Back to the future: Digital television and convergence in the United Kingdom

Telecommunications Policy

Volumn 22, Issue 4-5, 1998, Pages 383-396

  Collins, Richard ^a  

^a LONDON SCHOOL OF ECONOMICS   (United Kingdom)

Author keywords

[No Author keywords available]

Indexed keywords

COMPETITION; LAWS AND LEGISLATION; PRIVATIZATION; PUBLIC POLICY; WIRELESS TELECOMMUNICATION SYSTEMS;

COMMUNICATIONS POLICY; UNITED KINGDOM;

DIGITAL TELEVISION;

EID: 0032064065     PISSN: 03085961     EISSN: None     Source Type: Journal    
DOI: 10.1016/S0308-5961(98)00022-6     Document Type: Article

References (45)

1. Radiocommunications Agency (1997) Strategy for the Future Use of the Radio Spectrum in the UK. London. Radiocommunications Agency, p. 4.
2. The UK Government Agency charged with responsibility for spectrum policy, the Radiocommunications Agency, estimated radio communications' contribution in 1995/6 to "efficiency, competitive gains and other user benefits" at £12-15bn, whereas in 1993/4 such gains were estimated at £7-11bn (Strategy for the Future Use of the Radio Spectrum in the UK. op cit, ref. 1, pp. 2-3;
3. Radiocommunications Agency (1994) The Future Management of the Radio Spectrum. London. Radiocommunications Agency).
4. Source http://www.fcc.gov.wtb/auctions/ summary/revenue.gif.
5. Financial Times, 19 September 1997, p. 20.
6. Notably the Office of Telecommunications (OFTEL), the Independent Television Commission (ITC), the Radio Authority, the Broadcasting Standards Commission (BSC), the Welsh Fourth Channel Authority, the Governors of the BBC, the British Board of Film Classification (BBFC), the Advertising Standards Authority (ASA), the Press Complaints Commission (PCC) and the Independent Committee for the Supervision of Standards of Telephone Information Services (ICSTIS).
7. Redley, M., The case for untidiness. In Converging Media? Converging Regulation? ed. R. Collins, IPPR, London, 196, p. 20.
8. See, inter alia, Consumers' Association Policy Report. Communications Regulation - Making the Right Connections. Consumers' Association, London, 1997.
9. Collins, R and Murroni, C. (1996) New Media. New Policies. Cambridge, Polity, 1996, especially pp. 158-181 and 199-212;
10. Collins, New Media. New Policies. op. cit, ref. 6.
11. The Director of MIT's Media Lab, Nicholas Negroponte, has argued that traditional spectrum hungry radio frequency users like television will move to wired delivery and historically wired systems, such as telephony, will move to wireless transmission thus using spectrum more efficiently (Negroponte, N (1995) Being Digital. New York. Alfred A. Knopf).
12. The 1996 Broadcasting Act (Section 8(1)) specifically charged the ITC with considering how a licensee would 'promote the development of digital broadcasting in the UK otherwise than by satellite'. Clearly, the government placed a high priority on ensuring that a variety of transmission paths and distribution technologies would be employed for UK digital television. Wired distribution technologies in the UK have been slow to develop. Video on Demand via ADSL/xDSL technologies have not yet progressed beyond field trials though British Telecom is reported to plan a commercial introduction of ADSL services, in a limited area initially, in 1998. Broadband cable franchises have not been fully built out and penetration of homes passed remains low. Indeed, the Radiocommunications Agency comments that 'radio based services often offer a rapid means of entering the market, particularly at the local level, at a lower market cost than that associated with cable' Being Digital. (op cit., ref. 2, Radiocommunications Agency, 1994, p. 28).
13. In digital transmission, unlike analogue, different types of television programmes take up different, and varying, amounts of bandwidth (or channel capacity). For example, sports programmes showing continuing movement require greater bandwidth than do relatively static programmes such as a talk show. The ITC estimated that each multiplex had the capacity to carry three to six channels.
14. Broadcasting Act 1996 Section 8(2).
15. However, the ITC's decision may not stick. The European Union Competition Authority, DG IV, initiated an investigation on the BDB licence by announcing a 20 day period of public consultation from 26 September 1997. DG IV acted in response to a complaint from DTN but its action is in keeping with its record of concern about possible foreclosure of competition through long term programme supply contracts. The ITC's requirement that BSkyB contract to supply BDB with programmes (resulting in a seven year contract) seems likely to have aroused DG IV's concern.
16. Though much of the strength of terrestrial broadcasters is accounted for by public service broadcasting. The commercial terrestrial television channels, Channel 3 and Channel 5, have either lost share, Channel 3, or have succeeded in capturing only a derisory share: Channel 5 was launched in March 1997 and in August 1997 had succeeded in attaining a viewing share of 0.7%.
17. Telecommunications Act 1984 Part I (2) (b).
18. See also the Peacock Report, especially Chapters 4 and 12 (Home Office (1986) Report of the Committee on Financing the BBC. Cmnd. 9824. HMSO, London, 1986.
19. Public Network Europe, 1995, pp. 40, 117, 123.
