Focus - Digital divide

Many are wondering what the hype surrounding digital TV is all about. MASSIMO FARRUGIA looks into some aspects of the new technology and why some of the broadcasters are unhappy with the latest policies.

Digital divide

"The main benefits with the new technology, which is set to replace the existing analogue system by the end of 2010 in Malta, is much more exciting than the complicated technological jargon might suggest," according to the chief technical officer of the Malta Communications Authority, Colin Camilleri.

The European Commission recently announced that Malta, along with Austria, Denmark, Estonia, Finland, Italy and Sweden, are planning to switch to digital broadcasting by that date. The rest will make the move two years later.

"Digital terrestrial television (DTTV) is about improved picture quality, better sound, better portable and mobile reception of television, more channels and access to a myriad of information services," Mr Camilleri said.

The MCA officer said switching from analogue to digital is as complex as it is exciting: "This is why the government drew up a strategy for the migration period, establishing a precise regulatory framework in which stakeholders in digital TV must operate".

But how will the new technology change the existing situation of Maltese television stations? Will the public still receive the foreign stations traditionally viewed in Malta? How do TV subscriptions come into the picture?

According to an international arrangement of analogue TV frequencies, Malta had access to eight UHF frequencies, five of which had been assigned by the Broadcasting Authority to PBS, Net, Super One, Smash and Telever, a station which never started transmissions. In the digital domain, however, the one-frequency, one-channel logic no longer holds because technology has made it possible to transmit four or more channels on a single frequency.

In practice, therefore, current analogue broadcasters will not have an automatic right to frequencies for digital television.

Malta has a number of frequencies reserved. Two blocks of eight channels each have been assigned to two network operators (Maltacom and Multiplus) while another three will be assigned to local broadcasters, Mr Camilleri said, explaining that managing the so-called spectrum of frequencies was vital given the limited number of frequencies assigned to Malta.

"The number of frequencies is limited because these have to be negotiated with neighbouring countries. There are pre-set protocols and a country cannot just take another frequency and assign it to a network or a broadcaster," Mr Camilleri explained.

The MCA's main intention behind the strategy was to create competition between local network operators, which would mean that consumers may choose their preferred package of channels, switching between terrestrial network operators - Multiplus or Maltacom. Consumers could also opt for Melita Cable, which is gradually switching to digital, even though the MCA had not set a cut-off date for the cable company to migrate to digital.

In the new context, therefore, international channels and local broadcasters are being classified as content providers - a term which local TV stations do not want for themselves. Maltacom, Multiplus and Melita Cable are the network providers and the people watching TV at home are the end users or consumers.

Yet, when speaking of "consumers" and "providers" in the context of new technology, one automatically knows that choice would come at a cost, since hardly anything comes for free in life. When analogue TV was introduced as a broadcast medium decades ago an antenna was an essential, one-time cost, even though the number of channels were limited, as was the transmission quality.

The advent of cable television changed this logic as the provider started charging customers for servicing costs and rights to carry foreign private stations. Choice, in this sense, means that even subscribers of Multiplus (and eventually also of Maltacom) pay for the service they receive, as television consolidates its position as society's essential commodity.

Discontent is in the air(waves)

What's in for those who don't want to subscribe to a network?

Television bosses are irate that the Malta Communications Authority has granted a licence to Maltacom and Multiplus as network operators and refused them permission to broadcast digitally - at least for now.

They are arguing that they should be able to retain their status as broadcasters of free-to-air stations when the migration to digital television is complete, even though the MCA has made it amply clear that this would not be possible for the moment.

Smash Television director Joe Baldacchino said all EU countries had given priority to existent free-to-air stations in devising a strategy to go digital. It was absurd that simply because technology was changing, the government was going to revoke existing broadcasters' licences.

"They are calling us content providers. But we are broadcasters and want our viewers to watch our stations for free," Mr Baldacchino said.

Smash TV had been the first station to start test transmissions in digital terrestrial last December but was stopped by the MCA pending the allocation of frequencies. The station has refused to form part of the Multiplus digital terrestrial package, on grounds that people should not be made to pay to receive a station that is transmitted for free.

According to Mr Baldacchino, viewers would be billed to watch PBS when they were already paying their yearly licences. In the case of Net and Super One, it was absurd that Nationalists and Labourites who pumped money to keep their stations going would have to pay an operator to watch their stations.

"What if the network operator goes bankrupt and closes down? We would be left with nothing," Mr Baldacchino said.

