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Federal Communications Commission.
This document modifies the rules to advance the date on which new television receivers with certain screen sizes and other TV receiving devices such as VCRs and digital video recorders, must include the capability to receive digital television signals forward four months. This action is intended to further the Commission's efforts to ensure that consumers are able to receive off-the-air digital broadcast television services as soon as possible.
Effective January 20, 2006.Start Further Info
FOR FURTHER INFORMATION CONTACT:
Alan Stillwell, Office of Engineering and Technology, (202) 418-2925, e-mail: Alan.Stillwell@fcc.gov, TTY (202) 418-2989.End Further Info End Preamble Start Supplemental Information
This is a summary of the Commission's Second Report and Order, ET Docket No. 05-24, FCC 05-190, adopted November 3, 2005 and released November 8, 2005. The full text of this document is available on the Commission's Internet site at http://www.fcc.gov. It is also available for inspection and copying during regular business hours in the FCC Reference Center (Room CY-A257), 445 12th Street, SW., Washington, DC 20554. The full text of this document also may be purchased from the Commission's duplication contractor, Best Copy and Printing Inc., Portals II, 445 12th St., SW., Room CY-B402, Washington, DC 20554; telephone (202) 488-5300; fax (202) 488-5563; e-mail FCC@BCPIWEB.COM.
Congressional Review Act
The Commission will send a copy of this Second Report and Order, in a report to be sent to Congress and the General Accounting Office pursuant to the Congressional Review Act, see 5 U.S.C. 801(a)(1)(A).
Summary of the Report and Order
1. The Commission modified its rules to advance the date on which new television receivers with screen sizes 13-24″ and certain other TV receiving devices such as VCRs and digital video recorders must include the capability to receive broadcast digital television signals from the current date of July 1, 2007 to March 1, 2007. The Commission also amended its rules to apply the digital television reception capability requirement to new receivers with screen sizes smaller than 13″ on this same schedule. The DTV reception requirement, which also often is termed the “DTV tuner requirement,” is being implemented under an approach that applies it first to large screen receivers and then progressively to smaller screen receivers and other devices over a period of several years. The modifications made herein affect the final step of this phase-in plan. With these changes, the scheduled implementation plan will provide for all new TV receiver equipment to include digital reception capability as of March 1, 2007.
2. This action follows the Commission's previous decision in the Report and Order and Further Notice of Proposed Rulemaking (R&O/FNPRM), 70 FR 38800 and 38845, July 6, 2005, in this proceeding to advance the date on which 100 percent of TV receivers with screen sizes 25-36″ must include digital reception capability to March 1, 2006. In this regard, the Commission continues to believe that it is essential that DTV reception capability be provided to consumers in new TV receivers as rapidly as possible in order to promote an expeditious completion of the transition from analog to digital broadcast television service. Consistent with that objective, our goal in this Start Printed Page 75740further action is to advance the schedule on which all new television receivers must comply with the DTV tuner requirement. The Commission concluded that advancing the DTV tuner mandate effective date for 13-24″ TV sets and other TV receiving devices to March 1, 2007 and applying this requirement to receivers with screens smaller than 13″ will most effectively ensure that products in these categories are equipped to receive digital television signals as quickly as possible consistent with the manufacturing and product distribution capabilities of manufacturers and retailers.
3. As we have observed previously, consumers must be able to receive digital TV signals for the transition to move forward to a successful completion. The DTV tuner requirement is intended to provide off-the-air DTV reception capability to the general population on a schedule that will promote a rapid completion of the DTV transition. Our goal in this matter remains to maximize the number of TV receivers with DTV tuners on the market, with a final goal that all new television receiver products include a DTV tuner, as quickly as possible. We recognize, however, that manufacturers' and retailers' product development and distribution resources and capabilities will affect their ability to comply with the tuner requirement and therefore need to be considered in decisions modifying that requirement.
