As mobile providers take over spectrum from broadcasters, the age of ‘free-to-air’ transmission could be coming to an end.
What does it take to make a national broadcaster? A national service should be freely available in all homes for adults and children without the barriers of encryption or subscription. The United Nations’ educational and cultural body, UNESCO, suggested in 2005 that public service broadcasting might have ‘an important role to play in providing access and participation in public life’; it would serve ‘the interests of people as citizens rather than as consumers’; it would assist in ‘strengthening civil society’ and it would be ‘a unique service providing universal access to information and knowledge’ (2005).
This piece argues that the universal service principle in British broadcasting is now under pressure in two ways. Firstly it has been suggested that BBC programmes should in future be encrypted and provided as availability within the United Kingdom. Secondly, the emergence of a new kind of spectrum scarcity – stemming largely from the expansion of new mobile phone and data services – is causing spectrum to be withdrawn from broadcasters and re-allocated to mobile providers. Data and video are now the powerful drivers of mobile traffic.
Broadcasters can now manage with less spectrum, partly as a benign consequence of digital switchover – signal compression has made it possible to do more with less. However, the pressures for mobile growth are now suggesting to policy-makers, commercial interests and broadcasters alike that there may come a time when broadcasting will no longer be ‘broad’ – but banished from the airwaves as the age of plenitude and of ‘free-to-air’ transmission comes to an end. The users – citizens and consumers – have remained largely unaware of the scale and significance of these possible changes.
Spectrum: The oxygen of broadcasting
The allocation of spectrum is an international as well as a national issue with broad spectrum use priorities being determined by the World Radio Conference (WRC) in consultation with national governments. The WRC was due to meet in November 2015 to take decisions, acting on the authority of the International Telecommunication Union (ITU), an agency of the United Nations. It was expected that this conference would agree the re-allocation of the UHF 700 MHz band from broadcasting to mobile use. The European Union also has an interest in these matters and four of its members, Germany, France, Sweden and Finland, have already committed to the sale of these frequencies to mobile providers (Ofcom 2014a: 10).
At present in the United Kingdom this same 700 MHz band is used by the Freeview platform to transmit some 60 free-to-air services, including all the BBC’s national television and radio channels. The Freeview platform, along with its sister organisation Freesat, is relied upon by the 47 per cent of British homes that have chosen not to pay for subscription television and that make use of an ‘open skies’ signal entering the home mainly via a rooftop aerial (Ofcom 2014b: 127; 2014c: 109). In practice Freeview has a wider take-up than the 47 per cent figure suggests, since many subscription homes have at least one additional television set which makes use of the free services delivered by the rooftop aerial; thus Freeview’s reach has been estimated at nearer 75 per cent of British homes (Ofcom 2014d: 4). To deliver television signals into the home this platform relies entirely upon the availability of suitable spectrum.
Freeview provides, in digital form, the old five analogue channels (BBC1, ITV1, Channel 4, BBC2 and Five) along with their families of newer channels – ITV2, BBC4 and many more besides. These services are also referred to as Digital Terrestrial Television (DTT), principally to distinguish them from services relayed by cable, satellite or Internet Protocol (IPTV). The 53 per cent of British homes that have signed up to pay TV receive these services principally via satellite or cable (Sky, UKTV, Virgin). More recently internet delivered services such as BT TV and Netflix have emerged as significant players.
However, current internet distribution is arguably unable to fulfil a public service remit, partly because in the UK there remain some 18 per cent of homes that do not have access to the internet and partly because this mode of delivery – unlike the rooftop aerial – involves additional monthly subscription payments and the possibility, even if this is unlikely, that control over content might be exercised by an internet service provider (Ofcom 2014b: 276). By contrast, broadcasting appears to be a highly efficient and cost effective means of delivering audio-visual content to large numbers of people. Some specialists have noted that broadband capacity is at present unable to cope with very high demand for the simultaneous viewing of especially popular programmes, whether sport or drama. The consultants Aetha comment in a recent report:
Linear television continues to be the most effective means of delivering simultaneous content. It is costly and impractical to expect many viewers to stream a programme simultaneously online, as bandwidth can still be constrained
The report goes on to note some high profile failures of streaming services: for example, when the ITV Player crashed in response to high demand for live coverage of the World Cup in 2014 and Sky’s Now TV crashed on the opening of Season Four of Game of Thrones in the same year (Aetha 2014: 20).
Other commentators, including the mobile industry itself, as well as the UN agency the ITU, are advocates of the view that, sooner or later, the fixed and mobile broadband that delivers the internet will be capable of replacing spectrum-reliant broadcasting altogether. In the process, spectators may lose the option of a choice between broadcast (over the airwaves and free-to-view) and broadband delivery. And a monthly broadband subscription may have to rise considerably to cover the costs of the providers in developing much greater capacity.
