Law and Bills Digest Group
23 June 1998
Major Issues Summary
The Objects of the Broadcasting Services Act
Analog Technology and Analog Television
Digital Technology and Digital Television
High-Definition Television (HDTV)
Mobile and Cordless Television
A new Marketplace?
Key Elements of Policy-Broad Reactions
The conditional eight year period
The HDTV mandatory preference
Prohibition on multi-channelling and
ABC and SBS funding
Appendix 1: Technical Matters
Australian Broadcasting Authority
Australian Broadcasting Corporation
Australian Communications Authority
Australian Football League
Australian Subscription Television and Radio
US Advanced Television Systems Committee
Consolidated Revenue Fund
Digital Terrestrial Television Broadcasting
Digital Video Broadcasting
Federation of Australian Commercial Television
Federal Communications Commission (US)
Gross Domestic Product
High Definition Television
acronym for American standard analogue
television transmission system
Organisation for Economic Co-operation and
acronym for Australian (and some European)
standard analogue television transmission system
Special Broadcasting Service
Standard Definition Television
Spectrum Management Agency
Time Base Corrector
Analog technology has been used from the
beginning of television broadcasting worldwide to provide viewers
with analog television programs via the broadcast spectrum. Now,
analog is about to be superseded by digital technology-a highly
advanced form of electronic delivery. This new form of delivery
enables the broadcast spectrum to be used far more efficiently than
in the past, allowing licence holders to offer consumers a greater
choice of content-in addition to traditional television
programming. Digital broadcasting also allows for the introduction
of high-definition television.
The proposed start-up date for digital
television in major metropolitan areas for free-to-air television
is 1 January 2001. The estimated cost of the necessary
infrastructure upgrading of the three commercial networks is about
$500 million in capital investments in the first three to four
years with estimated additional operating costs of $30-50 million
annually. For the ABC and SBS, the combined cost may be around
Digital broadcasting is being introduced on a
relatively tight timetable that has implications for both industry
participants and the making of public policy. Large economic
'rents' are involved and whatever public policy choices are made
will affect the daily lives of most Australians.
Whilst the introduction of digital television
has the capacity to excite widespread public discussion, interest
to date, as one would expect, has been greatest among industry
participants and others, including the growing list of converging
media and communications companies, directly affected by the
Government's 24 March 1998 announcement.
The high start-up costs, a sense of urgency
stemming from pressures, including industry's need to secure access
to the currently scarce broadcast spectrum, has influenced
policy-makers to expedite matters.
Legislation, principally the Television
Broadcasting Services (Digital Conversion) Bill 1998, has been
prepared and the Government's associated announcement has set the
parameters for public discussion and the substantial work and
investment program that is to follow.
Given the sums involved and the power
potentially wielded by those with access to the new technology, it
is also not surprising that the Government's plans have been
contested by some in the industry as well as by some 'outsiders'.
Significantly, the Australian television industry's contribution to
GDP is similar to that of our textiles, clothing, footwear and
leather industry's contribution to GDP. Given the stakes and the
number of potential 'players', any plan is unlikely to please
The commercial broadcasting networks, through
their industry representative the Federation of Australian
Commercial Television (FACTS), argue that they should be given free
and exclusive use of the spectrum for a sufficient period of time
in return for implementing and financing the high cost of digital
A coalition, including newspaper rivals News Ltd
and John Fairfax Holdings, communications companies Telstra, Optus,
Foxtel and the Australian Consumers' Association, claim that
consumers have been kept in the dark while a decision of staggering
proportions has been made.
Public broadcasters, the ABC and SBS, have
necessarily focussed on funding issues.
Access to the spectrum will place the incumbent
and any new licence holders at the forefront of what may be the
technical equivalent of the industrial revolution-digital
Government regulation and licensing of the
spectrum will affect not only how we are educated, entertained and
informed, but how we educate, entertain and inform others,
how we shop, how we keep healthy, how we monitor governments,
access the arts, culture and the humanities, how we participate in
local, state, national and international affairs and how we apply
for the jobs which all this will create.
Policy aside, the Television Broadcasting
Services (Digital Conversion) Bill 1998 amends an Act that
primarily relates to analog technology. It will add to a
legislative framework that does not primarily deal with digital
technology and the possibilities it creates. The main objects of
the Act are to promote a diverse range of radio and television
services offering entertainment, education and information in
a framework, which is competitive and responsive to audience
The Organisation for Economic Co-operation and
Development (OECD) has redefined broadcasting services to
properly reflect the new possibilities which digital television
offers. Australia has yet to do so.
Two questions arise-first, is the current
legislative framework the most appropriate to deal with the
introduction of digital television? Second, have all the
issues surrounding the introduction of digital television been
Current debate and public discussion of the
proposed introduction of digital television is focussed on the
Television Broadcasting Services (Digital Conversion) Bill 1998
(the Bill) introduced on 8 April 1998 to facilitate the
introduction of Digital Terrestrial Television Broadcasting (DTTB)
in Australia. The Bill is to amend the Broadcasting Services
Act 1992 (the Act) to provide for the conversion from analog
to digital television. The Bill also amends the
Radiocommunications Act 1992.
Commercial television broadcasters are set to
use new rights under the provisions of the Bill to commercially
exploit a limited and extremely valuable public resource-spectrum
space. The Bill carries forward the recommendations of the
Australian Broadcasting Authority (ABA) for the introduction of
This paper provides a background on the proposed
introduction of the Bill. A recent Senate inquiry into the
Government's proposed legislation has heard conflicting evidence on
the need to fast-track legislation. Senate debate is scheduled for
the week commencing 22 June 1998.
