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Broadcasters seeking answers for digital transition
By Aaron Pressman
LAS VEGAS, April 18 (Reuters) - Radio and television broadcasters are looking for answers as digital technologies sweep through their industry, opening new opportunities for revenue and programming but also putting at risk some of their existing businesses.
More than 100,000 broadcasters have gathered here for their annual meeting with a focus on finding strategies and products to profit from the digital wave without veering into untested money-losing ventures or being overtaken by Internet and cable-based programming.
For the television industry, the conversion of analog broadcast signals to digital signals means the same amount of airwaves can carry a lot more information.
By going digital, each current channel can carry as many as six ordinary shows or a single high-definition program with theater-quality pictures and CD-quality sound. Or, part of a channel can be devoted to carrying Internet traffic or pay-per-view shows.
At the current early stage, only 57 television stations nationwide are airing any digital broadcasts at all and most of those show only a few hours a week. Viewing the digital shows requires a special television set that costs about $7,000 or converter boxes that are not widely available yet.
By the end of the year, 100 or more stations should be live with digital programming, notes Chuck Sherman of the National Association of Broadcasters. And prices for digital sets are falling and should be under $3,000 in late 1999. ''We've really accomplished a great deal,'' Sherman said.
Aside from the equipment costs, a dearth of programming is also deterring consumers. ''There are not enough programs and we all would like to see more,'' Sherman said.
CBS Corp. (CBS - news) has shown football games in high- definition and Walt Disney Co.'s (DIS - news) ABC has offered a few shows digitally as well.
Later this year, General Electric Co.'s (GE - news) NBC is expected to start broadcasting the Tonight Show with Jay Leno in digital. News Corp.'s Fox network is leaning more towards sending multiple standard quality shows in digital instead of using high-definition.
''The dearth of programming is a real problem,'' said Susan Ness, a member of the Federal Communications Commission who has been actively involved in digital television issues.
Ness recommended that broadcasters create special programs to showcase the benefits of high-definition just as the Bonanza show in the 1960s spurred the popularity of color television.
''We've seen a revolution of epic proportions in the growth of digital in the Internet,'' Ness said. ''The same can be true of digital television.''
Many of the high-tech companies profiting from the growth of the Internet and digital computers are in Las Vegas this week, hoping to help broadcasters make the transition.
Microsoft Corp. (MSFT - news), Hewlett Packard (HWP - news) and Sun Microsystems (SUNW - news) are present to hawk their latest digital television-compatible wares. And executives from Internet broadcasting pioneers like Broadcast.com and RealNetworks Inc. (RNWK - news) are prominently featured offering their advice.
According to a recent survey of 300 television stations, that advice could be useful as very few TV stations are using the Web to distribute live video and audio or offer much interactive content at all.
After reviewing Web sites of the 300 stations, University of Florida professor Sylvia Chad-Olmsted found just 1.3 percent were Webcasting entertainment programming and 7.3 percent were sending news shows, although half the news was audio only. About 10 percent were allowing visitors to interact with the Web sites and 14 percent were collecting demographic data about Web visitors.
The focus on news Webcasting ''is a good beginning for establishing Web credibility but they need to go forward,'' Chad-Olmsted said. More interactive and lively content will lead to greater opportunities for advertising, electronic commerce and other unrealized revenues, she said.
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