FOR YOUR INFORMATION...........................FEBRUARY 9, 1993
    FTC RECOMMENDS AGAINST FCC IMPOSING A DUAL-MODE RECEIVER 
                 REQUIREMENT ON TV MANUFACTURERS
              Consumer Should be Allowed to Choose
     Requiring television manufacturers to produce "dual-mode"
television receivers capable of receiving both conventional and 
advanced television (ATV) signals during the period prior to full
conversion to ATV would not serve consumers' interests, may
restrict choices, and could force some consumers to purchase
certain types of equipment they would not voluntarily choose,
staff economists of the Federal Trade Commission said in comments
to the Federal Communications Commission made public today. 
     The staff comments were submitted Feb. 5 in response to an
FCC request for comment on whether the FCC should require that
television receivers be capable of receiving both standard, or
"NTSC," broadcast signals and ATV signals.  (NTSC stands for
National Television Systems Committee and refers to the existing
broadcasting system.) 
     According to the FTC staff comments, economic-efficiency
considerations suggest that a dual-mode receiver requirement
could be justified only if it could be demonstrated that some
market failure would prevent the production and distribution of
television receivers that consumers demand.  The FTC staff
recommended that consumers' interest can best be served by
permitting the production of different types of TV receivers, so
that consumers can choose for themselves the equipment they
prefer. 
     Given the FCC's mandatory 15-year conversion timetable,
consumers already will have a strong incentive to invest in ATV
compatible equipment, the staff noted.  Some television
manufacturers believe that during the transition period, ATV
television sets will be dual-mode without any requirement from
the FCC.  
                             - more -
(Comments to FCC on ATV--02/09/93)
     "Compelling dual-mode NTSC/ATV receivers, therefore, seems
an unnecessary means of ensuring that consumers are able to buy
television sets that can receive both NTSC and ATV signals,"
staff said.  "Morever, the regulation could hurt some consumers
by eliminating options that would otherwise be available to
them." 
     It is unlikely that the transition from NTSC broadcasting to
ATV broadcasting will be accomplished simultaneously at the
numerous individual television stations throughout the country,
the staff said.  Some areas of the country may have fully
operational ATV systems while others have very few operational
ATV systems.  As a consequence, during the transition to ATV,
consumers in some regions may place less value on NTS equipment
than consumers in other regions.
     If the FCC requires manufacturers to produce only
televisions capable of both NTSC and ATV reception, some
consumers may be forced to purchase ATV or NTSC equipment that
they would not otherwise purchase, the staff noted.  Indeed, the
staff said, some consumers may prefer "to buy an NTSC television
and later (once NTSC simulcasts cease) buy a downconverter to
transform ATV signals to NTSC signals." 
     The FTC's economists conclude that because the levels of
future demand for dual-mode and single-mode NTSC and ATV
receivers are unknown, "the interests of both consumers and
manufacturers will best be served by allowing all of these
products to be produced." 
     These comments represent the views of the FTC's Bureau of
Economics and not necessarily the views of the Commission or any
individual Commissioner.
     Copies of the comments are available from the FTC's Public
Reference Branch, Room 130, 6th Street and Pennsylvania Avenue,
N.W., Washington, D.C. 20580; 202-326-2222; TTY 1-866-653-4261.
                              # # #
MEDIA CONTACT:      Brenda Mack, Office of Public Affairs
                    202-326-2182
STAFF CONTACT:      Larry Schumann, Bureau of Economics
                    202-326-3359
(V930003)
(fcc-atv2)