Government watchdog, Ofcom, has revealed that late adopters of digital technology will have to pay a collective sum of up to £572 million in order to prepare themselves for the impending digital switchover.
The cost to the average household will be around £137 to ensure that they have all the correct equipment to meet the Government’s proposed switchover deadline of between 2008 and 2012. This estimate is based on a per-household average of two television sets and one VCR and assumes that consumers opt for the cheapest available technology, Freeview.
Ofcom also claimed that about a fifth of latecomers will also have to upgrade their aerials to fit in with the Governments plans, at a possible cost of £125 per time, with smaller set top aerials having to be replaced at a cost of £20 to £40 per aerial.
As well as consumer expenses, the Government body has also admitted that costs in extra energy consumption resulting from the additional electricity used will range from between £200 million and £800 million, while a possible £300 million may also be added to the bill by providing further “public service” programming to compete with the BBC.
Commenting on the financial implications, Ofcom said: “The research takes a broader and more sophisticated approach to some previous research, factoring in the latest timetable for switchover and the expected reduction in domestic equipment over the next few years.”
Currently 63% of homes already have digital, with an additional 200,000 households upgrading every month. However, according to Ofcom, it is estimated that around 10% of UK homes will be reluctant to do the switch for a variety of reasons.
Despite the strong adoption rate, research published by Ofcom earlier this year revealed that less that a third of UK consumers have heard of the term “digital switchover” with a significant proportion not knowing where to turn to for advice (see UK Public Unaware Of Impending Digital Switchover).
This lack of knowledge is mirrored within the television industry, with a study from the London Business School and Video Networks claiming that more than 50% of television industry executives feel that the government is not doing enough to educate and communicate with consumers about the digital switchover (see TV Executives Call For Clear Switchover Strategy).
The Digital Consensus report highlighted an industry lacking any consensus on digital switchover, with 60% of executives confessing to not knowing the Government’s strategy.
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