Provisional conclusions of 
the BBC Trust on BBC 
participation in a 
“Freesat” proposition 

February 2006 


Foreword 

The BBC Trust considered BBC Executive proposals to establish a joint venture that willmanage and support a national satellite basedfree-to-view digital service (referred to as 
“Freesat”) at its meeting on 21 February. We have provisionally concluded that the Trust 
should approve these proposals and give clearance for the BBC to proceed. 
In reaching our decision we have considered the needs of licence fee payers, how the 
proposition fits with the BBC’s public service remit and the BBC's Public Purposes set out in 
the Charter, the public value created, the effect on relevant markets and competitors, and 
the risks to the BBC in establishing the joint venture. We have also considered the Trust'sgeneral duties under the Charter, in particular those set out in Article 23, and under theFramework Agreement. We have also had regard to such general guidance concerning the 
management of the affairs of public bodies as relevant and appropriate. 
These provisional conclusions are now open to consultation for a period of 28 days 
following which we will consider the representations received and make our final decision as 
to whether or not to approve the proposals. The present timetable envisages a final 
decision by the Trust being made by April 2007. The consultation will close on 27 March 
2007. Information on how to make representations to the Trust is attached as an annex to 
this provisional conclusions document. 
Chitra Bharucha 
Acting Chairman 
27 February 2007 

Contents 

Page 
1 Introduction...............................................................................................................32 Trustees’ decision.....................................................................................................43 The “Freesat” proposition......................................................................................44 The Trust’s approval procedure.............................................................................55 Basis for the decision................................................................................................76 Risk – both financial and reputational – arising from the proposition..............187 Conclusion...............................................................................................................19Definitions/Glossary of terms....................................................................................20Appendix 1...................................................................................................................23Appendix 2: How to make representations to the Trust......................................26

1 Introduction 

Under the terms of the previous BBC Charter, the Secretary of State’s approval was 
required for any proposition that the BBC should enter into a joint venture arrangement.
The BBC originally submitted a proposition, approved by the BBC Governors, to the 
Department of Culture, Media and Sport ("DCMS") in June 2006. 
DCMS considered the proposition and commissioned an independent report on its market 
implications. However, DCMS did not publish the proposition for consultation before theprevious BBC Charter expired and so the BBC Executive Board has resubmitted the 
proposition for the Trust's consideration. DCMS has written to the Trust formallyconfirming handover of this matter. 
The new BBC Charter places a number of specific obligations on the Trust which we have 
sought to fulfil in our consideration of this proposition. These include that the Trust isrequired to represent the interests of licence fee payers, assess their views carefully and 
appropriately, and must also have regard to the competitive impact of the BBC’s activities onthe wider market. It must also ensure that the BBC observes high standards of openness 
and transparency. 
We have considered the proposition put to us by the BBC’s Executive Board. We have also 
taken into account assessments of the competitive impact of the proposition on the wider 
market, and the strength of feeling amongst licence fee payers expressed directly to the BBC 
Governors (at public meetings and through their engagement with audiences through theBroadcasting Councils and the English National Forum) about access to the BBC’s digital 
services. While we recognise that a cautious approach should be taken to anecdotalevidence of this nature, these views are consistent with our own experience of the views oflicence fee payers. 
After weighing these issues carefully we have reached the provisional view that the BBC 
should be permitted to proceed with the implementation of this proposition. It isunfortunate that the process of approval has been delayed in this case. The BBC’s original 
intention was to make these facilities available to licence fee payers before the 
commencement of the first Digital Switchover trial in Whitehaven in September 2007. It will 
not now be possible to achieve this, but we understand that if approval is given following 
consultation it should be possible for the BBC to make this additional means of free accessto a range of digital services, including its own, available before Digital Switchover in Border, 
the first region to make the switch.1To ensure that our decision making process is open and transparent and to seek to take into 
account a full range of views we have concluded that we should, to the extent possible 
without compromising any commercial sensitivity surrounding the proposition, make public 
our reasoning and allow a limited period for comment before reaching a final conclusion. 
1 The timetable for switchover can be found at the Digital UK (the organisation leading the UK's switch todigitaltelevision) website - http://www.digitaluk.co.uk/en/when.html 

2 Trustees’ decision 

3 The “Freesat” proposition 

Our starting position has been that we should be as open as possible about the nature of the 
proposition and our reasons for endorsing the BBC’s proposed participation. We have alsotaken into account the interests of potential joint venture partners in determining how much 
detailed information it is reasonable to make publicly available. The venture represents a 
commercial investment for the BBC’s potential partners so we have taken care not to make 
public any detailed financial or market information which is commercially sensitive that we 
have taken into account but which might compromise their competitive position. 
Considering the likely benefits to the licence fee payer, the public value created and the 
potential market impact, and having regard to the Trust's duties under the Charter and theAgreement (particularly the duties in Article 23) and such general guidance concerning the 
management of the affairs of public bodies which we consider relevant and appropriate, our 
provisional conclusion is that we should approve the proposition that the BBC invests in a 
joint venture to offer a national satellite basedfree-to-view digital service. However, toallow for views to be expressed on this provisional conclusion we have decided to consult 
publicly for a period of 28 days on all the views set out in this document. 
The proposal submitted to us for consideration is that the BBC should launch a national 
free-to-view satellite proposition as an additional means of access for licence fee payers to 
access digital services, including the BBC’s digital television channels and radio services. Thisaccess route would be offered on the basis of a one-off initial payment with a guarantee ofno ongoing subscription charges. It would be future-proofed (for example by designing in 
high definition (HD) and personal video recorder compatibility). It would be marketedthrough retail outlets and direct retail channels such as the internet. Launch is anticipated intime to ensure that those licence fee payers in the Border region who are unable to receive 
Freeview and do not wish to use “Freesat from Sky” have an alternative means of 
subscription-free access to digital services should they wish to do so in the lead-up to 
switchover.
The intention is to establish a joint venture company to manage the marketing and technicalaspects of “Freesat”. The new proposition would be open to other broadcasters and it is 
hoped that in addition to BBC services a wide range of other services would be accessible.
The BBC hopes that other public service broadcasters will also wish to participate in the 
venture. Set top boxes would be supplied by third parties working with retailers to a 
specification agreed with the joint venture company. 
It is important to bear in mind the boundaries to what is being evaluated in considering thisproposition. The proposition will have an in-built capability to carry HD output. This allows 
for appropriate future development (we have described this as future proofing). Whilst the

