For years, the unanswered question among some media observers monitoring the transition of the broadcast TV standard to ATSC 3.0 from ATSC 1.0 was just how multichannel video programming distributors would add NEXTGEN TV channels to their lineups. At what cost would this be for MVPDs? How would retransmission consent negotiations go for the addition of these ATSC 3.0-powered stations?
The American Television Alliance, a notorious group claiming to be pro-consumer but has been largely aligned with the interests of the Cable TV industry, has provided answers to the FCC with respect to a mandated end to ATSC 1.0 broadcasts from direct broadcast satellite service provider DirecTV.
In short, DirecTV wants a forced switch to ATSC 3.0 prevented at all costs.
Michael Nilsson, counsel to the ATVA at HWG LLP’s M Street offices in Washington, D.C., on August 12 wrote to the Commission in response to questions from Media Bureau staff at a July 31 meeting. The reason? DirecTV wanted to provide additional information to the Commission on the costs for MVPDs associated with a transition of broadcast signals to the ATSC 3.0 format.
It first reiterated earlier statements provided to the Commission that DirecTV will “only be able to provide an ATSC 1.0 feed to consumers.” It offers two reasons. First, DirecTV subscriber set-top boxes numbering in the millions aren’t designed to receive an ATSC 3.0 signal, and replacing all such equipment would be cost-prohibitive. Second, “satellite carriers reuse frequencies many times, designing ‘spot beams’ to deliver local broadcast signals to different markets throughout the country. Those spot beams have been allocated sufficient capacity for current carriage requirements in specific local markets and cannot be repointed. Thus, they have no capacity left for carriage of an additional ATSC 3.0 signal from each station.”
In a footnote, Nilsson adds, “Moreover, even assuming some customers had set-top boxes capable of receiving ATSC 3.0 signals, delivering an ATSC 3.0 signal to those customers would not relieve DirecTV from also carrying an ATSC 1.0 signal in order to prevent customers who lack ATSC 3.0-compatible set-top boxes from losing access to their broadcast programming.”
What’s the solution that DirecTV suggests, with ATVA serving as its mouthpiece in front of the Commission? “The development of the A/370 candidate standard, while still in progress, could provide a technical specification under which a ‘native’ ATSC 3.0 signal could be converted into formats that MVPDs would be able to use.”
For DirecTV, this is a 1.0 version of the ATSC 3.0 signal — bringing “backwards compatible” service for something Pearl TV and the ATSC has said for years is not backwards compatible.
“Even if successful, however, this technical capability would not answer the key question for
DirecTV—i.e., who bears the costs of the equipment necessary to do this conversion and the delivery of the downconverted signal to the MVPD,” Nilsson says.
He then offers a financial summation of DirecTV’s costs.
“For a nationwide provider like DirecTV, the question of who bears such costs is critical,” Nilsson concludes. “ATSC 3.0 receivers compatible with DirecTV’s system now cost roughly $8,000 per feed (i.e., primary and multicast feeds). Since DirecTV now carries more than 1,800 feeds nationwide, the total cost to purchase receivers would approach $15 million. Moreover, there is currently very limited supply of such receivers, so if there were a sudden spike in demand the price would only increase. These costs would bring with them no benefits whatsoever for DirecTV’s subscribers because DirecTV will only be able to provide an ATSC 1.0 feed to customers. Thus, by definition, every dollar DirecTV must spend on the ATSC 3.0 transition is a deadweight loss. Imposing such costs on DirecTV would be onerous, while spreading the cost among the nation’s nearly 1,500 broadcast stations would not only yield a much more manageable financial responsibility for each entity but also place the costs on the parties who stand to reap the benefits of the ATSC 3.0 transition.”
