Video Age International March-April 2010

V I D E O • A G E AP R I L 2 0 1 0 26 BY BOB JENKINS Ana logue television transmissions in the European Union are scheduled to end by 2012. But, as is often the case with targets set by the E.U., some states will meet them and some will not. Here VideoAge takes a look at the progress being made towards an all digital continent and assesses who will make the date and who won’t, as well as how the benefits will be deployed. Currently, six members of the E.U. — The Netherlands, Luxembourg, Germany, Denmark, Sweden and Finland have already switched to digital terrestrial television (DTT). A further five — Spain, Estonia, Austria, Slovenia and Malta — will make the change over the course of 2010, while the 14 remaining members of the E.U. (with the exceptions of Ireland and Poland) are committed to make the switch by the agreed date of 2012. Poland has said it should be ready to turn off analogue in 2013, while Ireland has yet to set a date. Spain originally adopted the 2012 date to which most European countries are adhering. However, at the end of 2004, the Spanish government decided it wanted to promote DTT in the country (an earlier attempt to launch DTT in the country had failed). As part of its planning, it moved the digital switch-over date forward to 2010. By the middle of February, more than 90 percent of Spanish households had access to digital in one form or another, and 83 percent were receiving DTT, whose market share was 57.5 percent, compared to analogue terrestrial’s share of 20.2 percent. At February’s Digital Switchover Strategies 2010 conference organized in London by Informa, the British research and publishing group (it publishes TBI), Ignacio Leon, director of Communication at the Spanish Office for DTT switchover, announced that the final phase of switchover had begun and that Spain’s analogue signal would be switched off by early this month. In addition to the significant differences in dates at which various European Union countries are making the switch, there is a vibrant debate in regards to what to do with the spectrum freed up by the move to digital, the “digital dividend” as it has come to be called. At the Informa conference, Philippe Lefebvre, director general, Information Society and Media at the European Commission, pointed out that in three of the six countries that have already made the move (Denmark, Sweden and Finland), a significant part of their “digital dividend” had been used to open up new channels. But this did not by any means have to be the case. Lefebvre was at pains to point out, “The ‘digital dividend’ does not belong exclusively to broadcasting,” although he did accept that “continuation of existing broadcasting licenses in a digital form was a prerequisite.” Other possible deployments of the “digital dividend” mooted by Lefebvre included “more economical supply of wireless broadband,” which he suggested would have a significant economic benefit. He also suggested that whereas broadcasting was to benefit from some of the freed spectrum, it might well be in the form of “increased innovation in broadcasting services,” in particular, the provision of HD services. However, both he and Simon Murray, principal analyst, Media at Informa Telecoms and Media, agreed that one of the least likely uses of the dividend was mobile TV, with Lefebvre describing DVB-H as “probably now history.” Whatever the newly available spectrum is put to, the economic benefits of the move will clearly be significant. Although stressing that the estimates he gave were personal estimates and not those of the European Commission (the executive branch of the E.U.), Lefebvre put the possible benefit to Europe’s economy at anywhere between 17 billion euro and 75 billion euro (US$23 billion — $102 billion), depending on the exact nature of the new services chosen to be deployed and the resulting demand for them. But of course there is no such thing as a free dividend, and David Scott, CEO of Digital UK, estimated that by the time the U.K.’s switchover was completed in 2012, the communications cost alone would be in the area of £150 million ($230 million). Although there are still two years to go before the U.K. officially switches off the analogue signal, approximately 90 percent of U.K. homes already have access to digital, a fact which is in no small part attributable to Freeview, the country’s free DTT service. Freeview, at 50 percent penetration of all households, represents more than half the total UK digital penetration. Freeview was launched in 2005. It has reached the 50 percent penetrationmark in just five years which, as managing director Ilse Howling pointed out, compares very favorably with the 15 years mobile phones took to reach 50 percent penetration and the 10 taken by color television. Furthermore, in those U.K. regions where the analogue signal has already been switched off, an average of 68 percent of analogue homes chose Freeview, as opposed to the 20 percent opting for Sky, and negligible numbers picking Virgin Media, the cable option. On that basis, Freeview’s Howling predicted that by the time of the 2012 London Olympics, Freeview would be in over 90 percent of U.K. homes. Also enjoying reportedly rapid growth is HD. Although there is of course no direct link between the “digital dividend” and the roll-out of HD, Danielle Nagler, head of HD at the BBC, was clear that in the minds of many people, the two are linked. As an illustration of the speed at which the new service is being adopted, she cited the BBC’s first ever HD transmission of Planet Earth series in 2007 which registered an HD audience “that was too small to measure.” By late 2009, when the BBC was showing the next Attenborough series, Life, 22 percent of the program’s audience was watching in HD. The BBC has adopted the slogan, “our best, at its best” for its HD channel, clearly reflecting Nagler’s view of the technology. “At its heart,” she insisted, “it simply improves our relationship with our audience.” Nagler believes that the fundamental point about HD is that “it is simply better television.” Of course there are many other possible uses for the “digital dividend” and the debate is ongoing in regard to which will eventually be deployed. There is the BBC’s Project Canvas, which would provide an IPTV platform open to other content producers and owners, but this is strongly opposed in some quarters. Paul Bristow, vice-president of strategy at Swiss-based ADB Group made the case for “hybrid TV,” which would allow a huge range of content and all of the Internet to be accessed via television sets. Whatever each E.U. country finally decides to do with the spectrum freed by the move to digital, it seems certain that the overwhelming majority of its members will have made the move by the set date of 2012, and that, as ADB’s Bristow observed, “the traditional notions of broadcasting have never been more threatened.” “Digital Dividend:” When the E.U. Gets It, What Will It Do With It? D T T T r a n s i t i o n Simon Murray of Informa Telecoms and Media Although there are still two years to go before the U.K. officially switches off the analogue signal, approximately 90 percent of U.K. homes already have access to digital, a fact which is in no small part attributable to Freeview, the country’s free DTT service.

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