The deadline for the digital switchover (DSO) from terrestrial television has been set for between 2015 and 2020 in many countries worldwide by ITU and national authorities. The DSO will be used as an opportunity to rethink the TV market in many countries during the next 5 years. The approach governments and regulators will take will depend on their aims and objectives, which the private sector will also need to consider. These objectives are typically among the following:
- supporting digital TV transformation and the launch of new services (HDTV and HbbTV, for example)
- ensuring that comprehensive and universal TV services are affordable to all
- opening up the TV market to new entrants, therefore diversifying the TV offering to consumers
- freeing up spectrum for mobile broadband and to obtain significant revenue
- supporting national original content and independent production
- supporting national industrial policy.
Many articles on DSO have been published that focus on the associated narrower operational and technical decisions but fail to address these key objectives. In our experience, while these 'operational' decisions are crucial, the success of DSO also relies on three main issues associated with these objectives: the attractiveness of digital terrestrial TV (DTT) content offers, the appropriateness of the regulatory regime and the ability to enforce the regulatory regime.
Analysys Mason's worldwide experience in DSO projects illustrates the diversity of situations and policy decisions
We have worked on DSO projects across all regions worldwide. The fundamental issues and analyses are the same, but diverse situations, policy decisions and private investments lead to different outcomes for the TV market. Below we outline some high-level differences to illustrate this diversity and examine the key issues in each case.
- Europe – launching new services with spectrum issues at the centre of the debate.Much of the focus has been on the associated UHF broadcasting spectrum 'digital dividend' bands that could be migrated to mobile use (initially 800MHz and now potentially 700MHz as well). In markets where DTT content offerings have not improved significantly, the platform has struggled to remain competitive. More widely, the TV industry focuses on making DTT competitive by moving to HDTV and UHDTV, adopting non-linear TV standards like HbbTV, and ensuring that DTT is available on mobile devices.
- Africa – rethinking the TV market with a focus on local content and network investments. The situation in Africa highlights different technical challenges and issues. Although the situation varies between countries, analogue terrestrial infrastructure can be less universal than in other regions, meaning that satellite or cable are taking some lead. Therefore, DSO policy makers need to focus on their DTT content strategies as well as on taking action to improve the terrestrial distribution reach.
- Latin America – diverse industrial policy, rethinking the TV market and affordability. DSO is planned to take place between 2015 and 2020 in most countries in the Latin America region. In terms of industrial policy decisions, we have seen a variety of choices influenced by different models, such as those of the USA, Europe and Japan, both in the selection of technical standards (ATSC, DVB and ISDB) and the structure of the TV market.
- Asia–Pacific – offering attractive and affordable TV to all. In the Asia–Pacific region, DSO is planned for most countries between 2015 and 2020. The main challenge is similar to that in other regions – to ensure that DTT is accessible and attractive to all.
- USA – broadcast spectrum auctions are the central focus. The focus in the USA has mainly been on spectrum release for mobile use after the associated auction. Following the 700MHz auction in 2009, plans are underway for an incentive auction of spectrum below 698MHz during the next 12 months.
We expect significant progress towards DSO in many countries worldwide during the next 5 years that will lead to changes in the TV markets.