Bills Digest No. 88 2002-03
Broadcasting Legislation Amendment Bill (No. 3)
This Digest was prepared for debate. It reflects the legislation as
introduced and does not canvass subsequent amendments. This Digest
does not have any official legal status. Other sources should be
consulted to determine the subsequent official status of the
Contact Officer & Copyright Details
Broadcasting Legislation Amendment
Bill (No. 3) 2002
12 December 2002
Portfolio: Communications, Information
Technology and the Arts
To make a number of amendments to the high
definition television quota for digital television including:
- changing the quota from a weekly to an annual quota
- allowing advertising and promotional material to count towards
the quota and
- delaying the commencement date for the statutory review of HDTV
The free-to-air television services that have
historically been received by Australians are terrestrial analog
broadcasts: the signal is transmitted from towers to home receivers
in the form of a continuous wave. With digital broadcasting, the
signal is in the form of discrete bits of information. A major
advantage of the digital signal is that digital data stream can be
compressed. As the available spectrum is used more efficiently,
digital broadcasting offers the potential for the development of
other services such as interactive television and
multi-channelling.(2) In addition, background noise and
interference can be more readily removed to improve video and audio
reception. The move to digital requires both broadcasters and
viewers to upgrade their technology.
In March 1998 the Government announced the
regulatory framework that would apply to the transition to digital
television and expressed its commitment to high definition digital
broadcasting.(3) The initial provisions for the
transmission of digital television were inserted in the
Broadcasting Services Act 1992 (BSA) by the Television
Broadcasting Services (Digital Conversion) Act
Following a number of reviews of technical and
policy matters relating to digital broadcasting, the
Broadcasting Services Amendment (Digital Television and
Datacasting) Act 2000(5) (the DTD Act) was passed
which refined arrangements for the introduction of digital
television. The most significant of these were:
- the requirement for broadcasters to transmit a standard
definition digital television (SDTV) signal at all times and at
least 20 hours per week of high definition digital broadcasts
(HDTV)(6) in addition to the existing analog
- provisions to enable the ABC and SBS to
multi-channel(8) certain kinds of programs.
Under provisions inserted by the DTD Act all
mainland capital city stations had to begin transmitting full-time
SDTV services from 1 January 2001, although the analog signals will
be simulcast until at least 31 December 2008. The requirement for
20 hours of HDTV was initially scheduled to take effect from 1
January 2003 but was postponed by 6 months in December 2002 (see
In its 2001 election policy Broadcasting for
the 21st Century the Government acknowledged that broadcasters
need flexibility in the transition to digital television. To
further this objective the Government stated that it would consider
legislative amendments to:
- enable broadcasters to meet their 20 hour per week HDTV
requirement on annualised basis (ie 1040 hours per year), and
- include advertising time in the quota.(9)
On 27 August 2002 the Minister announced that
the deadline for the commencement of the HDTV quota would be
extended. The Minister stated that it was:
now highly unlikely that any legislative
amendments to provide the flexibility committed to by the Coalition
can be put in place before the HDTV quota obligation comes into
effect for some broadcasters.(10)
On 25 September 2002, the Government introduced
the Broadcasting Legislation Amendment Bill (No.1) 2002 to delay
the commencement of high definition television obligations on
broadcasters for six months until 1 July 2003. The legislation
received Royal Assent on 10 December 2002.
Since that time the Government has affirmed its
commitment to HDTV. In October 2002 the Minister announced that the
Government would legislate to defer the review of the HDTV
arrangements due to be completed by January 2004 until July 2005.
The Minister stated that deferring this review will mean that it
will be able to take into account the experience of HDTV
programming over a sensible period of time. (11)
The requirement for mandatory HDTV transmission
has been widely criticised.(12) The Productivity
Commission in its March 2000 report on the broadcasting industry
highlighted many of the points made by opponents of the regulatory
The Commission argued that HDTV television sets
would be expensive and that HDTV will be a premium service for a
small number of viewers .(14) It noted however that, the
costs of HDTV production, distribution and transmission will be
borne by all broadcasters, advertisers and ultimately the community
as a whole. The Commission also observed that the mandatory HDTV
policy may constrain the emergence of new services because it
consumes more spectrum than SDTV and could prolong the conversion
process. The Productivity Commission recommended that a new
regulatory framework would facilitate consumers' adoption of
digital television and, in particular, that:
- HDTV should not be mandated but should be left to the market,
- multi-channelling by the commercial and national broadcasters
should be permitted.