20. This is not to make a judgement on the desirability or otherwise of the weakening of governmental power in media and communications markets. Moreover, promotion of entry has been a clear government priority since Mercury, the first competitor to BT, was licensed under the Telecommunications Act 1981.
21. Asynchronous Digital Subscriber Line - a technique for transmitting compressed digital signals, including video, over a standard twisted copper pair of telephone cables.
22. The projected British Interactive Broadcasting (BIB) service is to be launched by a consortium of BSkyB (32.5%), BT (32.5%), HSBC-Midland Bank (20%) and Matsushita (15%). It will provide a broadband broadcast downlink via satellite combined with a wired narrow band return path to a variety of interactive multimedia and video services.
23. The principal UK operator of wired telecommunication services, British Telecom, is prohibited from offering broadcast television services before 2001 as a form of entry assistance to cable companies so as to promote network infrastructure competition - particularly in voice telephony.
24. For the purposes of this paper I do not consider cable as a provider of voice telephony and other telecommunication services.
25. Informed Sources, Context News Monitor, London, 7-20 June 1997 p. 38.
26. Edward Briffa, quoted in The Times, 20 September 1997, p. 10.
27. The same report cites a British Telecom source, Rupert Gavin, as estimating a global Internet user total of 40m.
28. Microsoft acquired an 11.5% share for $1bn.
29. For an excellent comprehensive discussion of this issue, see Cowie, C. and Crowther, P., Review of the allocation of digital terrestrial multiplex licences and its implications for competition in UK broadcasting. Mimeo, 1997. [Available from Campbell Cowie, London Business School, Sussex Place, Regents Park, London NW1 4SA].
30. See also Cowie, C., Competition problems in the transition to digital television in the UK marketplace. Media Culture and Society, 1997, 19 (4), 679-690.
31. With respect to premium programme content through its contracts with leading sports rights holders and film producers and distributors.
32. 89/552/EEC amended by Directive 97/B6/EC.
33. Article 3 (2) b of the Telecommunications Act 1984 requires the Secretary of State (the Government Minister responsible) and the Director General of Telecommunications to "maintain and promote effective competition between persons engaged in commercial activities connected with telecommunications in the United Kingdom".
34. The Act provides, Part I 4 (1), that telecommunication system means a "system for the conveyance, through the agency of electric, magnetic, electro-magnetic, electro-chemical or electro-mechanical energy, of (a) speech, music or other sounds; (b) visual images; (c) signals serving for the impartation (whether as between persons and persons, things and things or persons and things) of any matter otherwise than in the form of sounds or visual images; or (d) signals serving for the actuation or control of machinery or apparatus.
35. See, inter alia, Oftel (1995) Consultative Document. Beyond the Telephone, the Television and the PC. London. Oftel.
36. Oftel (1996) Consultative Document. Competition Issues in Terrestrial Broadcast Transmission. London. Oftel.
37. Oftel and the DTI (1997) A Joint OFTEL and DTI Notice and Consultation. Extending the Regulatory Regime for Conditional Access Services. London. Oftel and the Department of Trade and Industry.
38. A Joint OFTEL and DTI Notice and Consultation. Extending the Regulatory Regime for Conditional Access Services. Op cit., ref. 31, Oftel, 1997, p. 1.
39. A Joint OFTEL and DTI Notice and Consultation. Extending the Regulatory Regime for Conditional Access Services. Op cit., ref. 31, Oftel, 1997, p. 2, para 10.
40. A Joint OFTEL and DTI Notice and Consultation. Extending the Regulatory Regime for Conditional Access Services. Op cit., ref. 31, Oftel, 1997, p. 2, para 7.
41. A Joint OFTEL and DTI Notice and Consultation. Extending the Regulatory Regime for Conditional Access Services. Op cit., ref. 31, Oftel, 1997, p. 13, para 67.
42. A Joint OFTEL and DTI Notice and Consultation. Extending the Regulatory Regime for Conditional Access Services Op cit., ref. 31, Oftel, 1997, p. 3, para 15.
43. A Joint OFTEL and DTI Notice and Consultation. Extending the Regulatory Regime for Conditional Access Services. 1997, p. 3, Ibid.
44. Derived from ABC UK newspaper circulation statistics for August 1997.
45. See United States versus Paramount Pictures. 334 US 131. The anti-trust actions usually known as the Paramount case began in 1938. The US Justice Department filed a petition against the Hollywood majors (Big Five - Loew's/MGM, Paramount, RKO, Twentieth Century Fox, Warners and Little Three - Columbia, United Artists, Universal), charging violations of Sherman Anti-Trust Act - anti-competitive practices, discriminatory pricing and supply arrangements, etc. The eight defendants had vertically integrated businesses linking film production to distribution and exhibition. The Justice Department sought to abolish 'all monopolistic practices in the motion picture industry'. It secured a consent decree in 1940 which maintained vertical integration in exchange for minor concessions on new trading/working practices. The case was reactivated in 1944 and in 1948/9 leading to a new consent decree under which the studios sold theatres.