Receivers 13-24″ and Other TV Receiving Devices
4. Decision. Consistent with the need to promote a rapid and orderly end to the DTV transition, we continue to believe it is desirable and appropriate to advance the date by which all new television receiving equipment must include the capability to receive over-the-air broadcast DTV signals. The rules already require that all new large screen receivers and 50 percent of a responsible party's mid-size receivers include digital reception capability and we recently advanced the date by which all mid-size receivers must include that capability by four months, to March 1, 2006. Advancing the date by which the remaining 13-24″ smaller-size sets and other TV receiver devices categories must comply with the DTV tuner requirement will serve to ensure that a greater portion of all TV receiver products that are in use by consumers at the time analog service ceases will be able to receive broadcasters' digital signals and thus provide for a smooth and orderly completion of the switchover process. Commenters observed, that many consumers do, in fact, rely on a smaller-size set as their primary device for watching TV service and those consumers will receive only limited benefits from purchasing new analog-only sets that will not receive broadcast signals when analog service ceases.
5. Our goal in the R&O/FNPRM with respect to the smaller-size sets and other TV receiving devices categories was to advance the date by which these products must include digital reception capability to December 31, 2006 or earlier, if feasible. In deciding on a new date for applying the tuner requirement to these products, we need to consider the ability of manufacturers to produce compliant products as well as the benefits of including DTV tuners in these products. After carefully examining the record, the Commission concludes that the action which most appropriately balances our concerns on both sides of this matter is to advance the date by which new 13-24″ television sets and other TV receiver devices must include the capability to receive broadcast digital television signals to March 1, 2007. From the information provided by commenters and the participating manufacturers, we conclude that it may not be feasible for the general population of receiver manufacturers to produce all of their products in these categories with DTV tuners at an earlier date. In particular, we recognize the manufacturers' points that the DTV tuners that will be included in smaller receivers are not the same units as installed in larger screen sets, that the design of smaller screen receivers is changing to flat or thin panel formats, and that the product development, parts acquisition, manufacturing, distribution, and marketing processes for new television receiver products are both technically demanding and complex with multiple steps that must be completed in succession. We are not adopting Philips' suggestion that we exempt other TV receiver products from the accelerated date for compliance with the tuner requirements, as other manufacturers appear to be able to include DTV tuners in those products by March 1, 2007.
6. The Commission is concerned that if it were to require DTV reception capability in smaller-size and other TV receiver products before the general population of manufacturers is able to properly complete the product development process, it could prove disruptive to the market for those products. Specifically, we are concerned that such disruptions could possibly involve deficiencies in the quality of products marketed so that they would not be acceptable to consumers, manufacturers deciding to simply leave the market for these products, or manufacturers just removing broadcast television reception capability from these products. The Commission does not find that it would be better to accept the removal of 13-24″ TV sets from the marketplace or the removal of all television reception capability from a display device. To do so might pose business costs for manufacturers in terms of lost sales or possible shut-down of production facilities that we do not believe are necessary.
7. We also note that the March 1, 2007 date when the industry indicates that the general population could be ready to produce 13-24″ sets and other TV receiver products with DTV tuners is only two months beyond our December 31, 2006 proposal. We believe that the benefits of allowing manufacturers to proceed with the inclusion of DTV tuners in these products on a more orderly basis would outweigh the adverse effects of the relatively small number of affected products (as compared to the hundreds of millions of analog-only receivers currently in use) that would be brought into the market in the two month period between December 31, 2006 and March 1, 2007. Upon balancing the production capabilities of manufacturers and our interests in promoting a rapid conclusion to the DTV transition, we believe the brief two month period when new analog-only sets can be brought onto the market will still allow the return of the 700 MHz spectrum in a timely manner without overly burdening manufacturers. Accordingly, we are advancing the date by which television receivers with screen sizes 13-24″ and other TV receiver devices must include the capability to receive digital television signals from July 1, 2007 to March 1, 2007.
Receivers With Screen Sizes Less Than 13″
8. In the R&O/FNPRM, the Commission sought comment on whether it should extend the DTV tuner requirement to apply to receivers with screen sizes less than 13″ inches. It noted that if such devices are to provide off-the-air reception of TV signals after the transition, they too must be able to receive DTV signals and that it is less likely that very small screen receivers, and particularly handheld and similar portable devices, would be used with a separate device for receiving DTV signals.