The take-up of digital television has not been
rapid. In September 2002 it was reported that since digital
broadcasting commenced around 20 000 to 30 000 digital devices have
been sold.(15) This term is used to describe set top
boxes which are capable of decoding SDTV or HDTV digital
transmissions(16) and televisions that include a digital
receiver.(17) According to the Explanatory Memorandum to
the Broadcasting Legislation Amendment Bill No.1 2002 around 16 000
high definition set top boxes have been sold in Australia. To put
these figures in some context, it has been estimated that one
million television sets are sold annually in
Australia.(18) HDTV set top boxes cost between $800 and
$900.(19) Television sets that are capable of displaying
high definition transmissions if they are used in conjunction with
a set top box cost around $4000 to $5000.
The television manufacturing industry has
claimed that take up of HDTV has been hampered by the fact that
there are presently very few hours of HDTV being broadcast. The
Government has stated that the amount of high definition content
broadcast by Australian commercial networks has varied between one
hour per week to ten hours per week.(20)
The ALP has expressed opposition to the measures
contained in this Bill. In particular, the Shadow Minister for
Communications Lindsay Tanner MP has argued that annualising the
HDTV will mean that:
consumers are not guaranteed to receive regular
weekly streams of high-definition content. Consumers with expensive
high-definition television equipment could be waiting months to get
feeds of high definition from their favourite stations.
There is a strong suspicion that commercial
networks will simply push all their high-definition quotas into
sporting programs such as test cricket and
The Opposition has also criticised the proposed
changes to allow advertising to count in the HDTV quota expressing
concern that foreign advertisements will be used to facilitate
compliance with the quota.
Clause 60A of Schedule 4 BSA requires that a
review of the operation of the HDTV quota should be completed by 1
January 2004. The Bill proposes to postpone the review until 1 July
2005. During the last election campaign the ALP called for this
review to be brought forward. The Government has rejected this
proposal on the grounds that HDTV needs to be assessed over a
longer time frame.
Part 4 of Schedule 4 of the BSA sets forth the
digital television format standards.
Clause 37E sets out the HDTV quotas for
commercial television broadcasting licensees in non-remote areas.
It provides that in non-remote areas the regulations must determine
standards which require each commercial television broadcasting
licensee to transmit in SDTV and HDTV and meet a specified quota of
Subclause 37E(2) provides that standards must be
directed towards ensuring that:
- HDTV broadcasting begins as soon as possible but in any event
within the phase in period ; and that
- Within the phase in period licensees are transmitting at least
20 hours per week in HDTV.
- The phase-in period is defined as the period ending at the
later of 30 June 2003 or 2 years after the broadcaster began
transmitting in SDTV.
The national broadcasters (ABC and SBS) are
subject to similar HDTV quotas under clause
To give effect to clauses 37E and 37F the
Broadcasting Services (Digital Television Standards)
Regulations(22) were made in November 2000.
Items 2 and 6
delete references to commercial and national broadcasters
transmitting 20 hours of HDTV per week and instead substitute a
requirement to broadcast the HDTV quota.
This term is defined for commercial and national
broadcasters by proposed subsections 37E(2B) and
37F(2B) (items 3 and 7). The HDTV
quota applies at the end of the phase-in period. Generally speaking
the quota for each calendar year is 1040 hours. The quota is
adjusted on pro-rata basis depending on when the phase in period
Items 4 and 8
ensure that HDTV demonstration programs are not to be included in
assessments of whether the licensee is complying with the
requirement to broadcast the HDTV quota after the phase-in
Clause 37L defines high-definition television
programs for the purposes of determining HDTV quotas. A different
definition applies depending upon whether it relates to a
commercial television broadcaster or a national broadcaster. For
commercial licensees a high definition television program is a
program that was originally produced in:
- high-definition digital video format, or
- a non-video format (eg 16mm or 35mm film) and subsequently
converted to high-definition digital video, provided that the
conversion has not resulted in a significant reduction in picture
quality (proposed subclause 37L(1)).
This type of program is described as a true HDTV program
For the national broadcasters, the
high-definition television program definition additionally includes
SDTV programs that have been converted to a high definition digital
video format and programs that have been converted from analog
video to SDTV and then to a high definition digital video
Item 10 repeals the existing
definition and substitutes a new clause 37L. There
are two principal differences between the old and the new
Firstly the new definition deals with the extent
to which non-HDTV material (archival material) may be included in
the HDTV quota if it is included within a HDTV program. Such
material may only be included in the quota if it amounts to an
insubstantial proportion of the television program or incidental
material . The archival material must also have been produced
before 1 July 2003 or a later date determined in writing by the
Minister. The explanatory memorandum gives the example of
flash-backs to historic material in a HDTV documentary as the type
of material that would be included in the HDTV quota under the
New clause 37L also ensures
that incidental material is included when considering whether a
licensee has complied with the quota. Proposed subclause
37L(6) provides that incidental material includes:
- advertising or sponsorship material (whether or not of a
commercial kind); or
- a promotion for a television program or a television
broadcasting service; or
- community information material or community promotional
- a news break or weather bulletin; or
- any other similar material.
