Office of Communications Bill [Lords]

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Mr. Allan: The hon. Gentleman raises an interesting point about the value of the spectrum. I tabled a parliamentary question some time ago to ascertain that value, because I thought that any money coming in could be spent on assisting the transfer. The response came back that no calculation had yet been made in any Government Department of the potential value of that spectrum. The digital strategy is entirely altruistic, and the Government have no pounds signs

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in their eyes; at least when they are giving parliamentary answers.

Mr. Taylor: It is always intriguing that when Governments change, files do not pass across. If we return to the files that existed before May 1997, some figures emerge. Even in those days, I took an interest in what it would take to facilitate the last analogue television sets being switched off. Analogue cannot be switched off if a significant number of people in the country are still clinging to it.

Brian White: Is not one of the problems in this debate that we are concentrating on televisions rather than the access methodology? It is the access methodology, whatever it is, that is important, not the number of television sets, which are simply boxes to receive the signal at the end of the process.

Mr. Taylor: Normally, I agree with the hon. and learned Gentleman—learned in the sense of the industry, rather than of law—but I am not sure that I do in this context because of the psychological importance of the television set. Of course, broadcast in whatever form it takes in a digital age can come to any receiver. As the hon. Gentleman rightly said, that does not have to be the television set. There are active and passive aspects to this. Nevertheless, the television set is an important form and it would be an irresponsible Government who tried to switch off the television sets of people who regarded them as the main way in which they received broadcast information.

I understand the hon. Gentleman's technological point, but there is a psychological issue involved. There is also an economic issue, partly because one cannot release the analogue spectrum until one has switched off all the transmitters. We must also ask how to buy out the last percentages. I hope that now Barry Cox is there, the Government will have a massive campaign to persuade people to switch and that they will encourage set manufacturers increasingly to produce digital televisions and kitemark them.

If my memory serves me well, this country is a significant manufacturer of television sets. It would boost us in our world leadership of television manufacturing if we could generate more purchases of digital televisions. The old days in which television were hardly ever changed are beginning to alter. There is an opportunity to renew through obsolescence rather than for other reasons. If people want to change their set, we should make sure that they buy a digital one.

In any event, there will have to be some campaign to get through the critical mass. Ways must then be found to complete the removal of analogue sets, and they may well require Government funding. Patricia Hodgson, who is now at the Independent Television Commission, has been thinking innovatively—I am not saying that her proposals have my entire support—about how to arrive at an analogue switch-off, and I urge the Minister to take that very seriously.

Returning to the contents of the new clause, the timetable proposed seems to be de minimis. We should not leave things too long and at least this would place a burden on Ofcom to get its act together quickly. In

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doing so—and taking into account the point made by the hon. Member for Milton Keynes, North-East that we are talking about not only the television set but a whole range of broadcasting platforms—we could find a way of reaching the objective of analogue switch-off, and of putting Britain ahead of other countries in that process.

Michael Fabricant: In some ways, we are ahead of other countries. There is already 33 per cent. penetration of digital television reception among households in the United Kingdom. To answer my hon. Friend the Member for Esher and Walton (Mr. Taylor), television penetration stands at about 98 per cent. of households. We have to applaud the BBC and the independent television companies, and latterly Castle Communications and NTL, for achieving that in a country that is not as topologically suitable for terrestrial television as, say, Holland, owing to its lumps and bumps.

The whole raison d'etre of the Bill is the acknowledgement that there is convergence between various technologies. The hon. Member for Milton Keynes, North-East rightly pointed out that this is not only about television, but about the internet and a two-way flow of digital data. However, in relation to new clause 1, it is right to talk primarily about television because that is what is involved in the analogue switch-off. If the new clause said that there should be a deadline of one or two years for analogue switch-off, I would have difficulty in supporting it, but it does not. It simply asks for Ofcom to address itself to the problem and to make proposals.

