RSSNearly $1 BN Set-Top Box Subsidy May Not Be Enough
By Scott M. Fulton, III | Published March 20, 2007, 5:25 PM
With the US Congress having approved a plan just eight days ago to provide households with as many as two coupons, each good toward $40 off the purchase of a converter set-top box enabling existing television sets to receive digital programming over the airwaves after February 17, 2009, LG - expected to be a major producer of STBs - predicted that its models would end up selling for $60 apiece.
The comment came from John Taylor, LG's vice president of US government relations, in a public statement that was cited this morning by Reuters.
LG joins Samsung and the RCA division of Thomson Consumer Electronics in announcing the availability of set-top boxes next January, when the coupon program is officially launched. Both Thomson and Samsung have acknowledged the $40 value for each coupon, in so doing implying that its STBs would sell for that amount. But LG's comments seem to imply that $60 may be the going rate.
Subscribers to digital cable systems who don't intend to pick up over-the-air signals may not need STBs. Instead, these devices would be intended for the 34 million US households, by National Association of Broadcasters estimates, that still rely on terrestrial broadcasting, and for whom billions of dollars in transmitter upgrades has already been invested by TV stations.
Still, these STBs will likely be fairly utilitarian devices, which may lead some to wonder why a manufacturer would want to charge a premium. One clue came from Samsung today, whose representatives at the same meeting with LG cited the fact that the coupon program takes place in January, after the holiday purchasing season has already ended - thus making promotions difficult during an historically slow sales period.
Congress has set aside $990 million for the converter box subsidy, with the option of increasing funding by $510 million if, for some reason, it turns out the $80 per household isn't enough. Lawmakers had originally planned to set aside $463 million until they had seen the first wave of cost estimates by electronics manufacturers.
I spend any free time playing on-line games in place of watching tv. At least gaming is interactive and being on a vent server, you can talk to everyone else who is playing the games your playing. Its so much better than just staring at a tv screen and having to endure the frequent boring commercials.
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|Why is the government paying people to watch Television?
What the hell is wrong with this country?
(That's a rhetorical question, the list would be *far* too long for this forum)
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|Better yet, why do cable TV systems charge $50 a month plus when most programming offered has commercials during the programs?
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|Yeah, I kinda been wondering that myself. I might be showing my age, but I remember when the only difference between normal cable and premium channels was content (ie new movies), not the presence of commercials.
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|I cannot understand usa either....
Heaven forbid if people step outside of their house because they cant watch TV.
Maybe people wont be so content with their lives anymore and start questioning all these stupid government decisions.
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|No, no, no. I don't want to spend any more time outside, I only see the sun on average about an hour a day (during the summer). If I want to see it more than that, I can watch it on tv. ;)
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|Umm...because the ads pay the networks not the cable company.
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|meh.
I'm just going to stop watching TV altogether. There's nothing airing that is worth purchasing extra equipment, and I maybe watch 2 hours of TV a week. That time could well be used to catch up on my reading .
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|Why does congress feel a responsibility of $1 Billion dollars? I can understand if they allow the new converters to be tax deductions on one's tax return for 2008, but if congress truly believes that switching all television to digital, freeing up the existing airwaves, and alleviating broadcasters (I understand that there are many reasons) - is necessary for our country's (if you're not in the US, ignore) benefit - then why give coupons?
We're apparently at war with Iraq right now and a 1 Billion dollar budget for television is silly. People can afford to spend $50.
The government did not subsidize the purchase of DVD players - and while adoption for digital set top boxes is being required at a faster rate than VHS to DVD, I don't know anyone who complained of the s***. The quality was better, the format offered more - it was understood.
I don't like knowing that my taxes are going to cover rebates for television viewers. Is radio next?
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|Amen. If there was anyone who would want to do this, maybe ADVERTISERS. How many TVs have you seen in the last year that are on bunny ears AND don't have a digital tuner?
This is absolutely pathetic. Congress under Bush in 05-06 will go down as one of the most spineless, pathetic sessions in the last hundred years.
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|Count mine as one.
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|I think the idea is to provide those that are less financially secure to still be able to watch television. If that is the case, then they'll have to make sure the boxes have an RF output as they may not have the inputs for a direct feed.
Digital set top boxes for free to air tv have been available elsewhere in the world for 7 years or more, so they're a well developed product whose prices is already coming down. A price of US$60 is about right, thats the price of a lower end box. They're certainly not talking high definition boxes, as they are of no use unless you have a true HD tv (and most of the LCD's and plasma's people have been buying are HD ready or HD compatible, not true HD!).
It sounds like the coupon may only be suitable for certain boxes? Its not that hard to have the same 'box' in many different format markets, all that is required is a software change.
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|I agree, but why 2 coupons? If you can't afford a $40-60 box so you can watch TV, maybe you shouldn't have TWO!
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|man lucky..
here in Japan we get no coupons :(
although I don't watch TV a lot.
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|Was anyone besides me thinking "they'll just mark up the devices an extra $40", when they heard the initial announcement?
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|I don't think it was ever intended to pay entirely for the devices, and also the devices will come down in price within 1.5 years.
Who cares about the devices? So screens go blank on a date. Wouldn't the world be better off without TV?
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|$1 to BN? BetaNews is doing well...
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