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Wednesday, 6 March, 2002, 13:24 GMT
Digital revolution starts here
Ondigital launch at Crystal Palace, London
Bright beginning: Ondigital - now ITV Digital - launches in 1998
By BBC media correspondent Nick Higham

Television in Britain is undergoing its biggest change since its invention more than half a century ago - bigger even than the introduction of colour pictures in the 1960s and the arrival of multichannel satellite TV in the late 1980s.

The familiar box in the corner of the room is changing utterly.

The new generation of digital televisions use the same technology as computers - anything a PC can do a digital TV can do as well (and in some cases better).

No longer an example of a passive "lean back" technology - enjoyed with minimum effort and engagement while slumped on the couch - the digital TV is an active "lean forward" device, designed for interaction and involvement.

Sky Playercam
Sky Sports' playercam is an established digital extra
Digital TVs invite you to play games, to seek out on-screen information and entertainment and to part with your money in ways old-style broadcasters never even dreamed of.

But no one knows how long this digital revolution will take to sweep away the old analogue television world, or how profound its impact will be on our viewing habits, our pockets and the broadcasting industry.

Global media companies and governments alike are fumbling in the dark, while huge sums are invested in a technology whose appeal to viewers and consumers remains unproven.

More than a third of British homes now have digital TVs, or set-top boxes which convert digital signals into something a conventional TV can make sense of.

Of these, 5.7 million subscribe to the service delivered via satellite by Sky TV, controlled by Rupert Murdoch, whose other UK interests include the Times and Sunday Times, Sun and News of the World.

Sky growth

What does Sky Digital offer?
Almost 150 channels
70 radio and audio channels
100 pay-per view sport and films channels
Cost: 408 per year

Sky Digital's rapid growth in the three and a half years since it launched has been achieved partly by converting existing analogue customers to digital and partly by generous subsidies.

Set-top boxes costing around 200 to manufacture are supplied free - there is a modest installation fee - provided customers agree to connect the box to a BT phone line.

Viewers can then make use of interactive services, offered by both the BBC and Sky on news and sport programmes.

The interactive benefits include extra information on-screen using the remote control, or alternative camera angles during sports events, and e-commerce facilities.

ITV's troubles

satellite dish and set-top box
Digital TV requires a satellite dish, set-top box or new TV set

Just over 1.25m households subscribe to the service provided by now-collapsed ITV Digital, delivered to conventional rooftop television aerials from conventional earthbound transmitters.

ITV Digital was jointly owned by Granada and Carlton Communications, the two companies which between them control the majority of the ITV network.

They used their muscle within ITV to rename the old OnDigital service last year.

What did ITV Digital offer?
Just over 30 channels
Interactive service plus internet access - ITV Active
E-mail through TV set

ITV Digital's channels are mostly supplied by Sky and its interactive service, ITV Active, also allows access to the internet.

Customers can also get the ITV Sport Channel - which is absent from the Sky service.

ITV1 itself only appeared on Sky for the first time late last year.

Carlton and Granada were initially reluctant to pay Sky millions of pounds a year to make the country's most popular commercial channel available on Sky Digital - why make your principal competitor's offering any more attractive than it was already?

Walsall's Marcelo - 5 Mar 2002
Football rights have cost ITV Digital dear
But as Sky Digital grew, and as viewing to mainstream channels like ITV1 and BBC One fell disproportionately fast in digital homes, the policy was rethought.

Now ITV Digital has gone into administration - the ITV Sport Channel failed to pick up enough subscribers to justify the 315m three-year deal it signed to cover the Nationwide League.

Despite this, a 100 set-top box offering access to all free digital channels - such as BBC Four, CBBC, CBeebies and ITV2 - should be in the shops shortly.

Cable calls

What do NTL and Telewest offer?
Same package of channels as Sky
Interactive e-commerce services and internet access
Video on demand
The UK's two main cable companies, NTL and Telewest Broadband, claim 1.14m and 641,000 customers apiece.

They too offer Sky's package of channels, plus services like "video on demand" (where the viewer pays to watch a film which can be paused, rewound or fast-forwarded just like a video) not available on Sky or ITV Digital.

The companies are able to offer this because cable networks can carry much more data much faster than phone lines.

But the launch and growth of digital cable services has not all been plain sailing.

NTL is saddled with crippling debts
It has been hampered by technical glitches and by the persistent failure of UK cable companies to get their marketing and customer service right, despite their undoubted technological superiority.

Both companies are saddled with big debts as well.

NTL is in particular trouble - its overdraft totals 12 billion, twice the debt which brought down US energy giant Enron.

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