4 The Trust’s approval procedure 

4.1Non-service activity 

BBC has not at this point put proposals to the Trust to make HD output available, other 
broadcasters might decide to make HD services available on “Freesat”. Should the BBC 
seek approval for a service licence to make available HD output via a channel through 
Freesat and other platforms, such an approval would be subject to a Public Value Test (PVT) 
which would include consideration of a Market Impact Assessment (MIA) prepared by 
Ofcom. 
We are of the view that in considering the Freesat proposition it is not appropriate ornecessary for the Trust to consider the potential market impact of HD output beingavailable through Freesat, given that this matterwill be taken into account if there is an HD 
PVT. Further it would be inappropriate for the Trust to seek to prejudge such matters on 
the basis of assessments which have not been produced for a PVT. 
The BBC Governors originally submitted this proposition to DCMS for the Secretary of 
State’s approval on 15 June 2006. The Trust has sought and obtained the Secretary of 
State's consent2 to the proposition being resubmitted to the Trust for approval under the 
procedures and structures of the new BBC Charter and Framework Agreement. 
The Trust considers that the “Freesat” proposition constitutes a non-service activity, as 
defined by Clause 22 of the Framework Agreement. The Agreement states that non-service 
activities are those that do not have the nature of a service which, by way of contrast, 
generally involve the selection or commissioning of content as well as its scheduling or 
distribution. The activity in the case of “Freesat” is limited to one element of distributionand as such the proposition itself does not automatically require a service licence. 
It is worth noting that any BBC service that can be accessed through the free satelliteproposition is subject to a service licence, and any future new services that may be madeavailable through “Freesat”, would be made subject to a PVT as required by the new BBCCharter and Framework Agreement. 
In accordance with the requirements of the new BBC Charter, the BBC Trust has adopted a 
series of protocols which set out a detailed framework within which the Trust will discharge 
its functions and which address the practical application of those functions. These protocolsare publicly available and can be accessed from the Trust’s website:
www.bbc.co.uk/bbctrust/framework/protocols/index.html 
The protocol applicable to “non-service” activities provides for the Trust to take intoaccount, where relevant, the potential public value and market implications of proposals and 
apply the same broad principles – evidence-based assessment and transparency in decision-
2 By letter dated 25 January 2007.

4.2 Whether the proposal should be subject to the full 
Public Value Test 

making for example – that apply where changes to services are considered. In particular theTrust is required under the protocol to take into account the following considerations in 
deciding whether to grant approval: 
a.the public value created by the proposal; 
b.value for money; 
c.the interests and perspective of the licence fee payer; 
d.market impact; 
e.risk (financial, operational, reputational); and 
f.compliance with the law and with BBC and Trust policies. 
The Trust considers that it is appropriate to take account of each of the above matters. The 
Trust must also consider whether the approval of proposed changes should be subject to 
any ongoing terms or conditions. The purpose of any such terms or conditions would be to 
enhance public value and/or take account of any potential market impact. 
We have considered whether it would be appropriate to make this proposal subject to a 
PVT in the context of these proposals. The Agreement does not require the Trust to 
conduct such a test, but requires the Trust to bear in mind that non-service activities may be 
significant and may raise issues of public value and have market implications. The Trust 
should ensure that to the extent relevant andappropriate, the same principles that underlie 
treatment of services are applied to consideration of non-service activities. 
We have taken into account the fact that the launch of Freesat will not result in any new 
BBC services becoming available and that any future new BBC services that might be made 
available on “Freesat” would be subject to a PVT prior to launch. We have also taken intoaccount the scale of the proposition. The maximum annual cost to the BBC fallssubstantially below the threshold requiring referral to the Trust (the threshold being £50 
million3). 
The BBC’s proposals were put forward for approval more than six months before the new 
Charter arrangements took effect with the expectation that clearance to proceed could be 
secured prior to the commencement of the new Charter. A further consideration for theTrust has been the impact of any additional delay. Conducting a full PVT could add a furthersix months to the approval process and would prevent the proposition being made available 
before the commencement of digital switchover.
Taking these factors, and the information provided to the Trust into account, we haveconcluded that it would be inappropriate, and contrary to the best interests of the licence 
fee payer, for a formal PVT to be conducted. 
3 Set by the Trust in its protocol onFinancial Plans Budgets and Delegations 

5 Basis for the decision 

5.1 Stated objectives of the proposition 

5.2The Public Interest duties placed on the BBC 

We consider that the information available to us, supplemented by public consultation, willbe sufficient to allow us to evaluate and form a proper view on the public value created and 
the effect on the wider market, and to take an appropriate decision in the circumstances ofthis case. 
In reaching our provisional conclusions we have focused in particular on: 
1.Whether the proposition will serve the best interests of licence fee payers 
2.What public value the new proposition might create 
3.How the proposition fits with the BBC’s public service remit 
4.The competitive impact of the proposition on the wider market 
We have also considered whether the proposed venture represents value for money, along 
with risk and compliance issues within the appropriate sections considering areas 1 to 4. 
We set out below the context for the Trust'sconsideration of areas 1 to 4 including the 
BBC's stated objectives and the Public Interest duties of the BBC and the Trust.
The BBC’s stated main objectives in launching the proposition are: 
1.Driving digital take-up in analogue homes, predominately those outside of digital 
terrestrial television coverage areas; and 
2.Offering a free-to-view digital upgrade path to ensure that licence fee payers can be 
offered all the benefits of digital including those which may not be fully available on 
digital terrestrial television, notably HD, guaranteed free of subscription inperpetuity. 
The Public Interest duties placedon the BBC include the following: 
As Article 3(1) of the Charter explicitly states, the BBC exists to serve the public interest - 
ensuring that its actions have public value is key to provision of BBC services. As such, theBBC must ensure that all its actions accord with the public interest and fulfil its remit asencapsulated by its Public Purposes: 
(a) sustaining citizenship and civil society; 
(b) promoting education and learning; 
(c) stimulating creativity and cultural excellence; 
(d)representing the UK, its nations, regions and communities; 
(e)bringing the UK to the world and the world to the UK; 

5.3 The Public Interest duties placed on the Trust 

5.4 Whether the proposition will serve the best interests of 
licence fee payers 

(f ) in promoting its other purposes, helping to deliver to the public the benefit of 
emerging communications technologies and services and, in addition, taking a leading 
role in the switchover to digital television.4Article 5 of the Charter provides that the BBC's main activities should be the promotion of 
its Public Purposes through the provision of output which consists of information, education 
and entertainment, supplied by means of television, radio and online services and by similaror related services which make output generally available and which may be in forms or by 
means of technologies which either have not previously been used by the BBC or which 
have yet to be developed. 
The Agreement elaborates on the BBC's responsibilities, stating at Clause 12(1) that theBBC must do all that is reasonably practicable to ensure that viewers, listeners and otherusers (as the case may be) are able to access the UK public services intended for them, orelements of their content, in a range of convenient and cost effective ways which are 
available or might become available in the future. This clause specifically gives satellite as an 
example of a way in which content might be made available. 
The Public Interest duties placedon the Trust include the following: 
It is the Trust's role to secure the effective promotion of the Public Purposes as well as, 
according to Article 22 of the Charter, acting as the guardian of the licence fee revenue andthe public interest in the BBC. The Charter also requires at Article 23 that, in exercising all 
its functions, the Trust must act in the public interest and, in particular, it must: 
(a) represent the interests of licence fee payers; 
(b)secure that the independence of the BBC is maintained; 
(c) carefully and appropriately assess the views of licence fee payers; 
(d) exercise rigorous stewardship of public money; 
(e)have regard to the competitive impact of the BBC’s activities on the wider market;
and 
(f) ensure that the BBC observes high standards of openness and transparency. 
The Trust and the BBC Executive, in performing their respective functions must also haveregard to matters such as general guidance concerning the management of the affairs of 
public bodies as they consider relevant and appropriate. 
In this section we consider the best interests of licence fee payers, which also forms part of 
our consideration of the public value of the proposition. We have done this by (i) identifying 
the issues arising from limited access to Freeview before digital switchover on a region byregion basis; and (ii) assessing how the proposition is in the best interests of licence fee 
payers in light of the issues identified in (i). 
4 Article 4 of the Charter.

