Ensuring that most users are equipped with digital receivers is the main challenge for switchover and a pre-condition for switch-off. Finding a solution for all receivers in the home, not just the main receiver, just adds to the challenge. The two basic options are digital converters or set-top-boxes connected to analogue receivers, and integrated digital receivers. Moreover, additional reception facilities such as cabling, antennas, dishes, etc are often necessary.
There must be a large range of digital reception solutions to suit various user segments. This means choice of functionality, price and commercial formulas. Equipment cost is not a major barrier to the consumer of pay-TV services since some pay-TV operators subsidise it, having already deployed millions of set-top-boxes. However, pay-TV will not achieve the widespread penetration of digital TV only. Now the main challenge concerns the creation of “horizontal” markets for unsubsidized receivers supporting free-to-air digital TV services, where consumers pay the full cost from day on Co-existence of the two business models is important for wide-spread digital TV market penetration.
Availability of cheap receivers is essential to minimize entry barriers for consumers. Most of them must be equipped before the switch-off can take place. Equipment costs should not be much higher than in analogue and services at least comparable, thus offering a cheap entry point to digital TV. This is the way the market seems to go now. Of course consumers should also have options to buy expensive equipment supporting sophisticated services. Service and equipment diversity also contributes to wide-spread digital TV market penetration.
Free movement of goods within the internal market requires that national authorities do not impose administrative constraints for commercializing digital broadcasting equipment and compulsory technical requirements.
Some ITU Member States envisage public subsidies for digital equipment through schemes aimed at the whole population or just specific groups. The risk with the first scheme is discouraging purchases, including purchases of more sophisticated equipment than the one subsidized. The risk with the second scheme is trading of devices between subsidized and unsubsidized population groups.
Several other forms of incentives have been considered by some Member States, roe instance temporary and digressive reduction of the license fee for homes with digital equipment to encourage fast digital migration, etc. Some Member States allow a reduced rate of VAT on pay-per-view and subscription broadcasting services. The financial implication and parties affected are different, so each option should be carefully analyzed and implemented.
Consumer information is crucial to drive digital equipment sales in a market-led approach to switchover. Consumers should be empowered to plan their own migration rather than being forced and thus deprived by this process. They should be well informed of the timing and consequences of switchover so as to take their own decisions on services and equipment from a wide range of choices. They must be aware of what various devices can offer, what are the prospects of analogue equipment obsolescence and the possibilities for upgrading. Information and labelling should also be available in accessible formats for consumers with disabilities.
Informing consumers is the responsibility of equipment manufacturers, retailers and service providers, who need to co-ordinate their action and send clear messages whilst respecting competition law. Labelling schemes for analogue and digital equipment, with explanatory notices and/ or logos, based on voluntary industry commitment, would be particularly useful. The goal would be to send consumers positive and negative signals about, respectively, digital-compliant and analogue-only receiver equipment. This information should mirror national switchover policies, including indicative national or regional switch-off dates. Especially as an analogue switch-off date approaches in a particular Member State, its consumers should be clearly warned about the risks of equipment obsolescence.
Policy intervention in this area has been proposed in some ITU countries. However, Member States cannot impose de jure or de facto compulsory labelling schemes without prior notification. Notification enables a compatibility assessment of such measures with internal market rules to be undertaken. Where necessary, a certain degree of harmonization could be envisaged so that the approach to labelling would be common whilst tailoring its implementation to local circumstances, such as national switch-off dates. Labelling specifications could be approved by consumer and standardization bodies.
2.1.4 Integrated digital television receivers
The prohibition of selling analogue-only television receivers according to a staggered calendar was approved and is now fully implemented in the United States. It is being debated in some EU Member States. All EU countries would have to implement the obligation more or less simultaneously to preserve homogeneity within the internal market. This would have greater impact in countries where digital penetration remains low and strain the principle of subsidiarity traditionally applied in broadcasting policy.
Another potential drawback of compulsory integrated digital receivers would be the extra cost for consumers which, depending on the exact technical requirements, could however be partly offset by economies of scale. The impact would be greater in those countries where digital TV is less developed. Concerns can be also raised as to the technological neutrality of the measure. If only one type of digital tuner were to be mandated, this would presumably favour the dominant analogue TV network, often terrestrial.
