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The Federal Communications Commission says Best Buy and other retailers must pay more than $3 million in fines for selling analog TVs without labels that explain the sets won't work after the digital TV switchover next February.

In a 41-page legal document filed last week (and dug up by Ars Technica), Best Buy essentially says, "Oh yeah? Make us."

There have been many bumps along the way to the February 2009 switch to all-digital TV in the U.S. The FCC is spearheading the transition and has established deadlines to help it along. Best Buy alone was fined $280,000 after FCC enforcement agents found analog TVs for sale in the store without this label, which the commission had previously decreed should be attached to all TVs without a digital tuner:

This television receiver has only an analog broadcast tuner and will require a converter box after February 17, 2009, to receive over-the-air broadcasts with an antenna because of the nation's transition to digital broadcasting. Analog-only TVs should continue to work as before with cable and satellite TV services, gaming consoles, VCRs, DVD players, and similar products. For more information, call the Federal Communications Commission at 1-888-225-5322 (TTY: 1-888-835-5322) or visit the Commission's digital television Web site at: www.dtv.gov.

Best Buy and other retailers like Sears, Wal-Mart Stores, and CompUSA were found to be in violation of these rules. But were the rules enforceable in the first place? That's where it gets a bit sticky.

Instead of paying the measly fine, Best Buy responded in meticulous detail to the FCC's Notice of Apparent Liability, issued last month. Here's a summary of the retailer's five main points on why it believes it doesn't have to pay a cent.

1. You can't make us label anything
Best Buy's attorneys point out that never before has the commission had jurisdiction over retailers, and twice before when it tried to, an appellate court invalidated it.

2. We didn't do it on purpose
The FCC accused Best Buy of purposely selling analog TVs without labels. Best Buy says that's not true, details its efforts to comply, and says the burden should be on the FCC to prove the intention of the retailer.

3. We tried our best
Best Buy details the steps it took to ensure the right boxes were labeled, but admits that it was difficult to determine which boxes needed them. Products with similar model numbers sometimes made it hard to figure out which had just an analog tuner and which had an analog and a digital tuner.

4. Your agents messed up
The retailer points out that some violations pointed out by FCC enforcement agents were just wrong. It does so to point out to the FCC that it's not accusing the commission of purposely making errors, so the FCC shouldn't accuse Best Buy of the same. Also, Best Buy is trying to show how difficult the process is of determining which boxes need labels.

5. You didn't go about this the right way
Best Buy quibbles with the process with which the Notice of Apparent Liability was carried out. It says that it didn't get public comment on the retail Labeling Rule, and also calls the NAL "procedurally invalid" because it wasn't give enough notice of its violation or time to respond.

The amount of money ($280,000) is so small that the retailer is likely not concerned about the fine. Rather, it's trying to make a point about the reach of the FCC's arm in handling the DTV transition.

The outcome will turn on what an appellate court has to say about this. And though Best Buy has a fairly good case, it's a tough call as to how it will turn out, according to Barbara Esbin, senior fellow and director of The Center for Communications and Competition Policy at the Progress and Freedom Foundation.

"There is no law that says the FCC had jurisdiction to promulgate and enforce a labeling rule," she said in an interview. "But the FCC doesn't claim it has express authorization."

What the agency relies on to regulate labeling by retailers is the same as used in the regulation of cable television services back in the 1960s.

"The FCC relied on this doctrine that it has some regulatory authority that is not expressly given, but is in the subject matter of the authority it has over wire and radio communication devices and reasonably ancillary to its express jurisdiction over that entity and its equipment," according to Esbin.

Indeed, when asked to cite the statute giving it authority to regulate retailers' labeling, an FCC spokeswoman pointed to the Code of Federal Regulations that govern the FCC, but are not laws.

"I can't say Best Buy has a slam dunk argument, but they have reasonably good claims," said Esbin. "The labeling rule imposed on retailers rather than on manufacturers are not reasonably ancillary to express jurisdiction."