The main elements of the Government's proposed
legislation are as follows:
- the commercial and national free-to-air television broadcasters
(FTAs) will be lent 7 mega-hertz (MHz) of spectrum free of upfront
charge. In return they will be required to simulcast their existing
service in analog and digital format for 8 years, after which they
will have to return the equivalent of their loaned spectrum to the
- FTAs will be required to commence DTTB in metropolitan areas by
January 2001 and in regional areas from that date onwards so that
all areas have DTTB by 1 January 2004
- following the start-up of DTTB, the FTAs will be required to
broadcast minimum levels of high-definition television (HDTV), with
these levels increasing over time. If the FTAs do not comply with
these requirements they will forfeit their loaned digital
- FTAs will be able to use that part of their loaned spectrum not
utilised for DTTB to provide datacasting services, but will have to
pay fees to ensure that they do not have an advantage over non-FTA
datacasting providers. Available broadcasting spectrum not required
by the FTAs for digital conversion will be allocated on a
competitive basis for the transmission of datacasting services,
which will commence at the same time as the transmission of DTTB.
Existing FTAs will not be permitted to bid for this spectrum.
- FTAs will not be permitted to use their digital spectrum for
multi-channelling or subscription television services, although
they will be allowed to provide enhancements directly linked to
programs simulcast on their analog channel
- the prohibition on new commercial FTA entrants will be extended
until December 2008
- the current local content requirements will continue to apply
in the digital environment. In addition, the FTAs will be required
to provide closed captioning for all prime time programming as well
as for news and current affairs broadcast outside prime-time
- the Government is still considering the funding requirements
for the ABC and SBS for digital conversion, as well as whether the
national broadcasters will be permitted to broadcast non-commercial
multi-channel programming in line with their charter
- a number of committees comprising representatives of the
Department of Communications, Information Economy and the Arts, the
Australian Broadcasting Authority (ABA) and the Australian
Communications Authority (ACA) will be established to advise on
regulatory and technical matters relating to the
There has been a broad range of views on the
appropriate policy for Australia. Prospective new participants have
spent considerable time and money lobbying the Government arguing
for a level playing field in spectrum allocation.
In response to the Government's policy:
- the Federation of Australian Commercial Television Stations
(FACTS) argued that the FTAs should be allocated 7 MHz of spectrum
free of charge, with a 15-year period of exclusive use. This would
enable the introduction of HDTV, the simulcast of existing analog
channels, and the absorption of the cost of the conversion. FACTS
would also like its members to have the freedom to offer
multi-channel services. The Australian Association of National
Advertisers has supported the FACTS position
- the Australian Subscription Television and Radio Association
(ASTRA) has questioned the commercial viability of HDTV and has
argued for a system that is based on the competitive pricing of
spectrum and which provides an opportunity for the entry of new
players. ASTRA is, in particular, opposed to the FTAs being
permitted to offer multi-channel services using spectrum they have
been given free of charge
- the ABC has asked for access to sufficient spectrum to allow it
to either broadcast HDTV or to multi-channel. The Managing
Director, Mr Brian Johns, has stated that the ABC hopes to be able
to run up to four channels at different times of the day. The ABC
has also claimed that it would cost over $100m over the next 3-5
years to prepare for digital broadcasting and that the ABC could
only cover about half these costs. It has been reported ('ABC
closer to victory in war on outsourcing', The Australian,
7 April 1998) that a funding review of the Corporation by
consultant Arthur Andersen has concluded that it will have a
deficit for the digital transfer of $30-$50 million over five
years, given projected costs of $190-$220 million
- Telstra has argued against the allocation of free spectrum to
the FTAs as it would threaten its investments in data and online
services, the broadband network and Pay-TV. It believes that if the
FTAs wish to enter these areas then they should be subject to a
competitive bidding process
- regional television broadcasters have supported the FACTS
position and have also argued for a prohibition on new entrants in
regional television markets until the end of the transition period,
a licence fee rebate and tax relief on infrastructure inputs. They
believe that special arrangements are necessary to achieve digital
television in regional areas within a reasonable timeframe
- Internet service provider, OzEmail, has argued for the setting
aside of spectrum earmarked for digital TV for the introduction of
interactive data services. Other independent online content
providers have expressed concern that the FTAs might eventually
control future Web TV services, where users can access the Internet
through a television set, as well as digital television.
The ABA convened the Specialist Group, which
considered the application of digital transmission technology to
terrestrial broadcasting in Australia. In January 1997, the final
report of the Specialist Group, Digital Terrestrial Television
Broadcasting in Australia, was presented to the ABA for
consideration. The recommendations of the Specialist Group outlined
policy issues to be addressed, considerations and actions that flow
from threshold decisions, and implementation considerations.(2)
of the Broadcasting Services Act 1992.
The main objects of the Act are to:
- promote the availability to audiences throughout Australia of a
diverse range of radio and television services offering
entertainment, education and information
- provide a regulatory environment that will facilitate the
development of a broadcasting industry in Australia that is
efficient, competitive and responsive to audience needs
- encourage diversity in control of the more influential
- ensure that all Australians have effective control of the more
influential broadcasting services
- promote the role of broadcasting services in developing and
reflecting a sense of Australian identity, character and culture
- promote the provision of high quality and innovative
programming by providers of broadcasting services.(3)
The main issue here is whether this legislative
framework, which deals primarily with analog technology, is
appropriate to facilitate the introduction of digital
The Final Report (the Report) of the ABA's
Specialist Group specifically addresses this issue:
The Act is concerned with the regulation of
broadcasting content and broadcasting content providers rather than
the carriage of the program which is subject to regulation under
either the Radiocommunications Act 1922 or the
Telecommunications Act 1991 depending on the means of
The widespread adoption of digital technology
for broadcasting delivery will require reappraisal of some of the
current rules so that they might assist in the development of
service diversity and in the development of new and innovative
services that take advantage of the capabilities of digital
With digital technology the current concept of
what constitutes a channel largely disappears. The service is
delivered by a digital data stream that may contain one or many
services embedded in it. Furthermore, what might be a high
definition single video channel at one time (say for live sport)
might become four or five lower quality movie channels at another.
