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Coupon-eligible converter box or CECB is a specification for digital television adapters that were eligible to receive subsidy "coupons" through the United States federally-sponsored digital television converter box program. This program was put into place in order to provide over-the-air TV viewers with an affordable means with which to continue to receive free digital over-the-air television services after the digital transition was completed. The specification was developed by the National Telecommunications and Information Administration (NTIA), with input from the broadcast and consumer electronics industries, as well as public interest groups.
In March 2005, United States House Commerce Committee chairman Joe Barton of Texas said he would introduce a bill requiring the transition to digital television "sometime in the spring", saying he wanted analog broadcasting to end Dec. 31, 2006. Included in his plan was a subsidy of $400 to $500 million for converter boxes expected to cost $50, intended only for the poor, and only for those who did not use a pay service. Each home would receive one box, and each person would send a rebate coupon to the United States Treasury to be redeemed. The estimated number of boxes was 8 to 10 million.
The United States Digital Transition and Public Safety Act of 2005, which is a part of the Deficit Reduction Act of 2005, required that, among other things, the Federal Communications Commission (FCC) direct all full-power television stations to cease analog TV broadcasting in 2009, by midnight (23:59) on February 17 (later changed to June 12). Recognizing that consumers may wish to continue receiving broadcast programming over the air using analog-only televisions not connected to cable or satellite service, the Act authorized the NTIA to create a digital-to-analog converter box assistance program. Consumer education plans for the subsidy program were targeted to low-income, elderly, disabled, inner city, immigrants, and rural Americans, because these groups mainly watch analog antenna TV more than any other groups. The Act also established a new Treasury fund, known as the Digital Television Transition and Public Safety Fund, and directed the receipts from the FCC’s returned analog spectrum auction to be deposited into the fund.
The Act directed the NTIA to implement and administer a program through which eligible U.S. households could obtain a maximum of two "coupons" (actually payment vouchers) of $40 each to be applied towards the purchase of a digital-to-analog converter box. The Act defines the term “converter box” to mean “a stand-alone device that does not contain features or functions except those necessary to enable a consumer to convert any channel broadcast in the digital television service into a format that the consumer can display on television receivers designed to receive and display signals only in the analog television service, but may also include a remote control device.” The Act, however, did not define “eligible household”.
As of April 2006, 20 million people (some with more than one set) received only over-the-air TV, and adding the subscribers to a pay service who had TVs not hooked up, an estimated 70 million TVs would need upgrading.
In 2006, the NTIA let people see, and give their opinions about, its plan for distributing coupons. One requirement was that anyone requesting coupons had to own only analog TV sets (no cable or satellite); if they asked for two, they had to say they had two sets. In an effort to limit misconduct, requests for coupons would be taken only from January 1, 2008 to March 31, 2009, and each coupon would be valid for three months. A consumer education program only had a budget of $5 million, so the companies participating in the transition would have to help.
On March 12, 2007, the NTIA held a news conference to announce the standards for the converter boxes and the requirements for receiving coupons. This meant manufacturing could begin, and that the NTIA could select a company to send out coupons.
The $1.5 billion in funding for the coupons would only supply half the 73 million analog TVs not using a pay service, including 18 million in homes with only over-the-air TV. The Commerce Department had no plans to make coupons available only to the poor.
Coupons could be requested by phone, mail, or online. At first, anyone would be able to apply, even for those who had one or more TVs connected to a video service.
NTIA set converter box standards based on what manufacturers and broadcasters wanted, and LG Electronics, Thomson, Samsung and Jasco were the first four companies announcing their plans to make the devices. After June 1, 2007, retailers could apply to sell converter boxes. Each would have to be in the Central Contractor Registration database and have at least a year of experience in the consumer electronics business.
To implement the coupon program, the Act authorized NTIA to use up to $990 million from the fund for the program, including $100 million for program administration. Those funds supported an initial "non-contingent" program that was available to all requesting households. NTIA was also authorized to expend up to $1.5 billion for the program, including $160 million for administration, if the $990 million were insufficient to fulfill the non-contingent coupon requests. In that case, a "contingent" fund would be available for U.S. households not serviced by cable or satellite. Notice and certification of fund insufficiency would be made to the Committee on Energy and Commerce of the House of Representatives and the Committee on Commerce, Science, and Transportation of the Senate.
