTV screen at a distance of 8 feet yields about 26 degrees viewing angle. For the viewer to have a substantially equal viewing experience with a 37” HDTV screen (also with 1920×1080 pixel matrix, and identical HD program material), the viewing distance must be reduced to a bit less than 6 feet. It so happens that the best selling HDTV size of the past two years is the 32” HDTV size (10 million units sold in the U.S. in 2009), but that size is often offered in 1280×720 pixel resolution as well as in 1920×1080. The viewing distance must be reduced to about 5 feet for the 32” 1080 HDTV to match the 52” HDTV experience at 8 feet.

1080 Pixel Size vs. 720 Pixel Size

In the horizontal plane (width), the ratio is simply 1920 divided by 1280 = 1.5. These HDTV formats were designed with square pixels, thus the vertical ratio (1080/720) is also 1.5. Thus, theoretically, the viewing distance for the 32” 720 HDTV must be increased to over 7 feet for the 720 pixel size to visually match the size of the 1080 pixel at 5 feet. However, in practice, the perceived resolution of the viewer of a specific transmitted HDTV program is generally more dependent on the origination and transmission format (1080i or 720p) rather than whether the HDTV display is native 1080 or 720, unless the supplied HDTV material is at the extremes, where near static 1080i images would favor 1080p displays and where very fast moving 720p images with great detail would display equally well on both 720p and 1080p displays. This indicates that there is a viewing advantage in buying a 1080p home HDTV over a 720p, particularly for 32” sizes and larger. But remember that fast sports in 720p HD may display better on the 1080p home HDTV than 1080i coverage of the same fast sports event. (Also remember that there are only two basic broadcast HD OTA formats (ATSC) in use: 720p60 and 1080i60, and that progressive is more efficient to compress than interlaced, causing OTA broadcasters to only use 12 Mbps compressed for 720p60 while often needing 16 Mbps compressed for 1080i60. Note: 60 is actually 59.94).

Viewing TV on Home PC Monitor

There are several delivery methods for watching TV or videos on the home PC monitor: (1) DTV (ATSC OTA) USB Stick receives streaming and displays HDTV programs (no monthly fee), (2) Wireless Broadband USB Stick receives and displays any TV and video program available over wireless broadband subscription (Internet OTT, PPV, VOD or monthly subscription), and (3) Wired Broadband connection through your cable or FTTH internet provider receives and displays any TV and video programs available on the internet (Internet OTT, PPV, VOD or monthly subscription).

According to DELL, a major PC monitor supplier, most wide displays offer at least 1920×1080 resolution, with some up to 2560×1600 to serve CAD and similar extremely high resolution applications. PC monitor sizes in 2011 are generally from 19” to 24”, with some models up to 30”.

Desktop PC Viewing Distance

A common viewing distance in front of a new, larger and wide PC monitor is about 2 feet minimum, perhaps extending past 2.5 feet in cases viewing very large monitors (> 24”). Going back to the “Near Fully Resolved Viewing Distance Chart” above, a 24” PC monitor with 1920×1080 pixel resolution is nearly fully resolved by a human 20/20 visual acuity system at about 3.5 feet. That means that, at only 2.5 feet viewing distance, the viewer may concentrate and focus, and be able to “see” each pixel point. We can therefore conclude that any new, larger and wide PC monitor should provide a display resolution of at least 1920×1080. It seems impossible to find and buy any larg and wide PC monitor with less than 1080 resolution in 2011.

“Window Watching” TV/Video on Desktop PC Monitors

Watching video or television on your large, wide desktop PC monitor is not likely to be a substitute for watching prime time first run television or immersive movies on the larger home HDTV, for most people. The majority of home viewers is NOT likely to sit down for hours in front of their large and wide desktop PC monitor, only 2.5 feet away, and watch full screen television. The desktop PC monitor TV viewing (or video viewing) will be “window watching” where the live video is likely to occupy about one quarter of the screen area, in order to keep sufficient screen area for working on PC productivity apps or surfing/searching while watching. On a 1920×1080 resolution PC monitor, one quarter resolution is 960×540, thus the viewers maximum perceived resolution for the (one quarter) video window cannot exceed what is slightly higher resolution than the wide SD (U.S. 853×480).

