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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