Should each of these video channels constitute a separate service
if they are not in a state of continuous program transmission?
Would multi-program transmission time require the programs to be
defined as separate services? Depending on how this issue is
resolved would the present limit of one television service per
market continue to be relevant? If not, how should the limits be
The Specialist Group also makes the point that
the distinctions between broadcasting and other services will
inevitably continue to blur as the transmission technologies
Analog Technology and Analog Television
The current television picture is based on an
analog transmission system that is over forty years old. Australia
used this system when television broadcasts began in 1956. The only
significant advance in analog television since has been the
introduction of colour television in 1975.
Technically, the analog signal can be easily
distorted as it travels through the air from the television station
to the home and may produce ghosting or picture noise. Analog also
requires the full aspect or bandwidth of the spectrum and a clear
and unobstructed delivery path from broadcaster to viewer.
Technology and Digital Television
Digital technology allows the spectrum to be
used, not only for television programs, but for Internet service
providers, datacasting networks, educational institutions,
community, indigenous and ethnic groups, banks and financial
institutions, radio broadcasters, governments and political
parties, information service providers-the list goes on.
Currently, 7 MHz of spectrum space is used to
deliver each channel of analog television to our homes. The same
7MHz of spectrum space will be used for digital television.
However, digital television will be radically different. Unlike the
analog signal, a digital signal does not easily distort as it
travels through the air. The pictures at home will be exactly the
same quality as the one that is transmitted by a television station
(no ghosting or picture noise). The pictures will either arrive
'picture perfect' or it will not arrive at all. In addition, this
new digital technology offers broadcasters a technique called
compression which, as the name suggests, allows the
television signal to be compressed, thereby enabling the same 7MHz
of spectrum to carry more channels. Furthermore, because the
current analog system cannot be compressed, part of the broadcast
spectrum is used as a barrier between channels to eliminate
interference. New digital engineering now enables this 'junk
spectrum' to be used commercially. The capacity or use of the
spectrum is therefore enhanced or enlarged by digital technology.
It offers a far more efficient use of the spectrum, thereby
optimising its use and substantially increasing its value.
Digital technology now offers far greater
alternatives to licensees of the spectrum. The concept can easily
be understood if we think of digital television as being
the delivery system of digital technology. All those
possible spectrum uses mentioned earlier could simply be provided
to the consumer through digital television.
Digital technology enables the spectrum to be
used in a number of ways:
High-Definition Television (HDTV)
Digital technology will allow programs to be
broadcast in much higher resolution or clarity than today's
television. This is called high-definition television, or HDTV.
Purchasers of an HDTV set will be able to receive high quality,
crystal clear pictures displayed in a wide screen 16 x 9 aspect
ratio format. Our current television ratio is a 4 x 3 'box square'
aspect ratio format.
An HDTV set will deliver CD quality sound
through high quality speakers and may incorporate laserdisc and
digital video technologies, offering a complete 'movie theatre'
experience in the home.
When programs are not being broadcast in HDTV,
digital technology will allow each station to transmit not one, but
four or more standard definition programs simultaneously. This is
called Standard Definition Television (SDTV) or
'multi-channelling'. Multi-channelling requires the use of
compression technology, which is not possible with today's analog
Digital technology will give broadcasters the
capability to transmit data over the air regardless of whether
programs are being broadcast in HDTV or SDTV. This may include
content from the Internet, text, Web TV (explained later) or simply
information running 'in sync' with TV programs.
Mobile and Cordless Television
Australian engineers have recently chosen the
European standards transmission system (DVB) over the American
standards transmission system (ATSC). This will enable digital
television to be transmitted and received in a mobile environment.
Laptop computers could be adapted to receive all of the above
features of digital television.
In summary, digital technology gives digital
television three combinations of features which analog television
- HDTV (high-definition)
- SDTV (multi-channelling) and
- Data Transmission.
- Mobile and Cordless Television.
This offers broadcasters a great amount of
flexibility to deliver a colourful mix of video, audio, text and
data to the Australian public.
Interested new participants argue that digital
television could facilitate a whole new media market generating
consumer benefits from the convergence of traditional newspaper and
television content.(5) Firstly, their contentions are that a level
playing field should be set in place from the outset and secondly,
that market mechanisms should be used to allocate spectrum.
This concept of a new marketplace raises issues
of definition and interpretation. The traditional definition of
'broadcasting services' was specifically addressed in a report by
the Organisation for Economic Co-operation and Development (OECD)
titled Communications Outlook 1997, which provides:
A 'broadcasting service' is defined as
point-to-multipoint transmission of information by electronic
means. Traditional examples include the broadcast of television and
radio services from terrestrial towers, as well as satellites and
cable television networks. More recently the development of packet
switched data networks, such as the Internet, has brought forth a
new range of broadcasting services.(6)
In Australia, the Act specifically
excludes a service that provides no more than data or no
more than text (with or without associated still images). The Act
also excludes a service that makes programs available on demand on
a point-to-point basis, including a dial-up service.
The OECD report also points out that:
By 1996 the broadcast of audio signals via the
Internet had become relatively commonplace and video signals were
being offered. A large number of radio stations broadcast
programming by traditional means and via the Internet. At the same
time a growing number of events are broadcast using video over the
Internet technologies. Moreover new services are emerging that use
the Internet to broadcast news and information. These Internet
based services very much challenge the traditional concept of
broadcasting as point-to-multipoint transmission because they may
derive information from multiple sources and can be customised to
meet the demands of individual users.
While not all Internet broadcasting services yet
match the transmission quality of traditional media, development is
proceeding apace. It is increasingly clear, as different
infrastructure providers upgrade their networks and capabilities,
that convergence is not simply a matter of new services being
delivered over the public switched telecommunications networks.