On a very large PC monitor (i.e. 27”) with full screen resolution at let’s say 2560×1440, the one quarter window provides a pixel matrix of 1280×720, exactly matching the 720p HD standard. We conclude that the majority of desktop PC monitor TV/video “window watching” is largely served by HD streaming in 1280x720p60/30/24 format, but often viewed in less-than-720p as pre-selected by the OTT TV streaming service presuming a PC monitor destination. The starting streaming resolution is often 360p with options for the viewer to increase streaming resolution up to 720p.

Full screen watching of TV/video on your large desktop PC monitor is really just like watching smaller screen HDTVs, with the big difference being the viewing distance. Too close in the PC environment, and probably to far away in a TV room environment. The “Near Fully Resolved Viewing Distance” chart above indicates that a 27” HDTV with 1920×1080 native resolution should ideally be viewed at a distance of about 4.5 feet. You sit a lot closer to a 27” PC monitor than 4.5 feet.

Remember that the PC/Mac desktop monitor is nearly always displaying broadband internet supplied TV/video material, and generally not TV channels via cable, satellite or FIOS/U-verse.

Viewing Mobile/Wireless Television:
On-the-road means stationary and moving

On-the-road Stationary may mean watching prime time TV or a movie while sitting with your laptop, netbook or i-Pad at a fixed location like in the Admirals Club at DFW airport . On-the road Moving may mean watching a streaming HD movie while on the Metro North train from Grand Central to New Haven. Although “wireless” may be well served by Wi-Fi hot spots in the airport lounge or on the train, in here we’re primarily talking 4G broadband wireless now becoming reality across the U.S. with downlink speeds from 5 to 12 Mbps, sufficient to view relatively good HD quality television in a moving environment. But you need to subscribe to the 4G wireless broadband service and usually plug in a 4G USB “wireless antenna stick” to your “larger” mobile display device, UNLESS you’re watching on a smartphone, mini netbook or tablet with built-in 4G transceiver.Note that both the ACER Netbook and the APPLE i-Pad offer about 10” diagonal screens with 1024 pixel resolution across. Horizontal resolution made up of 1024 square pixels requires 576 pixels of vertical resolution in a 16:9 aspect ratio HD screen. 576 “lines of vertical resolution” is PAL, however, PAL is 4:3 aspect ratio, thus 1024 x 576 is a “16:9 Wide PAL” raster. Internet delivered OTT (Over-The-Top) HDTV programming is largely delivered as 1280x720p60 (or p30, or p24 with 3:2 pulldown), which, when scaled to the 1024×768 i-Pad screen will provide for a relatively large (bottom) black bar of 1024×192 suited for control icons, but, again presuming square pixels, only 75% of the i-Pad display is utilized for the 16:9 720p HD presentation, reducing the “effective diagonal HDTV screen size” to about 8.5” (down from the full screen 9.7”). Scaling the 1280×720 to the ACER is accomplishing nearly full screen viewing at 10” diagonal, and the DELL laptop’s 1366×768 square pixel 16:9 display is a perfect “full screen” 720HD conversion.

Viewing distances of 1280×720 portable displays

The near fully resolved viewing distances for 1280×720 are about 3.5 feet for the 14” diagonal, about 2.5 feet for the 10” diagonal, and about 2 feet for the 8.5” diagonal (effective 16:9 viewing area) i-Pad. All three examples are of the portable kind, but, when viewing long form HDTV material, the displays are nearly always stationary within a building or a moving vehicle, and not “pedestrian mobile” as a cell phone may often be. Comfortable viewing distances may be in the range of 2 to 3 feet, with the laptop, netbook or i-Pad positioned on a table or desk in front of the lone viewer. We conclude that a 1280x720p program offers sufficient resolution to give viewer a near true HDTV experience, particularly on the 14” laptop. There is no need for 1920×1080 program/delivery resolution for these wireless applications.

ATSC M/H is now Mobile DTV (Mobile DTV):
The future of OTA TV broadcasting?

A possible bright spot in 2011 within the TV broadcasting industry is Mobile DTV (Mobile DTV), as the FCC pushes forward with the “TV Spectrum Grab” in support of the wireless broadband providers and to the likely detriment of TV stations. Mobile DTV is believed by some to be a very important part of the long term financial health of local TV stations and their owners, the Group TV Station Owners. Others are skeptical about the Mobile DTV business model, including the Author . This Report will not detail the technical workings of ATSC M/H developed over many years as an add-on to ATSC OTA DTV, as finally adopted as a mobile/handheld TV delivery format in October 2009 (ATSC standard A/153).

