The Leadership Conference on Civil and Human Rights

Transition in Trouble

• Table of Contents
• Acknowledgements
• Executive Summary
• Introduction
• Many Will Suffer Significant Harm if the DTV Transition Fails
• The Leadership Conference has Identified Numerous Issues that Threaten a Successful DTV Transition
  • Transition Planning Lacks Leadership and a Comprehensive Plan
  • Transition Awareness is Low; Consumers and Retailers are Confused; Outreach Efforts are Inadequate
  • Coupon Program is Confusing, Burdensome, and Restrictive
  • Costs and Burdens to Many Communities and Viewers are Excessive or Overwhelming
  • Many Communities Will Lose, not Gain, Television Stations and Service
  • No Rapid Response is in Place to Deal with Inevitable Transition Problems
• Recommendations
  • Improve Organization of the Transition
  • Fund Increased Consumer Outreach, Education and Research
  • Reduce Costs and Burdens of Transition on Viewers
  • Preserve Communities' Access to Their Television Stations
  • Prepare for Rapid Response to Problems
• Conclusion

Coupon Program is Confusing, Burdensome, and Restrictive

With the NTIA TV Converter Box Coupon Program now in operation for several months, a number of issues relating to the procurement and redemption of the coupons are surfacing that disproportionately impact many LCCR communities.

Perhaps the biggest problem is the two-phase structure of the coupon program. In the first phase, where $990 million is allocated, all U.S. households will be able to apply for up to two $40 coupons per household to purchase converter boxes on a first come - first served basis. The second phase is open only to households that certify in writing that they rely exclusively on over-the-air television.

Unfortunately, this coupon program structure may have the unintended consequence of keeping coupons out of the hands of the very people who are most reliant on over-the-air television - those in lower-income, older, non-tech savvy, non-English as a primary language communities. They are the hardest to educate and include in the digital transition. By the time they receive word about the need to apply for coupons, all the coupons may already have been snapped up, many by households that are not exclusively reliant on over-the-air television.

Or, if members of these hard-to-reach communities do apply, but only in phase two of the program, in order to qualify for a coupon they must then take the added step of certifying they are reliant on over-the-air television. That may be an added disincentive to even submitting an application for a coupon, as Alex Nogales, president and CEO of the National Hispanic Media Coalition, testified before Congress:

Indeed, the certification will be a deterrent to low-income families, especially those that do not dominate the English language. Ladies and gentleman, I have no doubt that the disenfranchised population that will be the most impacted by the digital transition will be the last to apply for the coupons. This being the case, having to certify in writing that they rely on over the air reception is just adding an additional burden that will discourage many of them from applying for the converter boxes. A two phase-plan with an added burden for those that are hardest to reach doesn't make a lot of sense. If the reason for this two-phase system is because NTIA thinks there is a likelihood that the program will run out of funds before all the impacted households have obtained their coupons, then NTIA should go back to Congress and ask for additional funding.⁴¹

Nogales concluded, "(W)e can't afford to make mistakes on a program that is a first-come, first-serve program where the populations that are in most need of these coupons run the risk of being the last to hear about the program."

We applaud NTIA for showing flexibility with other problematic provisions of the program. For example, in response to widely held concerns, NTIA appears to be willing to modify the coupon program to allow nursing homes with multiple residents to apply for multiple coupons, and to show flexibility in issuing coupons to those who receive mail at a post office box.⁴²

However, numerous other problems remain, including whether the digital converter boxes are even available at retailers once consumers receive their coupons. Many converter box models, particularly those that are lower cost or pass through an analog signal, have been slow to reach retail stores.⁴³ "Consumers are finding few choices in their local stores," said Joel Kelsey, policy analyst for Consumers Union, nonprofit publisher of Consumer Reports. "This is a consumer Catch-22. Those who acted early in requesting coupons face limited or expensive choices in converter boxes, but can't wait for more options because their coupons are expiring."⁴⁴

Senators Inouye and Stevens of the Senate Commerce Committee recently shared with NTIA acting Head Meredith Attwell Baker their concerns over the coupons expiring after 90 days. They want consumers to be able to use their converter box coupons to preorder the boxes so that they might order boxes that are out of stock or in limited supply and not run afoul of the expiration date. Also, they want consumers to be able to reapply for coupons if their coupons have expired, as the coupons presently have no ability to replace or reapply for expired coupons.⁴⁵ Another problem with the 90-day expiration date is the inability of those who applied early for coupons to purchase lower priced converter boxes, such as that marketed by Echostar, which will not come to market until summer.⁴⁶

Other problems or challenges with the coupon program include:

• Households with multiple families and/or televisions are still eligible for only 2 coupons;
• Converter boxes are either not available or in short supply in many rural areas;
• Many large national retailers such as Best Buy, Wal-Mart, Radio Shack, and others refuse to accept coupons for mail-order or Internet purchases of converter boxes, making it difficult for infirm, disabled, or rural households to purchase boxes;
• Persons with disabilities are not aware which converter boxes that are eligible for coupons accurately display closed captioning and support video description;
• The envelopes used to mail converter box coupons are not sufficiently distinguishable from junk mail by people with visual disabilities; and
• Coupons may not be used for many models of converter boxes that pass through an analog signal, a requirement to receive broadcasts of many community and low-power TV stations that will not transition to digital on February 17, 2009 (more on this below).

These challenges to the success of the coupon program are significant impediments to a digital television transition that leaves no viewers behind. They must be addressed quickly, so that those who rely exclusively on over-the-air television are able to receive coupons and affordably transition to digital television by February 17, 2009.

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41. Testimony of Alex Nogales, note 10, above.

42. Coupon Program Designed to Ease Digital TV Transition May Expand to Nursing Homes, P.O. boxes, Associated Press, April 23, 2008.

43. Now Hear This Newsletter, April 10, 2008, Consumers Union.

44. Now Hear This Newsletter, June 19, 2008, Consumers Union.

45. Senate Commerce Committee Wants Consumer Flexibility on DTV Coupons, Broadcasting & Cable, May 7, 2008.

46. Consumers Having Problems with Digital TV Converter Coupons, Consumer Affairs.