Indeed one of the major benefits of the Internet has been to
engender new ways of thinking about the delivery of service. This
point is fundamental to information infrastructure policy for OECD
As a matter of interest, the same report
provides that the contribution of terrestrial television
broadcasting service revenues to GDP in the OECD area was 0.41 per
cent in 1994. Australia was well above this average at 0.58 per
Estimates of OECD television broadcasting
revenue (excluding cable television) increased at a growth rate of
6.1 per cent on average from US$75.2 billion in 1992 to US$84.7
billion in 1994.(8) In 1994, the average revenue on television
broadcasting services in the OECD area (excluding cable television
revenues) was US$84.75 per capita. Australia's figure was again
above this at about US$105.00 per capita.(9) The disparity in these
figures may be due to a higher ratio of cable television revenues
in OECD countries than in Australian. As the survey states, cable
television revenues have been excluded.
If a new marketplace were to evolve in
Australia, digital television would simply be the conduit to the
marketplace-a highly efficient delivery system using the spectrum
as the highway of delivery.
John Fairfax Holdings argues that a new
marketplace requires a level playing field and lobbied heavily for
the spectrum to be auctioned, submitting that:
The networks get free and uncontested access to
the digital broadcast spectrum for eight years, Pay-TV operators
get protection from the network's muscling in on their turf, and
the Government gets some very grateful people in some very
influential places. On the other hand, television viewers miss out
on the choice that new operators would have brought to the
industry. Fairfax, like other telecommunications companies and
Internet service providers, had argued for an auction of the
digital broadcast spectrum rather than it being given away to the
commercial networks. This alternative would have delivered to the
Government several billion dollars in revenue up front, plus a
steady cash flow each year in the form of annual licence
It would seem that Fairfax considers the
possibilities of a new marketplace both lucrative and laced with
possibilities. A recent newspaper report states that Fairfax has
estimated the opportunity cost of giving the spectrum to the FTAs
is from $1 billion to $2 billion.(11) However, auctioning the
spectrum must also be considered in the light of Australia's
International government agencies divide the
radio frequency (RF) spectrum into bands for various purposes. In
Australia, the Spectrum Management Agency (SMA) allocates these
bands into channels for specific purposes which optimise the
special characteristics of each frequency band. If RF channels were
auctioned, who would control Australia's interests in the
international management of the spectrum?(12)
The Bill has received a mixed reaction from
industry participants, interested players and others. The main
- the conditional eight year period of free spectrum use to
- the mandatory preference for HDTV
- that available broadcast spectrum not required by the FTAs will
be allocated on a competitive basis for datacasting only
- that commercial FTAs cannot use the spectrum for multi-channel
- ABC and SBS funding.
The comments of Mr Jock Given, Director of the
Communications Law Centre (University of NSW) are relevant:
So the commercial networks which get frequencies
can't use them to provide multi-channel TV services, because that
would be competition for the Pay-TV business. And the new players
which get frequencies for datacasting can't use them for TV
services, because that would be competition for the free-to-air TV
business. Policy is made by keeping the warring commercial
interests equally unhappy, rather than encouraging the creative
exploration of the capabilities of a new and cost efficient
technology to provide a flexible and interesting service
This summation might be contrasted with the
relatively unrestricted playing field of the electronic commerce /
information technology / Internet sector which is moving forward
under a mutually convenient and industry co-operative approach.
conditional eight year period
The spectrum is an extremely valuable public
resource. Under the plans outlined by Senator Alston it is to be
- the commercial FTAs, the ABC and SBS
- free of upfront charge
- for a minimum period of eight years (to protect the capital
investment costs of conversion)
- on condition that all programs be simulcast until the end of
the eight year period.
Senator Alston has said:
I'd take a lot of persuading that we should be
asking the free-to-air networks, and that includes the national
broadcasters, the ABC and SBS, to pay up front when they will
clearly have to make a significant capital investment which will
not expand the market or expand advertising revenue.(14)
Although Australia is not as 'digitally
advanced' as our European equivalents, digital equipment has
nevertheless been used throughout the broadcasting industry for
some time. As one commentator has recently noted:
In the TV production studios, digital stages
have been used for twenty years. When I built a small television
studio at the Australian Film, Radio and Television School in 1977
we spent about a quarter of the budget on a digital time-base
corrector (TBC) to stop the side-ways shake of lines generated by
the early videotape recorders. Today, much better TBCs are built
into home camcorders. So there is nothing new in having digital
stages in the process of passing the original image through the
system to the end viewer. We are just adding one more digital stage
in the end-to-end process. We are now about to transmit the signals
in digital form.(15)
Further to this, analog equipment is old by
world industry standards. Capital expenditure on upgrading plant
and equipment, as in any other industry, is due and required. It
follows that the 'conversion' to digital may not be as dramatic as
some may believe. Full digital format might therefore be considered
as a natural and necessary industry progression.
Of course, there is no questioning the fact that
the FTAs will have to spend a considerable amount of money to
transmit in digital format. The question is, how much will they
have to spend? Recent newspaper reports suggest an amount of $740m
in capital expenditure.(16) Only when this question is answered is
it appropriate to ask whether the cost to full digital transmission
equates fair and reasonably with free spectrum use for
eight years. The very nature of technology and its rapid advance
also questions this eight-year period of free spectrum. As
mentioned earlier, the true value of the spectrum is largely
unknown and will remain so until the marketplace can be properly
Is there a public interest in locking out
competition until 2008, particularly in this rapidly advancing
technological climate? Reed Hundt, former Chairman of the US
Federal Communications Commission maintains that:
competitive telecommunications services are
crucial to economic development. For years, the World Bank took the
view that a telecommunications network was essentially a luxury
that only developed economies could afford. Today, even the World
Bank recognises that telecommunications is not a luxury, but a
necessary tool for building a developed economy.(17)
The government's decision protects the capital
investment of the FTAs digital transmission start-up costs. There
is, nevertheless, a strong argument favouring a competition-based
telecommunications legislative regime to be set in place to
coincide with the introduction of digital television, an approach
which would fall in line with the 'spirit' of the Trade
Practices Act 1974. However, to properly consider this
argument, the cost of digital transmission implementation must also
be considered. Who will, or should, be left with the burden of
infrastructure start-up costs? Equitable principles suggest that,
to gain the benefit, one must first suffer the burden. Perhaps a
flexible licensing and revenue mechanism is more appropriate.