(i) Issues arising from limited access to Freeview before digital switchover on a region by region basisMarket data published by Ofcom5 shows that 27% of the UK population are currently unable 
to receive Digital Terrestrial Television (Freeview). The proportion rises to 42% in 
Northern Ireland and 43% in Wales. For each region this will only be remedied when there 
is digital switchover in that area making available higher power transmission of DTT signals.
We address below the implications of this situation. 
Of the 7 million homes yet to move from analogue to digital reception, almost half fall 
outside the area where Freeview coverage is currently available. For these licence fee payers 
the only means of subscription-free access to the BBC’s digital services is currently through 
Freesat from Sky.6 Market research commissioned by BBC Management indicates that 
around 4% of households who cannot access Freeview use the Sky Freesat option. This low 
take up figure is likely to be attributable in part to factors such as the absence of activepromotion contributing to a lack of awareness in the market that Sky offers a Freesat 
package. It is also not clear what access these households have to cable and how many 
choose to access digital services in that way. 
Digital switchover will be staggered from 2008 to 2012 currently with four regions not due 
for switchover until 2012 including Northern Ireland and three regions not due for 
switchover before 20117. These regions will be particularly affected because until they are 
switched over, the only means of access to digital services for those licence fee payers 
outside current DTT coverage will be to use subscription services or Freesat from Sky (oranother market entrant who provides a non-subscription service). The higher power 
transmission DTT digital signals will not remedy this situation for a significant number of UK 
regions for at least another 3 or 4 years including Northern Ireland where only 58% of 
households currently have access to DTT. 
This means that a significant proportion of licence fee payers will be unlikely to receive the 
full range of BBC services that they have paid for through their licence fee. For those 
households not receiving digital services, 6 of the BBC’s 8 TV channels, 3 of its 11 networkradio services and the BBCi service are not accessible (unless they subscribe to Freesat from 
Sky). 
The BBC Governors emphasised when they approved the proposals for “Freesat” last year 
that in their own direct contacts with licence fee payers at public meetings, and through 
their engagement with audiences through the Broadcasting Councils and the English NationalForum, the feedback was clear: concerns about access to the BBC’s digital services were 
often raised and came from all parts of the UK. Governors reported particular anxiety 
5 Ofcom report – The Communications Market 20066 BSkyB currently offer a 'Freesat' package, for a one-off installation fee of £150, which is offered to customers as 
an alternative to Freeview.6 A 'Freeview' package is also available terrestrially that is marketed by a joint venture 
formed by the BBC.
7See footnote 1 above regarding the timetable for digital switchover 

amongst licence fee payers living in areas where Freeview was not available or where the 
signal was weak. Appendix [5] contains a note of licence fee payer concerns over 
subscription-free access to BBC digital services. The comments set out in the note areanecdotal and we have therefore taken a cautious approach to our evaluation of them. 
However, the comments are consistent with our own experience of the concerns raised by 
licence fee payers and with our view of the public value in approving the Freesat proposition. 
(ii) Assessment of the best interests of licence fee payers and the public interestAs part of considering the public value of the proposition, which is dealt with in section 5.5below, we have concluded that it is not acceptable for a significant proportion of licence fee 
payers to be exposed to the risk of being deprived of a subscription-free non-commercialaccess route to BBC services until as late as 2012. This is because licence fee payers in 
geographical areas where access to Freeview is not possible would, until digital switchover in 
their area, only be able to access BBC services by taking up Sky Freesat (or an offering of any 
other entrant to the market) or subscriptionservices. This is in the context where no 
commercial provider would be subject to the same express Public Interest duties that applyto the BBC with oversight by the Trust (with our own express public interest duties). 
There would also be no guarantee that there would remain a subscription free route toaccess BBC services in such circumstances. As part of considering the public value of the 
proposition, our view is that it would not be in the public interest for licence fee payers to 
be reliant only on commercial provider routes as a means of access to BBC subscription-freeservices. 
There may also be additional benefits to consumers through the introduction of an 
additional provider and hence greater competition in the market. This would lead toincreased choice for consumers and potentially other benefits, such as improved product 
offerings to customers in the short and longer term. This effect will be particularly strong inthose areas where there is currently only a single, or limited, supplier of digital retail TV 
services and those outside of the current Freeview footprint, where the current level ofcompetition may be lower. 
We consider that failure to address this position, which potentially affects a significant 
proportion of licence fee payers, would be inconsistent with the BBC's and the Trust's public 
interest duties, particularly to promote the Public Purposes set out in the Charter, which 
require facilitating access to BBC services. Accordingly, it is also in the interests of licence 
fee payers and part of the public interest that if the proposition is approved this is done so 
as to ensure, as far as possible, that Freesat is launched as soon as possible. 
We also consider that the BBC's main stated objectives for the proposition are consistent 
with the best interests of licence fee payers and the Public Interest duties of the BBC andthe Trust. In relation to the second stated objective, to provide a subscription-free route to 
HD output in perpetuity, given that there will be a PVT assessment should such a proposal 
be made, the Trust has only considered whether it is in the public interest (and in the 
interests of licence fee payers) to have an in-built capability to carry HD output. Our view isthat this allows for appropriate future development (we have described this as "future 
proofing"), which is in the public interest because it protects against Freesat being 

