APPENDIX 62
Letter to the Chairman of the Committee
from the Director of the Federation of the Electronics Industry
COMMUNICATIONS INQUIRY—MANUFACTURERS'
COMMENTS
1. Writing on behalf of Consumer Electronics
Manufacturers, I would ask the Culture, Media and Sport Select
Committee to consider the following points in relation to the
evidence given to you and your colleagues by the Secretaries of
State for Trade and Industry, and for Culture, Media and Sport
on 12 March 2002.
2. Television receiver manufacturers welcome
the commitment by Government to the objective of achieving switchover
to all digital television broadcasting by 2010. We believe the
timescale is achievable, providing the current difficulties are
recognised and a radical get well programme is put in hand quickly.
3. Some 37 per cent of UK homes have been
connected to digital television since the launch in October/November
1998. This is a remarkable achievement and has given the UK a
lead world-wide which is in our country's interest to sustain.
However, the vast majority of digital homes in the UK are subscribing
to Pay-TV.
4. It is clear that at least 40 per cent
of UK homes have no wish to subscribe to Pay TV. This substantial
minority will have to be persuaded to migrate from analogue to
digital television and for this there will have to be good quality
Free-To-View digital services. Such services are just becoming
available with the launch of BBC4 and the BBC childrens' programmes.
The further delay to the launch of BBC3 and the questioning of
BBC's right to run a News 24 programme must be greeted with dismay
by all who wish to see the take-up of digital Free-To-View accelerate.
5. Another key factor particularly for the
40 per cent Free-To-View minority is the need to provide digital
television by terrestrial means. This requires Digital Terrestrial
Television to achieve 99.4 per cent coverage of UK homes. It is
inconceivable that a Free-To-View home will voluntarily purchase
a satellite dish and digital satellite receiver. Unfortunately,
the Government has assumed that Digital Terrestrial Television
coverage for the BBC and Public Service Broadcasters need only
reach 80 per cent of the population and the remainder of UK homes
can be expected to receive Digital Television by Satellite, Cable
or ADSL. In their Report to the Secretary of State for Culture,
Media and Sport published in December 2001, the Viewers Panel
stated that ..."arguably Digital Terrestrial Television should
cover 99.4 per cent of the population." We fully support
this view. It is critical requirement to achieving switchover
by 2010.
6. There are suggestions that manufacturers
should be made to supply digital-only TV sets from a certain date.
This would almost certainly contravene EU legislation or would
otherwise be seen as an illegal barrier to trade. It would, moreover,
be very difficult to police. Furthermore, currently such a limitation
of consumer choice might well be in breach of fair competition.
The Viewer's Panel certainly think mandated digital TV sets are
not appropriate at present. Such suggestions mask the real problems
which are related to the poor reception and inadequate coverage
of Digital Terrestrial Television; and insufficient Free-To-View
digital television services.
7. Consumer Electronics Manufacturers have
made significant investment in design and development of digital
television receivers. There is a small but significant market
for integrated digital television (iDTV) receivers which could
grow rapidly if vigorous efforts are made to improve the range
and quality of digital Free-To-View services; and a commitment
made to universal DTT coverage. There is also a substantial potential
market for low cost digital terrestrial Free-To-View Set-Top-Boxes
which could help to transform digital take-up into a mass market.
But to be successful Digital Terrestrial Television coverage and
reception must be greatly improved and the associated Free-To-View
services introduced rapidly and effectively.
8. Should the Chairman and his Select Committee
colleagues wish for further information our industry will be very
pleased to respond.
14 March 2002
| 