From the start-up date of 1 January 2001, the
FTAs will be required to broadcast minimum levels of HDTV, with
these levels increasing over time. To receive HDTV directly,
consumers will need to purchase a special wide screen
high-definition digital television set. The quality is
substantially superior to the current analog TV sets. Senator
Alston has said:
It will enable the cinema and the concert hall
to be transported to the home.
The wide screen is indeed impressive, but will
it benefit many Australians? First, most consumers do not have
living rooms large enough to fully complement the use of the HDTV
wide screen. Indeed, the size of our current television sets is
made to fit the average size variants in Australian living rooms.
Further, to optimise the use of HDTV, the lights should be turned
off, just like in the cinema. Viewing habits indicate that watching
television is often only peripheral to general household
Second, the cost of an HDTV set will be 'several
thousand dollars' as the Department of Communications, Information
Economy and the Arts has stated.(18) Newspapers have reported the
cost at around $7500-$10 000 each.(19)
Third, the overseas experience tells us that the
HDTV option may encounter significant problems. Reed Hundt, former
Chairman of the US Federal Communications Commission (FCC) said in
The FCC's plan was first developed in response
to the Japanese industrial policy of promoting of high-definition
television. Most observers call Japan's policy a flop.
Nevertheless, the FCC has continued to pursue its own
high-definition scheme. The idea was that broadcasters would use
the new spectrum to transmit just one signal that would be
simultaneous and identical to the analog signal, except for its
high-resolution, or so called high-definition. This high-resolution
picture would presumably be so attractive that Americans would
naturally elect to purchase the new high-definition televisions.
Then standard TVs would be abandoned and today's analog spectrum
could be returned to the public and used for other purposes.
Therefore, the scheme was labelled a transition, and the new
spectrum was called a second channel.
It turns out that the engineering consortium
called the Grand Alliance has invented something more than a
prettier picture. Instead it has discovered a genie in a bottle.
Maybe you want to broadcast multiple signals of higher resolution
than today's signal, or dozens of audio signals, or software
packages, or thousands of pages of text, or a pair of very
high-resolution movies. The digital genie can grant all of these
wishes within the 6MHz(20) that were originally thought capable of
transmitting only one program.
The digital genie has made terms 'second
channel' and 'high-definition' historical artefacts. Their use
constrains our imagination and confines our vision to the idea of a
forced transition from analog to digital spectrum.
A high-definition quota is the same thing as a
requirement that broadcasters devote a very high percentage of
their digital bitstream to just one of the Grand Alliance's 18
formats. It's the digital equivalent of ordering the New York Times
to publish just one 22-page section on high-gloss paper instead of
the four sections in today's newspapers.(21)
Jock Given, Director of the Communications Law
Centre (University of NSW) makes the following point:
This is a very expensive punt. Broadcasters are
worried about the hundreds of millions they will have to spend, but
the great issue of digital TV is the need for people to spend
billions on new TV sets and VCRs to be able to get access to the
services. And if you haven't upgraded when the analog signal gets
turned off, you get no television.(22)
Blair Levin worked on the digital television
proceeding as Chief of Staff for the Chairman of the US Federal
Communications Commission. On HDTV, he says:
After the spectrum was awarded in the US,
broadcast executives admitted that despite all the talk about
high-definition, they weren't sure that's what they were going to
do. One exception to the broadcaster confusion is the Public
Broadcasting System, which has consistently said they will use the
spectrum to multi-cast (multi-channel).(23) The other exception is
the Fox Network, which has also consistently said they will
multi-cast in standard definition.(24)
After the broadcaster uncertainty was
publicised, the US Senate Commerce Committee held a hearing in
which the broadcasters uniformly testified that their only goal is
transitioning to high-definition television. A poll of broadcasters
revealed that by a 52 per cent to 39 per cent margin, broadcasters
feel multi-channelling holds more promise than
With respect to picture quality, viewers may not
gain any benefits whatsoever from watching many current Australian
television programs. The content of Network 9's popular
Australia's Funniest Home Video Show is shot entirely by
home viewers (except studio content) on very poor quality domestic
camcorders. The ABC's successful Race Around the World
program is shot on new digital camcorders. These camcorders are
lightweight, durable, easy to use and very affordable. They are
made for a specific market focusing on content rather than quality
and cost far less than standard professional cameras. Though the
quality is inferior to that of professional cameras, their weight,
size and user friendly features allow programs like Race Around
the World to be made. The success of these two programs would
seem to suggest that content, rather than quality, might be the
preferred consumer choice. On the other hand, sport, movies and
arts programs would have a greater appeal viewed on HDTV sets.
Using the AFL example, a television camera, fitted with a
wide-angle HDTV lens, would enable viewers to 'read' the game far
more effectively than now. A wider aspect viewing ratio would take
in most of the field of play. It follows that the choices available
favour a flexible policy option.
When colour television was introduced in
Australia in 1975 the cost of a set soon fell to an affordable
level for most consumers. Manufacturers were able to reduce prices
once worldwide consumer demands grew. Similarly, if HDTV
broadcasting were to be a worldwide preference then the cost of a
set would no doubt fall from the estimate mentioned earlier in this
paper. However, it is important to note that the Government's
mandatory HDTV preference policy is unique to Australia.
