Neil Warns Terestrial Broadcasters
In a lecture given last night to the Royal Television Society, Andrew Neil warned of the negative impact of the digital revolution in broadcasting.
Mr Neil began with a warning about the potential dominance of BSkyB. “British television is on the brink of going digital and that digital revolution seems likely to be dominated by BSkyB.”
“Digital TV means choice for viewers in a whole range of interactive services. It will present the existing terrestrial broadcasters with fresh opportunities to become involved in areas such as subscription TV, pay-per-view and even video on demand.”
Mr Neil said that evidence suggests that established broadcasters have not taken advantage of advances in digital technology.
“There is every chance that the digital revolution will be dominated by BSkyB and its leading shareholder, News Corporation, which controls the essential encryption system.”
“Sky plans to introduce digital services next summer. It has secured a dominant position on the new digital Astra satellites,giving it something like 150-200 digitally compressed video channels together with massive data capacity.”
Mr Neil warned terrestrial broadcasters of the competition they will be facing in the near future and the problems of fragmentation in technology.
“All digital services will require a decoder unit which will be incorporated inside every television. The market is currently stacked in Sky’s favour. The terrestrial broadcaster will have an estimated 30 channels for digital capacity available for over the air transmission – far less than digital satellite can offer, but a huge increase on current terrestrial capacity.”
“But the terrestrial broadcasters have few plans about what to do with this extra capacity, and the Government has been slow to allocate it. The cable companies are even less sure what to do with their digital capacity.”
“Such dithering is potentially fatal . Sky’s digital decoders will be satellite specific:they will not decode the digital signals of the terrestrial broadcasters or the cable companies when they come on stream. So consumers will have to choose between a decoder unit for digital terrestrial, digital satellite or digital cable – or buy three separate TV-top units.”
“Digital technology does more than broadcast television pictures . It is the platform on which the convergence of broadcasting, publishing, telecoms and computers will take place.” Mr Neil believes that broadcasters have not grasped digital technologies signifincance in a wider sense.
“The risks for other broadcasters are clear: they could be marginalised in the digital revolution, or squeezed out altogether. It is clearly not in their interests that this should happen,nor in the public interest. It must therefore be a public policy priority now to devise rules to regulate the dominant gatekeepers of the future.”
Such rules would include: – The right to open access to conditional systems on fair terms; – Published tariffs applicable to all on the same basis; – A full and public explaination when access is denied; – A legal requirement not to discriminate in favour or against any service – Independent and binding arbitration where there is a dispute.
“There is a far more attractive alternative, if “Britain’s media companies have the courage and imagination to take it. The terrestrial broadcasters should join together with all Britain’s major media players including cable and interested satellite companies and those print companies with television ambitions, to announce their support for a common platform for digital television: a single decoder capable of receiving and unscrambling all manner of digital services.”
Mr Neil expressed the urgency of such measures. “There is not much time to lose,” he said, “They need to start aquiring the film, sport, and other rights for digital broadcast that will allow them to compete with Sky’s formidable offerings.”
“It is now right to treat the media market as a whole, to calculate each major player’s “share of voice”and to set the limits on that share. No group-public private or a mixture – should have more than 15% of total voice. The Government has suggested a 20% ceiling on each segment which I would ease to 25%.”
“We need to create a British Media Commission. The BMC would set the regulatory framework for all media, including the allocation of frequencies where necessary, and oversee the digital revolution. It would have powers to enforce share of voice, ceiling to sanction or forbid takeovers and mergers, to force disposals as a last resort.” Mr Neil concluded by saying,”It remains to be seen if the folk who run Britain’s media have the flair imagination and guts for entreprenuerial risk taking to take up the Murdoch challenge, or whether they will settle for comfortable complacency in their existing cosy cartels, while the future passes them by.”
Andrew Neil – Lecture to the Royal Television Society, June 15th 1995