Research for the BBC has estimated the loss to the UK in private and social value in not making high-definition channels on the Freeview platform at between £4.1bn and £15.6bn. Consultant Indepen said the loss included the cost to viewers in switching to other platforms to get HD as well as the impact of reduced audiences for public service content.
The estimate is contained in the BBC's response to Ofcom's consultation on its Digital Dividend Review, which proposes that all the spectrum liberated by digital switchover should be auctioned in 2008. The BBC, a member of the HD for All alliance of public service broadcasters, consumer electronics manufacturers and retailers campaigning for some spectrum to be set aside for HD channels on Freeview, said consumers were buying equipment in order to receive HD services.
"To ensure its long-term future viability and to enable it to compete with other platforms, Freeview must be able to offer a critical mass of HD services," said the BBC. Additional capacity would be required to offer HD channels alongside the current Freeview line-up, but there was "no business model for free-to-air HD on DTT at this stage that could enable free-to-air broadcasters to sustain likely auction prices".
The BBC submission says a minimum of one third of the liberated spectrum should be allocated to the BBC, ITV, Channel 4 and Five to "enable them to launch a strong free-to-air offer: at least one DTT multiplex with universal coverage providing three HD channels". BBC director general Mark Thompson said: "If pure market mechanisms are applied to the whole Digital Dividend, our fear is that it will jeopardise the success of universal access to high quality public service broadcasting, free-to-air on all main platforms and also lead to an erosion of the digital terrestrial platform and its ability to compete."
Lovelace Consulting | 21.03.2007