I’ve been closely following the transition of over-the-air television in the U.S. to the new ATSC 3.0 standard, also known as NextGenTV. Initially, the process appeared smooth, but things started to take a turn. Broadcasters began encrypting channels, making them inaccessible to viewers. Then, the industry was hit with a significant lawsuit that forced LG, one of the largest TV manufacturers, to pull its ATSC 3.0 tuners off the market.
In my latest video, we take a look at how the industry is responding to this lawsuit one year out. Broadcast industry association Pearl TV told the FCC last year that this lawsuit had no impact on the transition to ATSC 3.0, but they told a very different story to an appeals court hearing the case last week.
That lawsuit, filed by Constellation Designs, didn’t seek an astronomical sum—only $1.6 million in damages. But the real issue was the future costs: LG would have to pay a $6.75 royalty per unit for every television equipped with the tuner. This rate was about six times what they were paying to the patent pool for other related patents. LG, understandably, decided to exit the market rather than absorb those costs.
Fast forward to the present, and the broadcasters’ association, Pearl TV, has filed a brief with the U.S. Court of Appeals. They argue that the lawsuit could jeopardize the transition to ATSC 3.0. Their concern is that other patent holders, seeing the success of Constellation Designs, might also opt out of the patent pool, potentially leading to more lawsuits and higher costs for manufacturers. If that happens, they fear other TV manufacturers might follow LG’s lead and exit the market as well.
What’s interesting, though, is that Pearl TV’s message to the FCC last year was quite different. After the lawsuit, they downplayed the issue, saying everything was fine and there was no need for the FCC to intervene. They argued that the patent pools were functioning well and that there was no sign of market failure.
Despite Pearl’s reassurance to the FCC, the market tells a different story. Only a handful of new televisions this year included ATSC 3.0 tuners, and most are found only in high-end televisions that aren’t affordable for everyone. Panasonic’s recent announcement of their return to the U.S. market with TVs featuring ATSC 3.0 tuners adds some hope. However, those tuners won’t be activated until a future firmware update, and there’s no clear timeline for when that will happen.
The broader issue here seems to be that broadcasters are attempting to turn this new standard into a proprietary one. With ATSC 1.0, if a manufacturer’s product meets the FCC’s standards, they can build a tuner and sell it on the market. But under ATSC 3.0, manufacturers must get approval from broadcasters, pay for testing and certifications, and potentially face high royalty fees from DRM, which could make it financially unfeasible for many small hardware and software companies to participate.
The result is that consumers may end up paying more for television access, and options will remain limited – especially as the DRM encryption prevents the use of gateway devices that allow in-home streaming to televisions not connected to an antenna. This is particularly concerning given that broadcasters use public airwaves for free.
I’ve been encouraging viewers to make their voices heard with the FCC regarding these issues. Many have already submitted filings, and the ATSC 3.0 proceeding is now one of the FCC’s top concerns. It’s clear that public dissatisfaction with the transition is growing.
With a U.S. election coming up, followed by a presidential transition, this is a pivotal moment to influence how the FCC approaches the ATSC 3.0 standard. There’s an opportunity to ensure that the new standard benefits consumers, not just broadcasters. The more public feedback that can be submitted now, the better the chances of ensuring a fair and accessible transition.