An initial funding of $990 million was expected to allow all households an opportunity to apply for coupons, which expired 90 days after mailing. After that money was used up, $510 million in additional funds was available to households that stated they did not already subscribe to cable or satellite television services. Neither allotment had a means test.
A year before the original transition date of February 17, 2009, the NTIA planned to start processing coupon requests, and 2.4 million people had applied for 4.7 million coupons, out of an estimated 13 million homes that still received television with an antenna.
By the end of 2008, "about 40 million coupons have been requested, but to date 16 million have been redeemed, compared with an estimated 35 million televisions that will lose a signal." Institutions such as old-age homes were initially excluded from the program; while this was partially remedied (to allow one coupon per nursing home resident), prisons, homeless shelters and residential hotels remained disqualified from the coupon program.
On January 4, 2009, the NTIA began placing coupon requests on a waiting list after the program reached its maximum allowed funding. Only after unredeemed coupons expire could new requests be fulfilled. By January 7, NTIA's growing waiting list represented unfulfilled requests for just under a million requested coupons. A week later, the waiting list had grown to two million coupons.
On January 7, both Consumers Union and Massachusetts Rep. Ed Markey (who heads the U.S. House Energy and Commerce Committee’s telecom subcommittee) advocated that the February 17, 2009 analog shutoff date be postponed due to the lack of coupons and inability to handle expected public enquiries. On January 8, the Barack Obama transition team contacted key legislators, expressing support for a delay largely because of problems with funding coupons for converters. The delay passed early in February (see below).
The NTIA Specification is arranged in three categories, describing required, permitted, and disqualifying features.
These features are absolutely required, but may vary in the way they are provided by the box.
Manufacturers can self-certify compliance with these requirements, but must provide test results and two units to the NTIA for ad hoc testing. The FCC may also test converter boxes at the request of NTIA. Among the optional features permitted but not required are the following:
While an outdoor antenna is required for adequate digital reception in most locations beyond 10–25 miles (16–40 km) from TV transmitters, and smart antenna interfaces are an optionally-permitted feature of coupon-eligible converter boxes, there are no subsidies for antennas, and consumers using coupons to buy smart antenna-compatible converters must retain the option to buy the identical converter without the bundled smart antenna.
DTV converter boxes may earn a United States Environmental Protection Agency Energy Star label if they consume no more than eight watts operating, and one watt in standby mode, and automatically power-down after four hours of inactivity. Such units will have lower electrical power waste, when compared to other units.
Specifically excluded from coupon eligibility are high-definition video output and built-in DVR functionality, as well as digital cable and satellite set-top boxes. These output features are prohibited: component video, VGA, RGB, DVI, HDMI, USB video, IEEE-1394/iLink/Firewire video, Ethernet video, and IEEE-802.11/WiFi video outputs.
These boxes only tune to one channel at a time, as they only contain one ATSC tuner, and no analog tuner. Simultaneous TV watching and recording of different programs requires two converter boxes, if the recording device also lacks its own digital TV tuner. Another temporary option was recording in analog, if the digital box allowed full-time analog pass-through.
Most video recorders will also be rendered unable to change channels under control of built-in timers, as channel selection is now handled by the converter. However, if the digital set-top converter box has a programmable timer schedule which the user could program to match the recording schedule of her VCR, then the tuner will change to the appropriate channel at the time the VCR needs to record. Again, this will require a separate box for the VCR, or the viewer will have to watch what is being recorded. Another option available in very few cases is an "IR blaster", which a recorder can use to control an external tuner. However, this may make it impossible to view extra digital subchannels, if the converter box requires the use of a [-] or [.] button which the pre-digital recorder does not know how to transmit.
Small battery-operated portable TV's, while valuable in time of disaster, are poorly adapted to digital conversion. While at least one CECB (Winegard's RCDT09A) is operable from an external battery pack, the combination of television, converter, external antenna and power supply provides limited portability. As of 2009, portable digital LCD TV sets cost at least 100 dollars, and still cannot be used while in motion at significant speeds until broadcasters transmit mobile TV via the separate ATSC-M/H (which will itself require new tuners).
