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June 3, 1997updated 05 Sep 2016 12:25pm

DIGITALTV, NOW A BATTLE TO GET BOXES INTO THE HOME – PART 1

By CBR Staff Writer

By Jeremy Wall

The three separate UK groups who will be beaming those ones and zeros by spring next year look like converging not only technically – but in business as well. Just months ago, it seemed that there was a race to go to air. Now we are told that terrestrial boxes will be compatible with satellite boxes and vice versa, and that cable groups are talking to BSkyB and may even wait until they launch to roll out their own box. The cable groups also confirm that their box will conform to the European voluntary standards. Although the dollars may be flickering in the eyes of the media executives, no one company can pull off this imminent televisual digital revolution on its own. While technically, about 85% of the boxes of the three delivery systems are more or less the same, significant elements in the digital receiver – particularly conditional access and the Application Programming Interface which underpins interactive features – have not been standardized, nor has the navigation system associated with electronic program guides. Though further standardization work may follow and may help, it will not guarantee a common receiver on the UK’s likely timetable. If the three go to market as they stand, they might tempt OFTEL or a new Labor government to force regulation. Take a look at an OFTEL Consultative document on conditional access published in December 1996. They provided an answer to viewers who were concerned that they might need different set-top boxes to receive satellite, cable and terrestrial access systems.

Equipment can be upgraded

OFTEL said: Depending on demand, manufacturers may market set- top boxes (or digital) capable of receiving and decoding any combination of satellite, cable and terrestrial transmissions. Again, if there is a demand, boxes may also be capable of decrypting signals encrypted using various technologies. The greater the flexibility of the equipment, the greater the cost. Where little such flexibility is built into equipment at the outset, the provision of interfaces to allow later enhancement by adding modules gives reasonable assurance to the viewer that his equipment can be upgraded at a later date at an affordable price. But before we go into the issues surrounding standardization it may help to take a quick re-cap. Digital signals make better use of the broadcast spectrum – translated this means that the government would love everybody to get a digital decoder so that it could end analog broadcasting and sell off the frequencies for mobile communications. They offer viewers and listeners the opportunity of many more channels, sharper sound and vision, wide-screen, and extra streams of programming and information. A typical set-top box/digital decoder will be as powerful as a personal computer with a software platform flexible enough to run applications from many sources as well as applications specially developed to provide on-line services like home shopping, home banking and games. All of these services are in addition to the 200-plus channels of digital broadcast and near video on demand programming that the box will be able to receive and decode. The decoder will have the processing power to evolve to many future applications and services as the market evolves to compelling graphics-rich services. To allow easy searching of the types of programming or service, the viewer will see an Electronic Programming Guide when the television is turned on, providing continually updated details of programming including trailers for feature films and sporting events, together with unlimited information about programs. The sell sounds good, it might even make you want to go buy one. But before you do, you’ll have to choose between cable, satellite and terrestrial. Cable has a major advantage over the other players. Two-way digital cable is the only interactive platform giving broadband capability into the home. Satellite and terrestrial will still need a phone line to connect to the return path at 28.8kbps. Cable effectively has a built in phone line with a network high speed modem. Telewest, for one, has invested over 500m pounds in the design and construction of a fiber optic, digital broadband network ensuring enough capacity – even if all the street takes it up. The three largest UK cable operators Telewest Communications Plc, Bell Cablemedia Plc (including Videotron Holdings Plc) and Nynex CableComms Group have selected the Next Level Broadband Networks Group of General Instrument Corp as an initial supplier of digital equipment. They were keen to work with a technology company that could supply a turn key solution. Additional manufacturers of set-top boxes to be supplied to the cable companies are expected to be identified later this year. The cable strategy is to provide the boxes with a keyboard as part of a monthly package for the customer. But cable has missed out on developments in Europe. The largest European cable TV company Deutsche Telecom AG, who service some 16 million customers, have agreed with other European groups to create a standard decoder for digital cable television systems across continental Europe. A single Eurobox is expected to reduce costs through standardization and bulk orders.

700m pound subsidy for decoders

The Eurobox will use the Viaccess system developed by France Telecom, which will allow subscriptions to be charged. Digital Satellite, now called BIB, British Interactive Broadcasting Ltd, came to official fruition when British Sky Broadcasting Plc, formed a joint venture with British Telecom Plc, Midland Bank Plc and Matsuishita Electric (UK) Ltd earlier this year. The satellite company has confirmed that orders for one million digital satellite decoders had been placed with four groups – Amstrad Plc, Pace Micro Technology Plc, the UK satellite receiver manufacturer, Panasonic, the Matsushita subsidiary, and an alliance between Grundig AG, the German electronics group, and Hyundai Electronics Industrial Co Ltd of Korea. BIB will provide up to 700m pounds in subsidies for the digital decoders so they can retail at 200 pounds. The company, with an independent chief executive, will have an estimated peak funding requirement of 265m pounds and is projected to be profitable after five years. The providers, who have already signed for the British Interactive Broadcasting’s service to be launched next year, include HMV UK Ltd, the music, video and computer games retailer, food retailers J Sainsbury Plc, clothing catalogue company Great Universal Stores Plc and Dorling Kindersley Holdings Plc. Details on these deals are top secret. Subject to regulatory approvals, BIB’s services will be available to digital satellite television subscribers from next summer following the launch of BSkyB’s 200- channel digital service in the spring.

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