9. Decision. The Commission finds merit in the concerns that receivers with screen sizes less than 13″ should also be required to include DTV reception Start Printed Page 75741capability. Unlike larger screen receivers, the portable and typically battery-powered products in this category are more likely to be used to receive off-the-air signals and to not have inputs for connection to a separate DTV receiver. Thus, in contrast to larger screen receivers and other TV receiving devices, it is reasonable to expect that sets with screen sizes less than 13″ would generally not be useful to consumers once analog television service ceases. We recognize that these very small receivers are not typically used as a viewer's primary receiver. Nonetheless we also note their particular value for enabling the reception of news and public safety information in times of emergency. We therefore conclude that it would benefit consumers and the purposes of the broadcast television service and its transition to digital operation to require that receivers with screens less than 13″ are able to receive digital signals on the same schedule as other TV receiver products. Extending the DTV tuner requirement to receivers with screen sizes less than 13″ on that schedule will maximize the number of receivers in this category that will continue to be able to provide service after analog TV operation ceases. We are not convinced that it would be overly burdensome for the consumer electronics industry to bring these products into compliance with the DTV tuner requirement by the date when all other TV receiver products must include DTV reception capability. For example, Philips supports extending the tuner requirement to sets in this category. Because of the limited usefulness of these products for other purposes after analog service ends, we believe it would be preferable to restrict the marketing of products than to continue to allow non-compliant products to be sold to consumers. Accordingly, we will require that responsible parties equip television receivers with screens less than 13″ that are imported into this country or shipped in interstate commerce on and after March 1, 2007 with the capability to receive broadcast digital television signals.
10. The Commission agrees with commenters that this extension of the DTV tuner requirement to very small screen devices should only apply to products that receive off-the-air broadcasts and not other types of off-the-air reception devices such as cell phones and personal digital assistants (PDAs) that do not include the capability to receive broadcast TV service on the frequencies allocated for that service but may be able to receive broadcast TV programming that is re-transmitted over a wireless communications link other than a TV channel. To the extent that such devices are able to display broadcast TV programming transmitted over a non-broadcast communications link, we do not consider a device with that capability to be a broadcast TV receiver. Therefore, the DTV tuner requirement does not extend to small screen video capable devices that do not include the ability to receive broadcast television signals off-the-air. However, in cases where a cell phone, PDA or similar device does include the capability to receive TV programming on the channels allocated for the broadcast television service, that device is a TV broadcast receiver under § 15.3(w) of the rules and must comply with the DTV tuner requirement.
Other Approaches—Labeling Requirements
11. In the R&O/FNPRM the Commission also requested suggestions for alternative approaches for including DTV reception capability in all new TV receivers. Chris Llana recommends that as an alternative approach in conjunction with the DTV tuner requirement the Commission also require that television receiver products be labeled with enough information to permit consumers to make a fully informed decision before purchase and to alert them to the downsides of buying an analog-only product. He submits that any label should be clear and complete and that the label should be placed on the screen of TV sets, where it would draw attention to itself.
12. The Commission believes that consumer awareness of whether a television can receive off-the-air DTV signals or only off-the-air analog signals is critical to ensuring that consumer expectations are met. It also believes that it would further consumer education if manufacturers and retailers would provide point-of-sale and other marketing information to consumers and/or clearly label new television sets. The Commission believes that such efforts would result in more informed consumer choices about whether to buy DTV tuner equipped sets. These issues have been raised in the Second DTV Periodic Review, MB Docket No. 03-15, and we intend to address these issues expeditiously. In the interim, the Commission encourages manufacturers and retailers to clearly label and identify the tuning capabilities of new TV sets and/or employ other means to disseminate to consumers information regarding whether or not specific models are able to receive off-the-air digital television signals.
Final Regulatory Flexibility Analysis
13. As required by the Regulatory Flexibility Act of 1980, as amended (“RFA”), an Initial Regulatory Flexibility Analysis (IRFA) was incorporated into the R&O/FNPRM in ET Docket No. 05-24 (Report and Order and Further Notice). The Commission sought written public comment on the proposals on the NPRM concerning modification of the plan for applying the DTV tuner requirement to TV receivers with screen sizes 25-36″, including comment on the IRFA. No comments were received in response to the IRFA. This Final Regulatory Flexibility Analysis (FRFA) conforms to the RFA.