5.5What public value the new proposition might create 

superseded by technology as well as providing incentives for manufacturers to produce the 
required set top box equipment. 
In reaching the above conclusions we have taken into account generally the wider matters 
set out in these provisional conclusions particularly those explored in the section on public 
value and those in the section on market impact and we have also had regard to the Trust's 
duties under the Charter and the Agreement (particularly the duties in Article 23). 
As noted above, we do not consider that a full PVT is appropriate to our evaluation of this 
proposition. We have, however, considered the public value that the “Freesat” proposalmight create and applied the principles underlying the treatment of services as we considerappropriate in this case. The analysis set out below considers specific matters we consider 
relevant to public value and our provisional conclusion on the question of public value. 
We have considered the proposition against the following key measures of public value: 
reach; quality and distinctiveness; impact; and value for money. We consider these to be the 
appropriate aspects of public value to explore and evaluate.
(i) ReachIn the context of Freesat as a mechanism to allow subscription-free access to the BBC's 
Services, we consider reach to mean the extent to which the proposals will facilitate or 
increase that access. The market research suggests that whilst “Freesat” would have 
national appeal, it would be particularly effective in increasing reach to the BBC’s full range 
of services in areas currently unable to receive Freeview. Of the 7 million homes yet tomove from analogue to digital reception, almost half fall outside the area where Freeviewcoverage is available8. As with other satellite-based services, coverage for the free satellite 
proposition would be much greater than is the case for Freeview, opening up new 
alternatives to those licence fee payers unable to receive Freeview.
This evidence is consistent with the direct experiences of the BBC Governors referred toearlier through their contacts with licence fee payers at public meetings and engagement 
with audiences through the Broadcasting Councils and the English National Forum 
(ii) ImpactBased on our consideration of how the proposition would be in the best interests of licencefee payers and create public value, our view is that the proposition would be valued by 
licence fee paying users. We consider the impact of an additional means of access to 6 ofthe BBC’s 8 TV channels, 3 of its 11 network radio services and the BBCi service which,
along with a substantial range of other digital services from other broadcasters carry will 
have a significant positive impact on them - particularly for those who are unable to receive 
the Freeview service and within that number those who do not wish to use Sky Freesat or 
8 Ibid note 5, section 4.2.9.

who do not want, or cannot afford to use, subscription based services now or in the future. 
“Freesat” is expected to offer up to 300 TV and Radio channels (compared with around 75 
that are currently available through Freeview). 
(iii) Quality and distinctivenessWe also support the view that the proposition will be high quality and distinctive. The 
proposition will introduce competition in the market for free satellite television services and 
therefore offer an alternative choice of provider for consumers. Consumers will also face 
no adverse pressure from having a choice either to use a free commercial provider or 
upgrade their service. Furthermore, the Freesat service is guaranteed to remainsubscription free. This is a relevant matter for the Trust to take into account in relation to 
the public value of this proposition because there is a built in capability for HD output to be 
made available at a future date if Trust approval is given following a PVT. 
(iv) Cost and value for moneyFinally we have taken into consideration the cost and value for money to the BBC of 
supporting the new proposition. The costs involved are modest – well below the levels atwhich we would need to give our authority to BBC management to invest9 and comparable 
with what the BBC contributes to the Freeview joint venture and associated technicalinfrastructure. BBC management’s intention is that these costs should be shared amongst 
partners to the Freesat joint venture and this would reduce further the call on licence fee 
funding. We also consider that taking into account the modest costs involved compared to 
the public value of facilitating and increasing access to subscription-free BBC services, 
particularly in areas where licence fee payers cannot currently access Freeview, theproposition represents value for money. 
Any steps taken by the BBC at this point to improve access and promote the take-up ofdigital services will also have a beneficial impact at the point of Digital Switchover, reducing 
any resources that may be required then to support those who will require assistance tocontinue viewing the BBC’s services. Although the take-up of digital TV is expected to 
continue to grow, the market alone may be unable to deliver universal uptake. It is possible, 
therefore, that without coordinated efforts, such as this proposition, penetration will fall 
short of levels needed for analogue switch-off. 
Overall conclusionWe have reviewed the material available to us which we consider provides evidence relevantto establishing public value. We have also taken into account generally the wider matters set 
out in these provisional conclusions particularly in section 1 above addressing the best 
interests of licence fee payers. Having considered all these matters and the individualelements identified above, applying the Trust's duties under the Charter and the Agreement 
(particularly the duties in Article 23) we have concluded there is significant public value inthe Freesat proposition for licence fee payers.
9 Trust approval is required for investments above £50m.

5.6. How the proposition fits with the BBC’s public service 
remit 

5.7 The competitive impact of the proposals on the wider 
market 

We have considered the proposal in the context of the BBC’s public service remit and of 
the specific objectives set for BBC management by the Board of Governors which remain in 
place. The objectives set in relation to driving digital take up in 2006/7 were to: 
Ensure that BBC management prepares for digital switchover and drives the market for free-
to-air digital television, digital radio and new media whilst continuing to serve the needs of 
the analogue-only audience by: 
a.Raising awareness of how the BBC’s digital services add value to the overall portfolio; 
b.Improving their availability; and 
c.Working in partnership with the commercial sector to drive take-up. 
The Charter and the Agreement set out a number of public service duties. In the Charterthese include the Public Purpose for the BBC of “promoting other purposes, helping to 
deliver to the public the benefit of emerging communications technologies and services and,
in addition, taking a leading role in the switchover to digital television“10. In the Agreement 
it is stated that the “BBC must do all that is reasonably practicable to ensure that viewers, 
listeners and other users (as the case may be) are able to access the UK Public Services that 
are intended for them”11. 
We have concluded that the BBC's two main stated objectives are consistent both with theoverall objectives set by the Governors for BBC management and with the BBC’s Public 
Purposes, particularly those set out above. We are also satisfied that the proposition will 
contribute to other BBC objectives. In particular, increasing the choices open to licence feepayers for accessing the full range of BBC services will lead to an increase in the reach andaccessibility of the BBC, particularly in those areas unable to receive Freeview. We have 
concluded that the proposition put to us is consistent with the BBC’s public service remit 
and that it will make a positive contribution in relation to the specific objectives set by the 
Governors (which as noted remain in place) and to the BBC’s Public Purposes. 
In reaching the above conclusions we have also taken into account generally the widermatters set out in these provisional conclusions and we have also had regard to the Trust's 
duties under the Charter and the Agreement (particularly the duties in Article 23). 
The propositionis being assessed against the current approvals framework and requirements 
of the existing Fair Trading regime. The Freesat proposition does not specifically address 
whether the requirements currently expressed in the draft Competitive Impact Policy 
10 Article 4(f) 
11 Clause 12(1)

Statement (which has not been formally adopted by the Trust and was not in place at thetime that the Freesat proposition was put forward) are met. The requirement in the draft 
Policy Statement is subject to consultation and may change as a result.Taking these mattersinto account, and our provisional view that it is integral to the public value of the 
proposition that, if approved, it is implementedwithin an urgent timescale, our view is thatwe should not attempt to apply the draft Competitive Impact Policy Statement in the specificcircumstances in which we have considered the Freesat proposition. We have, however, 
taken into account the market impact of the proposition as set out below and we specifically 
invite consultation responses on this issue and will take them into account when our final 
decision is made. The Trust has received and considered privileged legal advice on the 
Freesat proposition's compliance with competition law (including state aid law). Weconclude on the basis of this advice that the Freesat proposition is compliant. 
We have also considered recommending that (i) the funding arrangements for the 
participation of other broadcasters in Freesat are such that it can be demonstrated that 
those other broadcasters are not being subsidised by the licence fee and (ii) that there 
should be appropriate separation between the operation of the Freesat proposition and the 
existing Freeview proposition. Our provisional conclusion is that our approval shouldinclude these matters.
(i) The Governance Unit report updated by the Trust UnitWe were provided with a report based on work conducted during 2006 under the direction 
of the BBC Governors to assess the competitiveimpact of the proposition before it was put 
forward to the Secretary of State for consideration. The Governors had asked for anassessment of the impact of the new proposal on the market and the Governance Unit12had, in the light of BBC management’s own assessment, carried out a review of the market 
implications of the proposition. 
The Trust Unit considered that the report and its market analysis provided a proper basisfor the Trust's consideration of the proposition and should be put before the Trust with 
amendments only to correct typographical errors and to update the statistics used. We 
have decided that it is appropriate to use this updated report, which we refer to as the 
Trust Unit report, as part of our consideration of the proposition particularly given that it isimportant to the public value of the proposition to consider it without further delay. Thework considers those specific markets which might be directly affected by the proposition 
and the impact on competition in those markets, as well as any ancillary markets that may be 
affected and wider economic effects. The full report is published alongside this document, 
and the key conclusions are set out here. 
The Trust Unit report advised us that the proposal may encourage some consumers to 
switch from their existing digital providers (or in the case of analogue households, choose 
PSB Freesat over an alternative digital offering). The market most likely to be affected was 
that for non-subscription digital providers (there are two significant competitors in this 
12 The unit, separate from BBC management and accountable directly to the Governors, established to provide 
independent advice to the BBC Governors.