The inability of some boxes to add new digital channels without a full re-scan (deleting all existing channel settings) renders them unusable to viewers who rely (or will soon be forced to rely) on directional antennas and rotors to receive distant stations. Signal strength meters, where available, are awkward, typically only displaying information for channels that have already been found. This is problematic as digital signals are most often transmitted on higher frequencies or with far less power than their analog counterparts, requiring careful antenna installation, orientation and location to avoid obstructions, fading and multipath interference problems. Where the converter fails to receive a channel, an often-cumbersome manual process is usually provided, however this requires knowledge of which channels each missing station is physically transmitting on, rather than the virtual channels each is mapped to.
Since the NTIA did not mandate the inclusion of MTS in CECBs' RF modulators, THAT Corporation (which licensed the now-expired patents to MTS' dbx technology, and still holds patents on some digital implementations of MTS) claims that consumers using RF-only connections with CECBs will lose stereo TV sound. This problem may be avoided by using the TV's line level inputs. Connecting the CECB's RCA connectors to a home stereo system, to a stereo VCR's AV inputs, to computer sound card speakers (with a Y-adapter attached to their mini phone jack) or to a separate RF modulator are other possible alternatives.
In late March 2008, the CBA filed a lawsuit in the U.S. Court of Appeals for the District of Columbia, seeking an injunction to halt the sale and distribution of CECBs, CBA maintained that the lack of analog support would seriously harm the LPTV and class A television stations the group represents, as it is cost-prohibitive for many or most of them to convert to digital transmissions, and the new boxes would prevent viewers from being able to watch (or even being aware of the existence of) their analog-only stations. LPTV stations are under no deadline to convert; however, no new analog stations will be authorized.
Responding to CBA's actions, the FCC and NTIA urged manufacturers to include the feature voluntarily in all converter boxes, and manufacturers responded by releasing a new generation of models with the feature. Some new DVD recorders and personal video recorders also provide both analog and digital tuners, and therefore could perform the basic functions of a set-top box in both modes.
In early May 2008, the D.C. district court denied the CBA petition without comment, essentially telling the association that it had other options, and that there was not "enough merit" to take the case to the courts. The CBA responded by saying it would lobby the FCC, and by urging more funding for low power and Class A broadcasters to transition to digital, asking Congress to increase the number of such stations eligible for funds.
On August 13, 2009, the CBA announced in a statement that it would shut down after 20 years of representing LPTV stations. One reason given was the cost required to fight "restrictive regulations that kept the Class A and LPTV industry from realizing its potential," including the campaign to require analog passthrough. Amy Brown, former CBA executive director, said, "some 40% of Class A and LPTV station operators believe they will have to shut down in the next year if they are not helped through the digital transition."
NTIA's TV Converter Box Coupon Program reached its $1.34 billion ceiling on January 4, 2009, approximately six weeks before the expected end of US full-power analog broadcast TV. Any additional consumers requesting coupons were placed on a waiting list, eligible on a first-come-first-served basis as funds from expired coupons become available.
In December 2008, FCC commissioner McDowell advised "those who don’t need the government subsidy not to wait on that process before purchasing a converter box for themselves or as a gift for someone else. During the weeks it takes for the government to process coupon requests, you will lose precious time to hook up the box, check antenna connections, and start enjoying free digital broadcast TV right away."
As US economic conditions continued to worsen, demand for the converters increased. Nielsen Media Research had estimated in August 2008 that 25% of affected viewers would opt for inexpensive converters instead of replacing existing televisions or switching to expensive cable and satellite television subscriptions. By November 2008, 38.3% were planning to buy the less-costly converter boxes.
Many retailers had stocked boxes based on coupon use and shortages of the converter boxes themselves remained possible. In early February, the Consumer Electronics Association estimated three to six million converters available while Nielsen estimated 5.8 million American households were completely unready for digital transition. Sometime in March 2009, existing inventory was expected to be depleted. Manufacturers who had halted production ahead of the original February 17, 2009 deadline were to resume converter box assembly but this new stock was not expected in stores until April. An average US household uses 2.8 television screens.