A. Need for and Objectives of the Rules Adopted in the Second Report and Order. As described in the Second Report and Order and Further Notice, the changes to the rules adopted in this proceeding are intended to ensure a smooth transition of the nation's television system to digital television. Beginning in 1987, the Commission undertook to bring the most up-to-date technology to broadcast television. That effort resulted in several Commission decisions, including those adopting a digital television (DTV) standard, DTV service rules, and a Table of DTV Allotments. The Table of DTV Allotments provides each existing television broadcaster with a second channel on which to operate a DTV station for a transition period in which stations will operate both analog and digital TV service, after which analog service will cease and one of each station's two channels will revert to the government for use in other services. The transition deadline established by Congress was December 31, 2006.
In 2002, consistent with its efforts to promote the expeditious completion of Start Printed Page 75742the DTV transition, the Commission adopted a requirement that all new television receivers imported or shipped in interstate commerce after July 1, 2007 include the capability to receive DTV signals off-the-air. In order to minimize the impact of the DTV tuner requirement on both manufacturers and consumers, the Commission adopted a phase-in schedule that applies the DTV tuner requirement first to receivers with the screens and then to progressively smaller screen receivers and other TV receiving devices. In the R&O/FNPRM, the Commission modified the phase-in schedule for requiring DTV tuners in new television receiver products by advancing the date for 100% compliance by receivers with 25-36″ screens to March 1, 2006 from July 1, 2006. In that action, the Commission concluded that maintaining the 50 percent requirement for 25-36″ receivers for the period from July 1, 2005 to February 28, 2005 and advancing the 100 percent compliance date for mid-size receivers to March 1, 2006 will ameliorate the concerns of the consumer electronics manufacturers and retailers with respect to the 50 percent approach and further its goal of promoting DTV reception availability. In that action, the Commission also proposed to advance the compliance date for 13-24″ receivers in order to promote a more rapid conclusion to the digital television transition.
In the Second Report and Order, the Commission revised its rules to advance the date on which new television receivers with screen sizes 13-24″ and certain other TV receiving devices such as VCRs and digital video recorders must include the capability to receive broadcast digital television signals from the current date of July 1, 2007 to March 1, 2007. The Commission also amends its rules to apply the digital television reception capability requirement to new receivers with screen sizes smaller than 13″ on this same schedule. With these changes, the scheduled DTV tuner implementation plan will require that all new TV receiver equipment include digital reception capability as of March 1, 2007. The Commission is taking these steps to ensure that digital television reception capability is provided to the general population on a schedule that will promote a rapid completion of the DTV transition. In this regard, we observe that consumers must be able to receive digital signals for the transition to move forward to a successful completion. The Commission's goal in taking the actions in the Second Report and Order is to maximize the number of TV receivers on the market, with a final goal that all new television receiver products include a DTV tuner as quickly as possible. In crafting those actions, the Commission recognized that manufacturers' product and distribution resources will affect their ability to comply with the tuner requirement and balanced those considerations with the need to ensure that new TV receiver products include DTV tuners.
B. Summary of Significant Issues Raised by Public Comments in Response to the IRFA: No comments were filed in response to the IRFA.
C. Description and Estimate of the Number of Small Entities to Which the Proposed Rules Will Apply. The RFA directs the Commission to provide a description of and, where feasible, an estimate of the number of small entities that will be affected by the proposed rules. The RFA generally defines the term “small entity” as having the same meaning as the terms “small business,” “small organization,” and “small governmental entity.”  In addition, the term “small business” has the same meaning as the term “small business concern” under the Small Business Act. A small business concern is one which: (1) Is independently owned and operated; (2) is not dominant in its field of operation; and (3) satisfies any additional criteria established by the Small Business Administration (“SBA”).
Electronics Equipment Manufacturers. Rules adopted in this proceeding will apply to manufacturers of DTV receiving equipment and other types of consumer electronics equipment. The SBA has developed definitions of small entity for manufacturers of audio and video equipment  as well as radio and television broadcasting and wireless communications equipment. These categories include the types of equipment affected by the rules adopted herein and both include all such companies employing 750 or fewer employees. However, these NAICS categories are broad and specific figures are not available as to how many of these establishments manufacture consumer equipment. According to the SBA's regulations, an audio and visual equipment manufacturer must have 750 or fewer employees in order to qualify as a small business concern. Census Bureau data indicates that there are 554 U.S. establishments that manufacture audio and visual equipment, and that 542 of these establishments have fewer than 500 employees and would be classified as small entities. The remaining 12 establishments have 500 or more employees; however, we are unable to determine how many of those have fewer than 750 employees and therefore, also qualify as small entities under the SBA definition. Under the SBA's regulations, a radio and television broadcasting and wireless communications equipment manufacturer must also have 750 or fewer employees in order to qualify as a small business concern. Census Bureau data indicates that there 1,215 U.S. establishments that manufacture radio and television broadcasting and wireless communications equipment, and that 1,150 of these establishments have fewer than 500 employees and would be classified as small entities. The remaining 65 establishments have 500 or more employees; however, we are unable to determine how many of those have fewer than 750 employees and therefore, also qualify as small entities under the SBA definition. We therefore conclude that there are no more than 542 small manufacturers of audio and visual electronics equipment and no more than 1,150 small manufacturers of radio and television broadcasting and wireless communications equipment for consumer/household use.