market – Freeview and Freesat from Sky), although there could also be some effects on 
subscription services. 
However, the report concluded that the introduction of this additional non-subscription 
offer would not be likely to have an appreciable effect on the effective functioning of thecompetitive process in these markets, and that in terms of consumer welfare the effectswould be beneficial. The review notes that from the consumer perspective a new entrant 
would introduce an element of choice in terms of subscription-free access to digital TVservices in those areas outside Freeview coverage, and enhance choice and competition in 
other areas with consequential benefits to consumers. From the supplier perspective the 
review notes the likely effect on future revenues of the existing players in the market, but 
taking account of the scale of the new proposal, concludes that the risk of it crowding out 
these competitors is minimal. 
The report also considered the potential impact on wider markets, including TV channels 
and the supply of hardware. It concluded that the characteristics of the proposal mean that 
there is unlikely to be a major impact on the overall distribution of advertising revenues 
between channels (as the majority of channels that would be available on the new platform 
also play-out on the other main digital TV retail services) and that the proposal may benefit 
some manufacturing and service industries. Overall, the review suggested that there may besome marginal positive impact on wider markets and that the proposition is likely to make a 
contribution to the growth of digital television take-up and its associated economic benefits. 
(ii) The Fathom Partners' reportThe original Governance Unit report was forwarded to DCMS in support of the BBC’sapplication in June 2006 (and a revised Governance Unit report which is published alongsidethis document was provided on 18 November 200613) seeking the Secretary of State’sapproval to enter into a joint venture arrangement. DCMS commissioned Fathom Partnersto comment on the report. Whilst Fathom agreed with the Governance Unit view that theproposition would increase competition with consequent benefits for consumers, it 
contained a number of conclusions which differed from the Governance Unit's views.
Although the Fathom Partners report was not commissioned by the Governors or the Trust 
Unit, we consider it is appropriate that we take the report into account in considering the 
proposition. The full Fathom Partners report is published alongside this document, and the 
key conclusions are set out here. 
•Fathom considered that the Governance Unit had not taken proper account of the 
effect on the proposition that future decisions on the provision of HD services could 
have. Fathom reviewed two separate scenarios – one without a strong HD channel 
line up and one with a strong HD channel line up. 
•Without a strong HD channel line up they concluded that the proposition would 
have limited appeal (0.5m customers) and may fail because of insufficient interest 
from potential manufacturers of the Set Top Boxes. Fathom Partners also 
13Please note that we are publishing both the 18November 2006 Governance Unit report and also the later Trust 
Unit report that amended and updated it. 

considered that this same scenario could have a negative impact on Sky’s subscription 
services as well as its free services because in their view the launch of PSB Freesat 
would alert Sky's paying customers to consider a free-satellite alternative potentially 
over time prompting a body of Sky customers to move from Sky subscription 
services to Sky Freesat, or to lapse their paying subscription. 
•With a strong HD channel line up they concluded that the proposition could be fairly 
successful (2.5m customers). They asserted that the Governance Unit had not 
considered the market impact of this scenario. Their view was that this scenario 
would exert significant negative impact on current and prospective participants 
across the TV market, including potential new entrants. 
Fathom also reported their findings on impact on competition and Digital Britain (thesefindings applied to both the above scenarios). 
•They agreed with the Governance Unit that the proposition would increase 
competition, with consequent benefits for consumers (e.g. lower prices, increased 
promotion of free satellite services). However, their view is that because theproposition would be publicly supported, the usual presumption that the benefits of 
competition for consumers outweigh the market impact on producers would not 
apply. 
•Finally, Fathom noted the Governance Unit’s comments about the possiblecontribution of “Freesat” to switchover, and the benefits associated with “Digital 
Britain”. They took the view that the proposition would not contribute significantly 
to digital take-up or deliver benefits associated with “Digital Britain”. 
(iii) The Trust commissioned independent reportWe commissioned an independent review of both the Governance Unit and Fathom reports 
from Zoltan Biro, Director, Frontier Economics. A copy of his review is published alongsidethis document and the key conclusions are set out here. 
•On the basis of the information contained in the Governance Unit report and the 
Fathom reports, Dr Biro concluded that the market impact of the launch of "Freesat" 
should be expected to generate static welfare improvements (i.e. in terms of 
allocative and productive efficiency) as a result of an increase in competition in digital 
TV retail.
•In Dr Biro's view, the issue requiring further consideration by the Trust when 
considering the overall welfare implications of the launch of "Freesat" (i.e. in terms of 
static and dynamic efficiency combined) is whether the anticipated scale of impact on 
the revenues of Sky, NTL and potential new entrants into digital TV retail would be 
expected to have a detrimental impact on their incentives to invest in product and 
process innovations. 

As a result of Dr Biro’s work, we asked the Trust Unit to further clarify the estimate of the 
potential impact on Sky (as the main market participant likely to suffer a loss to revenues) in 
terms of whether the anticipated impact on revenues could have a detrimental impact on its 
incentive to invest in product and process innovations. This is discussed further below. 
Our view 
Having taken into account all of the material before us we reached the following provisional 
views.
(a) Effect of strong HD channel line upAs set out above in the section describing the "Freesat" proposal, it is important to bear inmind the limits to what is being evaluated in considering this proposal. The proposition does 
not include approval for a service licence to make available BBC HD output through Freesat. 
Any such approval would be subject to a PVT which would include consideration of a MIA 
prepared by Ofcom. We therefore consider that it is not necessary for the Trust to give 
great weight to the potential market impact with a strong HD channel line up. However,
the Trust has appropriately taken into account, when assessing the proposition's public 
value, the future proofing in the proposition by building in the capability to provide BBC HD 
output and the fact that this would entail enabling access to HD content if other 
broadcasters decide to make unencrypted HD output available. 
In the risks section below we have considered Fathom's conclusion that without a strongHD channel line up the proposition would have limited appeal (0.5m customers) and may 
fail. 
(b) Competitive restraint on competing servicesWe considered the Fathom Partners' conclusion that the proposition without a strong HDchannel line up could have a negative impact on Sky’s subscription services as well as its freeservices. 
The Trust Unit review recognises that the proposition may exercise a competitive restraint 
on competing services (primarily free satellite services but also, to a lesser extent, 
subscription services) but concludes that it is highly unlikely to deter significant levels of 
investment or to result in market exit. 
As noted in Section 5.7(iii) above, we asked for some further work to be done by the TrustUnit on the likely impact on Sky. None of that work so far suggests that the launch of 
"Freesat" will deter significant levels of investment and innovation or result in the market 
exit of existing market participants. 
We would welcome the views of industry participants on this issue, in particular those of 
Sky, NTL and potential entrants. Any figures that consultees are willing to provide will be 
held in confidence as set out in Appendix 2. 
(c) Market Impact

