Consumer Cost Of Digital Switchover To Hit £572 Million

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 Government’s 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 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 make 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).

Ofcom: 020 7981 3040 www.ofcom.org.uk