A Simple Question:

Why not just receive the ATSC main (H)DTV channels over-the-air (OTA) on a portable TV with a built-in ATSC (H)DTV tuner/receiver? (Like we did back in the olden days with NTSC?) Technically, why do we need ATSC M/H (or Mobile DTV)?

The Simple Answer:

You don’t UNLESS you’re watching local TV while moving. The original ATSC standard (A/53—FCC adopted in 1996) was designed to deliver reliable digital television OTA to stationary antennas/receivers. A/53 is NOT capable of delivering reliable digital television to moving targets, such as to receivers on moving cars, buses and trains, or to receivers carried by walking pedestrians. (Just like NTSC was NOT.)

As the cell phone market and handheld devices developed into video display cell phones a number of years ago, the TV station industry recognized the opportunity to serve their local markets with mobile television service, as an add-on sub-channel to the main DTV channel with a technical requirement that it must provide reliable TV delivery to (dedicated Mobile DTV) receivers moving within vehicles at any reasonable land speed including interstate highway speeds. To make a long story short, ATSC standard A/153 did just that, but at a very low payload efficiency requiring from 3 to 6 times the payload bitrate to be added for error correction. The low (net) available compressed bitrate restricted the maximum resolution of the video payload to SD or less, depending on other factors including the bitrate consumed by the main DTV channel. The current A/153 Mobile DTV standard thus provides for a maximum resolution of 832×480 (up to p60 refresh rate), with a base resolution of 416×240 (max p30 refresh rate) and a third mid-point resolution of 624×360 (up to p60 refresh rate).

First buy a Smartphone …
Then buy a Mobile DTV Receiver/Display?

YES and MAYBE, provided you really want to watch local TV in your car, to keep up with local traffic in rush hour, as well as news and weather, or on the bus or train to watch other TV programs. AND provided there are Mobile DTV products available. That is the current shortcoming, that some of the consumer electronics manufacturers are not releasing prototypes into full production until there is reasonable certainty that the mass Mobile DTV market will develop. BUT this Report Issue is not intended to detail the CE product supply issues related to Mobile DTV. We’ll do that in the next Report (Countdown to NAB-2011 Issue 3) and explore why 4G wireless providers may agree to streaming local TV stations’ newscasts to local 4G subscribers.

Nearly every person in the U.S. between the ages of 15 and 65 owns a cell phone or a smartphone, adding up to nearly 300 million wireless subscriptions, counting a fair amount of duplication of personal and business cell phones. The consumer’s choice is not likely to be whether to buy a cell/smartphone or a Mobile DTV receiver/display. You’ll most likely buy the cell or the smartphone first, then you determine if you want a Mobile DTV receiver/display. Obviously, not every cell/smartphone owner will decide to purchase a Mobile DTV receiver/display unit. Many smartphone owners would rather want to receive Mobile DTV channels on their smartphones, but such requires the smartphone to have a built-in ATSC M/H (Mobile DTV) tuner/decoder. More about that in the next Report.

The illustration immediately above shows the availability of just one dedicated self-contained Mobile DTV product, the LG Mobile DTV receiver/display unit, with a native screen resolution of only 480×234. Mobile DTV channels delivered to In-Car ceiling and headrest displays really require at least “Wide SD” resolution, with the current highest Mobile DTV delivered resolution in 2011 being 832×480 (substantially equivalent to wide SD 480p). It is interesting to note that Apple fit the i-Phone 4 with a 960×640 native resolution 3.5” display, assuring a “Near HD” experience when watching 720p HD program scaled to 960×540 (16:9) on the i-Phone 960×640 display. The In-Car displays shown above with 800×480 resolution will give a high quality wide SD viewing experience when supplied with a 720p streaming wireless program or a hi-res 832x480p Mobile DTV signal.

Local TV Stations shooting to protect the old NTSC 4:3 analog TV set?

All of “The 3 Television Screens” discussed above are wide aspect ratio able to display 16:9 with minimum correction. All TV stations are now required (after the 2009 final DTV transition date) to transmit a DTV signal which, if 1080i or 720p, must be 16:9, although a 4:3 pillar box picture (with static side bars) may fill the 16:9 screen. However, any DTV signal which is SD480i may be either 4:3 or 16:9. But any such 4:3 picture when received by a HDTV set may be presented as stretched to 16:9 or as 4:3 pillar box with the static side bars (which bars used to be black but now may include darkish graphics to indicate to the viewer that the transmission is HD but the 4:3 pillar box picture is not).

