Mixed Signals: How TV Retailers Mislead Consumers on the Digital Television (DTV) Transition
2008-02-13
Executive Summary
One year from now 22 million Americans who rely on free
over-the-air analog broadcasting will be at risk of losing access to TV. On
February 17, 2009, analog televisions that receive over-the-air signals will go
dark, unless they are retrofitted with digital converter boxes. For many
Americans who are hearing about the transition for the first time, information
about the change comes from electronic store retailers, where consumers ask
what is necessary to maintain TV reception-- a primary source for news, information
and entertainment.
In an effort to determine America’s preparedness for the
transition, the U.S. Public Interest Research Group (PIRG) Education Fund
conducted a “secret shopper” survey at 132 locations of five leading national
electronics retailers in ten states. The survey found that retail electronic
store staff are largely uninformed and are not adequately preparing consumers
for the impending transition to digital television.
Our survey shows that the majority of retailers provide
inaccurate or misleading information about the digital transition. Many sales
clerks tried to persuade our surveyors to buy new, expensive digital
televisions or high-definition televisions rather than explaining the
availability of the less expensive option such as buying converter boxes,
discounted by government coupons available to anyone who needs one.
Specifically, staff at these132 locations provided the
following inaccurate or misleading information about the digital transition.
• 81% of the sales staff did not know about or gave out
inaccurate information about converter boxes.
• 78% of the sales staff provided inaccurate information
about the federal government’s coupon program for converter boxes.
• 42% of sales staff provided inaccurate information about
the month of the digital transition deadline date.
To protect consumers against misinformation or consumer
fraud, the U.S. PIRG Education Fund makes the following recommendations.
Retailers must ensure:
• they adequately educate staff about converter boxes and
the coupon program.
• converter boxes are made available at fair prices.
• consumers are informed of the availability of federal
coupons.
• analog TV sets remaining on store shelves are properly
labeled.
Additionally, the federal government must enforce penalties
against companies that mislead consumers in an effort to reap greater profits
from the sale of TVs to people who could get by with a low cost converter box,
with its price reduced further by a $40 government coupon.
The congressionally-mandated transition to a digital
system gave broadcasters one of the largest public giveaways in the history of
our nation. The value of the publicly owned airwaves used by broadcasters
increased by billions of dollars, for which broadcasters paid nothing. The
public lost out to powerful broadcasters when the decision to switch systems
was made. Now, one year from the switch date, it looks like consumers are in
danger of losing out again by unknowingly being steered toward the purchase of
unnecessary, expensive equipment by uninformed or dishonest sales clerks.
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