In the 6MHz channel used for broadcast ATSC, 8-VSB carries 19.39 Mb of data per second. The eight signal levels are selected with the use of a trellis code. The FCC intended the 16-VSB variant to be used for digital cable, but didn't have the power to force this so QAM has become the de facto standard for digital cable in the USA and Canada.
An 8-VSB receiver (which is not designed to cope with reflections) requires only half the amount of DSP power as a QAM receiver with the same information density. It was incorrectly believed that this could result in a cost savings over QAM when 8-VSB was initially considered for ATSC transmission.
There are four problems with 8-VSB with respect to the leading competitor COFDM. Like the analog NTSC transmission standard there is a single carrier, this is as opposed to COFDM used for terrestrial DVB transmissions.
The first is that noise in any part of the 6 Mhz band will disrupt the entire transmission. The inner coding deals with the constant low level noise. While the 8-VSB has eight power levels, the trellis coding means only two bits are transmitted not three. The extra bit is used to increase the redundancy of the bits transmitted at the lower power levels to deal with low level noise. COFDM needs to deal with this type of noise as well but offers a range of inner codings to deal with more disparate environments, and because of the multiple carriers the COFDM outer coding can help deal with the low level noise problem better so long as it is not spread over the whole spectrum. To state that in practical terms, both deal equally well with solar radiation, but COFDM deals better with any other (non-blackbody) interfering transmissions.
The second problem is short bursts of high power noise. Like low level noise, this is a problem for COFDM as well, but again COFDM deals with this better. ATSC and COFDM use an outer coding which compensates for short bursts of high power noise, but the COFDM standard allows a range of codings which can be tailored to the local environment while ATSC only allows a single outer coding.
The third problem is with dealing with long bursts of high power noise which cover a portion of the 6Mhz spectrum. COFDM deals with this in the outer coding, but 8-VSB has no defense against this. In practice this means that you need to keep electronic devices away from your antenna if they cause interference, just like with analog television. Placing the antenna atop a three meter pole above your roof should be more than sufficient, 20 cm can be enough in many cases. This is also not a huge problem because regulation prevents anyone from selling a device which will interfere with your UHF TV reception from more than a few feet away. Since almost all 8-VSB transmissions are in the UHF band this shouldn't be any more than a transient problem unless your neighbor is really out to get you.
The fourth problem is with reflections. This is one that you need to be aware of if you wish to receive an 8-VSB transmission. This problem also affects NTSC, so if you get any analog channels you can quickly ascertain if this will be a problem with your reception. If you see any "ghosts", you have serious reflections. COFDM has this problem as well, but because it uses multiple carriers and each carrier is reflected differently by each reflector the outer coding can compensate for a portion of the problem as if it were a long bursts of high power noise which covered only a portion of the channel's bandwidth. In practice this means COFDM can work well in cities were you generally have the most problems with reflectors in the environment. You can also create reflections between your receiver and your antenna with poor connections and poor impedance matching, neither system can compensate for this. The most effective solution for dealing with external reflections, such as buildings and mountains is to use a directional antenna. A directional antenna will ignore most reflectors not directly in front of it. The antenna can be defeated by placing it inside a building where many reflectors are often very close by.
Disputes over ATSC's use
There had been a continuing lobby for changing the modulation for ATSC to COFDM, the way DVB-T is transmitted in Europe, and ISDB-T in Japan. However, the FCC has held that 8-VSB is the better modulation for use in U.S. digital television broadcasting; presumably do to the power of the 8-VSB patent holders, not the lack of buildings or electronic devices in the country. In 2000, the FCC denied a petition for rule making from Sinclair Broadcast Group requesting the change. Because of continued adoption of the 8-VSB based ATSC standard in the US, a switch to COFDM is unfortunately unlikely at this point.