Minority populations (including African-American and Hispanic households) and persons under 35 years old, and older than 60 years old were among the least digital-ready groups, although many Spanish-speaking viewers will continue to receive Mexican analog border stations. until the end of 2021.
A bill extending the end of digital transition to June 12, 2009 was signed into law on February 11, 2009. The American Recovery and Reinvestment Act, part of a larger appropriations bill signed into law on February 17, 2009, added $650 million more in funding, $490 million of that for coupons, giving a total of $1.83 billion available for additional converter boxes, not addressed in the DTV Delay Act. By February 18, with 36% of US full-power stations digital-only, five million of America's 115 million households remained entirely unready with requests for 4.3 million coupons remaining on an NTIA waiting list. While additional coupons began to be issued in early March 2009, at least an additional two to three weeks (above normal delays) were needed to clear an existing backlog. One reason for the backlog: an accounting quirk that required funds actually be available before more coupons could be sent out. Even though unused coupons meant more money for the program, the coupons had to actually expire before the money that would have been used became available. After the program ended, $250 million from the original bill had not been used, a problem that could have been solved with legislation rather than more funding.
Viewers in markets where individual stations ended analog operations on or before the original deadline were not accorded any form of increased priority in the handling of their DTV coupon requests.
On March 24, 2009, the NTIA announced that the more than 4 million persons on the waiting list had been sent coupons, meaning those whose coupons had expired could apply for new ones. The NTIA estimated 17 million coupons had expired, while 25.7 million, 56 percent of the number issued, had been used. On April 12, Nielsen estimated that 3.6 million households remained unready.
The analog shutdown for full-power TV stations was completed in mid-2009, with several stations ending analog transmissions well before June 12 (many on the original February 17 date). In most cases, at least one station in each media market remained on for up to 30 days afterward as an "analog nightlight", prohibited from broadcasting regular programming, but allowed to transmit continuous information on how to obtain and connect a CECB (and to broadcast any emergency alerts). The 30-minute (half each in English and Spanish) public service announcement seen on most stations was produced by the National Association of Broadcasters.
On June 14, two days after the cutoff, Nielsen said 2.5 million homes were not ready. On June 17, the NTIA said two million requested coupons had not been mailed.
In some cases where stations changed physical channels from temporary ones to permanent ones (usually their old analog channel), people have been advised not only to re-scan but to "double-scan", in order to clear outdated information from the box's memory. This involves unplugging the antenna and rescanning, so that the box receives no signals, then unplugging the box, and rescanning again.
The NTIA reported that as of July 22, 33,578,000 coupons had been used, more than the 33.5 million possible with the original $1.34 billion allocation. $435 million of the extra money added was already owed for pending requests. Assuming 55 percent of the coupons are redeemed, the actual money from the DTV Delay Act totaled $239 million as of July 22.
On June 15, U.S. Representative Peter DeFazio, an Oregon Democrat, introduced the House version of The Digital TV Transition Fairness Act, which Senator Bernie Sanders introduced in December 2008. It would have extended the converter box program beyond July 31, subsidized antennas and required certain customers of video services (pay TV) to receive discounts. However, on July 31, the application process for the CECB program expired at midnight without extension. Toward the end of July, consumers were making 35,000 requests for coupons per day, with just over half being used. On July 30, though, the number of requests totalled 78,000, and on the final day, 169,000 were received. Mailed requests postmarked July 31 could still be processed. $300 million in funding remained. As of August 5, consumers had used 33,962,696 coupons.
The NTIA said 4,287,379 coupons had been requested but not redeemed. As of August 12, $310,796,690 was available, and if all requested coupons were redeemed, $139,300,174 would be left. Given the average usage rate, leftover funds could be over $210 million.
A source said the NTIA gave back $241.6 million to the Treasury, which was mostly divided between the Defense and Commerce departments; $2.6 million went to "final closeout costs". The total amount left unspent was $489 million, but the funds from the original bill must go to a DTV public safety fund rather than back to the government.