If broadband were able to develop the capacity to deliver the current average daily television diet of just under four hours per person it would, of course, also do much more than that – offering a wide range of additional informational and commercial services, as at present. But one small cost-related point may be worth noting for the future. In 2013, the cost to licence fee payers for the distribution of all BBC services was 6.5 per cent of the licence fee or 80p per month (BBC Trust 2013: 1). This amount may subsequently be seen to compare favourably with an enhanced monthly broadband bill.
Bigger kids on the block: The growth of mobile
The ITU develops the long term case for the broadband delivery of television in its Trends in Broadcasting report, while the international trade body for the mobile phone and data sector, GSMA, has argued for mobiles to take over not only the 700 MHz band but also the lower 470-694 MHz band (ITU 2013: 27; GSMA 2015). This lower band appears to constitute the last suitable bloc of spectrum for the free-to-air broadcasters including the BBC (EBU 2015).
One significant way of growing the business of mobile providers is the development of mobile video services – a category that includes broadcasting. Here the take-up, though significant in the richer parts of the world, has not been as rapid or extensive asfirst thought. The 2013 ITU report cites an earlier Cisco study forecasting that by 2016 ‘video will generate over 70 per cent of the mobile data traffic’ (ITU 2013: 6). A later report by Cisco corrected this forecast to an estimate that ‘… nearly three-fourths of the world’s mobile data traffic will be video by 2019’ (Cisco 2015: 3). Given the generally fast pace of change in the mobile field this is a significant downward adjustment; it also seems likely that users are making greater use of Wi-Fi facilities in order to avoid the otherwise significantly higher mobile data fees associated with video use.
Of course, it would be unwise to underestimate the general pace of change and it is important to note significant variability across countries and age groups. Thus, for example, France is currently the leader in Europe for the reception of television via the internet with 30 per cent of homes receiving television on their main set via internet protocol (IPTV) (Aetha 2014: 70). In the UK, the BBC’s iPlayer (also internet delivered) appears to be growing in popularity although its significance in terms of volume can be over-stated. In 2012, it represented just 2.3 per cent of all BBC viewing. The figure will have risen since then, but it will be important to monitor this use as against live or linear TV watching. (BBC Trust 2014: 22).
There are other popular technologies in play. With regard to smart phones considered as TV reception devices, 22 per cent of adults in Britain have ‘ever watched a TV programme on a mobile’ and 13 per cent have done this at least once every three months. The figures for children are difficult to compare; 31 per cent of children aged 5 to 15 own a smartphone. For these children tablets are more popular than the mobile phone for watching television programmes though there also seems to have been a small renaissance in watching programmes on the main TV set in the home. For children the figures for watching television on a mobile appear to have gone down from 14 per cent to 11 percent between 2013 and 2014 (Ofcom 2014e: 49; 2014f: 39).
In noting these various related developments, the spectrum story nevertheless remains a big one. From the point of view of the BBC and other free-to-air broadcasters, the worry, disruption and cost involved in being required to migrate all services away from the 700 MHz band to the lower band is considerable. And, as indicated above, the mobile companies have already indicated that they wish to make use of at least part of the lower 470-694 MHz band. GSMA has cited the possibility of a ‘co-existence’ within this band that the broadcasters believe is not achievable. Moreover, if the spectrum space on offer is insufficient to innovate and develop new services (Ultra High Definition television is one example) this could have damaging effects on the competitiveness of DTT.
At present a cloud of uncertainty hangs over this lower spectrum band. A recent high level report for the European Commission prepared by Pascal Lamy, former head of the WTO, proposed that the use of this lower band by broadcasters be reviewed in 2025 (Lamy 2014). GSMA members would like to see the issue resolved sooner – by 2020. Depending on which industry interests prevail, the users of broadcasting who have enjoyed an unmetered abundance of supply since the 1920s face eviction from a public space into the world of privately managed subscription.
In part this process of transition is occurring in most countries as governments understand that the ‘free’ spectrum space allocated to broadcasting has become economically valuable. In the UK, in 2000, spectrum sales for the development of the 3G mobile phones brought in an amount of £22.5 billion for the national Treasury, followed by £2.3 billion for the auction of the 800MHz spectrum for 4G in 2013 (Radio Communications Agency 2000; Ofcom 2013). It is easy to see why some governments might prefer to see the airwaves as generators of public cash, not public communication.
Digital TV = Pay TV?
The tension between public and private ownership of communication systems has been with us for a long time. In Britain, there has been some sympathy for public service broadcasting since the creation of the BBC in 1922 and, much later, a special clause in the European Treaty permitted public methods of funding (Goldberg et al. 1998).