Item 11 amends clause 60A of
the BSA giving effect the Government s decision to postpone the
review of the HDTV quota system until 1 July 2005.
So far consumers have been reluctant to embrace
HDTV technology. Two factors that have contributed to this lack of
enthusiasm are undoubtedly the high price of receiving equipment
and the limited amount of high definition programming being
transmitted by broadcasters. These factors are mutually reinforcing
in that broadcasters are reluctant to invest in HDTV programs if
there is no audience for them and people will be unwilling to pay
for expensive new technology if there is little to watch.
The mandatory HDTV quota was intended to break
this deadlock and act as a major driver of the transition to
This Bill gives broadcasters more flexibility to
meet the HDTV quota requirements. However it may be that further
measures need to be taken to accelerate the transition to digital
television. In the United States where the take up of HDTV has also
been sluggish the Federal Communications Commission has recently
decided to require the inclusion HDTV receivers(25) in
nearly all television sets by 2007.(26) The Minister has
indicated that this is one option that will be considered by the
- For further information on the development of policy in this
area see Dr Kim Jackson, Digital Television and Datacasting ,
Department of the Parliamentary Library, January 2002.
- Multi-channelling is when a television broadcaster shows two or
more separate streams of television programming. Each is a self
contained independent service.
- Senator the Hon. Richard Alston, Digital A New Era in
Television Broadcasting , Media Release, 24 March 1998.
- For more information on this legislation see Bills Digest
- For more information on this legislation see Bills Digest
- The technical requirements of SDTV and HDTV are not specified
in the Broadcasting Services Act. The terms are given
their normal in the broadcasting industry.
SDTV is essentially a widescreen version (16 x
9) of the existing broadcast system. It has picture quality similar
to DVD with Stereo sound. SDTV offers program enhancements such as
a choice of camera angles or TV guides. In a 7 megahertz channel it
is possible to multi-channel up to 4 standard definition
HDTV has a higher picture resolution and
superior sound quality compared to SDTV. It does requires more
spectrum however which effectively precludes multichanneling.
For detail on SDTV and HDTV see Sony, Phillips
and Panasonic Digital Television in Australia ,
Briefing Paper, September 2002.
- This is known as the simulcasting requirement.
- Under the Broadcasting Services Act 1992 commercial
broadcasters generally must not, during the simulcast period,
broadcast a program in SDTV unless it also broadcasts in analog.
- Liberal Party of Australia, Broadcasting
for the 21st Century , October 2001. On 15 October the Minister
announced the Government would, as foreshadowed in its election
policy, legislate to annualise the HDTV programming quota. See
Senator the Hon. Richard Alston, HDTV election commitments to be
implemented , Media Release, 15 October 2002.
- Senator the Hon. Richard Alston, Commencement of High
Definition Quota , Media Release, 27 August 2002.
- Senator the Hon. Richard Alston, HDTV election commitments to
be implemented Media Release 15 October 2002.
- See Senate Environment, Communications, Information Technology
and the Arts Committee,
Report on the Broadcasting Services (Digital Television and
Datacasting) Bill 2000, June 2000.
- A copy of the report is available at the following website
- Productivity Commission, Broadcasting Inquiry Report,
March 2000, p. 252.
- Selina Mitchell, Digital TV: just slow off the mark or dead in
the water? , The Australian, 17 September 2002.
- HDTV set top boxes can also decode SDTV transmissions.
- Currently there is only one model of television set available
for sale that includes an integrated standard definition receiver.
This set retails for $3999. No sets with integrated high definition
receivers are generally available for sale at present.
- Selina Mitchell, Digital TV: just slow off the mark or dead in
the water? , The Australian, 17 September 2002.
- Broadcasting Legislation Amendment Bill No.1, Explanatory
Memorandum p. 5.
- Lindsay Tanner MP, High-Def Digital Tv Shambles Unfolds ,
Media Release, 11 December 2002.
- A copy of the regulations is available at the following link:
- Broadcasting Services Amendment (Digital Television and
Datacasting) Bill 2000, Explanatory Memorandum, p.101.
- According to the Explanatory Memorandum to the DTD Bill, the
difference in definition reflects the fact that a major source of
programming for SBS and, to a lesser extent the ABC, is Europe
where few true HDTV programs are produced at present.
- These are televisions that contain all components necessary to
receive and display digital transmissions. A set top box is not
- Federal Communications Commission, FCC introduces phase-in plan
for dtv tuners: plan minimizes costs and allows consumers to access
dtv signals Media Release 8 August 2002. See
- Maria Hawthorne, Mandatory digital TV considered , The
Australian, 2 October 2002.
20 January 2003
Bills Digest Service
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