1. DTV2001: Services, adoption, investment and policy issues arising from the first year of digital television in Australia Joanne Jacobs Monash University

2. Scope of the paper Current services Reception device availability Device development ‘Policy stasis’ of DTV regulation Diversity? Competitive environment? Future services and the overseas experience Recommendations for the next review period

3. Current services  Reception device availability Device development ‘Policy stasis’ of DTV regulation Diversity? Competitive environment? Future services and the overseas experience Recommendations for the next review period

4. Current Services ‘Services’ means technically defined vehicles through which content is received. These may include radio, television, telephony as well as convergent media ‘Content’ means programming received via these services ‘Interface’ means the standard software-oriented mechanisms employed by reception devices

5. Current Services: Range HDTV SDTV Multi-channelling Enhanced programming Datacasting Capacity exists for future services that bear resemblance to telephony and messaging

6. Current Services: HDTV Display resolution 180K - 1,500K, 16:9 widescreen effect, 5.1 channel Dolby digital sound Metropolitan areas to transmit minimum weekly quota of 20 hours HDTV Computer technologies, rather than broadcasting technologies are driving development of HDTV Government-initiated protection of commercial audience share for FTAs is driving regulation for minimum HDTV

7. Current Services: SDTV Technically feasible to carry 4 -6 SDTV signals in one 7MHz channel allocation, and each of these can carry 5.1 channel Dolby Digital sound This means that significantly smaller channel allocations could be planned for SDTV-only broadcasters, or a ‘multiplexing’ arrangement could be possible for experimental commercial, community or public broadcasters

8. Current Services: Enhanced Must be linked to existing HDTV or SDTV content Very limited enhanced programming presently being transmitted Electronic Program Guides (EPGs) are as yet very unsophisticated EPGs could extend beyond enhanced programming to become a ‘service’ in their own right; permitting PVR, messaging, home shopping

9. Current Services: Datacasting I According to specifications released prior to the abandoned datacasting spectrum auction, datacasting channels had capacity for at least one SDTV stream with Dolby digital sound, plus content which would otherwise appear much like that available via WWW technologies Limitations on content carried by datacasting may be regarded as negatively affecting DTV device adoption (see below)

10. Limitations are: –No programming which may fall into the categories of drama, current affairs, sporting programs and events, music programs, infotainment and lifestyle programs, comedy programs, documentaries, ‘reality’ television programs, children’s programs, light entertainment and variety programs, compilation programs, quiz programs and games shows is permitted. –No traditional television news, sports news, financial markets and business information and weather programs are permitted. –No hosted programming is permitted. –No individual program choices may be linked to other datacasting programs such that a discrete television-style product may emerge. Cancellation of spectrum auction (May 2001) further negatively affects DTV device adoption Current Services: Datacasting II

11. Current services Reception device availability  Device development ‘Policy stasis’ of DTV regulation Diversity? Competitive environment? Future services and the overseas experience Recommendations for the next review period

12. Adoption I Digital TV begins in Australia 1 January 2001 First 6 months of 2001, the only DTV receiver device is a Thomson brand Set-Top Box (STB) According to Davies, of the 10,000 STBs imported for sale, by April only 2,500 devices sold (SOURCE: Sydney Morning Herald, 6 April) Encel has noted that over the same period approximately 250,000 analog units sold (SOURCE: Digital TV Facts, http://www.digitaltvfacts.net/dtv2html/ftrecord.html) Recommended retail for STBs: A$699

13. Adoption II From June, Teac (SD-STB) and DGTEC (HD- STB) begin releasing their own STBs Digital Television Strategy group still have not released standards for API Very limited value addition in content, thus poor incentives to purchase STBs No integrated HDTV sets presently available. Estimated retail for HDTV receivers A$8,000- $10,000 (SOURCE: International Dynamics, 1999)

14. Current services Reception device availability Device development  ‘Policy stasis’ of DTV regulation Diversity? Competitive environment? Future services and the overseas experience Recommendations for the next review period

15. Adoption III Devices planned for the Australian market include: –Sony SDTV (not a STB) available from December –Sharp, Panasonic, Philips, Thorn and others are planning widescreen integrated SDTVs but have not released any plans for development of integrated HDTVs The Digital Video Broadcasting Multimedia Home Platform (DVB-MHP) has been approved as the Application Programming Interface (API) standard –Units available with MHP from 2002 (estimated) –Limitations on interactivity based on device capacity

