Congress completed its attack on the U.S. economy today by voting (in the House) to delay the shutdown of analog TV broadcasting. If you were hoping to get a job building, installing, or maintaining new services that used the freed-up spectrum, hope no longer. The spectrum, and therefore any new jobs created by its new licensees, won’t be opened up until mid-June. An auction for a tiny portion of the TV spectrum raised $20 billion (source). Let’s assume that auctioning the entire spectrum would generate at least $100 billion in revenue for the Federal Government. Let’s further assume that the spectrum license is one third of the total capital investment required for a new wireless service. That means that, had analog TV been shut down, companies would have invested a further $200 billion in planning, design, equipment, software, marketing, customer service facilities, etc. That’s real capital investment that should be creating long-term jobs. There probably isn’t that much actual investment in the latest $800+ billion “stimulus” bill going through Congress. We would need to expand the current bill to $1.6 trillion in order to undo the damage done by the delay in the shutdown of analog TV.
Let’s also look at the global warming and air pollution angle. A VHF station transmitter will typically deliver more than 300 KW of output power. Assuming some level of losses, we’re talking about 0.5 megawatt per TV station to run the analog transmitter. Multipled by the more than 1000 television stations nationwide, even accounting for the fact that many are lower power UHF stations, we would need a good-sized coal-fired power plant running 24 hours per day to supply this load. Given that we’re running these huge transmitters for no particular reason, we’re going to need even more elaborate schemes to combat CO2 pollution.
Finally let’s look at the electronics retailers, some of which are going through Chapter 7 liquidation proceedings right now, notably Circuit City. Under the original plan they would have had their best day ever on February 17 as the analog TVs stopped receiving signals through their rabbit ears. They would have sold converter boxes, new digital TVs, cable subscriptions, satellite subscriptions. What do they get now? The same temporary boost in sales, but three or four months after most have gone out of business.
Can anyone think of a more effective way to shrink the U.S. economy?
[To those who worry about the effects of a TV shutdown on the poor: more than 97 percent of U.S. households classified as being in poverty own a color television and this number was about the same even when TVs were much more expensive. Americans at all income levels seem to be able to obtain necessary television gear.]
What about the effect of TV shutdown on ratings? This would lower audience for existing programs, which would reduce advertising revenue, result in layoffs over the coming months, etc.
I think we’d still be better off if the shutdown happened now, but you’d have to subtract the lost revenue for entertainment industries from the $1.6 trillion estimate.
Murali: The people who supposedly aren’t going to be able to watch TV anymore fall into two classes: (1) elderly, shunned by friends and relatives, clueless, and (2) too poor to afford a $50 converter box without assistance from the Federales. Losing those two classes of audience should not change the price that an advertiser is willing to pay for TV time. Remember that when Toyota is paying for an ad on TV they are only interested in the number of people watching who are capable of buying a new car. They don’t pay for the absolute number of eyeballs.
Not that this changes your main argument, but your quoted 300KW figure for VHF TV transmitters seems quite high, which makes me wonder if you’re quoting ERP (effective radiated power) figures, which take substantial antenna gain into account, rather than actual amplifier input power. (ERP figures are typically many multiples of the electric power actually consumed by a transmitter’s power amplifier.)
In the major TV market with which I’m moderately familiar, most of the VHF TV stations have amplifier input powers in the 15-45KW range, with ERPs ranging from 45KW to 155KW. (UHF transmitters tend to be far bigger power hogs, consuming much more electric power than VHF transmitters to get equivalent coverage. It’s not uncommon to see UHF stations with ERP figures in the megawatt range.)
Chris: You’re probably right. I was just pulling figures off Web pages that profiled various stations. Still, I haven’t figured out why the U.S. is suddenly so rich that we can afford to waste even 50 KW per TV station! That’s about 50 megawatts nationwide (1100 stations?). But you’re right, the main argument is why we’re delaying a huge amount of business investment at a time when the U.S. economy is still shedding jobs.
Actually the bill just delays the mandate for conversion. Many stations will be going ahead with the February conversion.
Here’s an example: most Peoria stations will be switching in February:
http://www.pjstar.com/archive/x357829743/Area-stations-still-planning-to-go-digital-Feb-17
Jim: The early shut-down by individual stations solves the problem of wasting power, but I don’t think it will enable the spectrum to be reused on the original schedule. Most of the bidders on spectrum, as I recall, wanted to use the same block nationwide and therefore it wouldn’t work for them if their spectrum were dark in Peoria but still cluttered with Jerry Springer in Phoenix.
Phil,
“Still, I haven’t figured out why the U.S. is suddenly so rich that we can afford to waste even 50 KW per TV station! That’s about 50 megawatts nationwide (1100 stations?).”
If you’re going to do math, do math:
50 million watts / 300 million Americans = 1/6 watt per person
x 24 hours/day = 4 Wh/day/person
x 365.25 days/year = 1461 Wh/year/person = 1.461 kWh/year/person
x $0.17/kWh = $0.25/year/person
Yeah, that’s going to break us.
(And the $0.17/kWh is for Hawaii, the most expensive state for electricity.)
George: That’s still $100 million per year! For $100 million we could develop a set of free online textbooks for K-12 education, saving state and local governments $billions. $100 million doesn’t round to zero, except maybe in Washington these days…
The Washington saying is “a billion here, a billion there”. A million is walking-around money in Washington.
Unfortunately.
Actually, I do plan on using the freed up spectrum (for wireless Internet using unlicensed whitespaces equipment). So I’m not real happy about the delay, but I don’t think it is a big deal. The radios I would use need to be finalized, then sent to the FCC for approval, I doubt they will be available in 2009 anyway.
And I can’t imagine that a four month delay will be a huge impact on the big companies that bought 700MHz spectrum. Look at Xohm, they have had 2.5GHz for Wimax for years, and have only built out service in a few cities.