As a final point, the Federation of Commercial
Television Stations Technical Committee (the Committee) has
recently reversed its thinking on DTTB standards for Australia. By
initially promoting the adoption of a US DTTB standard, the
Committee believed this would ensure an early supply of HDTV
receiving equipment based on supplies to the US market. However,
demonstrations of the European DVB system, held only recently in
Australia by members of the European broadcast industry standards
consortium, convinced the committee to adopt the European DVB
system. A statement released by FACTS on 18 June 1998 hailed the
decision as an important milestone in establishing a framework for
the introduction of digital broadcasting in 2001. The detailed
standards will involve considerable work needed for the completed
definition of the system to be customised for Australia.
Government policy attempts to balance the
competing commercial interests of datacasters and FTAs. If FTAs
wish to provide datacasting services, they will have to pay.
A new feature of datacasting is the emergence of
Web TV. Users do not need a separate personal computer (PC) to gain
access to the World Wide Web (the Web). A Web TV set-box is simply
incorporated into the TV. In addition to Web access, software
companies, in conjunction with broadcasters, are developing
information systems to complement traditional forms of programming.
Consumers could be fed information running alongside or 'in sync'
with television programs. For example, if an Australian Football
League (AFL) match coverage were to focus on a particular player, a
small icon could be placed on the screen offering a 'player
profile' to viewers which, when 'double-clicked' by the viewer,
would appear superimposed over the 'live' action in a small box at
the corner of the screen. In addition, wildlife documentaries,
lifestyle programs, news and current affairs and quiz shows could
all use this additional element to supplement their traditional
formats. Advertising could also be incorporated into a television
program instead of the current 2-3 minute 'blocks' running between
Over 400 000 Americans currently use Web TV. In
this respect, it is appropriate to mention a recent nation-wide
study conducted by the Newspaper Advertising Bureau of Australia.
According to the survey, Australians are increasingly using the
Internet at the expense of the television.(26) With this trend
emerging, it may be interesting to consider whether some Australian
consumers, fearful of technology, might find Web TV a far less
intimidating creature than the PC (as a user device). The cost of
the Web TV set-box currently retails for about $US400. Unlike now,
consumers could access a version of Web TV without having to
purchase a PC.
As a final point, a recent study of 1,000
international chief information officers released by Deloitte &
Touche Consulting Group, identified Internet commerce as a growth
hot spot. The study predicted a 300 per cent growth in
company-to-customer Internet commerce by the end of next year, with
more than 50 per cent of businesses expecting to offer such
services.(27) For a modest outlay, each and every small store,
cottage industry or sole trader in Australia, wherever they may be
situated and whatever their speciality, could display their wares
to customers of the world.
As mentioned earlier in this paper, Internet
service provider OzEmail and other independent online content
providers have expressed concern that the FTAs might eventually
control future Web TV services. Telstra has argued that if the FTAs
wish to enter these areas of datacasting then they should be
subject to a competitive bidding process. The government's policy
permits the existing FTAs to use spare transmission capacity in
this spectrum to provide certain datacasting services, subject to
the charging regime in the Datacasting Charge (Imposition) Bill
1998. The amount of this charge will be determined by the ACA,
having regard to any directions issued by the Minister. However,
before determining a charge, the ACA will be required to provide a
report to the Minister on whether the proposed charge meets
competitive neutrality principles.
on multi-channelling and subscription TV
The Bill prohibits the commercial FTAs from
using their digital spectrum for multi-channelling (though they
will be authorised by regulations to broadcast programs that are
incidental and directly linked to the programs transmitted at that
time in analog mode) or subscription television services.
As mentioned earlier, the evidence shows that
the FTAs may prefer the multi-channel option over HDTV, or at least
the opportunity to use the full flexibility of digital television.
Of course, this option would directly compete with Pay-TV
operators. Consequently, the Bill effectively shackles the full
flexibility and use of digital television. Broadcasters are
prevented from offering viewers multi-channel television unless the
additional channels are incidental to the program.(28) Therefore,
the only benefit to viewers will be a couple of extra camera angles
or whatever else may be 'incidental' to the program.
Viewers will have to subscribe to Pay-TV
operators to watch multi-channel television, a service that could
be provided free if FTAs were allowed to make full use of the
spectrum. The government's rationale for this policy would appear
to be founded upon protecting the Pay-TV operators' substantial
investment in establishing and maintaining their service.
ABC and SBS
Both national broadcasters will offer viewers
the full benefit of digital television, provided funding is
available. Program makers in ABC regional centres around Australia
have begun to experiment with lightweight digital cameras (similar
to those used for Race Around the World), extending their
range from radio to television content gathering. ABC Managing
Director Brian Johns has said:
As the ABC gains digital capability, we will
provide more local programming for television and online services.
We will be able to do this because digital lifts the constraints of
a single television network.
We plan to run different program packages at
different times of the day-catering to diverse audience interests
including continuous news and current affairs programming, special
events coverage, education programming.
The ABC will look at time shifting programming
so that audiences have more than one opportunity to watch
particular segments. We could repackage existing programming in the
arts, drama, sport and probably children's programming as well.
It is the biggest change in broadcasting since
the introduction of television more than 40 years ago, and the ABC
must not be handicapped.
It is vital that the government provides
additional funding for the ABC now.(29)
As interested players have argued from the
outset of this debate, a competitive spectrum allocation process
would provide a substantial injection of money into the
Consolidated Revenue Fund (CRF). National broadcasters could well
benefit from a policy of this nature. Funding could be provided
from rents received, indirectly via the CRF, for the digital
conversion and ongoing costs of the ABC and SBS-thereby dispensing
with the need to place the added and ongoing burden on the
Market power in the media creates added
regulatory issues. The power of the media, and television in
particular, has been properly realised for many decades, and at
least since the 1960 Kennedy - Nixon debate.(31) Digital television
will soon focus the power, influence and importance of the media in
all our lives. Questions of fair access and appropriate controls
are necessarily at the forefront of this debate.