The QUESTION is: How many old NTSC-only analog TV sets are still out there in TV households being watched every day, and NOT able to view a letterbox of a live 16:9 image?

Nielsen (The Nielsen Company, New York) says we have about 116 million U.S. TV households in 2011. If we agree that there are an average of 2 TVs per household watched every day, that adds up to 232 million potentially “daily active” TV sets.

There now are about 90 million HDTV households, leaving 26 million TV households watching on either wide screen (non-HD) DTV tube sets (remember those 480p DTV sets?) or old analog 4:3 NTSC TV sets. DTV tube sets (non-HD) had significant sales from 1998 through 2004, selling about 12 million units, leaving let’s say 14 million TV households with only old NTSC analog sets. “Analog-only NTSC TV set households” are generally lower income and perhaps retired people, and may have less that 2 TVs per household watched daily. Assuming 1.5 TVs as an average, there are a total of about 20 million old NTSC-only TVs watched daily. Looking at the above illustration, there are only three sources from which an old NTSC TV displays TV programs:

  • Analog cable TV service (NO Converter/Set Top Box needed)
  • DTV stations over-the-air with DTV Converter Box and antenna
  • Digital Cable/Satellite/IPTV through Set Top Box

In 2008 and 2009, over 33 million of DTV Converter Box (DTVCB) $40 coupons were issued to the public by NTIA and redeemed by the public to buy DTVCBs which converted OTA DTV transmissions to analog output to feed the old NTSC analog TV sets to enable viewing of the new DTV signals.The specs required were that DTVCBs must convert all ATSC formats to NTSC, and support a 4:3 center crop of a 16:9 transmitted image and a letterbox view of a 16:9 transmitted image.

Millions of older NTSC analog sets are in use through STB D-to-A conversions with the STBs supplied by cable TV, satellite TV and FIOS/U-verse subscriptions. Millions more are supplied by “hybrid analog/digital” cable TV systems where no STB is required for the old NTSC TV set to display the cable analog channels. However, this analog channel service may end by 2012, as cable TV systems may wish to convert the highly inefficient bandwidth use for analog channels to carry additional digital TV channels and perhaps use the bandwidth for other VOD/OTT-like services.

Back to the QUESTION: How many old NTSC-only analog TV sets are still out there in TV households being watched every day, and NOT able to control the screen view being letterbox OR 4:3?

The Author estimates that only about 6 to 10 million NTSC-only TV sets are being watched every day without being able to control the screen view being letterbox or 4:3. These are all basic cable subscribers only using the direct coax connection without any STB.

At the most, this is about 5% of all regularly/daily watched home TV sets.

Many major local TV station with extensive newscasts are always transmitting the primary DTV channel in HD, thus all material locally originated is (or should be) 16:9. However, the “hybrid analog/digital” cable companies are still required by the FCC (for some time after the 2009 final DTV transition) to provide “dual carriage” of most local TV stations, meaning that they carry the DTV channel of course in digital but also carry an analog version of the DTV channel in their “old analog cable spectrum” to serve those subscribers viewing on old analog 4:3 NTSC TVs so that they can continue to watch the local DTV channels in the old analog mode without having to subscribe to a STB (Set Top Box) and without the need to purchase a new HDTV set. The other reason is that many TV households own multiple TV sets, and, although 90 million TV households in 2011 have at least one HDTV, they may indeed have one or more old analog TVs which are well served by cable systems continuing the dual analog/digital carriage into the future. Such dual carriage is a competitive advantage over digital-only systems (DirecTV, DISH, Verizon FIOS and AT&T U-verse). But it comes at a price: to carry 50+ old analog channels on cable coax consumes 300+ MHz of bandwidth which in digital mode could potentially carry hundreds of additional digital channels. (But do we really need hundreds of additional digital cable channels? Not really in the opinion of the Author.)

The local TV station with dual carriage on the local cable system may request that the analog conversion of the wide DTV signal is distributed as a permanent letterbox within the 4:3 screen, but this may not be competitive as the overall picture size experience to the viewer is compromised.

