BBC responds to Ofcom's consultation on the Digital Dividend Review
The BBC today submitted its response to Ofcom's public consultation on the Digital Dividend Review.
Ofcom has proposed a technology neutral auction of the radio spectrum released by the switch to all-digital television broadcasting between 2008 and 2012.
In its response, the BBC argues for the allocation of spectrum to Public Service Broadcasters to develop free-to-air, universally available high definition (HD) channels on the Digital Terrestrial Television platform (DTT).
The BBC also discloses findings of independent consultants that the loss to the UK in private and social value, if public service broadcasters are not able to develop HD services on DTT spectrum, is likely to range from £4.1billion to £15.6billion.
On HD, the BBC argues that:
- Consumers want HD-quality television, and are buying equipment in order to receive HD services. There are compelling reasons to believe that it will become a technology with widespread appeal.
- To ensure its long-term future viability and to enable it to compete with other platforms, Freeview must be able to offer a critical mass of HD services.
- There is not enough capacity on the existing six multiplexes, after Switchover (SO), to carry this critical mass without removing existing services or eroding their quality. Furthermore, there is no business model for free-to-air HD on DTT at this stage that could enable free-to-air broadcasters to sustain likely auction prices.
- A minimum of one third of the Digital Dividend (DD) should be allocated to Public Service Broadcasters (PSBs) to enable them to launch a strong free-to-air offer: at least one DTT multiplex with universal coverage providing three HD channels.
- This would kick-start a migration to more efficient MPEG4 receivers which could, over time, be used by standard definition (SD) services and greatly improve spectrum efficiency on DTT. The adoption of MPEG4 receivers is the pre-condition for HD becoming widespread on DTT, and the allocation of additional spectrum capacity would allow for a managed transition to the new format, while not depriving viewers of existing services using MPEG2 receivers.
- Not all the Digital Dividend is required to support free-to-air HD. Much of the spectrum would be available for other uses, which could include local TV, mobile TV, radio mics, rural wireless broadband or even more standard television channels.
- Only the Digital Dividend spectrum (UHF) is suitable for high definition or other television channels. But much more spectrum, which could be used for some of the above or other uses, is to be auctioned in due course.
The BBC submission to the Digital Dividend Review also comments on proposals to safeguard switchover, to protect the use of radio microphones in television production and theatre (Programme-Making and Special Events or PMSE) and to facilitate the launch of mobile television and local television services.
Mark Thompson, the BBC's Director-General, said: "High Definition is already a consumer reality, and it's one that really adds value for audiences.
"It's a technological advance that we think can and should be available as far as possible to all viewers of digital television – whether they watch through cable, satellite or an aerial, and whether they choose pay or free-to-air services.
"If pure market mechanisms are applied to the whole Digital Dividend, our fear is that it will jeopardise the success of universal access to high quality public service broadcasting, free-to-air on all main platforms and also lead to an erosion of the digital terrestrial platform and its ability to compete."
Auctioning off the whole of the released spectrum at the end of 2008 would foreclose the option for HD channels for up to 18 years, the licence period proposed by Ofcom.
The PSBs believe instead that there should be a combination of a market-led auction and a carefully designed interventionist approach to the release of spectrum, to bring more benefits to citizens and consumers (the largest intervention to date has been the move to Digital Switchover).
Notes to Editors
The value to society that would be foregone if HD were not available on DTT is between £4.1-£15.6biliion, according to research carried out by Indepen Consulting for the BBC, in its Review of Ofcom's Impact Assessment, entitled Intervening To Secure UHF Spectrum For HD PSB, depending on whether FTA HD services are launched on satellite.
Indepen calculated the loss of value by totalling components of lost private and social value:
The loss of private value was based on the loss of value to DTT households which remain without HD, and the cost of upgrading to another platform for the six million households which choose to switch to get HD.
Loss in social value was estimated by adding the loss reduced audiences for public service content and the deterioration in the quality of PSB services, resulting from the reduction in the value of PSB caused by migration from the DTT platform and the loss of social value directly associated with the HD PSB services, including the social value from universal provision of HD PSB services, should HD become the standard format.