Saturday, June 24, 2006

Give set top boxes to everyone

[Give everyone a set top box.]

After having reviewed the direction digital broadcast vendors are going at Broadcast Asia 2006 just concluded in Singapore, and how the creatives want to provide new content while the digital broadcasters are scratching their heads at the cost of HDTV and conversion to digital transmission, that single idea of giving set top boxes to everyone makes even more sense. Why?

The following is in the Australian context and experience but can be applied to any Asia-Pacific environment.

Firstly the set top box idea is not mine but that of former Telstra CEO, Ziggy Switkowski which he expressed in an address to the Australian National Press Club last year.

He said the Government should be the provider of set top boxes.

The cost would be A$440 million (about US$300 million).

The point he made was simple. Once you have got all digital broadcasting and an available market of 100 per cent of all households, creatives can unleash their imagination.

Switkowski eyes are wide open to new media players. He sees them able to invent business models that marry content with interactive applications and access to internet sites and databases, in ways few of us can anticipate today.

Now here is a comparative thought. Australia in its changeover to digital/HDTV is dual simulcasting in analog and digital for terrestrial transmissions that is costing the princely annual sum of A $143 million a year, paid, of course, by the taxpayer.

Based on the Switkowski proposition those transitional cost incurred by the ABC would disappear because analog transmission could be switched off, much earlier - by January 2008, rather than the present, wobbly time frame between 2010-12. That is assuming that set top box vendor(s) could deliver by that date.

This approach would enable a trade off between the dual transmission costs of the ABC and the cost of set top boxes. The whole national penetration of the interactive, digital platform in HDTV would be brought forward three years.

Why cannot the Australian Government see this practical solution for launching the digital broadcast platform onto a firmer footing rather than the adventure into the wilderness, all the digital terrestrial networks are going through, worrying about the unpredictable future bottom line.

But then which governments are ever practical?

- Gerald Brown

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