So, according to the illustration above, the most competitive presentation to the NTSC 4:3 screen watcher seems to be to always fill the screen, requiring a 4:3 centercut of the wide picture. However, one could make it dynamic according to program material which would require more planning and efforts on the part of TV station’s management. Is it worth the extra efforts? Probably not.

For that most competitive reason, local TV stations may want to always supply a 4:3 center-cut of the 16:9 program, and to definitely “protect” any insertion of logos and bugs to be within that center-cut. A reasonable 4:3 protection of 16:9 HD studio and HD ENG shots, to provide news, weather and traffic programs to a “less commercially important” minority of audience watching on old analog TV sets, which minority is expected to get rather insignificant by the end of 2012, is not “bottom-line” essential but is readily achievable without strict guidance and control.

A Local TV Broadcast HD Format for all seasons: 720p60

We have analyzed “the 3 Television Screens” as to viewing distance and resolution required to satisfy the large majority of the TV audience for the next several years. We conclude that local acquisition and production, including HD studio news, HD ENG, commercial production and HD POV, are best served both economically and operationally by the only progressive HD broadcast format of 1280x720p60:

  • 720p ProHD provides broadcast quality 19 Mbps for HD-ENG
  • 720p ProHD provides local broadcast quality HD-SDI in studio configuration
  • 720p easily cross converts in high quality to 1080i (and 1080p)
  • 720p offers best-of-class compression efficiency (MPEG-2 and H.264)
  • 720p scales very well to SD and Mobile DTV rasters (they are all progressive!)
  • 720p is the dominant OTT TV streaming format
  • 720p is tailor-made for full HD resolution TV station simulcast streaming
  • 720p60 is recommended (over 1080i) for fast action HD programs and sports

Additionally, utilizing 720p60 as the main DTV OTA transmission delivery format will also make available the maximum bitrate for the emerging Mobile DTV, providing the possibility to deliver Mobile DTV multi-casting and/or Mobile DTV simulcasting to maximize local audience ratings across all 3 Television Screens.

Current DTV stations with 1080i studio infrastructure can simply remain 1080i within the studio complex, converting to 720p HD ENG/EFP and convert the ATSC OTA transmission to 720p to provide for maximum Mobile DTV service.

The local HD acquisition process starts with the HD studio cameras and the HD camcorders, and some of the most cost effective and professional 720p60 (and 1080i60) cameras and camcorders are in the JVC ProHD product line. Discussing your TV station’s HD acquisition needs with JVC Broadcast is highly recommended by the Author.

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COUNTDOWN TO NAB-2011 — Issue 1

NEW Live HD ENG backhaul technology as early as 2011?

Will bonding of multiple 4G broadband wireless connections soon replace BAS microwave?

Live HD ENG makes you highly competitive

Local, national, and worldwide television news must have the capability to go live on the air with late-breaking news, with live pictures from the remote site, and, when appropriate, live interviews between the news anchors and the field talent, and between the field talent and the on-location news-worthy subjects. Whether from the ENG van, the ENG helicopter, fixed-mounted POV locations, handheld or shoulder-carried camcorders, instant wired or wireless delivery of news to the TV station with real HD quality on-air is an absolute necessity for local TV news market leadership and profitability in 2011.

It’s all about ratings . . . in HD

The Author of this Report resides in Los Angeles (Nielsen DMA #2 – 5.67 million TV Households – Population covered is about 17 million – about 5% of the total U.S. TV households) and the Author is a “news nut”. Needless to say that all major TV stations are HD, and the leading news stations are equipped to do HD ENG. Dividing 17 million population by 5.67 million TV households gives 3 persons per TV household, however, actual late evening potential TV viewing is more like 2 persons per LA TV households after deducting children and older demographics. Total potential viewership of late evening TV viewing (10PM—11:30PM) is on the order of 11 million. Late evening viewing of newscasts in LA add up to around:

After Prime Time viewing comes the News . . . with live HD ENG

Don’t disappoint the “captive viewers” with mediocre HD ENG material, Don’t encourage the “captive viewers” to find another local HD news channel with live HD ENG content, because your live ENG is not real HD or perhaps not comparable with your station’s news studio HD quality. In Los Angeles, it appears that about 13% of all potential viewers watch the late evening news, either at 10PM or at 11PM. But if we agree that the maximum U.S. TV audience at any one time is 81 million TV HHs watching during prime time, then the total available viewers in the LA market is about 5% of 81 million x 2 persons (at 10/11PM) per TV household = 8 million viewers. We just stated that 1.4 million viewers are actually watching the LA late evening TV newscasts, which now computes to 18% of the potential viewers covered by the 70% of all LA TV HHs. In here lies a very interesting observation: The large majority of viewers watching TV station programs (as opposed to cable programs) from 10PM to 11:30PM are watching late evening newscasts. Besides showing top rated network or syndication programs, HD news studio and live HD ENG operation is the only way to higher local audience share and local market dominance.

