With the country’s transition to digital television broadcasting now just a year away, speed bumps are starting to appear along the route.

The prospect that many consumers could lose station signals on some or all of their TV sets on Feb. 17, 2009, was raised last week not only in Congress, but in public policy surveys and—in what could be a bad sign for major TV stations—at Nielsen Media Research’s annual meeting with ad agency and marketing clients.

Whether the glitches will be temporary or have long-lasting viewing impact remains to be seen, but there are some strong warnings.

“There will be enough [calls from] consumers to light up the switchboard on both the House and Senate side,” Chris Murray, senior counsel of Consumers Union, told the House Energy and Commerce Committee last week.

Ron Bruno, president of the Community Broadcasters Association, which represents low-power TV stations, said consumers could lose access to 567 low-power stations and thousands more low-power translators rebroadcasting signals, leaving them angry and the stations facing bankruptcy.

Nielsen cautioned that 13 million households—10.1% of households nationally—could lose access to new TV signals, but that the potential impact is far greater for certain demographics and locations.

According to Nielsen, 17.3% of Hispanic households and 12.4% of African American households get all their signals over the air. More than 20% of all TVs used in Houston, Salt Lake City, Minneapolis and Portland, Ore., get their signals over the air. The switch would have far less impact in New York, Hartford, Conn., Boston, Philadelphia and Tampa and West Palm Beach, Fla., where fewer than 7% get their signals over the air.

The latest concerns come as the transition makes some major strides this week. Retailers are launching sales of converter boxes that enable analog sets to receive digital signals, and the Department of Commerce’s National Telecommunications & Information Administration begins distributing 300,000 coupons that cut the price of the converters by $40. NTIA eventually will mail out millions of the coupons.

Government officials—several of whom are unlikely to be around when the transition happens following the election and a change in the administration—as well as industry executives say the transition is going well, with hundreds of millions of dollars worth of public service announcements set to air, fliers going up in stores and broadcasters staging local talks and outreach programs. The FCC has asked for $20 million to publicize and help with the transition.

Democratic congressmen have been concerned that too little is being spent, nothing like the hundreds of millions of dollars spent overseas for similar transitions affecting fewer people. House Energy and Commerce Committee Chairman John D. Dingell, D-Mich., last week called the $20 million “woefully inadequate.”

Last week warnings of new problems were sounded. Among them:

Low-power stations: When full-power stations switch to digital, not all low-power stations will switch as well. Some offer programming in languages other than English and others are independent stations. It’s now turning out that the initial government publicity and the standards for digital converter boxes didn’t take the low-power stations into account. Consumers who buy most of the converter boxes approved so far will lose access to the low-power analog channels. New boxes that, when switched off, allow analog signals through are now being approved, but the Community Broadcasters Association and some congressmen are worried consumers won’t get those new boxes.

“The transition hasn’t been handled well,” said Greg Herman, VP of technology for CBA, whose outlook for the switchover isn’t rosy. “I don’t accept that all over-the-air television viewers will be properly equipped. The best efforts of everyone will not ensure that that happens.”

Antennas: Almost all the focus on digital transition equipment to date has been about over-the-air set-owners getting converter boxes. Last week both a study and a congressman suggested it might not be quite that simple: Some households also may need to buy new antennas and install them, not exactly the simplest thing to do in February weather conditions in northern cities. Both Centris, the research firm that conducted the study, and Rep. Rick Boucher, R-Va., cited the United Kingdom’s experience with digital transition. Mr. Boucher noted the U.K. also provided advisers to go house to house to determine the cause of any signal problems.

Ratings: Nielsen won’t come out and say that ratings could suffer from the switchover, but there are hints from its study and from some ad buyers that Feb. 19 might not be the most opportune time to buy ads aimed at Hispanics in Portland, Ore.
No one is yet predicting massive long-term rating changes as opposed to temporary blips, but Nielsen’s study suggests the potential magnitude of the converter problem.
In addition to the homes without any digital access, 26.2% of Hispanic households have one or more analog-only sets. The number is 19.5% for African American households, 18.8% for Asian households and 15.2% for white households.

While Congress has been concerned about seniors losing service, Nielsen said 12.3% of households headed by youths under 35 would be affected, compared with only 9.4% of those headed by people over 55.

Eric Rossi, senior manager of product leadership at Nielsen, said the company will continue to track the numbers, but the first view indicates there is much work ahead.

“We really don’t know what the ratings impact will be,” he said. He suggested the industry’s “good faith” effort will get the message out to consumers, but whether consumers really take action in advance remains to be seen.

Brian Wieser, senior VP for Magna Global, a major ad buyer, noted that unlike the U.K., the U.S. is switching without going through a test or a trial in a few markets.

“A big bang is fraught with more risks than one that is not,” he said.

Upselling: The digital switch may be a perfect time to buy a new TV set. Consumer groups are worried that people will be buying them not because they want them, but they wrongly think they have to.

“A third of people have no awareness of the transition and three of four consumers who do are completely confused and likely to spend money that they don’t have on televisions they don’t need,” said Consumers Union’s Mr. Murray.

He said the government isn’t doing enough to break through the maze of messages about digital to tell consumers what they need to know.

“People should know the least-cost choice for the switch. Everyone is going to be doing digital upselling that is in their interest. It may be a good time to make those decisions [to buy a new set], but because the government is forcing this change on consumers, the government has an obligation to filter out some of the bias and self-interest,” he said.