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Demand Higher than Expected for Converter Boxes, Gov’t in a Pickle

With the economy such as it is, more consumers than expected are requesting government coupons for converter boxes that will allow old TVs to receive the new digital TV signals, without having to subscribe to a cable or satellite service or purchase a new digital TV set.

The government, having underestimated demand for the coupons, is running out of money to subsidize the purchase of converters; it is also warning consumers that stores may begin running out of converter boxes, writes the Wall Street Journal.

Last month, Nielsen estimated that about 7% of U.S. households are still unprepared for the digital switch, which will take place on February 17. Those households must either buy a converter box, subscribe to a paid TV service, or purchase a new TV, in order to receive digital TV signals.

So far, about 103,000 consumers have been placed on a waiting list for the coupons. New coupons will only be distributed as old coupons expire, which happens 90 days after they’re mailed out. About 45 million coupons have been sent, but only 18 million have so far been redeemed.

The government had said that the $1.5 billion set aside for the program would be plenty, but is now saying it needs an additional $330 million. It is possible lawmakers could delay the transition by a few months, according to the article.

A November survey by Nielsen showed that 38.3% of consumers were planning to purchase a converter rather than a new TV in order to deal with the transition. In August, only about 25% were planning to use the cheaper alternative.