2.1.5 Digital connectivity
Currently, digital TV signals are almost always displayed on analogue TV sets connected to a digital set-top-box, which decodes those signals, through the analogue ‘SCART’ socket or connector. That means digital signals are converted into analogue signals before being displayed. This is acceptable for today’s television receivers, based on cathode ray tubes and small screen sizes. However, the quality penalty is more perceptible on big screens using new digital display technologies. Moreover, the lack of systematically implemented and enabled digital connectors prevents the transfer of digital information between digital TV receivers and other digital devices in the home. But digital connectivity raises copyright security concerns, in particular that insufficiently protected digital content could be illegally copied or distributed. The possibilities for implementing digital connectors should be further explored as an incentive to consumer equipment switchover. A number of options exist to interconnect digital TV equipment, fulfilling different requirements but it is still unclear which way the market will go.
Access to digital broadcasting should include citizens with special needs, notably people with disabilities and older persons. However, while digital broadcasting offers greater possibilities than analogue in this area, these are not yet supported by digital equipment on the market. Harmonized approaches can reduce costs through economies of scale, thus facilitating the marketing of relevant functionalities.
Infrastructure competition stimulates market development, increasing consumer choice, quality of service and price competition. This may be constrained in some areas by legal, administrative or contractual restrictions on the deployment of infrastructure or reception facilities. Authorities will need to arbitrate between promoting digital broadcasting and the fundamental freedom to receive information and services, therefore facilitating network competition, and other policy objectives on town planning, environmental protection or other areas. With that proviso, national authorities should encourage network competition. By way of example, some Member States have already adopted measures in support of this objective, for instance by requiring the provision of multi-network reception facilities in new apartment blocks, facilitating their installation in existing blocks (for instance by reducing the required threshold of tenants’ votes), or by removing restrictive clauses in property or renting contracts. Co-ordination between national and local authorities is important since local authorities are often responsible for the practical implementation of this type of measure.
2.1.8 Effects on citizens
In all transition periods there are a lot of actors, but the past has shown the principal actors are the users. The decision of the users is in all cases oriented by market forces that, driven politically by Administrations and Manufacturers with the support of Broadcasters, can promote the opinion for change to oldest analogical systems and buy the new digital equipment. What is very important and urgent is the coordination among the different actors. In fact if the users are ready to buy new equipment and the manufacturers have produced the equipment, is very important to have a “frequency planning” program prepared by Administrations and, at the same time, a sufficient number of programs emitted, with interesting contents attract the attention of users and promote the change.
The users are moving fast towards a mobile 2G/3G lifestyle and future technologies have taught us to use mobile technology in our everyday communication. By receiving mobile broadcasting services in conjunction with 2G/3G as a return channel, consumers will be able to receive a new kind of content service and have increased interactivity. Joint utilization of digital broadcasting and existing and new cellular/cellular-type network technologies will provide consumers with location-independent and personalized services. Additionally, the delivery of digital media content via several distribution channels strengthens the availability of information society services, as they could be provided in various manners, via different network transmission methods. The use of more extensive and diverse communication networks promotes the availability of additional services and the development of content and receivers at affordable prices. This will mean information society services, including public services, can be made more accessible and cheaper than ever for all citizens by combining the usage of different types of distribution communication networks or by offering them via one communication network.
For digital television and radio the crucial conditions for success require a public that is informed on the facilities and benefits offered by the new digital services, including technical enhancements, additional programmes and services. The public must be aware of the additional service opportunities digital broadcasting and consumer electronics will offer. (For example, initiatives in this direction (i.e. to raise the public's awareness) are already ongoing in some European countries.) In addition, geographical access to digital services should be maximized and the new services should be accessible on the shortest time-scale.
Open access to public services of the information society should be encouraged, and directly developed whenever possible. This will support and speed up the implementation and success of digital broadcasting and additional datacast services. The lifetime of consumer products is in general expected typically to be from 5 to 10 years, and in some instances more. This requires stable systems, open access and the possibility of upgrading. This can only be assured when there are common, widely adopted standards jointly agreed among market players.