Turning to the point of law, the doctrine of the
public trusteeship is relevant. Under the codes of Roman
law, things common to mankind by the law of nature, are the air,
running water, the sea, and consequently the shores of the sea. The
English common law evolved the concept of the public trust under
which the sovereign holds public property as trustee for the
benefit of the people.
In Australia, the doctrine has been raised in
issues involving private commercial usage of public things. In
Woollahra Municipal Council v Minister for
Environment,(32) Kirby P (now a member of the High Court of
Australia) referring to the doctrine of the public trustee said
it is this principle which restrains the donee
of a statutory power from exercising that power for a purpose,
which is not properly classified as being for the attainment of the
objects for which the statutory power was conferred.(33)
From Justice Kirby's judgement in the
Woollahra case, it would seem to follow that the
purpose of the Television Broadcasting Services (Digital
Conversion) Bill 1998, namely the conversion from analog to digital
television, must be attained with reference to and in accordance
with the objects of the Broadcasting Services ACT
1992.(34) Alternatively, does the government's approach
ensure that all Australians are able to enjoy the benefits of
digital free-to-air broadcasting as we move into the next
The issues are complex. How does the Government
regulate, under the current legislative regime, and at the same
time optimise the use of the spectrum when the true commercial
value of digital television is probably yet unknown? All this
whilst discharging its trusteeship of a very valuable and limited
Though it is impossible to currently place an
economic value on the spectrum, it is nevertheless desirable to
attempt to do so. As a starting point, it is not unreasonable to
suggest that 80 per cent of the value of a commercial FTA company
is attributable to the ownership of a broadcast licence.(36)
As a final point, the options available to the
Government should reflect the technology itself-they must be
innovative and flexible. Consideration must be given to whether the
objects of the Act cover the whole range of digital broadcasting
services which may become available to the public, and whether the
current legislative regime is appropriate for the introduction of
digital television in Australia. Once a 'future proof' legislative
regime is in place, policy can be determined by considering each
and every unique element of digital television-whether it be HDTV,
multi-channelling, datacasting or any other new and
innovative service which may be offered to the Australian public.
The options can best be explored by a combination of fact, law,
economics, the 'overseas experience' and independent expert
Digital television has the potential to focus
communications and the converging media bringing together the vast
range of related technologies via the humble television set. The
ultimate beneficiaries of the technological revolution, the
Australian public, could well claim that the spectrum is held in
trust for the health, recreation, and enjoyment and for
the entertainment, education and information of the population.
- Dr Kim Jackson, Television Services (Digital Conversion) Bill
1998, Bills Digest no. 178, Department of the
Parliamentary Library, 1997-98.
- Australian Broadcasting Authority, Annual Report
- Broadcasting Services Act 1992, section 3 (in part).
- Australian Broadcasting Authority Specialist Group, Digital
Terrestrial Television Broadcasting in Australia: Final
Report, Sydney, January 1997, p. 85.
- New Paths For Growth: Equal access to Australia's digital
spectrum, John Fairfax Limited, March 1998.
- Communications Outlook 1997, Vol. 1, Chapter 5,
Broadcasting Services, p. 67.
- Ibid., p. 82.
- Editorial, Sydney Morning Herald 27 March 1998.
- Steve Lewis and Finola Burke, 'Calls for Digital TV Slowdown',
Australian Financial Review (Weekend Edition), 14-15 June
1998, p. 7.
- The Spectrum Management Agency is now part of the Australian
- Jock Given, Director, Communications Law Centre, University of
NSW, 'Taking a Punt with TV', Sydney Morning Herald, 26
March 1998, p. 19.
- Finola Burke, 'A Lot of Digital Agitation', Australian
Financial Review, 17 December 1997, p. 14.
- Stewart Fist, 'So TV will be Digital', The Australian,
- Steve Lewis, 'Network worry over digital TV', Australian
Financial Review, 2 June 1998, p. 3.
- 'Everyone's A Winner', speech by Reed Hundt, Chairman,
U.S. Federal Communications Commission, Centre for Strategic and
International Studies Forum on Global Telecommunications
Liberalisation: Who Will Benefit?, Washington D.C., 17
- Digital Broadcasting-Q & A, Department of
Communications, Information Economy and the Arts, released on 24
- The Weekend Australian, 18-19 April 1998, p.
- 7 MHz in Australia.
- Digital TV: We Can Work It Out, speech by Reed Hundt
Chairman, US Federal Communications Commission, International Radio
and Television Society, New York, 21 November 1995.
- Jock Given, Director, Communications Law Centre, University of
NSW, 'Taking a Punt with TV', Sydney Morning Herald, 26
March 1998, p. 19.
- 'PBS Prefers Multi-casting', New York Times, 20
- Report by Blair Levin, former Chief of Staff, U.S. Federal
Communications Commission, commissioned by John Fairfax Holdings
Pty Ltd, 4 March 1998.
- Broadcast and Cable Magazine, 12 January 1998, p. 25.
- Catriona Jackson, 'Australians swapping TV screen for Internet:
Study', The Canberra Times, 16 May 1998, p. 5.
- Beverley Head, 'E-Commerce a $16trn earner', Australian
Financial Review, 26 May 1998, p. 5.
- Using the AFL football example, 'incidental' to the program
means 3 or 4 isolated camera angles in addition to the main
- 'ABC brings digital benefits to all Australians', Media
release, Brian Johns, Managing Director, Australian
Broadcasting Corporation, 10 March 1998.
- Section 81 of the Constitution provides that all revenues or
moneys raised or received by the Executive Government shall form
one Consolidated Revenue Fund.
- Television studio lights caused beads of sweat to run from
Nixon's forehead, giving an appearance of 'nervousness under
pressure'. A poll of television viewers clearly announced Kennedy
the winner. Interestingly, a similar poll conducted with radio
listeners gave the debate to Nixon.
- Woollahra Municipal Council v Minister for Environment
(1991) 23 NSWLR 710.
- Ibid. at p. 726.
- See page 3.
