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Positive Response Seen To Converter-Box Coupon Program

In little more than a month, the U.S. will complete the historic transition to digital broadcasting as full-power TV stations across the country cease analog broadcasts at midnight on Feb. 17.

Since January 2008, the TV Converter Box Coupon Program, administered by the U.S. Commerce Department’s National Telecommunications and Information Administration (NTIA), has helped the American public make a smooth transition to digital broadcasting. Consumers who choose to continue watching television on analog sets served by antennas have been encouraged to apply for the two $40 converter-box coupons available per household.

The response has been overwhelming — both from the public and from the consumer electronics industry. Millions of consumers have applied for converter-box coupons and successfully redeemed them, thanks to the thousands of consumer electronics retailers who joined the program. Also, more than 100 converter-box manufacturers submitted converter boxes for NTIA approval and 185 coupon-eligible converter boxes (CECBs) were approved.

More than 3,100 retailers became certified to redeem coupons toward CECBs, including eight of the top 10 retailers: Best Buy, Circuit City, Fry’s, RadioShack, Sam’s Club, Sears, Target and Wal-Mart, and numerous local retailers as well. There are nearly 35,000 traditional “brick and mortar” stores participating, including 38 online and 12 phone retailers.

These numbers have helped ensure that consumers with coupons can easily locate CECBs in all parts of the country, including the rural and urban areas of every state and U.S. territory. Online and phone retailers extend the program’s reach for consumers who can’t visit a store.

With just a few weeks to go until full-power analog broadcasts end, the demand for converter boxes has continued.

Coupons are valid for 90 days from the date they are mailed, so consumers may be using them to purchase CECBs into July, 2009. This timeline and the substantial demand for coupons reinforces the need for retailers to keep converter boxes on store shelves in the weeks and months ahead as consumers adjust to the new way that TV signals come into their homes.

Several indicators from the fourth quarter of 2008 underscore continuing demand for converter boxes, including the Oct. 15 report from The Nielsen Company about household readiness for this unique switchover. Nielsen found 9 million households were totally unprepared for the upcoming digital transition, with another 12.6 million households having at least one TV set that was not yet ready.

The coupon program’s Apply, Buy and Try campaign urged consumers to apply for coupons by the end of 2008 so that they would have plenty of time to purchase a CECB and connect it effectively to their analog over-the-air television.

And, while program efforts have put particular focus on those households served only by over-the-air broadcasts, we know many homes that use cable, satellite or other pay TV services still contain an extra older television — or two — that require converter boxes. That’s another source for additional converter-box purchases so TV owners can restore viewing on secondary sets in kitchens, workshops or a guest room.

These factors support the expectation that many consumers will purchase converter boxes up to — and beyond — the Feb. 17 transition date.

Of course, some will wait until the last minute or until their television sets go dark despite months of educational and outreach efforts encouraging advance preparations. These consumers may need to be able to find converter boxes, too — even if their belated awareness means a purchase without the advantage of a $40 coupon.

The coupon program recognizes that consumers have been well-served in their efforts to locate converter boxes so far, due to the vital backing from the consumer electronics industry since the program was conceived. Now, continued retailer cooperation is needed to meet the substantial demand for CECBs through the end of the program.

A strong private-public partnership with the Federal Communications Commission, community organizations, broadcasting groups and the consumer electronics industry has contributed greatly to the success of NTIA’s TV Converter Box Coupon Program.