Besides that, Best Buy (along with other retailers) appears to have gone way out of its way to comply with the FCC on the transition. Best Buy, for instance, was the first retailer to stop selling analog TVs last fall--and from a look at its argument, like a straight-A student who gets criticized by overly demanding parents for getting a B in math, it just wants a break, and maybe, the benefit of the doubt.

Despite that, the FCC probably isn't going to let this one go, so stay tuned.

For the vast majority of Americans, analog TV sets aren't supposed to go black as part of the switch to all-digital broadcasts until February 17, 2009. But federal regulators are expected to announce Thursday that Wilmington, N.C., has volunteered to make the transition several months early as part of a last-minute test of sorts, The Wall Street Journal reports.

The waterside town of about 100,000 plans to cut off its analog broadcasting as soon as September 8, according to the Journal and confirmed by a source familiar with the matter. North Carolina is Federal Communications Commission Chairman Kevin Martin's home state, but it was unclear whether that had anything to do with the test market's choice.

The FCC has scheduled a press briefing Thursday afternoon, where a formal announcement is expected to be made. An agency spokesman declined to comment further but said Martin would be answering questions about the plans at that event.

As part of the larger digital television transition, people who rely on over-the-air broadcasts will have to outfit their analog TVs with converter boxes--which the U.S. government has offered to partially subsidize--or buy new digital TVs or peripherals, such as VCRs.

Of course, residents who rely on cable or satellite for their television service won't have to worry about making any changes to their TV-watching set-ups. For more on what the switch means for you, see our FAQ.

If you buy GE's lackluster DTV converter box, are you stuck with it?

(Credit: CNET)

We finally got one of our government-issued DTV converter box coupons in the mail, and one of the notices on the accompanying information sheet caught our eye:

IMPORTANT UPDATE REGARDING REFUNDS: You will not be able to receive cash or credit for the coupon amount, but you can receive cash or credit for any amount you paid out of pocket, if the store policy permits.

To be honest, that's not much of a surprise when you consider how the coupon program actually works. If consumers were able to get credit or cash for returned DTV converter boxes, unscrupulous buyers could return a DTV converter box then use the credit to purchase any piece of electronics they wanted--which is definitely not the spirit of the coupon program.

But what happens if you get your DTV converter box back and it's broken?... Read more

This National Association of Broadcasters' "TV Trekker" truck is one way that broadcasters are trying to get the word out about next year's switch from analog to digital TV broadcasts.

(Credit: Anne Broache/CNET News.com)

By now, you've probably seen at least one of those televised public service announcements--or maybe even read on this very Web site--about how the U.S. government is forcibly cutting off analog TV broadcasts starting next February. And if you're a cable, satellite, or Internet-based TV subscriber, you probably already know that you shouldn't have to make any changes, and if you rely on over-the-air broadcasts, you may have already requested a taxpayer-funded coupon for a converter box.

Well, it seems your elected representatives on Capitol Hill don't have a lot of faith in the ability of their constituents--particularly ones who are elderly and live in rural areas--to make whatever adjustments are necessary to keep their TV sets from going dark when that juncture arrives.

At a hearing on Tuesday afternoon, Democrats and Republicans on the U.S. Senate Commerce Committee sounded repeated alarms about the coming switch to all-digital broadcasts--and grilled the transition's top two administrators, Federal Communications Commission Chairman Kevin Martin and National Telecommunications and Information Administration Chief Meredith Baker, about how they can be sure the message is getting out to every nook and cranny of the country.

Some suggestions arguably verged on the impractical. Sen. Ted Stevens (R-Alaska), voiced concern about getting the word out to "those people in rural areas who rely on the (TV) system but don't pay attention to it," a notion that Sen. Claire McCaskill (D-Mo.) seconded.

Sen. Mark Pryor (D-Ark.) said he is concerned about reports, which he claimed arose from a recent Washington Post article, that if people don't type in the "exact right" Web site address for the coupon program (It's http://www.dtv2009.gov, for the record), then eager coupon applicants will be stymied. He instructed Baker to make sure that the Web site can be called up "even with a margin of error," which seemed to suggest he'd like the feds to snap up misspelled domain names.

