CEA Head Gary Shapiro Asks Broadcasters to Support an Analog Cut-off Date and Promote over-the-Air Broadcasting.

LAS VEGAS -- Latest Broadside Against CEA Is Example of NAB's Strategy of Point-and-Blame Instead of Moving Forward

The broadcast industry should stop pushing for regulations on other industries, "remove its shackles" and market the value of its digital service to consumers, said Consumer Electronics Association (CEA) President and CEO Gary Shapiro. Shapiro shared his views on the digital television (DTV) transition and the broadcast industry in a speech delivered yesterday during NAB2005, the annual convention produced by the National Association of Broadcasters (NAB) this week in Las Vegas, Nevada.

"Broadcasters face significant challenges in the digital age - challenges they have refused to tackle and opportunities they have refused to embrace," stated Shapiro. "But these challenges are not insurmountable. Indeed, those who play these changes to their advantage will succeed in the digital age.

"For too long, broadcasters have tried to enhance or even save themselves by pushing for regulations on other industries," Shapiro continued. "Too many competitors and innovations are out there - all competing for the same eyeballs - for that approach to be successful in the long run."

Shapiro's comments came as the NAB issued a misleading attack on CEA's good faith attempt to modify the DTV tuner rollout schedule and accelerate the DTV transition. CEA is requesting the Federal Communications Commission (FCC) advance the deadline for manufacturers to include digital tuners in all televisions with screens sized 25- to 36-inches from July 1, 2006, to March 1, 2006. In exchange, the association is urging the Commission to eliminate the July 1, 2005, deadline that requires 50 percent of sets offered for sale in this size range include a digital tuner.

"How the NAB can distort the facts and accuse CEA of delaying the DTV roll out with our proposal is unfathomable. Yet again, the NAB is pushing for regulations on other industries instead of taking seriously their responsibility to move the DTV transition forward," said Shapiro. "CEA opposed the tuner mandate because so few Americans (less than 15 percent) rely on antennas to receive a television signal for the primary TVs in their homes. We accept the fact that the mandate is now law but our proposal would accelerate the DTV transition as the 50 percent requirement has not worked because consumers are not demanding tuner-equipped sets. The FCC cannot order consumers and retailers to buy products."

Shapiro continued, "Broadcasters are benefiting from the greatest wealth transfer in the history, namely the interest free "loan" of public spectrum. Their continued efforts to delay the transition indicate that NAB is trying to convert this loan into an outright gift. The American public deserves better."

In yesterday's speech, Shapiro noted that the move to DTV was designed in part to help support over-the-air broadcasts. But, he observed, broadcasters haven't taken advantage of this "unprecedented opportunity to revive their business. They have reacted to new competitive entrants with aggressive lobbying rather than aggressive business strategy."

Shapiro also noted that despite the challenges they face, broadcasters have refused to market their own product. Shapiro said, "While broadcasters have sought mandates on others, they have totally failed to promote free over-the-air broadcasting. CEA alone has created, funded and promoted a web site to help consumers choose antennas, visited by over 200,000 consumers a month."

Shapiro offered four steps for broadcasters to win back share and help save their industry:

--Promote free over-the-air broadcasting.

--Shift to HDTV quickly and promote DTV on analog channels.

--Support a hard cut-off date for analog broadcasts.

--Defend the First Amendment.

"I hope the broadcast industry does not sit idly by as broadcasting becomes wimpish, milquetoast media," said Shapiro in conclusion. "The answer is not to regulate competitors, it is to stand up and fight using broadcast strengths. It would be sad to see a great industry fade into oblivion or further into dependency on government regulation on other media. Instead of endless blame and delay, broadcasters need to embrace their digital future, move the DTV transition forward and do the right thing for the American public."

About CEA:

The Consumer Electronics Association (CEA) is the preeminent trade association promoting growth in the consumer technology industry through technology policy, events, research, promotion and the fostering of business and strategic relationships. CEA represents more than 2,000 corporate members involved in the design, development, manufacturing, distribution and integration of audio, video, mobile electronics, wireless and landline communications, information technology, home networking, multimedia and accessory products, as well as related services that are sold through consumer channels. Combined, CEA's members account for more than $121 billion in annual sales. CEA's resources are available online at www.CE.org, the definitive source for information about the consumer electronics industry.

CEA also sponsors and manages the International CES - Defining Tomorrow's Technology. All profits from CES are reinvested into industry services, including technical training and education, industry promotion, engineering standards development, market research and legislative advocacy.

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