Federal Communications Commission chairman William Kennard urged lawmakers in a speech to eliminate a loophole that allows broadcasters to hang on to their analog channels past 2006. In providing broadcasters a second free swath of spectrum for digital TV, Congress allowed broadcasters to keep their analog spectrum free-of-charge until 2006, or until digital broadcasts reached 85 percent of U.S. households, whichever comes later.

Kennard said the 2006 deadline should be made firm since broadcasters are "dragging their feet" on digital programming and because the 85 percent penetration rate may not be reached until 2025.

"Broadcasters have decided to sit on these two highly valuable properties — licensed to them for free by Congress — for as long as they can," Kennard said. "Spectrum-squatting may make great business sense for the broadcasters, but in terms of the public interest it makes no sense at all. Squatting on empty spectrum smothers innovation and endangers America's lead in new technologies."

Current broadcast spectrum is estimated to be worth $70 million. The government wants to auction the analog spectrum returned by broadcasters for wireless data applications.

Along with an escalating squatters fee for broadcast channels after 2006, Kennard said Congress should require that all new TV sets be equipped to receive digital programming by as early as 2003. "In addition to accelerating DTV deployment, this order would make DTV technology much more affordable by unleashing market forces and economies of scale to drive down the cost of equipment and receiver chips in both sets and converter boxes," Kennard said.

Broadcasters deny they are dragging their feet on digital TV deployment and blame the FCC for failing to impose rules that would require cable operators to carry digital broadcasts.