Why is there urgency in doing so? As you will know, Mr. Gale, from your past experience before coming to this place, for a long time there has been a limit to the amount of spectrum that is available to radio and television broadcasters. We cannot enjoy the situation that exists in the United States, where there is five times the population and about 50 times the land mass. You said, Mr. Gale, that digital television is not available in your part of Kent—nor is it available in Sussex and elsewhere—because of the co-channel interference that it might cause with France, Belgium and Holland. That is a real problem, given the amount of frequency that is available. Yet in this country we have, and are pleased to have, many programme production houses, and there is not sufficient channel space to enable all their programming to be made available unless we go digital.

We should continue to stimulate the digital economy to force Ofcom to come up with proposals. It is all very well for the Government to say that they would like to see analogue switch-off, but it needs to be dealt with. I wish that I could cast my mind back to the days when we switched off 405 lines—VHF transmission—and went on to 625 lines. I do not know how many television sets were still receiving black and white television on VHF, but I think that it was quite a large proportion.

I understand that members of the Committee may be worried that analogue switch-off will deprive people of being able to watch television. There has already been talk about auctioning off frequencies that would be made available by the switchover. Will the Minister

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consider earmarking a small part of the money from that to provide digital set-top boxes to enable everyone to watch digital television?

I disagree with my hon. Friends the Members for Vale of York and for Esher and Walton in that I do not believe that the way forward is to stimulate manufacturers to produce digital televisions. As the hon. Member for Sheffield, Hallam (Mr. Allan) said, there are many ways of delivering digital television—as well as various platforms—such as different sample rates and so on. Technology changes. As a consequence, set-top boxes can and will change in future.

There is flexibility in having an analogue set that can be attached to different types of set-top box. If one buys a digital television, one might be quickly lumbered with old technology; different ways of delivering digital encryption to enable the picture to be shown will create real problems if decryption, or decoding, from digital to analogue is built into the television. It is not as easy as merely switching over to a set-top box.

5.45 pm

I plead with the Minister not to get too many pound, dollar or, God forbid, euro signs in his eyes with regard to the auction. It was interesting this morning when Sir Christopher Bland, the new chairman of BT, was giving evidence to the Select Committee on Culture, Media and Sport. I asked him about the burden of debt that BT has and he was able to reassure us that it has reduced somewhat. I also asked him whether he thought it had been an effective sell-off and he said, ''Well, it was a good auction for the Treasury, but in the long term not necessarily a good auction for Great Britain Ltd., because in some ways it will restrict the actions of BT and others who have paid such an inflated rate.''

Mr. Taylor: That is an intriguing point. As the auction was thought up by the previous Conservative Government, I find it difficult to criticise it. However, I must say that it was not the Government who upped the bidding, or who delayed the process until we hit the boom in the stock market. The then British company One–2-One delayed the whole exercise through legal processes until the bidding became frenzied. My criticism is not of the amount of money that was raised from consenting adults in companies, but of the fact that the Government did not use some of that money to reinvest in the process of analogue switch-off.

Michael Fabricant: I welcome that intervention, and I suspect that I shall have an interesting discussion on that subject with my hon. Friend outside this Committee Room. Of course, they were consenting adults working for consenting companies, but the bottom line is that the Treasury was effective in ensuring that it gained the maximum amount of money from the auction. Whether that will benefit the industry in the long term is a moot point.

There is a sad and major omission from the Bill of any discussion about analogue switch-off. I cannot recall the complexion of the Government who took the bull by the horns and made the brave decision that

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there would have to be a switch-off from VHF television—bands 1 and 3—to enable UHF television, which has 625 lines, to go ahead. Perhaps it was a Labour Government. This Government must also make a decision sooner or later. If they leave it too long, a Conservative Government will make it in three, four or five years; possibly sooner, depending on industrial action.

The Government are going to have to address the question of analogue switch-off, which is a major omission that has not yet been addressed. I am now tired; I have spoken at length and shall now be seated.

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