"The MCA will revoke the license from existing broadcasters to give it to those who want to make money instead." he said.

Mr Baldacchino asked why the MCA had not yet allocated the frequencies which were reserved for free-to-air? "Granting a licence to network providers and refusing it to us is only giving the chance to Multiplus and Maltacom to consolidate their monopoly," he argued.

When Smash TV first started, it was carried on Melita Cable before it could be received through an antenna, which means that only Melita subscribers could receive it. So wasn't Mr Baldacchino's reasoning about Multiplus a question of two weights and two measures?

"Comparing cable TV with digital terrestrial is not comparing like with like because Melita Cable has an expensive cable set-up to maintain. This is digital terrestrial, where people can view free-to-air stations when they could simply buy a set-top box," he said.

In the consultation document published in July 2004, the MCA outlines four options which could be adopted for Malta to migrate from analogue to digital TV.

The first option was that existing broadcasters retained full control over their transmission capability, owning transmission infrastructure and using one frequency to transmit. But since the one frequency could be divided into many channels in digital and Malta had a limited spectrum the MCA said this set-up would not make sense.

The second option, shunned by Multiplus and Maltacom, was that current broadcasters formed a consortium for the operation of the network, retaining a degree of ownership and sharing transmission costs. A share of the cost would be recovered through the sale of set-top boxes.

This is similar to the concept of Freeview in Britain, in which case viewers can receive about 30 TV channels and 20 radio channels with just a one-off purchase of a receiver, that in England you can get for £40. Through this package, clients get all the BBC stations, ITV and other channels.

The third option was for the government to set up an infrastructure which transmitted all national broadcasts similar to the master antenna concept.

The fourth option was to use "third party" infrastructure, where channels would only be able to broadcast via a network operator (provided to clients against a subscription and fee). This option also contemplated a yearly fee paid by broadcasters to network operators to cover operating costs.

Unlike Smash TV, Super One and Net TV accepted to form part of the Multiplus package. For Super One managing director Michael Vella Haber, however, accepting to form part of the package was a better-than-nothing option.

"Our reasoning was that we would better give consumers the possibility of receiving us on digital, even if being part of Multiplus was the only way that is possible so far," Mr Vella Haber said.

Echoing Mr Baldacchino's claims, Mr Vella Haber insisted that broadcasters were licensed as such and were not just content providers. "Can someone explain to me why broadcasters will lose their status just because technology changes?" the Super One boss asked.

"It is a sad situation because we are in no man's land. For reasons known only to the MCA, we have not been given the possibility to transmit free to air."

Super One wanted as much household penetration as possible but was against a situation were families with modest incomes had to subscribe to a network operator to receive their station.

When contacted, Media.Link Communications (Net TV) media manager Louiselle Vassallo said the company had no official policy on whether current free-to-air stations should be able to retain their status.

In the official reactions submitted to the MCA, Media.Link stated: "Major broadcasters in Europe were allowed to retain their bandwidth".

PBS chief executive officer Andrew Psaila said at a business breakfast last month that PBS had a constitutional obligation to transmit free-of-charge, adding that the yearly licence was "a separate issue" to network operator fees.

"It's a question of updating TV sets to meet the demands of the new technology," Mr Psaila said, adding that viewers would only have to pay for a set-top box.

"It's not different from when colour TV replaced black and white. People had to buy a colour television set," Mr Psaila said.

Given its public service obligation, PBS would in all probability be assigned one of the frequencies reserved by the MCA for local stations.

Asked when the three free-to-air frequencies reserved for existing broadcasters would be allocated, the MCA said it was working "to review the optimum framework via which the process leading to assignment of these three frequencies will take place".

"The MCA wants to ensure the continued availability of TV content to the widest possible audience. The decision involves the definition of the 'must carry' rules which ensure that certain content must be broadcast by network operators in order to meet general interest objectives."

The MCA said it was working with the Broadcasting Authority to define such objectives and rules, hoping to make a decision on the assignment framework later this year.

But what does the MCA have to say about the claim that the granting of a licence to network operators Maltacom and Multiplus before giving one to the existing free-to-air channels was unfair, virtually consolidating their monopoly and hampering choice for the consumer?

The authority said there had been new entrants to the sector thanks to its policy, which had brought about competition, cut prices, improved service offerings and provided greater choice for consumers.

During the transition period, all TV stations in Malta currently transmitting their own content in analogue format via their own transmission facilities could make use of the cable and DTTV operators.