6 Risk – both financial and reputational 
– arising from the proposition 

The Trust's consideration of the market impact of the proposition should focus primarily onthe effect on consumers. The Trust Unit review concludes that for consumers, competition 
is likely to be strengthened by the introduction of PSB Freesat, as it provides an alternativesupplier of digital TV retail offering to almost all households in the UK, where a proportion 
of these households can currently opt for one provider only. Further, the Trust Unit notes 
that the impact of competition will be particularly strong in those areas outside of thecurrent Freeview footprint. The Fathom report also considers that the proposition wouldincrease competition, with consequent benefits for consumers (e.g. lower prices, increased 
promotion of free satellite services). Our view is that the proposition would introduce a 
new entrant to a market where there is an incumbent monopoly supplier, creating beneficialeffects (in terms of choice, increased promotion and potential price competition) for 
consumers. Our view is that these beneficial effects for consumers would not be diminishedbecause the new entrant was publicly supported (and it is relevant that the proposition is to 
establish a joint venture which the BBC hopes other broadcasters will wish to join, so the 
venture might not be only publicly supported). 
We also noted that Fathom and the Trust Unit agree that there will be benefits for upstream 
customers of Sky through the introduction of a choice of satellite service. 
(d) Contribution to "Digital Britain"
We have considered the research conducted by BBC management and the direct experienceof both Governors and Trust Members in their dealings with licence fee payers. It is clear to 
us that current limited access to BBC digital services is an issue of great concern to licence 
fee payers, particularly those unable to receive Freeview. We have good grounds for theview that many such people would take up a non-subscription offer if it was available(experience in those areas that are covered by Freeview bears this out). We consider that 
this would lead both to higher take-up, and earlier take-up of digital services. The mattersset out in the section above dealing with the best interests of licence fee payers are also ofrelevance to our view. 
It is important to make clear that this market review work does not have to include thesame level of detail and apply the same scope as the full market impact assessment that iscarried out by the telecommunications regulator, Ofcom, when the Trust is carrying out a 
full PVT concerning new BBC services or a significant change to existing services. We have, 
however, concluded that the scope and detail of review is appropriate when the scale of the 
BBC’s proposed participation and the Management’s take-up projections are taken intoaccount. In any event these matters will be the subject of public consultation which is why 
we have described our reasoning in some detail in these provisional conclusions. 

7 Conclusion 

BBC management has made available to us a detailed risk assessment. We are satisfied that 
this work identifies the relevant risks and that BBC management had devised appropriate 
means for managing and mitigating the risks identified. We are satisfied that the overall risk 
profile, both in financial and reputational terms for the BBC, is acceptable. 
We have taken into account that there is no guarantee that the proposition will be 
successful and that this can be affected by matters such as those identified by Fathom 
Partners if availability of HD output is not approved. We consider, however, that this riskmust be balanced against the considerable public value we have identified and the relativelylow cost of the proposition. This is in the context of the potential detrimental effect onpublic value which would result from further time being taken to commence work on the 
initial stages of the proposition. In our view, these matters provide strong justifications for 
approving the proposition while taking account of this potential risk. 
Considering the likely benefits to the licence fee payer, the public value created and the 
potential market impact, and having regard to the Trust's duties under the Charter and theAgreement (particularly the duties in Article 23) and such general guidance concerning the 
management of the affairs of public bodies which we consider relevant and appropriate, our 
provisional conclusion is that we should approve the proposition that the BBC invests in a 
joint venture to offer a national satellite based free-to-view digital service. 
We would caveat this approval with the condition that (i) the funding arrangements for the 
participation of other broadcasters in Freesat are such that it can be demonstrated that 
those other broadcasters are not being subsidised by the licence fee; and (ii) that thereshould be appropriate separation between the operation of the Freesat proposition and the 
existing Freeview proposition. 
However, to allow for views to be expressed on this provisional conclusion and to ensurethat our final decision to approve and allow work to commence takes account of all relevant 
matters, we have decided to publicly consult for a period of 28days on all the provisionalconclusions set out in this document. 
BBC Trust, February 2007 

Definitions/Glossary of terms 

Agreement See "Framework Agreement" 
BBC Executive BBC Executive Board. The BBC Executive is formally 
constituted under Article 7 of the Charter and is responsible 
for delivering the BBC’s services in line with the priorities set 
by the BBC Trust. It is responsible for all aspects of 
operational management of the BBC. 
BBC Governance UnitThe independent body that provided advice to the former 
BBC Governors. The Governance Unit has been superseded 
by the BBC Trust Unit. 
BBC Governors The former Board of Governors, superseded by the BBC 
Trust under the new Charter. 
BBC Management Part of the BBC Executive. 
BBC Trust The BBC Trust is formally constituted under Article 7 of the 
Charter. It is the guardian of the licence fee revenue and thepublic interest in the BBC. It has ultimate responsibility, 
subject to the terms of the Charter and the Framework 
Agreement, for the BBC's stewardship of licence fee revenue 
and other resources; for upholding the interests of licence fee 
payers and the public interest generally in the BBC; and for 
securing the effective promotion of the BBC's Public 
Purposes. 
BBC Trust Unit The Trust Unit provides the BBC Trust (i.e. the trustees) 
with independent and objective advice. The Trust Unitadvises the trustees on the conduct of their duties and 
supports their work in the following key areas: Performance;
Finance, Economics and Strategy; Audiences; Governance & 
Accountability; and Nations. 