- Hon. Warwick Smith (Bass - Minister for Family Services) Second
Reading Speech, Television Broadcasting Services (Digital
Conversion) Bill 1998, House of Representatives, Parliamentary
Debates, 8 April 1998.
- Comments of Michael Gordon Smith, Member, ABA, Digital
Television Policy Seminar, web site at:
The nature of the VHF and UHF frequency bands
makes them an ideal segment of the spectrum for broadcasting of
terrestrial television. Initially VHF, and later UHF, bands were
employed internationally for TV. TV was not possible before
engineers learned how to transmit wide band signals in these
segments of the RF spectrum.
Before mass production of TV sets could begin,
standards had to be set for the TV channels-a sub-set of
international spectrum planning. The USA and Japan divided their
allocated TV spectrum bands into 6MHz channels (legacy from 60Hz
power supplies), Europe chose 7MHz for VHF and 8MHz for UHF. The 8
MHz for UHF was to allow for improved pictures in the UHF
With these RF channel standards set world wide,
specific electronic equipment manufacturers produced the tuners for
TV sets to be used in specific regions. The tuners became a
specialised component for the industry.
With analogue TV, both NTSC and PAL requires a
gap between each channel to avoid adjacent channel interference.
These gaps (referred to as 'guard channels') are the same band
width as the channels used for TV broadcasting. The significance of
engineering for digital broadcasting is that these guard channels
are available to start digital terrestrial television. Digital
television still uses RF channels and the same bandwidth as
Each RF digital television channel carries a
digital 'transport stream' that is capable of carrying one or more
program (TV or Radio) and data services. The special RF modulation
schemes engineered to carry digital television do not interfere
with the existing adjacent analogue channels. The digital signal
carrier is still an RF signal designed to operate in existing TV
The limit for the US bit rate system (8 VSB RF
carrier) of each transport stream is fixed at 19.3 Mbits per
second. The limit for the European flexible bit rate system (COFDM
RF carrier) is around 30 Mbits per second in ideal conditions in
the Australian 7MHz channels. The maximum capacity for COFDM is
dependent on environmental conditions that cause variations in
signal quality-trees, rain, snow etc.
In addition, COFDM will allow return path
interactive services to source transmissions by RF.
Each transport stream will transport one or more
program and data services-up to the channel limit. Wide band width
services, such as HDTV, fill the channel capacity. Internet and
teletext services are very low data rates, allowing many thousands
of such services to be carried. Therefore, we should clearly
distinguish between a 'Digital RF Channel', a 'transport stream', a
'program' or 'data' service.
'Analog'-pertaining to the use of physical
quantities (such as voltages etc.) as analogues to the variables in
a mathematical problem, as in an analog computer or pertaining to
any device which represents a variable by a continuously moving or
varying entity as a clock, the hands of which move to represent
time, or a VU meter, the needle of which moves to represent varying
amplifier output energy (Macquarie Dictionary).
This is a form of datacasting currently used
during the broadcast of news, current affairs and other programs.
Closed captioning enables the hearing-impaired to read the
dialogue-in text form-of the television program. The text usually
appears at the bottom of the program and can be viewed via a
decoder. Closed captioning looks like sub-titles on foreign
Data is an item of information used by a
computer for the purpose of calculation, manipulation, or storage.
Data casting is transmission of this information. An example of
datacasting is the transmission of the Internet.
'Digital'-of or pertaining to units of
information that exist in two states only, on and off, as pulses
(opposed to analog) or pertaining to a device which represents a
variable as a series of digits, as a digital watch which shows
passing time by a series of changing numbers, or a digital tuner
which similarly shows the frequencies to which it is being tuned
High-definition television pictures, when
compared with normal standard definition pictures on our current
television sets, are sharp, non-grainy, crystal clear and superior
in quality and definition. HDTV comes in a 'wide-screen' 16 x 9
format. The current analog format is 4 x 3.
A 'hertz' is the basic legal limit for measuring
frequency. It is the frequency of a regularly recurrent phenomenon
that repeats itself once each second. Multitudes and fractions of a
hertz, such as megahertz (MHz) and kilohertz (KHz), are also legal
units of measurement of frequency: National Measurement Regulations
1961 (Cwlth) regulations 22(1), 23, Schedule 8.
A multi-channel broadcast is one where a number
of traditional television programs are broadcast at the same time.
Digital technology makes this possible by compressing the signal to
fit more 'channels' or 'programs' into the same corridor of
broadcast spectrum used for current television broadcasting.
Transmitting both analog and digital television
simultaneously so that viewers can receive the same program with a
current analog TV set or a digital TV set.
In radio communications law, 'spectrum' is
defined as the range of frequencies within which
radiocommunications are capable of being made:
Radiocommunications Act 1992 (Cwlth) section 5. A
'spectrum' can be likened to a corridor of radiofrequencies. Only
those frequencies within the corridor are capable of carrying
television signals. The corridor is thereby divided up so that each
commercial broadcaster (Networks 7, 9 and 10) and the national
broadcasters (ABC and SBS) each have their sub-corridor (bandwidth)
within the radiocommunications spectrum. The width of the spectrum
is limited and can only carry a finite number of bandwidths.
Spectrum is therefore a limited public resource.
Broadcast transmission is the carrying of
broadcast information-traditionally pictures and sound-through the
air from broadcaster to viewer.
In radiocommunications law, anything designed or
intended for radio emission, or any other thing, irrespective or
its use or function or the purpose of its design, that is capable
of radio emission: Radiocommunications Act 1992 (Cwlth)
One of the two types of apparatus licence, the
other type being a receiver licence. A transmitter licence
authorises the licensee to operate specified radiocommunications
transmitters. A transmitter licence is subject to conditions
additional to the general conditions of an apparatus licence. The
conditions include a requirement that the licensee not operate the
transmitter for a purpose inconsistent with a purpose specified in
the appropriate frequency band plan.