A number of senators said they were worried that senior citizens would be left behind, and Sen. John Thune (R-S.D.), voiced concern that people living in tribal areas in his home state won't get the message.

In response to the queries, Martin and Baker outlined a familiar list of educational strategies that their agencies are employing. (FCC staffers have been going to senior centers around the country to provide information, for example.) The FCC, for its part, has also called for more frequent public service announcements during peak TV-watching hours.

They also pointed to an backed by trade associations representing consumer electronics manufacturers and retailers, the cable and broadcast industries, public television stations, and civil rights advocates. The National Association of Broadcasters (NAB), which has said it will have spent $1 billion on a "multi-platform" information campaign by the time the transition occurs, has even taken to driving giant TV-shaped trucks around the country as part of its efforts.

The politicians' concerns come amid mixed evidence about how much Americans know about the switch. A survey of about 1,000 American residents conducted in late January by the advocacy group Consumers Union found that more than one third weren't aware of the government's converter box subsidy program and nearly two-thirds incorrectly believed the transition wouldn't affect them. Results of a broadcaster-commissioned survey (PDF) put out the same day found that some 79 percent were aware of the switch.

Sen. Daniel Inouye (D-Hawaii), the Commerce Committee's chairman, said he worried that "too many Americans remain in the dark about what the digital television transition means" and called for monthly reports from the FCC and NTIA about how things are going.

"I've just got my fingers crossed," the veteran senator said. "I hope everything turns out well."

Sorry little guy, but your days are numbered.

(Credit: Wal-Mart Stores)

Editors' note: Since the publication of this story, a battery-powered DTV converter box has been released, the Winegard RCDT09A. While we'd still hold off on buying a new portable TV this year--it's better to wait for portable TVs with new digital tuners--older analog portable TVs can be used with the RCDT09A if they have a composite or RF input. For more information, read our full review of the Winegard RCDT09A.

Portable TVs can be great for camping or in case of emergency, but you're probably going to be getting ripped off if you buy one in 2008. That's because almost all portable TVs use standard analog TV signals, and those signals are going to get turned off on February 17, 2009. And even though these TVs are just about obsolete, you can still buy them at places like Target, Wal-mart Stores, and Amazon. Some of the pages have warnings about the impending DTV transition, but some of them don't.

While it is possible that someone will come out with a battery-powered DTV converter--which could work with a portable TV that has inputs--we wouldn't hold our breath. The FCC's DTV FAQ page already explicitly says, "it is not anticipated that battery powered digital-to-analog converter boxes will be produced," ... Read more

(Credit: DTV2009.gov)

The DTV transition is less than a year away and as of January 1, 2008, Americans have been eligible to sign up for a $40 coupon to help purchase DTV converter boxes needed to receive new digital TV signals. While your instincts may tell you to sign up as quickly as possible, there's a strong argument to be made to hold off for a little while. Here's why:

1. The coupon expires in three months
If you carefully read you the FAQ on the government's Web site, the program clearly states that the $40 coupons expire three months after they're shipped. That's unfortunate because we're guessing many people don't think much of it, and are just trying to sign up before they forget. Now you're forced into getting whatever DTV boxes that are currently on the market, even though...

2. Better, cheaper boxes are coming
... Read more

If you're among the 2.4 million Americans who have already applied for government subsidies to offset the cost of a forced digital television upgrade, you should be receiving that voucher soon.

Next week, the U.S. Department of Commerce plans to start mailing out the $40 coupons, which can be used to defray the cost of selected converter boxes that permit older, analog televisions to receive digital broadcasts, Commerce Secretary Carlos Gutierrez said Friday.

It's all part of the congressionally mandated switch from analog to all-digital broadcasts scheduled to occur on February 17, 2009.

Here's a favorite demo that digital TV converts like to show: contrast the snowy picture generated by the good ol' rabbit-ears antenna and analog tuner on the left screen with the clearer image on the right of the analog TV outfitted with a converter box.

