Uncle Sam and John McCain want your airwaves.

From Michael Grebb at Wired News:

02:00 AM Sep. 22, 2004 PT

WASHINGTON -- U.S. lawmakers are increasingly willing to contemplate bold action to get people to stop watching analog, over-the-airwaves television and switch to digital TV. How bold? They will consider a bill Wednesday that pays a $1 billion subsidy to make it happen.

For a sense of how frustrated lawmakers have become, observers point to a new bill introduced Tuesday by Sen. John McCain (R-Arizona).

The legislation -- pointedly named the Spectrum Availability for Emergency-Response and Law-Enforcement to Improve Vital Emergency Services Act, or just the Save Lives Act -- sets a new deadline of Jan. 1, 2009, for the federal government to free up the analog TV spectrum for use by public-safety agencies.

The bill also would clear the way for auctioning spectrum to commercial interests -- like wireless broadband service providers.

And in a nod to subsidy programs in Europe, the legislation would provide $1 billion to help 17.4 million U.S. households without cable, satellite or digital TV tuners pay for equipment that would enable them to go digital.

"Since the industry isn't going to do it, the government has been forced to take action," said Gerry Kaufhold, a principal analyst at research firm In-Stat/MDR.

The bill highlights a congressional conundrum. On one hand, lawmakers are loath to turn off analog signals all at once, which would render an estimated 45 million analog TV sets -- those not hooked up to a cable or satellite service or to a digital-to-analog converter box -- utterly useless. And they are reluctant to spend money on any program that smacks of corporate favoritism.

On the other hand, emergency agencies want to use parts of the analog broadcast spectrum for public-safety uses. And wireless companies are anxious to pay billions for the right to provide broadband wireless services over large swaths of spectrum. All the while, Europe and Asia are pulling significantly ahead of the United States when it comes to broadband wireless services.

Under current law, broadcasters don't have to relinquish their analog spectrum until 2007 or until after at least 85 percent of American households have the equipment to receive over-the-air digital TV signals, whichever comes last. But few expect Americans to reach the 85-percent threshold for many years.

"It won't be until 2020 at the rate we're going," said Adam Thierer, director of telecommunications studies at the Cato Institute, a libertarian think tank. "We're trying to figure out a way to get out of this industrial policy mess."

Despite the potential backlash, lawmakers are starting to support the idea of a hard deadline that forces consumers off analog. Low-income households would get first priority under the subsidy program contemplated by McCain, but it's unclear how broadly the program would apply to everyone else.

Some support the subsidy concept. "Every successful rollout of digital (over-the-air TV) has come with a free box," said Kaufhold. "The model for digital TV in the world has been to give people a free box. The U.S. is starting to fall behind."

According to the bill's text, the subsidy would amount to a small portion of the $30 billion to $70 billion the federal government expects to collect when it auctions off large portions of the analog TV spectrum to wireless companies. (Other estimates, however, have been much smaller.)

McCain plans to hold a vote on the bill Wednesday at a meeting of the Senate Commerce Committee, which he chairs.

The broadcast industry has already started lobbying against the measure, which it fears will strip away its rights to the analog TV spectrum before the country is ready.

"What do you do about the people who haven't purchased a new TV set?" asked Dennis Wharton, a spokesman for the National Association of Broadcasters. "Do you just turn them off? NAB opposes the bill on grounds that tens of millions of Americans could potentially lose access to local TV stations if the McCain bill becomes law."

Wharton added that while the broadcasters' association supports the subsidy concept "to ensure that no American is denied access to local TV stations," it's unclear how such a subsidy would work.

It's also unclear how much, if any, of a subsidy would be necessary. Already, the Federal Communications Commission has mandated that all TV sets sold after July 2007 contain a digital TV tuner.

Considering that nearly 90 percent of American households already subscribe to cable or satellite services, it also begs the question: Is protecting free analog TV really worth the trouble?

"Finally, policymakers are starting to understand the serious opportunity cost of using spectrum in this fashion," said Thierer. While low-income households might need subsidies, other consumers might need to bite the digital bullet. "The cost-benefit analysis is very clear," he said. "The benefits outweigh the costs."

Even consumer advocates are accepting a hard date as a way to drive the transition forward -- as long as subsidies go to consumers rather than commercial interests.

"We fully support the notion that no TV should go blank," said Mark Cooper, director of research for the Consumer Federation of America. "But the cable and satellite guys could get a whack at this subsidy money, and they should be required to provide compatibility without the subsidy."

To be sure, McCain's bill is still in its infancy. While it likely will pass through committee Wednesday, few expect it to advance far in the few remaining weeks of this session of Congress, especially in an election year.

But with Congress poised for a planned rewrite of the 1996 Telecommunications Act next year, the bill's provisions could end up in a larger piece of legislation. Of course, McCain's chairmanship of the Senate Commerce Committee expires this year, meaning that he won't wield nearly as much power in 2005.

But in the remaining weeks of his reign, he's likely to make noise.

"McCain is kind of the maverick," said Kaufhold. "He'll push hard, and the rest of the industry will drag its feet behind him."