SA will not meet digital TV deadline: Ovum

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South Africa will fail to meet the mid-2015 deadline, agreed to with the International Telecommunication Union (ITU), to switch off analogue terrestrial television broadcasts, according to an international research firm. Consulting and research firm Ovum says most sub-Saharan countries, including South Africa and Nigeria, will fail to meet the deadline they agreed to with the ITU, which forms part of the United Nations.

Countries in the region agreed to the deadline, after which the ITU will not protect their traditional analogue TV frequencies from cross-border interference.

In a media statement, Ovum blames a lack of awareness among the public that an analogue switch-off is impending and inadequate funds being made available by governments to roll out digital TV infrastructure. There is also an insufficient supply of set-top boxes in many of the markets.

South Africa has missed a number of self-imposed deadlines to introduce digital broadcasting. The country lost a year of the process after government vacillated over which standard to use for digital TV. More recently, a high-stakes battle between MultiChoice and e.tv over whether free-to-air digital set-top boxes should use a control system based on encryption has led to further significant delays.

Although most countries in the region are unlikely to meet the ITU deadline, the prevalent mindset among many governments and regulators is that the deadline must be met at all costs, says Ovum.

“As a consequence, numerous sub-Saharan TV markets are considering switching off analogue TV signals before the audience has transitioned to digital. This would mean many homes will lose TV reception, leading to advertisers switching away from TV and, in turn, a decline in TV advertising revenue.”

In Tanzania, the switchover process was pushed through recklessly, with damaging results, says Adam Thomas, Ovum’s lead analyst for global TV markets. “Thousands of homes lost their ability to watch TV and advertising revenue suffered as a result. But this mentality to rush the process persists, not least in Kenya, which seems intent on repeating the same mistakes.”

According to Ovum, there is an “understandable eagerness among regulators to raise revenue from the sale of the spectrum that will become available following analogue switch-off and which will, most likely, be snapped up by mobile operators”. This is leading to a “rushed switchover”, the firm says.

“While the sale of spectrum will benefit the mobile sector, regulators could harm the TV business if they act with undue haste to get their hands on potentially lucrative spectrum,” says Ovum Ismail Patel, who tracks media and entertainment across the Asian, Middle Eastern and African regions.

“African governments and regulators need to accept that the 2015 deadline will be missed and shift their focus on to getting the process completed as quickly and efficiently as possible. Ovum believes that forcing through analogue switch-off is ultimately counter productive,” Patel says.

Ovum says initial digital TV launches are dominated by pay operators such as StarTimes and MultiChoice. “This has created a sector where the paid digital terrestrial television option represents an artificially high percentage of total homes using digital to receive TV. This is an issue because people will be less willing to transition from analogue to digital TV if they believe this will mean they have to start paying for TV. The result is that more than 90% of terrestrial TV was still analogue at the end of 2013,” the company says.

According to Thomas, the early focus on pay digital TV in Africa has created a misconception among the sub-Saharan audience that the technology is intrinsically a paid service.

“Once there is awareness that it can be received without payment, then free-to-air digital TV will be the overwhelming choice for most homes and the transition from analogue to digital will be better placed to proceed.” 

Source: TechCentral  22 July 2014