(Credit: Anne Broache/CNET News.com)

If you're currently a cable, satellite, or Internet Protocol TV subscriber, you're most likely not going to have to make any changes. But anyone who relies on over-the-air broadcasts will need to purchase a TV or DVD player with a digital tuner--or take the arguably thriftier route of outfitting an existing analog TV with a digital-to-analog converter box.

To that end, the government is allowing any household, regardless of income level or any other factors, to request up to two of the $40 coupons during a first phase, in which 22.5 million coupons are expected to be available. If that supply runs out, Congress can authorize some 11 million more vouchers, but households applying for that batch would have to self-certify reliance on over-the-air broadcasts.

Some 9,700 store locations across the country are prepared to accept the electronic cards next week, and another 7,000 or so expect to be able to redeem them in the coming months, according to the Commerce Department. The coupon-request Web site allows you to search for the nearest retailer who's supposed to be stocking one or more of the certified models.

The eligible boxes--some of which are apparently already in stores--cost between $40 and $70, according to the Commerce Department. Here's a complete list of the more than 30 certified boxes.

Remember that the coupons expire 90 days after they're mailed. Right now, the government isn't allowing households to reapply for help beyond the two-coupon maximum if theirs expire, although some congressional Democrats are urging more flexibility.

Applications are still being accepted online at DTV2009.gov or by calling 888-DTV-2009 (888-388-2009). You can also apply by mail or fax. The government plans to accept applications until March 31, 2009, or until the coupons run out, whichever comes sooner.

For more information about the digital TV switch, check out CNET News.com's latest FAQ.

If you want Uncle Sam's help in bankrolling your household's switch to digital television before analog channels go dark next year, you can start filing your requests now.

As promised, the U.S. government on January 1 began accepting applications from American households for $40 coupons to defray the cost of a basic digital-to-analog converter box.

The gadgets, which are expected to cost between $50 and $70, are supposed to enable analog TVs to continue functioning when analog channels are evacuated on February 17, 2009, per Congress' orders. (About a dozen models have been cleared for use with the coupons so far.)

It doesn't matter how much money you make or how many digital TVs you already own. Every American household will be eligible to receive up to two of the coupons during a first phase, in which 22.5 million coupons are expected to be available. If that first wave is exhausted, Congress could authorize an additional $450 million, creating up to 11,250,000 more vouchers. That crop would be limited to households that certify that they rely on over-the-air TV.

To sign up for a coupon or two, you can head to DTV2009.gov or dial 888-DTV-2009 (888-388-2009). You can also apply by mail or fax. The government says it plans to accept applications until March 31, 2009, or until the coupons run out, whichever comes sooner.

As of Wednesday morning, the National Telecommunications and Information Administration had received 277,457 applications for 528,354 coupons, totaling more than $21 million, according to spokesman Todd Sedmak.

The agency plans to begin mailing the coupons on February 17. By that time, more than 14,000 stores nationwide, including those of eight major retailers--Best Buy, Circuit City, Kmart, RadioShack, Sam's Club, Sears, Target, Wal-Mart--expect to begin stocking the converter boxes, Sedmak said. Update 3:55 p.m. PST:The vouchers are programmed to expire 90 days after their issuance.

The NTIA, which is running the coupon program, has said it's confident that the vouchers will not run out, as it has estimated the demand at 10 million to 26 million coupons. Some Democrats in Congress, however, have called for making more coupons available, arguing that some 70 million television sets are expected to need converter boxes to continue functioning.

Most American TV watchers are not expected to need new equipment.

If you already have a TV, DVD player or other peripheral device equipped with a digital tuner, you're good to go. (Nearly all new televisions purchased after March 2007, for instance, should include a built-in digital tuner, under federal regulations.) Subscribers of satellite, standard digital cable, and Internet Protocol television, or IPTV, services also aren't expected to have to make any changes. In a nutshell, only people who rely solely on free, over-the-air broadcasts will need to make adjustments.

If you're still not sure whether you need an upgrade, the NTIA has posted a quiz designed to help you figure that out. And for more information about the switch, check out our most recent FAQ.