Computer Manufacturers. The Commission has not developed a definition of small entities applicable to Start Printed Page 75743computer manufacturers. Therefore, we will utilize the SBA definition of electronic computers manufacturing. According to SBA regulations, a computer manufacturer must have 1,000 or fewer employees in order to qualify as a small entity. Census Bureau data indicates that there are 563 firms that manufacture electronic computers and of those, 544 have fewer than 1,000 employees and qualify as small entities. The remaining 19 firms have 1,000 or more employees. We conclude that there are approximately 544 small computer manufacturers.
D. Description of Projected Reporting, Recordkeeping and other Compliance Requirements. The rule changes adopted in the Report and Order impose no additional recordkeeping or recordkeeping requirements on manufacturers of television receiving equipment, large or small. While the modifications adopted therein may have a small impact on consumer electronics manufacturers, any such impact would be similar for both large and small entities. We do not believe that the potential impact on an specified number of small entities outweighs the overall public interest benefits conferred by of the rule changes adopted in the Second Report and Order.
E. Steps Taken to Minimize Significant Impact on Small Entities, and Significant Alternatives Considered. The RFA requires an agency to describe any significant alternatives that it has considered in reaching its proposed approach, which may include the following four alternatives (among others): (1) The establishment of differing compliance or reporting requirements or timetables that take into account the resources available to small entities; (2) the clarification, consolidation, or simplification of compliance or reporting requirements under the rule for small entities; (3) the use of performance, rather than design, standards; and (4) an exemption from coverage of the rule, or any part thereof, for small entities.
The modification of the date for implementing the DTV tuner requirement in TV receivers with screen sizes in the 13-24″ and under 13″ size ranges and other television receiver products set forth herein is intended to expedite the availability of DTV tuners in products in these categories that are offered to consumers. The consumer electronics industry has indicated that it prefers the DTV tuner requirement to become effective for 13-24″ receivers and other television receiver products on March 1, 2007 rather than a date of December 31, 2006 or earlier as proposed. The Commission also found that it was necessary to apply the tuner requirement to receivers with screen sizes less than 13″ in order to ensure that new products in that category remain functional after the cessation of analog TV service. Moving the compliance date for these receivers to March 1, 2007 rather than an earlier date will allow the general population of manufacturers sufficient time to include digital reception capability in small TV sets and other television receiver products and will also serve to promote the availability of digital reception capability in these sets for consumers.
Alternative approaches considered by the Commission, but rejected, include various suggestions by broadcasters and others to advance the deadline for DTV tuners in 25-36″ sets to either October 1, 2006 or November 1, 2006. We rejected these options on the basis that the lead-times available for product development under those scenarios would be too short for the general population of manufacturers, including smaller manufacturers, to bring new compliant products to the market, especially given the times associated with specification, design, testing and obtaining parts and components from suppliers. While other options that would have extended the deadline beyond March 1, 2007 may have posed less potential impact on manufacturers, including small business manufacturers, extending the date beyond March 1, 2007 would be inconsistent with the need to expedite the DTV transition. In its decision, the Commission balanced the need to ensure that DTV reception capability is included in new TV receivers as soon as possible with its concerns for impact on manufacturers, including small manufacturers. Thus, the plan adopted minimizes the potential impact on small manufacturers consistent with the Commission's goals for the DTV reception requirement.