Charter The new Royal Charter granted to the BBC on 19 September 
2006, which took effect on 1 January 2007 (subject only to 
some very limited transitional provisions which continue to 
apply after that date). 
The Charter sets out the Public Purposes of the BBC and 
guarantees its editorial independence. It prescribes the 
constitution of the BBC, the relationship between the Trust 
and the Executive Board, and the duties and functions of both 
bodies. 
DCMS Department of Culture, Media and Sport 
Digital Switchover The progressive replacement of the analogue broadcasting of 
television services within the UK with digital broadcasting of 
those services. This is scheduled to take place from 2008 
until the end of 2012 on a region by region basis commencing 
with Border in 2008. 
DTT Digital Terrestrial Television, often known as 'Freeview'. The 
broadcast of digital television channels received via existing 
rooftop aerials (rather than by satellite). 
EPG Electronic Programming Guide 
Framework Agreement The Framework Agreement complements the Charter (see 
above). It goes into more detail on many of the subjectsmentioned in the Charter and also covers such things as the 
BBC's regulatory obligations and funding arrangements. 
The Framework Agreement was made between the BBC and 
the Secretary of State for Culture Media and Sport, and 
approved after a debate in Parliament in July 2006. 
Freesat Free-to-view satellite proposition, offered on the basis of a 
one-off payment with no ongoing subscription costs. 
Freeview The supply of Digital Terrestrial Television channels via 
existing rooftop aerials. 
HD High Definition television output. 
ISP Internet Service Provider 

MIA Market Impact Assessment. This is provided by Ofcom, 
overseen by a joint steering group on which the BBC Trust 
and Ofcom are equally represented, and forms part of the 
Public Value Test. 
Non-service activity Activities of the BBC that do not have the nature of a serviceOfcom Office of Communications. Ofcom is the independent 
regulator and competition authority for the UK 
communications industries, with responsibilities across 
television, radio, telecommunications and wireless 
communications services. 
PSB Public Service Broadcasting 
Public Purposes The public purposes of the BBC set out at article 4 of the 
Charter. 
PVR Personal Video Recorder 
PVT Public Value Test, this is the means by which any significant 
proposal for change to the BBC's UK public services aresubject to full and public scrutiny. 
SD Standard Definition television output 
Service Any activity which is, orought to be, covered by a service 
licence. 
Service licence This is a licence issued by the Trust under article 24(2)(c) of 
the Charter. Determining what activities should be subject 
to a service licence is the responsibility of the Trust. 
STB Set Top BoxSwitchover date The date by which Digital Switchover will take place; 
currently scheduled for 31 December 2012. 

Appendix 1 

Note of licence fee payer concerns over subscription-free 
access to BBC digital services 
This note was prepared by the BBC Trust Unit. 
Lack of access to digital services is an important issue for many licence fee payers. When 
they are given the opportunity to pose questions to the BBC, for instance at public meetings 
or through unsolicited correspondence, it is a subject that frequently features in the top 
three or four most-asked categories. The main issues raised are: 
1.Viewers’ inability to receive BBC digital services 
2.Their aversion to paying Sky for access to BBC services 
3.The common misconception that access to BBC digital services is only available 
through a Sky subscription service14The analysis presented below illustrates the issues raised by licence fee payers through bothquantitative analysis of BBC data and qualitative research. We have also included what we 
have selected as a representative sample of comments and questions from licence fee payers. 
Data analysis 
Digital Terrestrial Television through a TV aerial (Freeview) is currently available to only 
74% of the UK population. From the beginning of 2005 to the end of 2006 the BBC was 
contacted by nearly 1000 people about the lack of digital coverage in their local area. Thesecontacts were as follows: 
Complaints 412 
Comments 520 
Enquiries 27 
Total 959 
Unsolicited contacts fromthe public via BBC website, phone, email and letter 05/01/2005 – 29/12/2006 
The BBC held five public meetings between July 2005 and July 2006, in Belfast, Cardiff, 
Glasgow, Norwich and London. In the run up to each public meeting, licence fee payers who 
were unable to, or didn't want to, attend the meetings were invited to send in questions via 
the website (Suggest a Question). This facility was only open in the 3 to 4 weeks 
immediately before the public meeting and not continuously over the year. The BBC 
received 2,001 responses via this internet facility, with 200 of these (10%) concerning thelack of digital services. The breakdown of these figures is as follows: 
Public Meeting Location Number of Number relating to Percentage 
14 Freesat from Sky, a non-subscription service, is available for a one-off fee of £150, with 98% UKcoverage

complaints digital reception 
London (ran from 2/7 to 19/7 2005) 1425145 10% 
Glasgow (ran from 1/11 to 23/11 2005) 122 20 16% 
Cardiff (ran from 25/1 to 22/2 2006) 195 21 11% 
Belfast (ran from 1/3 to 29/32006) 135 6 4% 
Norwich (ran from 13/6/ to 13/7 2006) 124 8 6% 
Unsolicited contacts15 to the BBC – a sample of comments 
“I am annoyed that digital terrestrial television is not available to the entire population of the 
UK” 
“I am paying a full licence fee but I’m not provided with a full service. This is totally 
unacceptable and scandalous” 
“I am very annoyed that the BBC expects me to pay a full licence fee when I cannot receiveFreeview in my area yet. This is disgraceful.” 
“I am very unhappy that I cannot get the same services when I pay the same licence fee” 
“I cannot get BBC services on DTT. I believe the analogue signal is being switched off this 
year in the Borders area and I believe I will be left without any television signal” 
“I find it ridiculous that we have to pay for SKY to get the extra BBC channels that we also 
pay for” 
“The only way I can watch digital television in my area is through NTL which I’m charged for 
and I don’t think this is fair.” 
“I live in an area where the only way to obtain digital tv is by subscription to Sky or Cable,
which I am not prepared to do.” 
Public Meetings16 – a sample of commentsLondon public meeting July 2005 (submitted to meeting via email)
“What are the BBC doing to ensure that everyone is able to receive their new digitalchannels? I live in a dead spot with no suggestion that the relay transmitter will be upgraded 
until the analogue signal is switched off. It seems there is now a digital divide developingthrough certain parts of the country, and I feel I am not getting my money's worth. I wouldlove to watch some of the programming on BBC3 and BBC4 but don't see why I shouldsubscribe to SKY just because I am geographically challenged” 
Cardiff public meeting February 200615 Unsolicited contacts are when a member of the public uses either email, the website, phone or post tocontact 
the BBC unprompted. Sample from Marketing, Communications andAudiences internal report 
16 Sample from BBC Trust Audience Team’s analysis of BBC data 

“Can it be justified that the Rhondda licence payers pay a full rate when we only have a 
reduced service which has no Channel 4, no Channel 5 or no digital services whatsoever? 
People who have gone over to digital television in Wales via transmitters cannot get BBC 
Two. They get 2W only and for most of the evening it is different to BBC Two.” 
“With the proliferation of digital Freeview channels, why can't viewers in Wales have a 
choice of the full range of BBC One and BBC Two programmes available in England as wellas regional productions?Do the board members think it's fair that you pay the full cost of 
the TV licence with no end reward for that outlay, without having to subscribe to BSkyB? 
We have no reception whatsoever in our village, no analogue, no Freeview, no nothing. And 
we have to pay twice to get one picture. Do you consider that fair?”
Belfast public meeting March 2006“I live in an area of Northern Ireland which does not have a digital signal. All I get is analoguesignal. I'd like to know what the BBC are going to do it provide for areas like mine to get a 
signal.” 
“In 2012, the Northern Ireland region and London region are the last two proposed regions 
of the UK to go digital. What lessons or improvements particularly to high definition 
broadcasting could Northern Ireland expect to receive from BBC?” 
Norwich public meeting July 2006"As a TV licence payer I am fed up with seeing a TV service advertised on the TV, namely 
Freeview which I can't receive." 
“The reception that we do get in King's Lynn which is very poor. For years we have hadpoor reception. We have had to buy mast-head amplifiers, and we have had to put up withthe poor signal. But the problem is that as each new service comes out, we're also last in the 
queue. We don't get Freeview. We don't get digital radio, and yet we pay exactly the same 
licence fee as all those people who might be called the chattering classes in London who getthe lot. This seems dramatically unfair” 
BBC Trust Unit 
29 January 2007 