Live HD ENG is a competitive necessity

Hundreds of TV stations around the US are already doing HD news from a new HD news set, many equipped with HD studio cameras, switchers and support equipment at investment level of millions of dollars per TV station. But HD studio news by itself, without live HD ENG, is no longer a major competitive edge in many Top-100 Markets. Live HD ENG is now a competitive necessity. It’s all about the ratings and audience share, which in turn is about attracting more and more local eyeballs, as an ever increasing HD viewer base watches television on HDTVs. One of the most important tools in 2011 to increase overall audience share is live HD ENG, reasonably matching the picture quality of your HD news studio. And to establish such live HD ENG capabilities with the most cost effective operations. So where does BONDING of multiple 4G uplink streams fit in? Are we still doing broadcast microwave? What is the story?

The story is all about the latest broadband wireless services called 4G or in some cases LTE or HSDPA+ and when this service comes to your metropolitan area. Probably later this year if not already there.

Bonding multiple 4G uplink connections

Let’s call them all 4G for simplicity, whether its Verizon’s LTE, AT&T’s LTE, Sprint’s 4G or T-Mobile’s HSDPA+. We refer to the fast wireless broadband services now being promoted by nearly all of the wireless providers. The issues are sustained downlink speed (DL) and sustained uplink speed (UL) between the various providers, as they vary somewhat. Verizon Wireless has indicated that “Consumer 4G Service” will deliver DL in the range 5 – 12 Mbps with UL in the range 2 – 5 Mbps. We expect that “Premium 4G Service” (or perhaps “Business 4G”) will be offered by all of the four major providers, and such must be competitive and be faster than the “consumer service”. But let’s “standardize” the “Business 4G data-speed” available for these discussion purposes. We set DL at an average of 12 Mbps and the UL at an average of 5 Mbps, both sustained, a fair expectation for 2012 in many major markets (if the Big Four service providers see profit opportunities at sustained 5 Mbps UL), but sustained UL at 5 Mbps is a real stretch for 2011!

As you want to transport compressed HD (live or real-time) from the field back to the TV station, you’ll be utilizing the uplink path (UL) at a sustained 5 Mbps. Thus, if you had a laptop in your ENG Van with a 4G USB wireless broadband stick, you may be able to send sustained 5 Mbps compressed live video back to your TV stations sometime by 2012, perhaps even in this year of 2011. (Presuming you’re in a 4G coverage area!)

But the potential problem is that you want to reasonably match the HD ENG live video quality with the HD studio quality. Your DTV transmitted OTA video is compressed by a $100,000 ATSC encoder system, perhaps outputting 16 Mbps if you’re 1080i, or perhaps at 12 Mbps if you’re 720p. It is not difficult to realize that live/real-time compressed HD to fit into the UL of 5 Mbps will fall substantially short of broadcast quality video, even with the latest technology H.264 (very expensive) real-time encoder. Enter 4G BONDING.


Let’s assume we’re working with a HD ENG format of 720p60, assuming a live compressed (local TV broadcast quality) stream at 19 Mbps supplied from the HD ENG camcorder. We obviously need 4x 5 Mbps circuits to transport live 720p60 at 19 Mbps, so if you sign up for four (4) separate 4G USB wireless sticks, and, if you are able to “BOND” those 4 each 4G UL channels together (or we may call it to “SLICE & SYNCHRONIZE & COMBINE”) to carry four slices of the 19 Mbps 720p60 live HD back to your TV station, each slice being about 5 Mbps, then reconstitute the video by a combining process back at the TV news studio.

Unless your HD camcorder provides a TS (compressed transport stream) output at somewhat less than 20 Mbps to be supplied to the 4G Bonding IP Processor, you’ll need an expensive real-time HD encoder between the HD camcorder and the 4G Bonding IP Processor, or, alternatively, a much more expensive 4G Bonding IP Processor to include a built-in broadcast quality HD compressing encoder.

