EBU Technical Review

No. 303 (July 2005)

Vive la différence

Many broadcasters across Europe are making ambitious plans for digital broadcasting. Given the complexity and size of their investments, it is only natural that they should be guided by the positive and negative experiences of other countries. Obviously, broadcasters want to replicate the success stories and, perhaps more importantly, avoid a disaster.

The UK is arguably the most successful market in Europe in terms of consumer adoption of digital satellite TV, digital terrestrial TV and DAB. The general perception across Europe seems to be that the UK has made good decisions about digital broadcasting. Even so, this issue of the EBU Technical Review contains two contrasting articles about broadband TV: one describes the success of RAI’s FastClick service in Italy, whilst the other presents a dismal picture of the difficulties facing broadband TV in the UK.

Broadband access to the Internet has been very successful in the UK (as in many other Western European countries) – so why should there be a particular problem in the UK with broadband TV? There is no simple answer to this question. One factor could be that the commercial roll-out of broadband TV in the UK has been confined to relatively small areas – and, consequently, has not been strongly promoted in the national media. Another factor might be the role of BT which, as the dominant telecom operator, has been criticised for its lethargy in unbundling access to the local loop. It is relevant to note that the UK regulator Ofcom has just announced a legally-binding agreement with BT which should solve this particular problem – and, consequently, encourage the development of broadband TV.

More generally, broadcasters need to assess the prospects for various new delivery mechanisms such as broadband TV, 3-G mobile phones and broadcasting to handheld devices via DVB-H or DMB? A key factor must be the competitive environment facing each of these new technologies. For example, if the UK market for digital TV is approaching saturation, it could be difficult for broadband TV to find a significant role in this very competitive market.

Although the UK’s Freeview digital terrestrial service has achieved remarkable success, it is important to remember that this triumph followed the miserable failure of the ITV Digital pay-TV service. From the consumer’s perspective, any new delivery platform must provide an attractive range of content. A key ingredient in the success of Freeview was undoubtedly the active involvement of the BBC which provided a wide range of TV and radio services, whilst also promoting the concept of free-to-air digital services. Although few countries have a public service broadcaster as strong as the BBC, the Freeview model is being adopted in other countries. Can the UK’s experience be copied by other countries?

It is easy to forget that different countries face very different circumstances. Much of the pressure for the introduction of digital TV in Europe comes from spectrum regulators who rightly see digital TV as a way of improving spectrum utilisation. In much of Africa, the UHF TV bands are essentially empty: in such circumstances, it is hard to justify digital TV in terms of spectrum efficiency. Even worse, the cost of set-top boxes for digital TV is too high for much of the population in most African countries. In my personal opinion, it would be ridiculous for developing countries in Africa to rush into digital TV.

Even within Europe, there are substantial differences in the existing infrastructure for broadcasting. For example, more than 90% of homes in the Netherlands and Belgium are connected to cable TV networks. Consequently, these markets are well supplied with access to multi-channel TV services. Hence, digital terrestrial TV could have difficulties in attracting a large audience in these countries. Conversely, countries with very low penetration of cable TV services (such as Spain and Italy) would appear to be natural markets for digital terrestrial TV. Despite these good omens, the Spanish digital terrestrial pay-TV service (Quiero) collapsed dramatically in 2002 – although digital terrestrial TV seems to be heading for considerable success in Italy.

Some countries, such as Denmark, are relatively flat and easy to cover with terrestrial transmitters, whilst other countries, such as Norway and Switzerland, require much more expensive transmitter networks to achieve near-universal coverage. Larger countries, such as France, must provide coverage to large rural areas with low population – but this problem is nothing compared to that facing Russia with its huge expanses of sparsely populated areas. Is it sensible to expect that a “one size fits all” solution is appropriate for all of these countries? Or do we need “tailor-made” solutions?

Another issue is that of timing: the cost of almost all new technologies falls dramatically as the technology matures – leading to slow growth in the early years, followed by rapidly accelerating take-up in subsequent years. I recall reading numerous reports of the early failure of a particular technology: for example, one newspaper stated “12 months after its commercial launch, it is now clear that the technology has failed. It certainly has not lived up to the hype surrounding its launch. One retailer said that consumers were not interested because the equipment was too expensive and because there was widespread concern about technical quality”. These statements were made in 1984 and the product in question was the audio CD. With the benefit of hindsight, we can see that these prophets of doom were very, very wrong!

One of the great benefits of the EBU is that it provides many opportunities for the international exchange of information. As EBU Members are rarely in direct competition with broadcasters from other countries, they willingly share their experiences (good and bad) with other Members. The idea of frank exchanges of information is inconceivable in other sectors, such as the consumer electronics industry, where no sensible company would reveal its business strategies to its competitors

Successful introduction of digital broadcasting and the eventual withdrawal of analogue broadcasting is not a simple issue. Success or failure will be determined by the interaction of many factors, which vary considerably from country to country. Yet many people assume that they can guarantee success by copying the strategies adopted in another country. It is human nature to try to simplify problems, but over-simplification can lead to disastrous results – in the words of Albert Einstein “Everything should be made as simple as possible, but not simpler”.

Philip Laven
Director
EBU Technical Department

27 June 2005

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