16. Adoption IV A factor affecting adoption of DTV signal reception devices is the analog shutdown plans. However, it is also likely that limited penetration of devices may also affect that shutdown date. US market allows for continuation of analog signal transmission where device penetration is less than 85% In Australia, the lessons learned from mobile telephony conversion to digital would suggest similar analog shutdown delays, if infrastructure penetration (both in terms of transmission and reception devices) is insufficient

17. Current services Reception device availability Device development ‘Policy stasis’ of DTV regulation  Diversity? Competitive environment? Future services and the overseas experience Recommendations for the next review period

18. Policy Environment Goldsmith et al identify diversity and plurality as a ‘key principle of democratic broadcasting systems’ (SOURCE: Cultural and Social Policy Objectives for Broadcasting in Converged Media Systems, 2001, p9) Current regulatory environment is based on service limitation rather than service diversification –Limitations on services affect plans for device development –Limited value addition of digital content affects device sales

19. Policy Potential I Incentives could be developed for broader player involvement in service provision using digital transmissions on Broadcasting Services Bands (BSB) Planning of spectrum allocation could admit telecommunications players to use BSB for broadband internet services (with an asymmetric dialup back channel) to specific areas This could enhance diversity and plurality to the broadcasting environment

20. Policy Potential II Expansion of the role of the ABC in taking some or all of the cultural and social policy responsibilities currently shared across commercial and national broadcasters (see Armstrong et al 2000, Goldsmith et al 2001) could be used as a quid pro quo for introducing new players Planning groups could be encouraged to seek representation from aspirant as well as current players

21. Current services Reception device availability Device development ‘Policy stasis’ of DTV regulation Diversity? Competitive environment?  Future services and the overseas experience Recommendations for the next review period

22. Competition? Diversity? Papandrea warns (2000a, p17), the limited range of players and services in DTV means that ‘there is less pressure for intense competition on the basis of quality’ Strategic planning for DTV regulation needs to recognise the natural inclination for all players to protect existing markets and that service and player diversification can fragment those markets

23. Current services Reception device availability Device development ‘Policy stasis’ of DTV regulation Diversity? Competitive environment? Future services and the overseas experience  Recommendations for the next review period

24. Future Services I Likely to emulate kinds of products available through internet technologies due to similarity of display and interactivity Key feature of internet is its capacity for user-initiated communication (see Dann & Dann, 2001) Key feature of internet is its capacity for user-initiated communication High bandwidth, back-channel equivalent services (eg: ADSL and cable modem) allowing complex user-initiated communication are already available

25. Future services II It could be possible to boost EPGs and datacasting to encompass complex communication activities (such as email, bulletin board services and E-commerce). This is dependent on: –Spectrum allocation (requiring new auctions for datacasting) –Commercial incentives (abolition of datacasting content limitations –Keyboard input capacity for API and receiver devices

26. Future Services III Voice or video conferencing transmitted through BSB could be developed as a specialty business application available on an appointment-oriented subscription basis –User requires receiver, back-channel and audio/audio- visual capture device –Service provider could set up connection and interface Advantage of this service is portability of devices, high-bandwidth, smooth playback and simplicity of the platform

27. Overseas & Locally US market note that the advent of Personal Video Recorders (PVRs) is raising copyright and publishing issues for DTV players and device suppliers European market note that advances in screen-based technologies are enhancing the visual quality of signal transmission and reception in SDTV devices, making the development of fully integrated HDTV units commercially unfeasible Justification of HDTV primacy in Australian DTV policy was based on preventing commercial advantage in the subscription broadcasting market - this is now being challenged by Cable & Wireless Optus iTV trials

28. Current services Reception device availability Device development ‘Policy stasis’ of DTV regulation Diversity? Competitive environment? Future services and the overseas experience Recommendations for the next review period 

29. Recommendations Integration of competitive and content-oriented regulations for existing and potential digital services accessible via BSB Expanding role for public broadcasters in terms of social and cultural activities, thus allowing niche market focus among commercial players Diversity to be recognised at corporate, service and content levels Establishment of incentives for DTV service and device development and adoption

30. Contact details Joanne Jacobs National Centre for Australian Studies Monash University Ph: (03) 9905 9091 Email: joanne@joannejacobs.netjoanne@joannejacobs.net Internet: http://joannejacobs.net/http://joannejacobs.net/