Ofcom: the future of digital tv and radio

Ofcom yesterday released the study "The future of digital terrestrial television" and today "The future of radio: the next phase"

You can download "The future of dtt" here: 128 pages

You can download "The future of radio: the next phase" here: 125 pages plus another 125 pages of responses to the
 previous consultation


The Future of Digital Terrestrial Television

Foreword

This is a time of intense innovation and change in UK television. Digital technologies are bringing choice and variety to viewers as never before. Digital platforms, like cable, satellite and broadband, are developing rapidly. They are making new types of content available and new ways of experiencing it, from High Definition to video-on-demand.

Digital Terrestrial Television (DTT) is one very important part of this new television landscape. Digital switchover will mean that DTT services are available throughout the UK – allowing DTT to become the way in which we ensure that the whole country has access to Public Service Broadcasting, free-to-air.

Under the Communications Act, Parliament gave Ofcom important responsibilities for the regulation of DTT. These are wider and deeper than our responsibilities for other television platforms, reflecting the role that DTT has in making PSB content available to all.

We think it is very important that the regulation of DTT allows it to stay at the forefront of broadcasting - adopting new technologies, so it can offer new services, and make the very best use of valuable spectrum. This document sets out our thoughts on how the DTT platform could evolve over the next few years.

In brief, it describes a tremendous opportunity - to begin upgrading DTT by embracing the latest technologies. These have the potential to bring huge increases in capacity to the platform, enabling it to offer richer and more varied services, including High Definition.

Our proposals describe how this huge prize can be achieved without needing more spectrum, while protecting existing viewers’ access to the existing PSB services.

I encourage all those who support the development of the DTT platform – broadcasters, multiplex operators and consumer groups – to work with us to turn this prize into reality.

Ed Richards, Chief Executive
---
The Future of Radio: the next phase

Foreword

Over the last three years radio has occupied two parallel universes.

One universe consists of the experience of millions of listeners for whom things have seldom been better. In terms of choice, listeners not only have more than 300 FM and AM commercial radio stations, a diverse suite of services from the BBC and a range of new community services. Many can also access at least 25 radio services through digital terrestrial television and satellite users can choose from over 90 stations. Through DAB, listeners in the majority of UK cities have access to over 35 digital stations. You can pause and rewind live radio programmes; you can discover more information about radio programmes through text and data services. UK broadband subscribers, now over 50% of the population, also have access to thousands of stations across the world. The BBC’s i-Player and the RadioCentrePlayer position radio at the centre of on-demand developments in the media sector. And the quality of programming is strong too, as radio continues to fulfil important public purposes, illustrated by radio’s importance to communities caught up in floods across the UK this summer.

So from the listener’s perspective, the picture is bright in terms of choice, range, quality of programming and innovation, right across the UK.

But there is another universe. This is the one occupied by those directly involved in running commercial radio stations, where financial pressures have been making it harder to provide those things that the audience expects.

Commercial radio revenues have been declining for several years. While there are some signs of recovery in recent months, the decline in revenues may partly be structural as advertisers move to new media. Competition from the wide choice of stations on digital platforms and from the calls other media place on listeners’ time is fragmenting audiences. These two factors together could mean that the business models of many local commercial radio stations, particularly the smaller ones, cease to be viable.

At the same time, the partial migration of radio to digital has increased transmission costs, generating a debate about whether, like television, we should set a date for radio to abandon analogue broadcasting.

These are serious issues and that is why, in April this year, Ofcom published a consultation entitled The Future of Radio. We recognised the need to try to pull the disparate strands of the radio debate together into an over-arching narrative; but we also recognised the risk of over-simplifying a set of issues which do not easily lend themselves to crisp, over-arching solutions.

Ofcom’s basic stance, however, is very clear. Our job is to interpret and apply the detailed statutory framework which Parliament has created for radio, much of it only four years old, and to advise Government where we see a case for adjustment. It is, of course, up to Government and Parliament whether and when to change this legal framework again.

The current framework is designed to ensure that commercial radio in the UK serves diverse tastes and interests; that it meets the needs of local audiences and that it is protected by ownership rules from the kind of excessive concentration which would jeopardise the plurality of voice which audiences value highly. In the 2003 Communications Act, Ofcom was also given the responsibility to expand the scope of radio. We have done this by licensing a network of community radio stations across the UK – 149 so far. We have also licensed a second national DAB radio multiplex, which was awarded to 4 Digital Group, led by Channel 4 in July this year, and further local DAB multiplexes.

For this statutory framework to be successful, however, commercial radio also needs to thrive as a business. So, in thinking about the application of the legal framework, and its possible modification, Ofcom must balance the goals set by Parliament, and the passions of listeners, against the changing commercial circumstances of the industry. When we propose change, it must be change which makes sense from a commercial perspective, as well as from the listener’s perspective.

Achieving this balance requires Ofcom to make judgments about the likely further development of digital radio. In The Future of Radio consultation document we argued that while it is not yet time to consider establishing a date for a switch-off of analogue radio, we need to think about providing the flexibility for such an outcome. This remains a subject of the utmost importance, but it is also one which requires the direct involvement of Government, as well as Ofcom, broadcasters, manufacturers, consumers and other stakeholders. So we are delighted that James Purnell, Secretary of State for Culture, Media and Sport, has recently announced the formation of a new Digital Radio Working Group, to carry forward this discussion. Ofcom will play a leading role in the group’s work, which we expect to be the focus for further work on the conditions which would need to be achieved before digital platforms could become the predominant means of delivering radio.

There are, however, some specific issues which need not await resolution of the big digital question, and it is on these that this document focuses. Some of these changes are substantial, others more detailed. All go in the direction of reducing regulation – some will say too fast, others not fast enough. But it is our view that this is the pace justified by the evidence, and by our overriding responsibility to listeners. The digital debate has been brought forward and is about to begin - now is not the time to tear up the analogue rulebook.

The immediate issues we tackle here fall under four headings: commercial radio content regulation; commercial radio ownership rules, other radio spectrum issues and rules specifically applying to community radio.

The tensions between the parallel world perceptions of UK radio mean that there will continue to be a vigorous debate about the issues addressed in this document. Ofcom is confident that radio will remain a highly valued part of the UK communications spectrum and we remain committed to playing our part in shaping this important industry’s future.

Ed Richards, Chief Executive David Currie, Chairman