HD ENG Van OR HD ENG Car?

Operational Preservation OR Future Innovation?

We’re talking local news, primarily, by major TV stations relying on news for DMA market leadership. Those kind of TV stations would currently operate a fleet of ENG Vans which need to be fitted for live HD operations. Those TV stations may take the opportunity (or may need) to modernize their ENG operations, and make it more cost effective, by reducing field staff while employing innovative strategies with new HD camcorders and support equipment, converting many of the 2-man ENG Vans to “lone ranger” operated highly cost effective “live capable” HD ENG Cars. Subject to establishing the viability of emerging broadband wireless technologies, your strategy may be:

  • Greatly reduce reliance on microwave backhaul (reduce future capex/opex costs as live HD ENG employs innovative new and cost effective technologies)
  • Establish wired internet connectivity points at often-used field locations (public internet or private network)
  • Employ BONDED 4G wireless live HD backhaul when and where reliably available,
    subject to acceptable costs
  • Eliminate need for complex and expensive support equipment (one such example being one or more broadcast quality HD encoder units required between HD camcorder and 4G Bonding Processor, or between HD camcorder and microwave unit)
  • Target a limited amount of HD ENG electronics equipment in the HD ENG car, sufficient for reliable live field reporting: HD camcorder with lowest bit-rate broadcast quality compressed HD live output, to feed into the 4G Bonding Processor (with remote 4G Head Unit), and editing laptop for field editing prior to backhaul transmission.

DWI = Driving While Innovating !

Many of today’s HD ENG Vans are highly capable remote broadcast vehicles, once set up at the remote location with the microwave antenna mast cranked up and directed. This “on site enabling and disabling” takes time, and, particularly, any directive to quickly move from one location to the next requires lowering the mast prior to moving, even moving just a very short distance. And then cranking the mast back up at the new location and establish the microwave link. Not so with the new innovative HD ENG Car with Bonded 4G Wireless connection.

As soon as the “lone ranger” HD ENG journalist turns on the Bonded 4G Wireless Backhaul circuits as he/she leaves the TV studios for the remote assignment, the HD ENG Car is in “live contact” with the TV studio for the duration of the assignment even while driving (no 25-foot mast concern), except (of course) in any 4G problem coverage areas. There is no need to hoist and lower any microwave mast! And for “delayed live”, the HD clips may be transmitted back to the TV studio while the HD ENG Car drives from one location to the next!

Cost Effective Live HD ENG Backhaul?

The basics don’t change much. The key issue is the compressed bitrate of the live real-time HD signal to be (a) near instantly edited in the HD ENG Van/Car, and/or (b) transported back to the TV station to go on-air, live or delayed. As “live” is the primary requirement, the “delayed” capability becomes secondary. If “live” is performed well, then “delayed” should be no problem. The quality of the compressed HD ENG video is very important, as the live field originated HD is intercut with the pristine HD video from the live HD news set. It is interesting to note that, as a larger portion of the local TV news hour is live (or delayed) footage from the field, it becomes more important that the field-originated HD reasonably matches the studio news set live HD picture quality. The compressed bitrates out of some typical HD ENG camcorders are as follows:

Note the 19 Mbps compressed full bandwidth 720p60 (59.94) transport stream (TS) available out of the JVC ProHD series of professional HD ENG camcorders, which broadcast quality stream (once decompressed) can easily be format converted to 1920x1080i60 (59.94) prior to going on air at the TV station.

BUT is the 4G Bonded Backhaul really cost effective? That’s really what we try to establish in this Report. There are several operational advantages, but are there also other efficiencies to encourage phasing out BAS microwave?

Note the 19 Mbps compressed full bandwidth 720p60 (59.94) transport stream (TS) available out of the JVC ProHD series of professional HD ENG camcorders, which broadcast quality stream (once decompressed) can easily be format converted to 1920x1080i60 (59.94) prior to going on air at the TV station. It is a fact that progressive HD video (i.e. 720p60) can be compressed with greater efficiency than interlaced video (i.e. 1080i60), meaning that it is not possible to compress the 1080i60 down to a 19 Mbps TS in the same compression domain (in this case MPEG-2) with the same subjective decoded average local broadcast picture quality obtained by compressing 720p60 to the 19 Mbps TS, in an encoder built into a cost effective professional HD ENG camcorder as in JVC’s ProHD range. Or a competitor would have done it already!


