U.S. digital television, ground zero.

How manufacturers are ushering in this year's new arrival

The transition from analog to digital television is underway. Soon American consumers will have access to the wonders of digital high definition television: digital surround sound, unprecedented picture resolution and a link to a variety of new features and technologies.

Which Comes First?

One question we might ask is which sector will drive digital TV in the U.S.Will manufacturers flood the market with digital TV sets, creating a demand for digital broadcasting? Or will broadcasters air digital TV first, making consumers want to buy HDTV sets?

The answer is that the switch to digital TV is no longer a chicken and egg debate. Manufacturers demonstrated their commitment to this technology with the unveiling of the first generation of HDTVs in January at the 1998 International Consumer Electronics Show. The sets introduced at the show will be on retail shelves during the fourth quarter of this year. And broadcasters are moving forward to deliver HDTV programming as early as this spring, with digital broadcasts reaching the top 10 markets by November. Moving forward, it is consumers who will drive the transition.

Currently, consumers have $250 billion invested in analog audio and video technologies. And they have already invested in digital technologies to the tune of $125 billion worth of computers, CD players and digital satellite systems. As for TV,, 60 million households own at least one big screen (25 inches or larger) TV, and 18 million households paid at least $2,000 at retail for their sets. Industry experts estimate that at least 25 percent of these 18 million households - roughly four or five million households - will be ready to replace their analog sets with digital ones in the first few years of introduction. Market analyses predict, conservatively, that 30 percent of U.S. households will have digital sets by 2006 and that more than 75 percent will be capable of receiving digital broadcasts through either a digital set or a set-top converter box.

The history of the consumer electronics industry - and recent research - demonstrates that consumers want HDTV. From black-and-white to color, from phonographs to CDs, from videotapes to DVDs, there is proof that American consumers want the best in video and audio performance. Time and again, they have expressed their enthusiasm for HDTV's audio and video improvements. And research indicates that their digital television purchases will be driven by other features as well. Such features include Internet access; interoperability with adjunct products like digital cameras and videophones; and the potential for add-ons like DVD.

Set Specifics

More than a dozen manufacturers have unveiled their first digital and high definition sets and will bring them to market this year. These first sets are large screen - ranging from 34 inches to 70 inches - and are likely to cost at least $2,000 more than today's televisions. Consumers who don't want to make that investment can opt to spend several hundred dollars on a converter box that will give them access to digital broadcasts through their current sets.

Manufacturers will build second generation sets next. These sets will be much more affordable and will be available to a broader population of consumers. They will provide a wider variety of screen sizes and features. The prices for digital converter boxes are also expected to drop drastically in the first few years of introduction.

Defining Times

The transition from analog to digital promises to be the most exciting and challenging change since TV's introduction. Retailers and consumers will be learning a new language - the language of "pixels," "interlaced," "progressive," "aspect ratio," "standard definition" and "high definition." Industry definitions for digital, standard and high definition television will help clarify purchase decisionmaking for consumers and will give manufacturers and retailers clear terms with which to describe the variety of products available. It is up to the manufacturers, broadcasters and retailers to develop a common set of answers to consumer questions and to move forward in this transition with clarity, because the educated consumer will be digital TV's best friend.

Gary Shapiro is the president of the Consumer Electronics Manufacturers Association.