The future of TV may well be in a box
June 18, 2006
By Thabiso Mochiko and Wiseman Khuzwayo
Johannesburg - The SABC could finally have a cure for unpaid television licence fees if the digital television migration committee, which also includes the department of communications (DOC), decides to introduce set-top boxes that would require users to insert smart cards to access digital television.
There are 7 million television owners in South Africa.
Sentech, which provides signal network for the SABC, e.tv and also for Multichoice, is upgrading South Africa's analogue television system network to digital to offer high-quality programmes during the 2010 soccer World Cup tournament and to meet the Fifa requirements.
Sentech and the DOC may decide that the broadcast service provider delivers free-to-air and unencrypted services, in which case viewers will need a set-top box to receive the signal. The disadvantage with this system, however, is that the SABC has no control over the viewers and interactivity is limited.
According to Sentech, the alternative is the "free access" scenario that requires a smart card. The viewers pay for the card and if they do not pay for their TV licences, they can be switched off.
This system also accommodates value-added services.
"The UK has a similar system called free view. Digital terrestrial television [DTT] also offers you a pay-TV environment where companies can broadcast subscription television channels," Sentech says.
This option is much more in SABC's favour and its stated wishes of gradually reducing its reliance on the state for revenue, while focusing more on its public service mandate rather than commercial excellence.
According to Frans Lindeque, Sentech's acting chief operating officer, the benefits of DTT are that it allows multiple channels per bandwidth, improved picture quality, multiple language offerings per channel and value-added services such as e-commerce and interactivity.
"[Digital TV] allows a very flexible environment to work in, while analogue is very static."
The migration period is starting this year. The first two years will be for upgrading the systems and installing equipment, while in 2008 the migration process will begin. This process will allow the analogue system to run concurrently with the digital system.
The gradual migration and the process of running analogue and digital simultaneously will allow households that do not have set-top boxes to continue to receive broadcasts. But Sentech has set itself a target of reaching a 92 percent national coverage by 2010, at a cost of R1 billion.
But Lindeque warns that the period for dual elimination might be long - three to five years - or even 10 years because the digital migration committee will still have to decide how the set-top boxes will be rolled out.
"Real migration depends entirely on the set-top boxes roll-out. We still have to decide on the funding model and whether they will be subsidised or not. Those are still being discussed," he says.
The committee is also in discussions with set-top boxes manufacturers, both locally and overseas, but has not yet selected the preferred manufacturer.
Lindeque says Sentech has been buying equipment from an international supplier who undertook that if "we decide to buy boxes from them in the future they will also establish a [plant] locally.
"The requirement we will have from anyone who is going to supply us is that they have local manufacturing and incentives.
"The preferred manufacturer, if it's an international player, will have to make a commitment to repair and manufacture locally," says Lindique. It is estimated that the boxes will cost R900 each, with the price gradually going down as more boxes are bought.
"We assume that there are 7 million TV households, and this figure might reach 10 million by 2010. All TV sets in South Africa are analogue and chances are that the set-top boxes will be an ideal option since it will take long to transform the TV set manufacturing industry."
According to Lindeque, in the US, the federal communications commission has set out legislation that all TV sets manufacturers should build digital receivers within the sets.
"I don't think in South Africa it will be a requirement for quite a while … it's a major transformation," he said.
Along with DTT comes high definition television (HDTV), which is also a requirement for broadcasting the 2010 Soccer World Cup internationally.
But until digital TV migration has been completed, HDTV would not be implemented.
Lindeque says Sentech will be able to provide other countries that already have HDTV with standard definition TV.
HDTV is regarded as a living standards measure 8 to 10 market product.
"HDTV is expensive … [but] we are looking at it," says Lindeque.
When Sentech made a presentation in parliament two months ago warning that the country would not be able to show the soccer World Cup unless the government pumped in more money, it was lashed for misleading the country.
Lindeque is optimistic that Sentech will meet the deadline.
"Failure is not an option," he says.
The minister of communications, Ivy Matsepe-Casaburri, said recently during her department's budget vote that the digital migration strategy would be concluded later this year.
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