Bills Digest No. 88 2002-03
Broadcasting Legislation Amendment Bill (No. 3) 2002
WARNING:
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 Bill.
CONTENTS
Passage History
Purpose
Background
Main Provisions
Concluding Comments
Endnotes
Contact Officer & Copyright Details
Passage History
Broadcasting
Legislation Amendment Bill (No. 3) 2002
Date Introduced:
12 December 2002
House:
Senate
Portfolio:
Communications, Information Technology and the
Arts
Commencement:
Royal Assent
Purpose
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 quota
arrangements.
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 1998.(4)
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 signal,(7) and
- 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 below).
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 regime.(13)
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, and
- 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 football.(21)
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 HDTV programs.
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 37F.
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
expires.
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 period.
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’.(23)
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 format.(24)
Item 10 repeals the existing definition and substitutes
a new clause 37L. There are two principal differences between the
old and the new definition.
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 proposed regime.
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 material;
or
- 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 digital television.
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 Government.(27)
- For further information on the development of policy in this area
see Dr Kim Jackson, ‘Digital Television and Datacasting’, e-brief,
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 No.
178 1997/1998
- For more information on this legislation see Bills Digest No.
179 1999/2000.
- 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 programs.
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 http://www.pc.gov.au/inquiry/broadcst/finalreport/index.html
- 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.
- ibid.
- 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: http://scaletext.law.gov.au/html/pastereg/3/1639/top.htm
- 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 required.
- 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 http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-225221A1.pdf.
- Maria Hawthorne, ‘Mandatory digital TV considered’, The Australian,
2 October 2002.
Mark Tapley
20 January 2003
Bills Digest Service
Information and Research Services
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ISSN 1328-8091
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