The Obama administration is putting “real pressure” on the NTIA and its vendors to devise an electronically downloadable converter box coupon that would speed delivery of the vouchers to consumers, said an official with intimate knowledge of the coupon program. The Obama transition team first broached the idea of an electronic coupon in early January when it began pushing for DTV delay legislation that would also require the NTIA to send coupons by pre-sorted first-class mail rather than use the slower, less-costly “standard” rate that the agency used for all of 2008, the official said.
Paul Gluckman
Paul Gluckman, Executive Senior Editor, is a 30-year Warren Communications News veteran having joined the company in May 1989 to launch its Audio Week publication. In his long career, Paul has chronicled the rise and fall of physical entertainment media like the CD, DVD and Blu-ray and the advent of ATSC 3.0 broadcast technology from its rudimentary standardization roots to its anticipated 2020 commercial launch.
The Federal Trade Commission signed a consent order with the National Association of Music Merchants barring the trade group from “arranging and encouraging the exchange among its members of competitively sensitive information that had the purpose, tendency and capacity to facilitate price coordination and collusion among competitors,” the commission said Wednesday. At NAMM-sponsored events between 2005 and 2007, NAMM members “discussed the adoption, implementation and enforcement of minimum advertised price policies” and other competitively sensitive issues, the FTC said. NAMM’s activities “crossed the line that distinguishes legitimate trade association activity from unfair methods of competition,” it said. The consent order requires NAMM “to institute an antitrust compliance plan,” without “interfering with the ability of NAMM to engage in legitimate trade association activity, including its sponsorship of trade shows and other events,” it said. CEA thinks the FTC consent order with NAMM has no ramifications for its own sponsored events, spokesman Jason Oxman said. “All CEA members participating in our events are required to abide by [antitrust] guidelines and must memorialize their adherence at each member meeting,” Oxman said. “CEA takes compliance with the antitrust laws seriously and we therefore take the necessary steps to ensure that our trade shows and other events are conducted in conformity with the antitrust laws.”
NCR and Toshiba at this week’s Retailtech show in Tokyo are demonstrating secure downloads of standard-definition video to SD memory cards using MOD Systems retail kiosks, the company said Tuesday. NCR and Toshiba together invested $35 million in MOD last year and became minority owners (CED Sept 18 p1). MOD spokeswoman Stephanie Martin offered few new details about the company’s plans to start retail kiosks in the U.S. this year. MOD “is carefully evaluating what retailers it will launch with in 2009,” but has not announced when or where it will launch, and with what retail partners, she said. Nor does it plan anytime soon to offer HD video downloads, she said. “Our focus for 2009 is on standard definition. Download time to an SD card for a full-length, standard definition movie is two to three minutes, depending on the file size. SD card technology is evolving at an incredible rate, so while MOD is pleased with current download times, we are very excited about the continuous progress we expect to see in the near future.”
The NTIA wants to spend $150,000 to host 32 focus groups in 10 cities to find out why 5 million households are, according to Nielsen estimates, still “completely unprepared” for the DTV transition and how it can help them, the agency said in a Feb. 26 request at the Office of Management and Budget for emergency review of the plan. It will use the research to develop “new messages and materials to reach these consumers,” said the request, which seeks OMB approval by Friday. Ketchum, the NTIA’s public-relations subcontractor, and Campbell & Co., the Chicago-based consulting firm, will do the research, which will “oversample those target demographic groups that are further behind in the preparedness efforts than the general population,” the agency said. Recent Nielsen studies “show that African- American and Hispanic households still lag behind the rest of the country in preparing for the transition,” it said. The NTIA will record the focus groups on audio and video, but destroy the recordings by July and won’t disseminate the findings publicly, it said. It will pay about 320 people $65 to $80 each, “depending on the market,” to take part in the focus groups, it said. “This is standard practice in focus group recruitment and is necessary to attract and retain diverse participation in the focus groups,” it said. “Typically, 10 participants are recruited, since there may be no-shows, but everyone is paid who shows, regardless of whether they are selected to participate.”
The NTIA has removed requests for 3.5 million converter- box coupons from the waiting list since it began compiling the list Jan. 4, including 146,200 in the 72 hours ended midnight Sunday, the agency said Monday. Still, orders for 4.1 million coupons remained on the waiting list Sunday night, it said. Redemption rates for coupons expiring in the week ended Feb. 20 soared to new record highs of 68.2 percent among over-the-air-only TV households and 66.5 percent for the program overall, the NTIA said. But average daily orders have dwindled since Congress passed the DTV Delay Act and President Barack Obama signed it into law (CED Feb 12 p11). Fewer than 61,000 coupons a day were ordered in the week ended Feb. 25, the NTIA said. That’s down from a high of 534,000 average daily coupons ordered in the first week of January amid the flurry of media reports that the coupon program had reached its funding ceiling.
