Ofcom delays decision on digital dividend

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Ofcom has confirmed it is delaying a policy decision on the outcome of its digital dividend consultation after receiving 750 responses. Ofcom had been expected to publish its decision early this summer after consulting on controversial proposals to auction the entire 128 MHz of spectrum due to be librated by digital switchover. An alliance of public service broadcasters, consumer electronics manufacturers and retailers has been lobbying Ofcom and the Government to reserve some spectrum for high-definition channels on the UK's digital terrestrial platform, Freeview.

Ofcom said its market-based, technology-neutral stance had prompted "an important public debate about the future use of the digital dividend". The digital dividend was "one of the most valuable spectrum bands likely to be available in the foreseeable future", and decisions on how it would be awarded and for what uses were among the "most important issues that Ofcom faces".

Summarising the key themes emerging from the consultation Ofcom said mobile telecommunications operators had argued for the spectrum auction to be brought forward. Telecommunications groups and IT firms broadly favoured Ofcom's market-led approach, while broadcasters "and a large number of individuals (and other organisations)" had argued for intervention.

Ofcom said the HD-DTT issue had prompted a "range of strongly felt views" with public service broadcasters and the HD for All lobby group arguing that spectrum be reserved for HD on the DTT platform. "In particular, they claimed that HD would be the new broadcasting standard and therefore HD must be available on the DTT platform with a minimum, critical-mass offering of five channels," said Ofcom's summary of responses statement.

"There was also a significant number of responses from individuals supporting HD for All and gifting spectrum to PSBs for HD on the DTT platform. Those critical of our proposals in this area often raised questions about our market research," said Ofcom, with some respondents saying its research was "now out of date, especially given how many HD television sets have been sold in the interim", and others saying it was "not acceptable that the research did not demonstrate technologies (especially HD) to respondents".

Announcing a delay to the digital dividend review timetable, Ofcom said it would now update its market research. "We will conduct further analysis of a wide range of issues including points raised about public value, the timing of the award, competition issues and further economic and technical modeling," said Ofcom. Its updated market research would be completed in the late summer, and a policy statement would then follow in "late 2007" after which a further consultation would take place. Next summer a statutory consultation on draft regulations would then be held, followed by the auction in the winter, and the issuing of licences in the first half of 2009.

Lovelace Consulting  |  30.05.2007

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