The high-definition screen has become a kind of Christmas tree, overladen with ornaments hung by regulators, greedy entertainment execs, would-be monopolists from the tech sector, broadcasters desperate to hold on to their spectrum, and even video game companies nostalgic for the yesteryear of impervious boxes. The tree is toppling--and it might just take out a few industries when it crashes.
High def kicked off in the '80s, when Detroit was losing the car wars to Japan and Motorola was figuring out that radio spectrum was pure gold if applied to mobile phones. Moto pointed out that the National Association of Broadcasters' members were squatting on lots of spectrum they'd been allocated, but hadn't lit up with TV signals. (Broadcasters get their spectrum for free, and in exchange we're supposed to get some programming over those airwaves.) Motorola proposed to buy the idle spectrum from the Federal Communications Commission and use it to run a phone business.
The NAB panicked--there's nothing a corporate welfare bum hates more than an end to its government handouts. So the broadcasters cast about for an excuse, any excuse, to continue to hold on to our valuable radio spectrum while doing nothing much with it. They found that excuse in Japan, where high-definition sets were being met with popular and critical acclaim. Japan--having destroyed the American auto industry--was about to destroy American broadcasting with its devious high-def sets, creating a high-def gap that America would struggle in vain to bridge!
The nervy broadcasters asked the commission to leave all that fallow spectrum intact and, furthermore, to allocate them even more spectrum so that they could broadcast HD signals alongside the analog ones. Once enough Americans had bought high-def receivers, the FCC could switch off the analog towers and return the spectrum to the American public, and then it could be sold to the likes of Moto for mobile applications.
Incredibly, the commission swallowed this and gave the broadcasters even more spectrum. The broadcasters approach spectrum like a dragon approaches gold: It's something to be hoarded and jealously guarded, but they're not much interested in using it. So they took all that high-def spectrum and built a nest of it, rested their ponderous, scaly bellies on it, and never lit it up.
By the 2000s, Congress and the FCC were desperate to get that spectrum in use. Representative Billy Tauzin (now a shill for the pharmaceutical industry) offered to give Hollywood any law it wanted in order to entice them to open their movies to broadcasters, which might in turn entice broadcasters to light up those towers, which might entice Americans to throw out their standard TVs. No, really! This is the kind of Rube Goldberg strategy they're chasing! In the U.K., by contrast, they simply created a standard for "FreeView," a box that tunes in 30 free, standard-definition digital TV channels and plays them on your old set, giving Brits an unbeatable enticement to switch to digital: One box gets you free cable for life, and you don't have to throw out your TV.
If the studios had their druthers, they'd just encrypt high-def signals. An encrypted signal needs a key to decrypt, and you can set up all kinds of rules about when, how, and who can decrypt a show by building it into the contract that comes with the key. But you can't encrypt over-the-air TV: The broadcasters get the spectrum for free, and in exchange they have to serve us. It wouldn't do to let them lock us out of the programs aired on our airwaves.
The Broadcast Flag is the law the studios came up with to square this circle. They proposed a Soviet-style planned economy (Fox president Andy Setos, who wrote the Broadcast Flag draft, referred to it as a "well-mannered marketplace") where all TV receivers would have to be built to honor the rules set down by the entertainment industry. The studios would get a veto over any feature that threatened its existing business model, and anyone who wanted to interface with a TV receiver would have to agree to play by Hollywood's rules. Even video cards, hard drives, and motherboards would fall under this rule.