The message here is to save about $10,000 (perhaps as much as $30,000) by NOT needing to invest in a separate and expensive Real-time HD Encoder Unit for each HD ENG vehicle. Use the “local TV broadcast quality” 19 Mbps TS/ASI output from the JVC ProHD camcorders to feed live into the 4G Bonding IP Processor to accomplish 4G bonded backhaul (or into your existing microwave modulator).

The COST-side of 4G Bonded Backhaul

We presume a requirement of four (4) bonded 4G 5 Mbps UL connections for a total backhaul bandwidth of 20 Mbps over broadband wireless, capable of returning live (or real-time) HD ENG local TV broadcast quality video at 19 Mbps out of any ProHD camcorder.

Each HD ENG vehicle needs to “subscribe” to four (4) “premium 4G wireless USB sticks”. Assuming that unlimited bandwidth use subscription costs $150 per month for each of the four circuits, the total cost for the 4G Bonded Backhaul will be $600 per HD ENG vehicle per month. Sounds reasonable. If your TV station operates six (6) such HD ENG vehicles, monthly 4G cost will be $3,600 for all six vehicles. Still sounds reasonable. Note that these costs are speculative at this time.

BUT will 4G Bonded Backhaul actually work? Remember, with your dedicated BAS microwave link, once the mast is up and link is established, your reliability is 99%+. There are several variables before 4G bonded backhaul can work (for live local broadcast quality HD ENG video), the most critical being the availability of sustained UL at 5 Mbps in many markets around the U.S.

What about working with a sustained (half) UL of 2.5 Mbps? You simply need eight (8) bonded 4G circuits rather than four. It becomes a “technology sophistication/hardware issue” in the 4G Bonding IP Processor (and receiver/processor) but it is technologically available.

Data transfer bandwidth usage for live HD ENG news clips

Some “unlimited” data plans are not really unlimited, but may kick in data rate slowdown after usage reaches a certain level during the monthly billing cycle. Such threshold may be 5GB, or, in the future with “premium/business 4G” at $150 per month, perhaps a lot higher. Remember that we put each 4G circuit at 5 Mbps and that four (4) such 4G bonded connections are required for live HD ENG using 19 Mbps TS out of ProHD camcorder. Let us look at live HD ENG bandwidth usage:

It’s interesting to note that the cost of transferring a HD ENG news clip live or delayed real-time or delayed slower-than-real-time is the same over the same circuit connection, although the much higher sustained data-rate transfer capability of a specific “fast subscription” may carry a higher monthly base price.

We see from the table above that 30 minutes a day of live HD ENG transfers at 20 Mbps add up to about 112 GB per month per HD ENG vehicle OR nearly 30 GB per month for each of four 4G circuits. Computing the monetary worth of 112 GB per month in terms of consumer subscriptions would be interesting. AT&T Mobility quotes 5 GB per month for $60, where 5 GB presumably is the total of DL plus UL. 4G HD ENG is nearly all UL, which may be advantageous to AT&T as UL is generally not used by far as much as DL. We take 112 GB divided by 5 = 22 multiplied by $60 = ~$1,400 per month. Significantly MORE than the $600 earlier estimated. With six (6) HD ENG 4G cars, the total monthly backhaul transmission cost is approaching $10,000. Your current BAS microwave backhaul is now looking more attractive.

Bonding with different service providers

There are four major 4G service providers: AT&T, Sprint, T-Mobile and Verizon. Your DMA area may cover a large geographically area, where each service provider may have areas with both good and poor coverage, requiring you to contract with two or more service providers, rather than just one, to get sufficient coverage. The poor coverage may be “bandwidth speed related” where bonding two 4G circuits work well but bonding four does not. This may encourage the bonding of four 4G circuits, of which two are from one service provider and two more from a second service provider.

Seeing is believing

The viability for 4G Bonded HD ENG Backhaul in your DMA can only be established by field testing, particularly as relates to your important requirement that live HD ENG picture quality shall substantially match your HD news studio picture quality. 4G Bonded HD ENG Backhaul is an interesting emerging technology requiring serious reviews by the TV broadcasting industry. But don’t remove your BAS microwave systems quite yet!

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