SCTE: Comcast Eyes Sub Growth from Analog Turnoff

No. 1 cable operator predicts reception problems with DTV converter boxes.
By Glen Dickson -- Broadcasting & Cable, 6/25/2008 11:07:00 AM

http://www.broadcastingcable.com/article/CA6573177.html

Philadelphia -- Comcast, the country’s largest cable operator, views the 
Feb. 17, 2009, turnoff of high-powered analog signals as a big 
opportunity to grab more basic-video subscribers, chief operating 
officer Steve Burke told the crowd at the Society of Cable 
Telecommunications Engineers’ Cable-Tec Expo 2008 here Wednesday morning.

Steve Burke

Burke conceded that a “significant chunk” of consumers have taken 
advantage of the federal government’s program to provide $40 coupons 
that subsidize the cost of digital-to-analog converters that will let 
analog-TV sets that rely on over-the-air signals keep functioning in an 
all-digital world. But he’s not sure that all of those people will 
necessarily redeem the coupons that they received from the National 
Telecommunications and Information Administration.

“We believe a significant chunk of people who got coupons never took the 
time to go to the consumer-electronics store [and pick up a converter 
box],” said Burke, who was speaking on a panel that included Charter 
Communications CEO Neil Smit, Showtime CEO Matt Blank and Nortel CEO 
Mike Zafirovski and was moderated by CableFAX Daily columnist Paul Maxwell.

Moreover, Burke expects that many consumers who do pick up converter 
boxes and hook them up to antennas will still have problems receiving 
digital signals.

“Once they install the antenna, we think there’s a 20%-40% chance the 
antenna is not going to work, because of the grade-B contour or other 
issues,” he added.

Between consumer inaction and technical problems, only a “small minority 
of people will have a real good outcome” from the converter-box program, 
Burke predicted, adding that cable will be the “best opportunity” for 
impacted over-the-air viewers to maintain TV service -- as well as to 
possibly sign up for Comcast’s high-speed-data and 
voice-over-Internet-protocol phone services.

Burke conceded that the 10%-15% of households in Comcast markets that 
rely on over-the-air TV have made a conscious decision not to get cable, 
and Comcast will “have to work through that” by stepping up its 
marketing efforts.

He then recalled a recent conversation with a broadcaster who joked that 
he was going to call in sick Feb. 18, 2009, to avoid a potential 
nightmare, and predicted that receptionists at local stations will be 
overwhelmed with consumer complaints after the analog turnoff.

“A station like WNBC [New York] or WPVI Philadelphia, the odds are they 
have one person answering the phones, and they might field 200 calls a 
day,” Burke added. “On the day of the transition, that receptionist 
could literally get 50,000 phone calls. My belief is there will be a 
huge consumer backlash, and the challenge is going to be trying to 
manage that. It will place a stress on the cable companies to keep up 
with installing [new homes].”

Smit agreed that handling consumer requests for new installations due to 
the DTV transition’s impact will keep operators busy, but he thinks 
cable is up to the challenge.

“This is a great opportunity for the industry to show what we can do,” 
Smit added.
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