NTIA Selects IBM To Handle DTV Coupons

WASHINGTON — The Department of Commerce's National Telecommunications and Information Administration (NTIA) said last week it has awarded IBM a contract to provide services for the implementation and administration of the nation's digital-to-analog converter box coupon program.

Under the contract, IBM will provide services in three areas including:

• Consumer education;
• Coupon distribution to consumers and retail store participation; and
• Financial processing to reimburse retailers, to maintain records, and to prevent waste, fraud, and abuse.

The Coupon Program, authorized by the Digital Television Transition and Public Safety Act of 2005, provides for distribution and redemption of coupons that consumers may apply toward the purchase of digital-to-analog converter boxes.

Households using analog televisions will not be able to receive digital broadcasts after Feb. 17, 2009, when analog TV broadcasting is to cease, unless the analog television is connected to a converter box that switches the digital signal to an analog format, or the analog television is connected to cable or satellite service.

The total award of the contact is $119,968,468, which includes $84,990,343 for the base period, and $34,978,125 for the contingent period.

The contract performance will begin immediately, and is scheduled for closeout Sept. 30, 2009, the NTIA said.

"This is a major milestone toward implementing a successful Coupon Program to ensure the switch from analog to digital television is completed smoothly and as planned," stated NTIA Administrator John Kneuer. "By awarding the contract on schedule, NTIA is preparing to be open for business so consumers may request coupons starting Jan. 1, 2008, as required by law."

Under the converter box coupon program, U.S. households may request up to two coupons, worth $40 each to be used toward the purchase of eligible digital-to-analog TV converters, between Jan. 1, 2008, and March 31, 2009.

Coupons will be distributed until the initial $990 million allotment for the program has been exhausted.

After this initial phase of the program, NTIA may request an additional $510 million already authorized by Congress. During this "contingent period," coupons will be available exclusively to households that rely on over-the-air broadcasting as their sole source of television programming.

Commenting on the plan, Jason Oxman, Consumer Electronics Association communications VP, said: "We are pleased that the NTIA has successfully taken this critical step in the transition to digital television. Implementing the converter box program and educating consumers about digital-to-analog converter boxes will guarantee all Americans have multiple options to enjoy watching free over-the-air television today, tomorrow and after Feb. 17, 2009.

"CEA is committed to educating consumers, retailers, manufacturers and legislators about the transition to digital television. CEA's continuous, award-winning efforts include Web sites, printed collateral and media outreach. CEA currently operates various Web sites that promote the DTV transition through consumer and retailer education (www.CEknowhow.com). CEA is also a founding member of the DTV Transition Coalition (DTVtransition.org), which works to ensure educational materials reach a broad U.S audience."

Similarly, Jonathan Collegio, National Association of Broadcasts (NAB) digital television transition unit VP, said, "This is an important step in a process that will bring digital television (DTV) to all Americans. The success of the converter box coupon program is critical to upgrading America to digital television. NAB looks forward to working with NTIA and IBM to ensure all Americans continue to have access to free, over-the-air television."