As broadcasters prepare to throw the switch on digital TV broadcasts early
next month, International Data Corporation
says the market for DTV will slog slowly through a period of consumer
confusion and technical hang-ups--but finally boom in 2007 in an unexpected
With issues ranging from high costs of digital TV sets--$5,000 and up--a
lack of high definition (HD) content, to technical issues such as whether
or not cable operators will carry HDTV signals, the move to digital
broadcasting will be a difficult one.
"The key reason [for the stalled market acceptance] is hardware
costs, but limited coverage and content availability," will limit the
appeal of digital television initially, said Kevin Hause, a senior
analyst with IDC. Indeed, true HDTV
broadcasts will be few and far between for the first two years or so. A
limited selection of network programs, such as NBC's Tonight Show, and a smattering a sports
programs will be the only true HDTV broadcasts.
Whatever the obstacles, broadcasters will boldly begin broadcasting at 41
stations from a wide range of U.S. markets starting November 1.
| Sorting out the digital TV offerings
|• HDTV: high definition television is a subset of digital television formats
offering over 1,000 lines of resolution, measured vertically. All HDTVs are
capable of displaying material in wide screen or "letterbox" format.
• SDTV: standard definition television offers essentially the same or
slightly improved picture resolution as today's TV, but the picture quality
is better because digital transmission eliminates snow and ghosts. Doesn't
offer wide screen viewing.
• Converter boxes: Most HDTVs are initially going to ship with separate
set-tops that receive and decode HDTV signals. Set-tops for displaying
signals on regular and SDTVs will account for the majority of hardware
shipments in the coming years, IDC said.
Source: CNET research, IDC
"Next week...most broadcasts will be [traditional low resolution]
content that is 'upconverted' to the high definition digital formats," said
Hause, but the resulting image will fall short of a true high definition
image. Eyeing this nascent market for upconverted images, Mitsubishi yesterday announced that it is shipping an HDTV.
True HDTV pictures have to be filmed with high resolution cameras in
addition to being sent over the airwaves in its original, digital state.
It will takes years to get these high-definition cameras into the hands of
the hundreds of camera people out in the field, according to Peg Murphy, an
executive at NBC Interactive, speaking at a recent forum in Silicon Valley.
The good news for consumers is that broadcasters will expand their DTV
content offerings by 2004, and "in that timeframe the planets
start to align in terms of consumer momentum, awareness and purchases,"
By 2007, IDC is estimating that 138 million HDTV sets and "converter
boxes"--devices that can take a digital signal and send out images to
either a digital TV or traditional "analog" TV--will be sold.
With digital technology, broadcasters can offer a high-definition digital
TV signal with significantly greater picture clarity and sound quality than
traditional TVs allow.
Relatively few people will wind up enjoying HDTV "in all its glory," the
report said, but there are still significant advantages that will drive
interest in the technology.
So-called "SDTVs," or standard definition digital televisions that don't
display content in the wide-screen format and display lower resolution
pictures than their costlier HDTV cousins, will increase in popularity
because they still offer greater resolution than today's TVs. They will
also be affordable enough to become a replacement for a consumer's aging TV
More popular still will be converter boxes that translate the digital
signal and display it on a regular TV, in a fashion similar to how
satellite programming services such as DirecTV work.
"This is probably going to be the most economical solution for many
people," according to Hause. "They can take advantage of digital signal
without spending money to replace that TV," he notes, because an
over-the-air signal transmitted digitally will offer better picture
fidelity than an analog signal. In fact, many cable operators are already
offering similar benefits by sending a digital signal through their coaxial
cable wires into homes with special set-top receivers.
In the future, Hause said, more of the receivers shipped by cable companies
will be able to decode the new digital TV formats and display those on
regular TVs, accounting for a large portion of the predicted growth in the
"It's a guard against obsolescence until the market settles on what signals
are being provided," Hause said. There are 18 different ways a signal can
be sent to a digital TV receiver.
Broadcasters are saying that 41 stations from a wide range of U.S. markets
are set to begin broadcasts in November. Affiliates of the four networks in
the 10 largest markets are required to begin their digital broadcasts by
May 1, 1999, and in the top 30 markets by November 1999, as mandated by the
But a government mandate alone is not going to be sufficient to smooth out
the transition to digital television. Digital TVs sold today come with a
separate set-top receiver that can cost between $1,000 and $3,000 that can
interpret and display all 18 formats. The cost of the TV and the receiver
is $5,000 and up, a factor which is going to severely inhibit the growth of
the market to around 13 million units by 2002, Hause notes. This will only
be overcome when more digital programming becomes available.
Currently, broadcasters are banking on high definition signals-those with
line resolution of 720 or higher-to drive interest in digital television.
But by 2007, more broadcasters will have firmed up plans for sending out
content in lower resolution SDTV formats, sometimes even sending multiple
channels in the place of one HDTV signal.