DTV Campaign Starts

The digital TV transition campaign has begun. With a Feb. 18, 2009 deadline for complete transition to digital over-the-air broadcasting, Comcast has begun advertising around the subject, with a "we'll take care of" message.

Also,$40 government coupons will be available starting Jan. 2, 2008, to defray the cost of decoders that convert over-the-air digital signals back to analog television for display on analog-only TVs.

The decoder boxes are expected to cost between $50 and $70 and will be available at most major electronics retail stores. Starting Jan. 2, the National Telecommunications and Information Administration will begin accepting requests for two $40 coupons per household to be used toward the purchase of the boxes.

To request a coupon, consumers can apply online at http://www.dtv2009.gov. The government also has set up a 24-hour phone line to take requests, 1-888-DTV-2009 (1-888-388-2009).

HDTV Transition Issues: How Big?

This summer, the Consumer Electronics Association estimated mid-year 2007 that 16 million high-definition televisions would be sold during the year, bringing the total number of HDTVs sold in the U.S. to 52.5 million.

Thirty percent of U.S. households had an HDTV in the early summer of 2007, likely rising to 36 percent by the end of this year. Among these HDTV households, almost a third own more than one high-definition set.

The issue is what happens as the analog TV broadcast shut off occurs in February 2009. Most surveys show a fairly high degree of consumer confusion about the coming change. That, in turn, has some observers calling for more vigorous programs to prepare the market.

The problem might not be as big as most people assume, irrespective of "awareness." For starters, most TV watchers in the U.S. market get their video from a cable or satellite provider.

Estimates of overall cable penetration range from 67 to 70 percent. Satellite providers have 25 percent penetration or more. Telcos aren't much of a factor yet, but the salient point is that these providers have a vested interest in making sure their customers remain customers, and will undertake most of the actual customer notification and equipment upgrade tasks when the time comes.

Some of those customers already get 100-percent digital signals using a decoder already in the home. Others already are outfitted with HDTV decoders as part of the upgrade process cable operators actively are pushing for "digital TV" tiers of service.

True, there are some viewers who get their signals over the air, and who will not own HDTV tuners by the analog shut off date. That's an issue, but affects a sub-set of over-the-air TV viewers.

UK Leads in Digital TV

The U.K. is well ahead of most other European countries in its use of digital media, by some measures. By the start of 2007, more than 76 percent of U.K. TV households were receiving digital TV services, a rate higher than other Western European countries, Japan or the United States, for example.

According to Ofcom, U.K. adults also spend more time on social networking sites than other Europeans. Two in five U.K. adults regularly log on to these sites, clocking up an average of 23 visits and 5.3 hours each month.

In the U.K. market, 33 percent of users send picture messages via their mobiles and 16 percent use them to connect to the Internet. About 10 percent of U.K. adults use mobiles for e-mail.

Ofcom also believes that online advertising in the United Kingdom accounted for 14 percent of total advertising revenues in 2006, passing magazine advertising for the first time and registering more than total spending on outdoor, cinema and radio advertising combined.

Advertisers in the U.K. market also spend more money per consumer on Internet advertising than any other country, at £33. According to Ofcom, this is twice as much as France, Germany and Italy combined.

Online advertising revenues generated in the U.K. market in 2006 also beat the combined totals of Germany, France and Italy at £231 per head.

Mobility and Video Will Drive Growth

If Bear Stearns analysts are correct, mobile penetration will zoom past 100 percent, as will digital TV penetration, quite soon. Which suggests those two types of devices are where ad revenue opportunities are brightest, not to mention other sorts of "for fee" services and applications.