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Dear Reader:

We wanted to let you know that, after nearly three years of operation on the World Wide Web, National Journal's Insider Update: The Telecom Act ceased publication as of January 1, 2008.

We took this step at a time when the National Journal Group is moving to increase technology coverage -- including reporting on telecommunications and broadcasting issues -- in several of its other publications. In particular, National Journal's CongressDaily -- our twice daily publication for Capitol Hill insiders -- will be adding staff in the coming weeks for this purpose.

CongressDaily will feature the kind of detailed coverage of telecom issues, both on Capitol Hill and at the Federal Communications Commission, that you are accustomed to seeing in Insider Update -- plus a lot more.

If you are interested in a trial subscription to CongressDaily, please call 800-424-2921 or e-mail us at memberships@nationaljournal.com. Thank you for your readership and support of Insider Update, and please don't hesitate to write to me at lpeck@nationaljournal.com if you have any questions or concerns.

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Democrats Seek Changes To Digital Converter Plan

By David Hatch

(Friday, November 17) House Democrats proposed radically altering plans for the nation's digital television transition -- signaling that major changes on media and telecommunications policy may be pursued by the new Democratic congressional majority.

In a detailed letter to John Kneuer, acting administrator of the National Telecommunications and Information Administration, 20 House members detailed modifications that they are seeking to a program for converting analog signals to digital ones.

Kneuer, a Republican, is awaiting Senate approval of his recent confirmation to head NTIA, which advises the White House on communications policy.

A new law establishes Feb. 17, 2009, as the cut-off date for analog TV signals. The law reserves $1.5 billion to help Americans purchase converter boxes so they can view digital signals in an analog format on older TV sets.

Under the initiative, households could apply for up to two coupons worth $40 each toward purchases of digital-to-analog units, to be priced at about $50. NTIA has been tasked with implementing the program. NTIA has been tasked with implementing the program.

"We continue to believe this plan is highly flawed and disadvantages the poor, the elderly, minority groups and those with multiple analog television sets in their homes," the letter, dated Wednesday, said.

Signers include Reps. John Dingell, D-Mich., who takes the helm of the powerful Energy and Commerce Committee next year, and Edward Markey, D-Mass., the presumptive incoming chairman of Energy and Commerce's Telecommunications and the Internet Subcommittee.

Democrats assert that the Republican-controlled Congress has "failed to provide sufficient funding" for the effort, and they warned that failure to design a consumer-friendly coupon strategy "could significantly jeopardize the public's acceptance of the transition and derail the firm deadline."

NTIA spokesman Todd Sedmak said his agency soon will respond to the letter. "We are more than willing to work with Congress to get the best program possible," Sedmak said.

The lawmakers oppose restricting participation only to households receiving over-the-air analog broadcasts because other citizens with analog sets would be "disenfranchised."

NTIA has sought feedback on such a restriction but has not decided whether to adopt it.

The Democrats also recommend that converter boxes replicate the picture and audio quality that consumers now get with analog sets. That could necessitate setting a manufacturing deadline to ensure that high-quality units are available for the digital transition.

Furthermore, they urge NTIA to ensure that the boxes can be updated, modified and repaired, and that they utilize the latest receiver technology.

But one observer suggested that new legislation may be needed to accomplish the goals because existing law only requires that barebones units be offered under the coupon program.

The legislators emphasized that consumer education is critical to the transition's success and complained that the $5 million statutory cap on outreach is "woefully inadequate."

They urged NTIA to provide timely feedback to Congress and the public about coupon requests and redemptions. "This would enable Congress to evaluate the effectiveness of NTIA's transition program and whether changes should be made prior to the statutory deadline," they wrote.


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