Appendix 2: How to make 
representations to the Trust 
Introduction 

Our provisional conclusions on the BBC’s Freesat proposals are now open to public consultationfor 28 days. We want your views on whether we have made the right decision. Below we set 
out a series of questions that you may find helpful in framing your response.
You may submit your response in the following ways: 
•At the BBC Trust’s website, www.bbc.co.uk/bbctrust. 
•By email to freesatconsultation@bbc.co.uk 
•By post to: 
Freesat Consultation 
BBC Trust 
35 Marylebone High Street 
London W1U 4AA 
Please complete the confidentiality statement, below, when you make 
your response. 
Audio and braille translations of this document are available upon request by calling BBC 
Information on 0800 068 0116. 
Submissions should reach us no later than 5pm on Tuesday 27 March 2007.
Questions for you to consider 
Public value 
The Trust is responsible for considering the best interests of licence fee payers, which also 
forms part of our consideration of the public value of the proposition. We have done thisby (i) identifying the issues arising from limited access to Freeview before digital switchoveron a region by region basis; and (ii) assessing how the proposition furthers the interests oflicence fee payers. In particular, we would welcome your views on the following: 
1. Is current access to the BBC’s digital services acceptable, and should the BBC be taking 
action to improve access to its digital services in the lead up to digital switchover? 
2. Should licence fee payers have a choice of subscription-free means of access to digitalservices? 

3. Are the BBC’s “Freesat” proposals likely to be valuable and attractive to licence feepayers? (You may wish to comment on whether there is a value for all licence fee payers or 
just those currently unable to receive Freeview) 
4. Should the BBC seek to future-proof the “Freesat” proposition by offering a range of set-
top boxes so that users can choose either standard definition (the standard that BBC 
channels are currently broadcast in) or a box that would be capable of receiving high 
definition broadcasts in the future? 
The BBC’s Public service remit 
The BBC has a number of public service duties. These include the Public Purpose for the 
BBC of “helping to deliver to the public the benefit of emerging communications 
technologies and services and, in addition, taking a leading role in the switchover to digital 
television“, and a requirement that the “BBC must do all that is reasonably practicable to 
ensure that viewers, listeners and other users (as the case may be) are able to access the UKPublic Services that are intended for them”. 
5. Do you agree with the Trust’s conclusion that the BBC’s “Freesat” proposals are 
consistent with the BBC’s Public Purposes because they will improve access to its digital 
services? 
Competitive impact 
The Trust has taken into account the market impact of the proposition. In particular, wewould welcome your views on the following issues and will take them into account when 
our final decision is made. 
6. Has the Trust correctly identified those markets that may be affected by the launch of 
“Freesat”? 
7. Do you agree with the Trust’s conclusion that launching the “Freesat” proposition will 
have a beneficial effect for consumers by increasing choice and introducing competition in 
the subscription-free satellite TV market? 
8. Do you agree with the Trust’s conclusion that whilst launching “Freesat” will affect other 
participants in the market, it is not likely to lead to exit from the market of existing 
participants or to create a barrier to future innovation? (Any figures for the likely effect on 
other participants' revenues would be particularly welcomed). 
9. Does the proposal to establish a joint venture and to limit its activity to marketing and 
technical co-ordination, leaving set top box manufacture, retailing and installation to themarket go far enough to minimise the impact of the proposition on the market? 

Conditions 
10. Is it appropriate for the Trust to impose conditions to prevent licence fee money 
benefiting other participants in the proposed joint venture and to ensure appropriate 
separation between Freeview and Freesat? 
11. Should the Trust impose any other conditions if it approves the proposals in its final 
decision? 
Other comments 
In addition to seeking views on the specific questions detailed above, we are interested inyour views on other aspects of the proposals. 
12. What other comments would you like to make about these proposals? 
How the BBC Trust will use your response 
Responses to this consultation will be published on the BBC Trust website 
www.bbc.co.uk/bbctrust after the consultation has closed. Feedback to this consultation will beused by the Trust to consider its final decision on the BBC’s Freesat proposals. 
Names and/or addresses of individual respondents will not be published on the BBC Trust 
website. The Trust will publish details of organisational responses. Please copy or sign the 
declaration below to signal that you are prepared for some or all of your response to be made 
public. If you would prefer that all or part of your response be treated as confidential, please 
make this clear in your submission. 
Confidentiality statement 
If you would prefer that all or part of your response be treated as confidential, please completethe confidentiality section below. 
What do you want the BBC Trust to keep confidential? 
•Nothing 
•Whole response 
•Part of it 
•Which part? (Please indicate) 

Name……………………………………………………………………………………… 
Position/job title (if applicable)………………………………………………………….. 
Organisation (if applicable)………………………………………………………………. 
Address…………………………………………………………………………………….
Telephone………………………………………………………………………………….. 
Email address……………………………………………………………………………… 
The BBC Trust will retain and use your name, address, email address and the organization you 
work for (if applicable) for the purposes of administering the online public consultations held onthis website. You will have the option of deciding whether you want your response and name 
displayed on this website (all other personal information will be withheld from display). Your 
personal details will not be passed to any third parties for marketing purposes. The BBC 
complies with the Data Protection Act 1998. For more information on BBC’s Privacy Policy 
please refer to http://www.bbc.co.uk/privacy/. 
The BBC is listed as a public body in Part VI of Schedule 1 to the Freedom of Information Act 
2000; this means that, subject to certain restrictions, the BBC may be required to disclose 
information it holds to individuals and organisations making a valid request to be supplied with 
that information under the Act. If you have requested that all or part of your response shouldbe kept confidential, the BBC will take reasonable steps to maintain confidentiality of that 
information if a request for its disclosure is received under the Act. Please note, however, thatin the event the BBC is able to withhold information under the Act, this decision may beoverturned by the Information Commissioner, the Information Tribunal or the courts.
Please note that we may still refer to the contents of responses in general terms, without 
disclosing specific information that is confidential. We will exercise due regard to the 
confidentiality of information supplied.
DECLARATION 
I confirm that the information I have submitted is a formal consultation response. It can be published infull on the BBC Trust’s website, unless otherwise specified, and I authorise the BBC Trust to make use ofthe information in this response to meet its legal requirements. If I have sent my response by email, the 
BBC can disregard any standard e-mail text about not disclosing email contents and attachments. 
Name Signed (if hard copy)……………………………………….……………………….