With only 2 digital carriage pacts to show for 3 years of negotia...

digital. APTS Pres. John Lawson told us: “APTS will back the legislation. We hope to work with committee staff over the August recess to secure inclusion of some of our agenda items in that draft bill.” Tauzin has said he planned to introduce bipartisan, omnibus DTV bill in Sept. Besides federal funding, PTV issues include cable carriage, assuring DTV tuners are built into TV sets and ensuring that definition of “primary video” under Cable Act is interpreted to include all of PTV’s digital programming streams and not merely one, he said. Lawson ducked question on dual analog/digital carriage during transition, saying public broadcasters were giving “primary emphasis” now to primary video. APTS/PBS cable negotiating team is in earnest discussions now with 2 MSOs, including Cox, Lawson said, but no carriage deal is imminent. In recent testimony to Congress, Lawson said that despite PBS and APTS board members’ in “hundreds of hours” seeking cable carriage agreements, PTV stations had been able to clinch deals only with Time Warner and Insight Communications. Two MSOs together reach only 21% of U.S. cable households, he told members of House Telecom Subcommittee: “This slow progress in reaching cable carriage agreements means that we all still are a long way from achieving the goals for DTV receiver penetration established by Congress.” Asked what was holding up agreements with MSOs, Lawson told us there were several outstanding issues, but sticking points typically were carriage of all DTV signals of PTV stations and carriage of unduplicated signals of multiple PTV stations in market. He said pubic broadcasters’ inability to reach more carriage agreements was causing stations to question whether “pursuing voluntary, negotiated carriage is a fruitful investment of their scare resources; whether at some point, we must redirect our efforts toward securing carriage through government intervention.” Lawson said his expectation of reaching carriage deals with other MSOs by year-end were “pretty restrained at this point.” If Congress failed to step up funding for PTV’s digital conversion, as many as 1/3 of 356 PTV stations wouldn’t make May 2003 deadline, Lawson said, and many stations that made deadline wouldn’t be equipped for local origination of programming and services: “So our system has many unfulfilled needs and we really need the federal government to step up support.” Stations had raised $771 million from state and private sources, and with only $258 million so far from federal govt., “we are unfortunately very short” of estimated total conversion cost of $1.7 billion, he said. PTV got late start in terms of persuading Congress to fund its digital transition, Lawson said, and now “we are also in a very difficult fiscal environment.” He said Senate Appropriations Committee had approved $50 million for FY 2003 for PTV’s DTV through CPB, 100% increase over previous year and $51.8 million for Public Telecom Facilities Program (PTFP) for digital conversion. Lawson said public broadcasters were working with many sources for funding not only for conversion but also for digital content. Senate appropriations bill would increase PTV’s education funding and ATPS has been able to get language in farm bill that would open up existing grants program for PTV stations, he said. Lawson defended PBS decision to relax underwriting guidelines, step that has led critics to charge system with permitting “creeping commercialism.” “To me the key is that we are not interrupting programs,” he said. At June 23 board meeting, PBS board decided to allow corporate underwriting spots to depict multiple products, corporate spokespersons’ voicing support for public broadcasting, toll-free numbers, Web addresses. Stations’ viewer surveys have shown that program interruption is “key differentiator” in terms of station underwriting, Lawson said: “Viewers aren’t particularly concerned about the length of the message or the message but really about whether or not the program is interrupted.” PTV has had its critics from day one, he said: “Some think we are too commercial. Some think we are not entrepreneurial enough. The bottom line is that stations have to maintain a trust relationship with their communities.” Membership is largest source of funding for PTV, Lawson said, and he trusted local stations to “find the right balance between raising funds and remaining noncommercial.” APTS board was considering revision in voluntary guidelines for stations’ use of their proposed digital ancillary and supplementary guidelines, he said. Revised guidelines may be announced in late fall after they're “fully vetted” within system, he said. Voluntary guidelines were adopted in wake of FCC decision to permit PTV stations to solicit ads on their nonbroadcast digital ancillary and supplementary services. That decision has come under attack especially from Republican members of Congress. At recent hearing, House Telecom Subcommittee Chmn. Upton (R-Mich.) said although FCC believed its decision would enhance PTV’s fund-raising potential, several committee members “have expressed concerns that the FCC’s decision will increase commercialization of public broadcasting to the detriment of its principal mission.”