The FCC seeks comments by April 27 and replies May 27 on a petition that alleges Americans are overpaying for DTV sets because of exorbitant royalties levied by patent holders that license the technology on unreasonable and discriminatory terms, it said in a public notice Wednesday. The Coalition United to Terminate Financial Abuses of the Television Transition (CUT FATT), whose only members are TV makers Vizio and Westinghouse Digital, filed the petition two months ago asking the commission to start a rulemaking to regulate the patent fees, and to impose fines on licensors judged to be non-compliant (CED Jan 5 p1). That the FCC has decided to seek comments on the petition is a sign CUT FATT’s allegations may have resonated with some at the commission. Compared with the DTV patent licensing process elsewhere in the world, licensors in the U.S. “operate in an unregulated ‘Wild West’ without supervision or accountability,” the petition said. In a written statement Wednesday, CUT FATT hailed the commission notice as a first step “to protect consumers against uncontrolled price-gouging by DTV patent holders.” Meanwhile, Funai wants the FCC to combine Vizio’s Friday request for temporary relief with the CUT FATT petition “under a single proceeding,” it told the commission in a motion filed Tuesday. In its request, Vizio said it will suffer “irreparable harm” without an FCC temporary order requiring Funai to license it for a DTV patent (CED Feb 24 p2). But the Vizio request was merely a petition for rulemaking in disguise and should be treated that way, Funai said. Vizio styled it as a request for temporary relief in “a blatant attempt to trigger the substantially shortened pleading cycle” under FCC rules, Funai said. If the commission decides not to group the Vizio request with the CUT FATT petition, Funai wants the deadline extended to March 13 to respond to it, it said. Without the extension, its response would be due Monday.
Kodak thinks the patent complaints LG and Samsung filed last week at the International Trade Commission (CED Feb 24 p5) are “retaliatory tactics” against infringement lawsuits that Kodak filed against both Korean CE makers in November, spokesman David Lanzillo told us in an e-mail Monday. Kodak invented the digital camera more than 30 years ago at its research labs in Rochester, N.Y., Lanzillo said. “Today, the technology that Kodak relies upon to create its portfolio of award-winning digital cameras is owned or properly licensed by Kodak,” he said. “Recognizing the value of Kodak’s leading innovation in digital photography, many global companies have licensed Kodak’s digital camera technology for use in their products.” But when LG and Samsung “refused to do so,” Kodak sued at the commission and in federal court, he said. “We believe that Samsung’s and LG’s latest filings are retaliatory tactics and we intend to vigorously contest their claims.”
LG and Samsung want Kodak to stop importing digital cameras that violate their patents, the Korean giants said in separate “337” trade complaints filed three days apart last week at the U.S. International Trade Commission. Ten models of Kodak cameras violate two Samsung patents, the company said in its Feb. 17 complaint. One Samsung patent (No. 5,731,852) is for a method of creating variable-length audio files on a camera, while the other (No. 6,229,695) is for a camera housing that makes the device less damage-prone when it’s dropped or jostled, Samsung said. LG’s complaint, filed Feb. 20, cites three Kodak cameras, each of which violates an LG patent, the company said. Kodak’s V1273 camera uses a focus-control system that violates LG’s 5,995,767 patent, the complaint said. Another Kodak camera, the V1073, uses a sound-generation and display-control method that violates LG’s 5,774,131 patent, it said. A third model, the Z1015IS, the only camera cited in both the LG and Samsung complaints, uses an on-screen menu system that violates LG’s 6,231,895 patent, it said. Kodak didn’t immediately respond to requests for comment.
Some of the largest markets where at least three network affiliates have dropped analog also have significant numbers of households on the converter box coupon wait list, according to newly released NTIA data. Almost 21,000 households in the San Diego TV market were on the list for DTV coupons Monday, the agency said. San Diego is the largest designated market area, and has the most network- affiliated stations, to have made the switch to digital this week. But just 0.46 percent of the San Diego households on the waiting list were over-the-air only, the NTIA said. Wilkes-Barre/Scranton, Pa., the third largest DMA affected, had almost 8,000 households on the waiting list, 0.15 percent over-the-air only. Los Angeles had the most households on the waiting list, just over 154,000, 3.47 percent of them over-the-air only, followed by New York, with more than 148,000 households, 2.86 percent over-the-air only. But Los Angeles and New York have few, if any, stations switching off their analog signals early.
The DTV Delay Act just signed into law “doesn’t change the operation of the TV Converter Box Coupon Program at this time,” NTIA’s vendor says in a new notice posted at the program’s retailer site. “Retailers should continue with the same processes for coupon acceptance and redemption that have been used since the program’s inception,” it said. But “other program changes in the DTV Delay Act that address the supply of converter box coupons require additional funding from Congress,” it said. There’s $650 million for the coupon program in the economic stimulus legislation, including for replacement coupons for consumers whose original ones expired, the site says. “The NTIA has indicated it will move quickly to change the program if legislation that authorizes more funds is passed and signed into law.” March 31 is no longer the deadline for applying for coupons. Under the new law, it’s July 31. But the NTIA hasn’t set the deadline to redeem the last coupons. Before the delay act, it was July 9.