The current debate and conflict over spectrum allocation is not the first time that universally available public broadcasting, free at the point of use, has faced something of an existential crisis. The early days of transition to digital in the UK were full of uncertainty and conflict. 1998 saw both the satellite broadcaster, BSkyB and its commercial rival ITV launch digital subscription services. BSkyB did well, attracting some 5 million customers by the end of 2000. ITV fared badly and was forced to close in 2002. As one contemporary observer noted: ‘Pay TV had in effect colonised the digital TV market’ (Starks 2007: 49).
However, in the wake of the ITV closure a surprising new alliance - combining the BBC with ITV, Channel 4, Arqiva and BSkyB - took over the licences and launched the Freeview digital service in late 2002. It was perhaps in the interests of BSkyB that this new initiative should not emerge as a subscriber competitor and Freeview remained, resolutely, a free-to-air service: ‘This was TV through the normal rooftop aerial for people who did not want pay TV’ (ibid: 83).
In the following decade many commentators believed the process of digital transition would deliver a predominantly pay TV system. To begin with this seemed to be happening. In 2002, when some 39 per cent of British homes had adopted digital television (mainly through BSkyB) the percentage of digital homes paying for TV stood at 87 per cent. Five years later, in 2007, when the proportion of digital homes had grown to 86 per cent the corresponding figure for pay television had fallen to 55 per cent. And five years after that, in the final switchover year of 2012, the figure of 96 per cent of homes adopting digital compares with 51 per cent of homes adopting pay TV (Ofcom 2007: 101; 2010: 97; 2014b: 127). There appeared to be life in the free-to-view model after all.
In 2014, the Lamy report acknowledged DTT as the ‘backbone’ of European provision, citing the fulfilment of such policy objectives as ‘cultural diversity and media pluralism’ and ‘ensuring universal and free-to-air access for citizens’; but he also noted that the market share of DTT varied considerably between countries with Belgium at 4 per cent and Italy at nearly 80 per cent (2014: 3 and 5).
A national service, free at the point of use
While the BBC appears resolute in supporting the principle of universal access and ‘something for everyone’, it also seems internally conflicted on the topic of internet delivery with one recent report asserting that:
By 2025, most people in the UK are likely get their television programmes over the internet. By 2030, possibly everyone will. The TV aerial will have gone the way of the typewriter (BBC 2015: 2)
At the same time senior executives lobbying in Europe and preparing for the possible consequences of the forthcoming World Radio Conference were arguing that spectrum should be retained for broadcasters and that free-to-air reception, via the old aerial, was one of the necessary features of public service.
In 1924, John Reith, first director general of the BBC, spoke of bringing ‘the best of everything into the greatest number of homes’ and marvelled at the new technology of broadcasting. He considered it to be:
…a reversal of the natural law, that the more one takes, the less there is left for others… Most of the good things of this world are badly distributed and most people have to go without them. Wireless is a good thing, but it may be shared by all alike, for the same outlay and to the same extent (Reith 1924: 147 and 217).
Wireless or broadcast delivery is still ‘a good thing’ and cost effective for users. Living wage or ‘minimum income standard’ calculations developed in the UK include the cost of owning a Freeview television along with an annual television licence fee to cover content costs (Rowntree 2014: 20). But there are also many homes managing on less than a living wage and some of these may be struggling to pay the licence fee. Government figures indicate that around 17 per cent of UK households are on a ‘low income’ – defined as less than 60 per cent of median income (Department of Work and Pensions 2014: 4). This 17 per cent figure could be seen to correspond roughly to the already mentioned 18 per cent of homes that Ofcom records as being without internet access.
Low income households with children may be as dependent on CBeebies and CBBC as high income ones might be addicted to the Today programme or Top Gear. But little or no research seems to be available on the likely costs of fixed or mobile broadband delivery of programmes – in an age when the option of broadcast delivery might no longer be available. This seems an odd omission.
Democratic governments and institutions have a responsibility to weigh carefully the impact of policy-driven change on all of a nation’s homes including the impact of otherwise yawn-inducing spectrum policies. Perhaps, as a minimum, the public could be kept better informed about the decisions being taken in their name by ministers, regulators and high level groups as well as by the guardians of mobile telecommunications and public service broadcasting.
This is an extract from the forthcoming book:
The BBC Today: Future Uncertain. Ed. John Mair, Professor Richard Tait and Professor Richard Lance Keeble. Abramis Bury St Edmunds: 5 September 2015
(Copies available from Richard@arimapublishing.co.uk and on Amazon)
All the images in this piece were provided by the author
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