F. Federal Rules Which Duplicate, Overlap, or Conflict With the Commission's Proposals. None.
14. Pursuant to the authority contained in Sections 2(a), 4(i) & (j), 7, 151 and 303 of the Communications Act of 1934 as amended, 47 U.S.C. 152(a), 154(i) & (j), 151, 157, and 303, this Second Report and Order is adopted and the Commission's rules are hereby amended as set forth in Rule Changes, and shall become effective January 20, 2006.
15. The Commission's Consumer and Governmental Affairs Bureau, Reference Information Center, shall send a copy of this Second Report and Order, including the Final Regulatory Flexibility Analysis, to the Chief Counsel for Advocacy of the Small Business Administration.Start List of Subjects
List of Subjects in 47 CFR Part 15
- Communications equipment
Federal Communications Commission.
Marlene H. Dortch,
Rule ChangesStart Amendment Part
For the reasons set forth in the preamble, the Federal Communications Commission amends 47 CFR part 15 as follows:End Amendment Part Start Part
PART 15—RADIO FREQUENCY DEVICESEnd Part Start Amendment Part
1. The authority citation for part 15 continues to read as follows:End Amendment Part Start Amendment Part
2. Section 15.117 is amended by revising paragraphs (i)(1)(iii) and (iv) and by adding paragraph (i)(4) to read as follows:End Amendment Part
(i) * * *
(1) * * *
(iii) Receivers with screen sizes less than 25″—100% of all such units must include DTV tuners effective March 1, 2007
(iv) Other video devices (videocassette recorders (VCRs), digital video recorders such as hard drive and DVD recorders, etc.) that receive television signals—100% of all such units must include DTV tuners effective March 1, 2007.
(4) The requirement to include digital television reception capability in new TV broadcast receivers does not apply to devices such as mobile telephones and personal digital assistants where such devices do not include the capability to receive TV service on the frequencies allocated for broadcast television service.
3. See Notice of Inquiry in MM Docket No. 87-268, 2 FCC Rcd 5125 (1987); 52 FR 34259, September 10, 1987, see also Tentative Decision and Further Notice of Proposed Rulemaking in MM Docket No. 87-268, 3 FCC Rcd 6520 (1988), 53 FR 38747, October 3, 1988.Back to Citation
4. See Fourth Report and Order in MM Docket No. 87-268, 11 FCC Rcd 17771 (1996), 62 FR 14006, March 25, 1997.Back to Citation
5. See Fifth Report and Order in MM Docket No. 87-268, 12 FCC Rcd 12809 (1997), 63 FR 13546, May 20, 1998.Back to Citation
6. See Sixth Report and Order in MM Docket No. 87-268, 12 FCC Rcd 14588 (1997), 62 FR 2668, July 11, 1997.Back to Citation
9. 5 U.S.C. 601(3) (incorporating by reference the definition of “small business concern” in the Small Business Act, 15 U.S.C. 632). Pursuant to 5 U.S.C. 601(3), the statutory definition of a small business applies “unless an agency, after consultation with the Office of Advocacy of the Small Business Administration and after opportunity for public comment, establishes one or more definitions of such term which are appropriate to the activities of the agency and publishes such definition(s) in the Federal Register.”Back to Citation
14. Economics and Statistics Administration, Bureau of Census, U.S. Department of Commerce, 1997 Economic Census, Industry Series—Manufacturing, Audio and Video Equipment Manufacturing, Table 4 at 9 (1999). The amount of 500 employees was used to estimate the number of small business firms because the relevant Census categories stopped at 499 employees and began at 500 employees. No category for 750 employees existed. Thus, the number is as accurate as it is possible to calculate with the available information.Back to Citation
16. Economics and Statistics Administration, Bureau of Census, U.S. Department of Commerce, 1997 Economic Census, Industry Series—Manufacturing, Radio and Television Broadcasting and Wireless Communications Equipment Manufacturing, Table 4 at 9 (1999). The amount of 500 employees was used to estimate the number of small business firms because the relevant Census categories stopped at 499 employees and began at 500 employees. No category for 750 employees existed. Thus, the number is as accurate as it is possible to calculate with the available information.Back to Citation
18. Economics and Statistics Administration, Bureau of Census, U.S. Department of Commerce, 1997 Economic Census, Industry Series—Manufacturing, Electronic Computer Manufacturing, Table 4 at 9 (1999).Back to Citation
[FR Doc. 05-24217 Filed 12-20-05; 8:45 am]
BILLING CODE 6712-01-P