WHILE the market is anxiously awaiting details of the outcome of a legal battle between Communications Minister Dina Pule and e.tv over the control of set-top boxes used to decode digital broadcasts, in other countries this debate has been overtaken by technology integrating digital reception into new TV sets.
South Africa is migrating from analogue to digital TV broadcasting, a move that will result in more TV channels and better picture quality. Companies such as JSE-listed Altech and Ellies have been positioning themselves to play a role in the digital migration programme.
Many European and Asian countries as well as the US have completed the migration to digital terrestrial broadcasting and used set-top boxes as an interim measure to enable old analogue TV sets to receive new digital broadcasts. In those markets, decoders are making way for the integrated digital television (iDTV) sets. iDTV is a digital television set with an in-built tuner capable of receiving digital broadcasting transmissions.
International research firm IMS Research is forecasting that shipments of iDTVs will grow to 143-million this year, up from an estimated 52-million in 2007.
The communications ministry and e.tv were involved in a court battle over the management of conditional access control, a technology used to control access to digital television services to authorised users by encrypting the transmitted programming. The court ruling was in e.tv’s favour, in effect stating that broadcasters should manage the control system.
Ms Pule, along with e.tv and other broadcasters, has been discussing a solution to ensure that the migration from analogue broadcasting to a digital platform is not delayed further.
Including conditional access in set-top boxes means that no one will be able to use the set-top boxes outside South Africa. This removes their theft value, says Shaun Hendricks, managing executive at manufacturer Tellumat: "It forces commitment to the local manufacturing industry as the source of set-top boxes."
The government plans to spend R2.4bn to subsidise the poorest households when they buy set-top boxes, but the figure could be higher than this.
Those opposing conditional access say set-top box control customisation in South Africa will introduce costs such as software royalties that will go to an international country, management services, certification and also call-centre operations.
The National Association of Manufacturers of Electronics (Namec), an industry body, is not in favour of this, while broadcasting industry body SOS: Support Public Broadcasting prefers a universal box or open model.
Conditional access has been used for years in pay-TV services to enable service providers to disconnect non-paying clients. Given that conditional access is a key feature in pay-TV services, this means public broadcasters could use this to switch off non-paying TV licence holders. Moreover, new entrants in the digital terrestrial broadcasting market or existing broadcasters could potentially use the digital terrestrial TV platform to provide pay-TV services.
According to sources, the SABC has already indicated that it does not want a conditional access system to be included in set-top boxes as it would violate its public broadcasting mandate. The SABC believes that citizens should have the right to public broadcasting services.
Namec chairman Keith Thabo says the organisation does not see the need for conditional access in the set-top boxes. The inclusion of conditional access is a barrier to entry into the market for emerging black manufacturers because they will need to be accredited by the conditional access vendor prior to producing boxes that have conditional access. This process can take anything between 18 and 24 months, at a heavy cost to the emerging manufacturers.
"The notion of conditional access applies to pay-TV because subscribers have access to television on the condition of paying subscription fees, so it makes no sense to have conditional access in free-to-air television," says Mr Thabo.
Moreover, the conditional access system is said to increase the costs of the set-top box. For every box sold there is a royalty fee that has to be paid to the company providing the conditional access software system.
For every fee the conditional access vendor charges, the manufacturer will pass on such costs to consumers, says Mr Thabo. "Consumers will be worse off because the set-top box will be more expensive," he says. So if conditional access is included, does that mean integrated digital TVs will not work in South Africa? According to Mr Thabo, the country will need integrated TVs specifically designed for it, which will make the market "very expensive because there are no economies of scale that we could derive from other markets".
Mr Hendricks says the conditional access element will be installed in those integrated digital TV sets.
Sekoetlane Jacob Phamodi, a campaign organiser for SOS, says the development, production and availability of iDTV sets will depend on demand for them as determined by broadcasters’ taste and a willingness to allow for their production.
"So we could very well end up with a situation where we would have integrated digital TVs which work for some broadcasters but still require set-top boxes for access to others."
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