Only Sky can save digital TV

Switch over? Switch off

The real problem is that Ofcom is absolutely terrified that 15 per cent of digital refuseniks are going to kick up a tremendous fuss when their analogue tellies stop working over the next few years. Let's be perfectly honest and state the chances of them running out before digital switchover (DSO) and taking a DSat or Cable subscription are next to zero.

Ofcom and the BBC Trust are also really interested in rapidly pushing through plans for FreeSat, the DSat equivalent of Freeview on DTT. I've always been extremely baffled by this, especially when Sky offers an equivalent service which is fairly priced, but the recent furore in Whitby, which has piqued my interest but not hit the national press yet, provides a clue for the true motivation.

Basically, refarming of any spectrum is difficult - even playing with power levels and mast position will not give the same coverage as before. This could develop into a huge PR nightmare as digital switchover occurs, especially as a lot of channels will not be available outside of the main 80 DTT masts. DSat will be the only economic alternative for people suffering poor reception and the BBC does not want BSkyB to be seen saving the DSO.

People should also not forget this use of the DTT spectrum is Version 2. Version 1 was the bankrupt ONdigital financed by ITV. It should also not be forgotten that BSkyB wanted to be part of ONdigital, but was barred on competition grounds. ITV has obviously admitted defeat on payTV and nowadays seems to take a 100 per cent ad-funded model for all distribution channels including the internet.

However, Channel 4 is still confused: it sort of admitted that selling subscriptions for Film 4 was a big failure; it also seems to want to get out of the game of encrypting its other channels and therefore earning revenue from Sky; yet it is still trying to get consumers to pay for content on the internet.

It should also be remembered that for however much the PSBers whinge and whine, their past and continuing failures in PayTV are completely of their own making and the state subsidised channels have been cross-subsidising these failures for many a year.

In the long-term, we can disregard TopUpTV - which I believe is fatally flawed. TopUpTV requires a different kind of set top box, which receives the free to air Freeview transmissions as well as TopUpTV’s paid for service.

Even with the addition of Setanta content, which is the best shot in the arm for TopUpTV for many a year, I suspect TopUpTV will not be around in the medium term with its current subscription/technology mix.

The lessons to Ofcom are clear: the DTT platform is currently unhealthily dominated by PSBers, there is a huge barrier to entry to new content owners and there is already a flawed PayTV platform using the DTT spectrum, which is basically going nowhere fast.

Basically, I believe Sky is the last hope before the whole of the DTT platform becomes subsumed by the PSBers, which is the outcome that the BBC have wanted all along. This is the question Ofcom should be considering. Instead of wasting its time on preventing Sky's entry, it should be actively encouraging entry. ®

A longer version of this article first appeared on the Telebusillis blog.