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Digital television is an improved format (although not without problems of its own) for over-the-air "terrestrial" television broadcasts (I.E. broadcasts from a transmission tower). DTV offers higher physical resolution than standard analogue television, this is called HD or "High Definition". DTV also offers some other minor features. In the U.S. DTV is transmitted in either 790p/60 or 1080i/30 (actually 29.97fps) format. For more information what those numbers mean, see HD.
The Digital Television (DTV) transition was a problem recently afflicting the United States. Existing Analogue broadcasting equipment and technology (STV) which worked perfectly well in spite of its real technical problems was arbitrarily declared illegal by the Federal Government mandating an unnecessarily abrupt switchover.
Since the majority of existing U.S. Television sets had analogue receivers, these sets require conversion boxes to receive the new signal. Also, broadcasters have been required to purchase exceedingly expensive new transmission equipment to enable the mandatory digital broadcasts.
For the "NTSC-2" color upgrade a way was found to bundle the color information alongside the black and white information, this method is called YIQ "composite" video. In this method the Y (luminance) is derived from the existing black and white signal and the in-phase (cyan to orange) and quadrature (violet-green) information are "squeezed" in alongside the Y transmission on a "sub-carrier" wave. The full RGB color image is then algebraically "regenerated" out of the YIQ information via a predetermined algorithm.
As a result of this, equipment that was not capable of decoding the color information ignored the unknown wave and decoded only the pre-existing "Y" information as a monochrome black and white image, just as before.
The digital transmission ("ATSC") fundamentally altered the way that the image is encoded, modulated, transmitted and decoded. Thus existing analogue decoding equipment in the receiver is now completely useless. It is necessary to intercept the digital signal and convert it into an analogue format to watch DTV on an analogue television.
VNS Organization does not believe DTV to be inferior. Digital television has many significant advantages and the transition to it was highly desirable. Rather we believe that the implementation of the DTV switchover was repeatedly bungled by incompetent government authorities and dithering broadcasting organizations, leading to excessive consumer confusion and opening the door to manipulative and deceptive marketing practices by unscrupulous companies. The DTV switchover should not have been mandated by the government but occurred organically by natural market forces, like the switchover to color television.
Furthermore the VNS Organization objects strongly to the choice of ATSC for the transmission and encoding system. The FCC should have selected the tried-and-true (and significantly less patent-encumbered) DVB standard already long established in Europe and other parts of the world. DVB has many technical advantages over ATSC including reduced vulnerability to dynamic multi-pathing (mentioned below) and ATSC is much more heavily patented, driving up the cost of both consumer and professional equipment compared to the rest of the world. This is part of a consistent pattern of anti-consumer behavior by the FCC, tending in this and other areas to prefer expensive, patented, closed, proprietary technologies over inexpensive, open, unencumbered, standard ones.
The VNS organization also strongly objects to the FCC outrageously permitting broadcasters to use the 1080i format which is interlaced. Interlacing is categorically obsolete and causes enormous technical problems. Allowing broadcasters to continue using this stone-age technology is permanently harming both the consumer and the industry.
The principle advantage is the often vastly improved picture and audio quality. While what "looks good" is highly subjective, image and audio information of much greater resolution (and in the 720p format only) much greater frame-rate can indeed be transmitted.
DTV advocates also make much of the availability of sub-channels within the DTV transmission, public broadcasting makes great advantage of this, deploying multiple sub-channels focusing on global news and information, arts and crafts, etc. This however, for the consumer's perspective, this is no different than a broadcaster simply running more than one channel.
An additional minor feature is "datacasting" services such as electronic programming guides, vaugely similar to the ORACLE and CEEFAX type-systems that have been in use in Europe for decades. This feature is of limited usefulness in the Internet age.
(See also Wikipedia Article on U.S. DTV issues for information on the engineering nightmares the switchover introduced.)
DTV refers to standard broadcast television using the ATSC system in North America. It is a free, over-the-air transmission format that replaces the older standard-definition "NTSC" format.
HDTV refers to any form of television which is broadcast or cablecast in 720p or 1080i HD. HD is "High Definition", a very broad term for various video formats of higher than STV resolution. Most OTA DTV broadcasts are in some form of High Definition (caveat, see below). Cable and Satellite TV services can also be in HD, subscribers sometimes must pay extra for this.
DirecTV is an unrelated satellite broadcasting system owned by Australian media-mogul Rupurt Murdoch's cynically mis-named News Corporation. It is a subscriber service, and offers HD channels. In spite of its deceptive marketing practices, DirecTV is not required to receive DTV or HD broadcasts.
Normal HD video formats including DTV are in widescreen 16:9 aspect ratio. 16 units wide per 9 units high. Standard definition video formats including STV are in 4:3, four units wide per 3 units high. SD video is also 480 scanlines, interlaced while HD video is either 790 scanlines progressive or 1080 interlaced.
Some DTV channels promote themselves as offering HD television, when in reality many of their supposedly HD broadcasts are nothing more than 4:3 SD resolution video "zoomed" into HD's vertical-resolution and framed with black or colored side-bars (often including animated text vaunting the HD format!) to the left and right to fill out the missing width. The combined image may technically be in an HD aspect-ratio, but the useful part of the image is still in SD. Furthermore, because the SD image has fewer scanlines the useful part is deleteriously enlarged, similarly to an optical blow-up of a photograph.

As you can see in this example, although the transmission is HD the image itself is not. To make matters worse, on SD televisions using a converter-box the actual 16:9 image is already being "shimmed" at the top and bottom to fit the 4:3 screen without cropping! (This is hi-lighted in red below, in reality it would be black)

This is not always done with deceptive intent, programs recorded in SD cannot be broadcast on an HD channel any other way. If the Vistua Network operated a television station it would institute a ban on 4:3 content except reruns of old shows. In extreme cases we have seen adverts submitted to the station in 16:9, preshimmed to 4:3 which is then shimmed back to 16:9 by the station's transmission equipment and then reshimmed back to 4:3 by analogue televisions, resulting in the commercial playing in a tiny frame in the center of the screen. AAAACK!
The woman in these illustrations is Lena Soderburgh, who's photograph is a standard test image. Please see note at the article Widescreen.