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Remarks of William E. Kennard
Chairman, Federal Communications Commission
to the
"Dawn of Digital Television" Summit Meeting

Washington, D.C.
November 16, 1998
(As prepared for delivery)

Just over two weeks ago, the digital television era finally arrived with our nation's first nationwide digital broadcast. Many Americans will remember John Glenn's return to space not only as a thrilling reaffirmation of human potential, but also as the first time they saw digital television.

The beginning of DTV is complex, involving a number of different industries with different challenges. However, despite the complexity, I am extremely hopeful about the many contributions that DTV will be making.

Since the last time I addressed many members of this audience, we have passed several important milestones.

First and foremost, of course, we saw the launch of DTV at 42 stations. That's almost double the number of stations that originally volunteered to be on-the-air with DTV by November 1. Many stations in smaller markets have decided that digital is the way of the future and that moving quickly is the best way to be a leader in that digital future.

And it's not just the stations making DTV news lately.

The steady stream of product announcements from the consumer electronics industry says to me that consumers will increasingly have lots of options for viewing digital television content. Selling DTV equipment is a once-in-a-generation opportunity that could reorder the pecking order of market leadership in consumer electronics. So I have a lot of confidence that DTV sets will rapidly become increasingly affordable.

The first wave of DTV programming also is beginning to take shape. Some networks will be starting with high-definition movies and sports. Public broadcasters have also stepped forward with some truly innovative interactive programming, such as PBS's Frank Lloyd Wright program that allowed viewers to download blueprints of Wright architecture and other program data. Direct-to-home satellite services will soon be offering 24-hour-a-day HDTV movie feeds. And some cable networks will be offering a similar array of HDTV movies by early next year.

And, as I've said before, DTV is not just HDTV, nor does it have to necessarily be anything like television as we have known it. Just last week it was reported that America Online will be launching a new digital television service called "AOL TV" early next year.

What will be the "killer app" that drives digital television into the mass market? Only the market will decide. But as I look around at this emerging landscape, I'm more confident than ever that digital is the future of television.

Today I want to reiterate my view of what the government's role should be in this process and to emphasize that it is very important that private industry take the lead in these DTV developments. We in government need to leave you in industry to define your business plans, make your investments, figure out how to exploit the power of digital technology, and take the lead in defining the future of digital television. We won't--and can't--supply the business plan for digital tv.

This is not to say that there is not a role for government in the development of DTV.

For one thing, we must ensure that the public interest is paramount, and we will continue to work to ensure that the valuable public spectrum is put to good use.

Government can also facilitate the resolution of any obstacles that arise in the buildout of DTV. We will continue to promptly issue construction permits and to work with local and international governments to smooth out any bumps in the road to the DTV buildout, and to help clear away any barriers that arise.

One challenge for DTV to overcome is consumer acceptance. I know that many in industry are pursuing consumer education efforts and spending heavily to raise awareness of DTV.

To support these efforts, today, the FCC's Office of Engineering and Technology is issuing a Consumer Information Bulletin that provides information about the current status of DTV topics such as deployment, reception, and cable compatibility.

Another key issue is cable compatibility, which is very important for the success of DTV. Everyone in this audience knows that 2/3 of Americans get their television from cable, and that therefore the cable industry is a vitally important part of the transition to DTV.

Therefore I'm especially pleased with the recent joint response I received from the cable and consumer electronics industries reporting their agreement on an interoperability standard for connecting cable boxes to digital receivers.

In fact, I view this work on the so-called IEEE 1394 standard as a useful model of how we in government can effectively help industry work through technical issues of compatibility and interoperability. Earlier this summer, different industry groups were far apart and not effectively communicating. Rather than initiate a heavy-handed FCC proceeding to impose technical solutions, we held a series of meetings to illuminate the key issues and areas of disagreement. I then sent a letter to the heads of NCTA and CEMA urging them to work together. The result was the completion of a standards-setting process in what I've been told was near record time, and the removal of an important obstacle to the DTV transition.

I am aware, however, that agreement on a 1394 standard is only one part of the solution to DTV compatibility. The issue of digital copy protection for valuable content remains unresolved. I know that many electronics makers and retailers believe that 1394 should be just one of many options for connecting cable set-top boxes to digital receivers. And progress on defining interoperability standards for digital cable-ready sets must be made, so that consumers will have the choice not to have a separate set-top box.

I believe that private industry, not government, should decide these technical standards. But I also believe that government can advance the public interest by taking steps to prevent any breakdowns in private standards-setting processes that could delay the successful transition to DTV.

At my direction, therefore, the technical staff at the FCC, under the leadership of FCC Office of Engineering and Technology Bureau Chief Dale Hatfield, over the upcoming months will be hosting a series of inter-industry forums to discuss DTV compatibility and interoperability issues. Many of the technical issues that must be resolved will require cooperation among industries with diverging interests. I believe that government can play a facilitative role by providing a neutral but knowledgeable forum in which industry participants can come together to exchange information and points of view.

And as everyone knows, the FCC has a current proceeding underway where we must decide about the relationship between broadcasting and cable in the digital age - the miust carry issue.

With all these issues, we must be guided by the principals of facilitating consumer choice, and insuring that we not limit the availability of digital television choices to American consumers.

So we in government will monitor your progress and step in to remove barriers. We will safeguard the public interest and provide information to consumers. But it is up to you to define the future of this new communications media.

Thank you for the invitation today, and I look forward to the rest of the day's events.

- FCC -