Monday, April 6, 1998 | 10:31 a.m.
For television station managers, today's opening of the trade show for the National Association of Broadcasters represents an opportunity for a very expensive shopping trip.
Crowding the aisles at the show will be representatives of companies selling cameras, transmitters, monitors and a variety of other equipment needed to transform television from today's analog broadcast standard to tomorrow's digital system.
Officials with NAB say this year's show may be the biggest ever. More than 90,000 broadcasters are in Las Vegas for what essentially is a gathering of 11 associations and conferences that meet annually for discussions ranging from the technical aspects of producing radio and television to content watched and heard by millions of viewers and listeners.
The conferences began Saturday. The trade show runs today through Thursday at the Las Vegas Convention Center, the Las Vegas Hilton and the Sands Expo Center.
The promise of digital has been on NAB's agenda for years, but 1998 is the year the top 10 television markets in the United States will start to throw switches that would deliver a signal to viewers. For stations in New York, Los Angeles, Chicago, Dallas and six other cities, the deadline for broadcasting the digital signal is in May 1999.
The deadline is later for stations in the next tier of markets. Since Las Vegas is No. 61 in the nation, local stations will have until around 2001 to upgrade. But it will be an expensive proposition for the network stations scheduled to change and advertisers will be asked to shell out more to cover the costs of the five-year plans broadcasters have in place to upgrade.
At KLAS Channel 8, the CBS affiliate in the Las Vegas market and a station that already has had a taste of the digital experience, the transition cost is estimated at about $9 million.
"We've projected $1.5 million to $2 million to convert the transmitter on the mountain and another $6 (million) or $7 (million) for the studio," said Jack Wilkinson, chief engineer at KLAS. "That doesn't count the expense of maintaining two sets of equipment because when we switch to digital, we'll continue to provide the analog signal to the public through 2006."
Congress set the deadline because it intends to auction off the analog frequencies to other potential users.
Stations will be required to keep their old signals on line to give the public the opportunity to make the switch, since the digital format can't be deciphered by today's analog TVs. For KLAS, that means twice the equipment maintenance for the analog signal going out on Channel 8 and a parallel digital signal assigned on Channel 7.
KLAS is broadcasting a digital signal for the show today. It's the fourth time in three years that the station has set up to broadcast the signal to the Las Vegas Convention Center where digital TVs are receiving it. The demonstration also was offered earlier this year during the Winter Consumer Electronics Show. At that event, manufacturers were showing off the hardware they hope consumers will rush to buy for Christmas this year.
But will the public be quick to put up $5,000 to $10,000 -- the price tag experts say will be on the merchandise -- for a new TV?
Broadcasters marvel over the pictures digital signals provide. But the digital world offers more than just screen clarity. The digital signal can either provide the crisp images that draw raves or it can offer a broader spectrum to transport more information. In other words, the digital signal can give viewers multiple channels at the same time and controls on the TV will let viewers separate them. As a result, broadcasters will be able to offer their own pay-per-view and premium channels.
Companies with digital TV products heading for the market later this year include Panasonic, Sharp, Zenith, Sony, Philips and Matsushita.
The new digital TVs will be able to decipher the different standards of transmission to be offered by the networks. ABC and CBS have announced their standards -- and they're different -- while NBC and Fox are expected to announce their plans at the convention.
The computer industry has pushed broadcasters to adopt a so-called progressive standard because those images can also be displayed on PC monitors. Broadcasters currently transmit using a method called interlace scanning.
CBS said it will begin airing five hours of prime-time shows later this year with the method that allows the highest picture quality. ABC, meantime, plans to broadcast lower-resolution images, allowing it to squeeze another channel onto the air.
ABC said it will use the progressive technology to transmit prime-time shows in a format that fits 720 lines on a TV screen. That's more than the 525 lines consumers currently see, though less than the best resolution possible.
The idea of doing this is "being able to produce content for the converged world of television and computers," ABC Television Network Preston Padden said at a news conference.
CBS, meanwhile, said it will transmit some programming this year using 1080 interlace technology, which offers the highest picture quality. It will offer high-definition TV broadcasts at four of its owned stations in November and will expand that to reach 42 percent of U.S. TV homes by November 1999.
Once all the standards are made public, the nation's 1,600 affiliate TV stations can begin buying the equipment best matching what their networks are doing. The total cost of the overhaul: $6 billion.
In addition to the economic impacts of the switch to digital, there are legal and legislative issues to be considered. Many of the panels scheduled for the NAB show involve policy issues associated with the switch.
William Kennard, the new chairman of the Federal Communications Commission, is scheduled to appear before broadcasters Tuesday morning. It's his first NAB appearance as the FCC chief after spending three years as the agency's general counsel.
Four other FCC commissioners are scheduled to appear on a panel to discuss regulations: Susan Ness, Harold Furchgott-Roth, Gloria Tristani and Michael Powell.
BLOOMBERG BUSINESS NEWS contributed to this report.
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