Making sense of digital TV

By media correspondent Nick Higham

Are you confused by digital television? You're not alone. Last week the government announced a new digital "kitemark" scheme to stop people being misled into buying new "digital" sets which in reality are simply analogue TVs with some digital features (like digital sound).

In future you should look for a DVB sticker. It stands for Digital Video Broadcasting, the name of an international consortium of almost 300 broadcasters, manufacturers and regulators set up to promote and co-ordinate digital development - though not many people know that, which is why the DVB logo may well create as much consumer confusion as it resolves.

Recent research by the Consumers Association suggests confusion is one reason why the government's target of a total switch-over from analogue to digital by 2006 at the earliest, 2010 at the latest is unlikely to be met.

But there are other reasons, even more significant, and indifference seems to be one of them.

• Three-quarters of the people the Consumers Association surveyed don't have digital.
• Two-thirds of those haven't even thought about getting it.
• Few of those who have thought about it say they will definitely go digital some time soon.

Confusion

One reason for the lack of enthusiasm is the cost: some people simply can't afford it, others who could afford it prefer to spend their money on something else.

Some people confuse digital TV with pay TV and assume you have to pay for the five terrestrial channels once you go digital. Many people say they aren't interested in watching more channels anyway. And some, especially older people, are simply ignorant of what digital has to offer.

But one potential source of confusion is now on its way to being eliminated. ITV has thrown in the towel and agreed to go on digital satellite at the end of this year, making all the terrestrial channels available across all the platforms.

ITV (principal shareholders Carlton and Granada) has been reluctant to join Sky Digital's satellite platform partly because it wanted to boost Sky's digital terrestrial rival, Ondigital (principal shareholders Carlton and Granada), on which ITV and its little sister ITV2 are available.

Going on satellite is a recognition that Ondigital (with a million subscribers) is still an also-ran beside Sky (with five million).

Officially ITV says it's "irritating" for Sky customers to have to switch away from digital to analogue if they want to watch the country's most popular channel.

Unofficially, ITV must be worried that its audience may decline faster than the other terrestrial channels if it is not part of the Sky offering (though at the moment the reverse seems to be happening).

Expense

But going on the satellite is not cheap. ITV is renting three transponders for £10m a year, and will spend another £10m a year on things like satellite uplinks and extra programme costs.

Even then there will only be 16 versions of the ITV service - against the 27 regional variants available terrestrially. Some digital viewers are going to lose out on the locally-tailored news services available on analogue.

What's more, though ITV has done a deal with the Luxembourg-owned Astra satellite company, it will also have to pay further millions to BSkyB to use Sky's "conditional access" technology - scrambling the signal so only those in the UK can watch.

The alternative would be not to do a deal with Sky, but to pay extra for the rights to broadcast ITV programmes in parts of Europe, because the Astra 2D satellite signal has some (limited) spill-over across the Channel.

The good news for Carlton, Granada and the third ITV group, Scottish, is that they will pay around £85m less for their analogue licences this year.

The reduction is a reward from the Independent Television Commission for putting more weight behind the switch to digital, an incentive to do more, and a recognition that as digital grows a smaller and smaller proportion of ITV viewers will come from the analogue transmissions for which the licence fees are payable.