2. Analog Shutdown - Early Retirement or Killing Me Softly

4. Analog Death or… Digital Bleeding Edge

5. Analog Death or Digital Bleeding Edge Switching Off Analog Shouldn’t Have To Be Painful

7. Analog Death or Digital Bleeding Edge SITUATION BEFORE DIGITAL BROADCASTING  Analog channel 60  Digital assignment of channel 59  Broadcasting from San Bruno Mountain

8. Analog Death or Digital Bleeding Edge TWO CHANNELS OUTSIDE THE CORE  Searched for channels in crowded spectrum  Successful petition for channel D43  D43 required transmission from Sutro Tower (co-locate with existing channel 44) putting KCSM at the primary transmission site for the San Francisco Bay Area  Facility secured  Digital transmission begins March 2004

9. Analog Death or Digital Bleeding Edge DECISION TO SHUTDOWN ANALOG  Cost of operations  Loss of analog site lease to NBC affiliate  Unreliable analog transmitter  Lack of other transmission facilities  Cable penetration >80%- Satellite 9%

10. Analog Death or Digital Bleeding Edge TASKS TO DO BEFORE MAKING THE DECISION

11. Analog Death or Digital Bleeding Edge Expected & Unexpected Relationships

12. Analog Death or Digital Bleeding Edge PTFP REQUIREMENTS  2 years Federal interest remaining in equipment purchased through grant  PTFP allowed that interest to be transferred

13. Analog Death or Digital Bleeding Edge NEGOTIATIONS WITH CABLE CARRIERS  In addition to the major carrier and two overbuilders, there were numerous smaller overbuilders, there were numerous smaller companies companies  KCSM provided receivers to all that we could identify

14. Analog Death or Digital Bleeding Edge NEGOTIATIONS WITH DBS  DirecTV very cooperative  EchoStar has been more difficult

15. Analog Death or Digital Bleeding Edge PETITION TO FCC  Counsel to KCSM recommended first requesting an “STA” to go dark

16. Analog Death or Digital Bleeding Edge CONTENTS OF PETITION  Lost our lease  Looking for alternate site  Agreements had been made with cable and DBS for digital carriage  Telecourse students would be provided loaner STB and tapes of programs no longer accessible

17. Analog Death or Digital Bleeding Edge ANNOUNCING THE DECISION  On-air messages  Messages in our monthly guide  Newspaper articles (press coverage was limited)  No advertising budget  Increased information on website

18. Analog Death or Digital Bleeding Edge

20. SWITCHING OFF THE ANALOG CHANNEL  We ceased broadcasting scheduled programming on May 15th, 2004  Turned off transmitter on May 24, 2004  Shut down prior to lease expiration to allow time for site clean up

21. Analog Death or Digital Bleeding Edge WHAT WE LEARNED - INITIALLY  Non-stop calls & written correspondence voicing concern over losing KCSM  Engineering Dept. trained staff on how to answer calls  Call summary 10% would not be consoled10% would not be consoled 45% interested in obtaining the equipment necessary45% interested in obtaining the equipment necessary 45% would not get cable / satellite or equipment45% would not get cable / satellite or equipment

22. Analog Death or Digital Bleeding Edge WHAT HAPPENED NEXT  Viewers attempted to buy equipment  Retailers did not have enough stock  …and worse, frequently did not know what a “set-top” box was or if they had them in the store  Viewers who succeed in buying receivers frequently needed installation advice from KCSM Engineering staff

23. Analog Death or Digital Bleeding Edge SATELLITE ISSUES  EchoStar required second antenna  DirecTV had a problem with early versions of their receivers. KCSM audio disappeared on channel 704  Continued confusion over KCSM channel assignments on cable and satellite systems

24. Analog Death or Digital Bleeding Edge TO DATE RESULTS  38% viewership loss after analog shutdown  30+% increase in pledge income with less than 5% increase in pledge minutes  YTD ’05 Membership Income already exceeds entire FY ‘04 entire FY ‘04

25. Analog Death or Digital Bleeding Edge ALWAYS MORE TO DO  Listing services  PSIP  Set top boxes  Newspapers- TV listings  Field continuing viewer calls

26. Analog Death or Digital Bleeding Edge WHERE WE ARE NOW  Nearing the end of second 6 month STA  Filing Petition to Terminate License  FCC could require analog restart

27. Analog Death or Digital Bleeding Edge CONTENTS OF FCC PETITION  Community impact from analog termination  Quantity of OTA stations in grade B contour  Number of analog OTA viewers losing access  Steps taken to mitigate OTA viewership loss  Cable & DBS agreements  Economic impact of new construction for NCE

28. BAY AREA BROADCASTING  28 Commercial Stations  6 Non-Commercial Stations

29. BAY AREA BROADCASTING  28 Commercial Stations  6 Non-Commercial Stations

30. Analog Death or Digital Bleeding Edge Thank You Michele Muller Director of Engineering KCSM TV & FM San Mateo, CA michele@kcsm.net