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Full Transition to HDTV May Require Further Regulation
Oct 6, 2004
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Competition, falling prices, and new regulations will spur millions of U.S. households to adopt High Definition TV (HDTV) during the next 5 years, according to research from Strategy Analytics. The firm predicts that the number of U.S. households owning some type of HD-capable hardware will rise from 8.7 million in 2003 to more than 14 million by the end of this year. Roughly half of these households will also receive HD programming from cable, satellite, or terrestrial sources, the firm said, adding that by 2008, some 37 million households will receive HD programming.

Even with this rapid growth, Strategy Analytic believes it is highly unlikely that digital TV hardware will reach the penetration levels needed to conclude the government's goal of a full transition to digital broadcasting within the next 5 years. As a result, the firm believes legislators and the U.S. Federal Communications Commission (FCC) must seriously consider further regulatory measures, such as the down-conversion of digital signals or the subsidy of adaptors for millions of existing TVs.

"The next 12 months will be a critical period, as consumer electronics vendors launch a new generation of digital receivers incorporating government-mandated features such as ATSC tuners and CableCARD slots," noted James Penhune, director of the Strategy Analytics Broadband Media and Communications practice. "At the same time, market factors are combining to promote demand for digital TV. These include a growing base of households with HD-capable displays and the increasing importance of HD programming services to cable and satellite operators competing for high-value subscribers."

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