The MCA said by the switch-off date, when all analogue transmissions will be closed, "alternative arrangements for any free-to-air reception of digital transmissions will have been in place for some time".

"Analogue turnoff will release vital spectrum resources that can then be reassigned to be used by new and exciting services that will be underpinned by technologies that will have come on stream by then," it said.

Network operators have their say

Melita Cable's Franco Degabriele said the cable TV company had spent about Lm28 million over 14 years to create an infrastructure. It now has about 105,000 subscribers in Malta. He would not reveal how many of them had opted for digital.

Asked whether he envisaged a fall in the prices of cable TV due to competition, he said this would definitely happen but made it clear he could not say when or how prices would fall.

Asked by when Melita Cable intended migrating completely to digital, Mr Degabriele replied: "Our intention is to gradually switch to digital. However, we do not want to place an axe on our clients' heads".

The Times asked Maltacom when it estimated it would start digital transmissions and whether the company had worked out what share of the market it could win. The questions remained unanswered.

Addressing a business breakfast on digital terrestrial television on June 15, Maltacom chief executive officer Stephen Muscat said the telephone company expected to have national coverage of DTTV transmission within 18 months, that is not before the beginning of 2007. The question to ask here is: Would Maltacom have been privatised by then, considering that shareholders gave the go-ahead to the company to start the privatisation process six months ago? And, if so, would the new owners implement the plans to provide a network and bring about the needed competition?

Mr Muscat had said that when Maltacom announced that the MCA had assigned the company access to rights of use of radio frequencies in the UHF band for the development and implementation of DTTV, Maltacom's share price jumped from Lm1.35 to Lm1.50 in two days.

Another question sent to Maltacom, which also remained unanswered, was: What advantages could Maltacom have over competing operators once it comes on stream?

Multiplus - the first company to express an interest to operate a DTTV network in February 2003 - was granted a telecommunications operator licence in July 2004 and granted the rights of use of the terrestrial frequencies last May. It started operations on July 1.

The company, with its transmission infrastructure at Portomaso Tower, is currently operating its DTTV network on five terrestrial frequencies.

"The company will be developing a further three frequencies, thereby increasing the number of channels it can offer. The company can cover 75 per cent of all households and is also in the process of increasing its coverage across the entire territory," Multiplus sales and marketing manager Marouska Bugeja said.

"Our main aim is to offer a service of quality channels at a low and affordable cost. The interest in our product seems to be growing every day," she added.

"Subscribers need to buy a digital receiver and lease the Multiplus Smart card at Lm12 a year. A package with more channels can be bought against a higher charge, together with a sports package for football lovers."

Ms Bugeja would not say how many subscriptions the company has had so far, describing the public's interest in the company as substantial.

What's wrong with my old brown Grundig?

While the oldest colour TV sets might still be working fine (as is the case with some of the first brown Grundig sets imported to Malta in the early 1980s) the difference in quality between an analogue TV picture and a digital picture is now evident to most people because most have become acquainted with computers. A digital TV is basically a computer monitor. The worst computer monitors can have more resolution than the best analogue TV set.

The analogue system...

In the analogue system, a camera captures the picture at 30 frames per second, turning pictures into dots, also called pixels. Each dot is assigned a colour and intensity. The pixels are combined with synchronisation signals so that the electronics inside the TV set may know how to display the signals on the screen.

The final signal is called a composite video signal. Sound is separate. This is why there are usually two different phono plugs connecting the TV set with a video or DVD player - one carrying the picture and one carrying sound. (On systems which handle stereo, there would be two plugs for sound.)

Analogue TV signals may be transmitted as radio frequencies (UHF) on specific frequencies (using an aerial) or via a cable network.

Going digital...

Digital TV involves digital cameras, which capture a picture at a much higher resolution than analogue cameras. This means that the pixels making up the picture on the screen are much smaller and more frequent, making the picture look crisper and more detailed, not to mention the better sound quality.

A digital signal is transmitted via a frequency or a cable network which the TV set receives and decodes. The analogue logic of one frequency per channel does not hold in the digital domain because one channel can be divided into multiple sub-channels and transmitted in a compressed form.

But what makes digital terrestrial TV technology most exciting for lovers of the box is the great potential for interactivity, the possibility of choosing to watch a particular film, football match and news bulletins to their heart's content. Against given charges, clients may even bet, shop, make a bank transaction and access the internet using their dipper.

The TV of the future may be received on a hand-held computer or a state-of-the-art mobile phone.