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Broadcasting Issues: Platform and Technology Issue

Hon Marian Hobbs
Minister of Broadcasting

6 July 2000

Broadcasting Issues: Introductory Paper: Platform and Technology Issues

The following paper was approved by the Cabinet on July 3 2000

Office of the Minister of Broadcasting

Memorandum to Cabinet

Broadcasting Issues: Introductory Paper: Platform and Technology Issues


1. On 10 April, Cabinet confirmed details of a work programme to review a number of aspects of current broadcasting policy [CAB(00)M12/2G(2) refers]. This paper, the first called for by that work programme, reviews changes in technology that are currently transforming the broadcasting industry. It considers the significance of those changes for the current broadcasting environment and identifies areas for further work.

Executive Summary

2. Digital technology will continue to bring important changes to New Zealand’s broadcasting environment over the next few years. The key feature of the new communications environment is that any form of information content (e.g. video, graphics, sound, text or voice) can be made available via any transmission platform (e.g. cable, satellite, wireless networks) to a range of traditional and new consumer reception devices (e.g. mobile phone, television, PC).

3. Digital technology will substantially expand the range and quality of services and content available to viewers, impact on audience size and configuration, and change network and industry structures.

4. Internationally these changes are encouraging governments to review and, in many instances, change their broadcasting regulatory framework. In New Zealand this is to be achieved through the broadcasting policy work programme, which should take the outcome of the Ministerial Inquiry into Telecommunications into account. The Government’s electronic commerce strategy [CAB(00)M15/3G(1) refers] may also have implications for the broadcasting industry and the issues identified in this paper.

5. The key issues identified in this paper that require further work are:

a. the allocation of spectrum for digital television, including competition issues, and issues relating to the transition from analogue to digital broadcasts; and

b. consumer access to broadcasting services in a digital environment, such as geographic coverage, the control and design of set-top boxes and related equipment, and access by content providers to networks.

6. These will be covered in the work programme’s three subsequent papers relating to platform issues. Two of these papers will not be finalised before the outcome of the Telecommunications Inquiry has been considered and on that basis will not be considered by Cabinet before the fourth quarter of this year or early 2001. It is proposed that the remaining paper on Reservation of Spectrum for Non-Commercial Purposes be considered by Cabinet in September 2000.

7. The government’s content objectives for public broadcasting will be covered in a separate stream of work and will be informed by the issues identified in this paper.

Scope of this Paper

8. The boundaries between broadcasting, telecommunications and the Internet are becoming blurred as technology evolves. The primary focus of this paper is to assess the policy implications of these technological changes as they relate to broadcasting services, simply defined as the transmission of audio and audiovisual information.

9. Implications of these changes for non-broadcasting services and the development of a knowledge economy are being addressed in separate fora. In particular:

 The Ministerial Inquiry into Telecommunications will comment on whether the regulatory environment facilitates the ongoing delivery of Internet access and other telecommunication services critical to the development of an information economy in New Zealand. This is likely to include some discussion of broadcasting issues, and of issues relevant to broadcasting services. Such issues include network access and interconnection. Officials from the Officials’ Committee on Broadcasting Issues have met with the Inquiry panel to discuss matters of common interest, and intend to continue that dialogue. In some instances, this paper proposes that Cabinet not take decisions on certain issues until the outcome of that Inquiry, and the government’s response to it, is known.

 Cabinet recently agreed to a government vision for electronic commerce and a process for development and consultation on an electronic commerce strategy [CAB(00)M15/3G(1) refers].

Part 1: Government Objectives for Involvement in Broadcasting

10. The history of government involvement with broadcasting parallels the history of government involvement in network industries generally. Internationally, governments have traditionally had a number of objectives in mind with regard to network industries. These include:

 Promoting efficient use of resources and encouraging innovation in services.
 Ensuring equitable consumer access to services.
 Encouraging and supporting appropriate technical standards.
 Preventing the abuse of the high degrees of market power common to network industries.

11. In the case of broadcasting, governments have also sought to regulate and foster content. Content objectives have included:

 Enforcement of standards of content which conform with and support perceived community values.
 Promotion of national culture and identity.
 Promotion of participatory democracy, including encouragement of a diversity of information sources.

12. A companion paper [Broadcasting Policy: Objectives and Delivery Mechanisms] seeks Cabinet’s agreement to the government’s content objectives for public broadcasting.

Development of Broadcasting Regulation in New Zealand

13. The New Zealand broadcasting regulatory environment was reformed extensively in the late 1980s and early 1990s. Prior to those reforms, broadcasting was characterised by implicit regulation as government owned the broadcaster and associated networks.

14. The current regime seeks to provide a wide variety of broadcasting services and to encourage investment and innovation in services by minimising regulatory barriers to entry into the broadcasting market, while ensuring that key public service objectives continue to be met. It avoids, where possible, prescribing how a particular technology, resource or market should develop, as prescription runs a high risk of locking into a structure or service that would otherwise not endure.

15. There are currently three principal limbs to New Zealand’s broadcasting regulatory framework. These are:

The Broadcasting Act 1989: This Act:
 Establishes the Broadcasting Standards Authority to enforce programme standards;
 Establishes the Broadcasting Commission (NZ On Air) to:
- promote programming that reflects New Zealand culture and identity (including Maori language and culture); and
- maintain and extend the coverage of television and sound radio broadcasting to New Zealand communities that would otherwise not receive a commercially viable signal.
 Establishes Te Reo Irirangi Whakapuaki (Te Mangai Pahou) to fund programming that promotes Maori language and culture.

The Radiocommunications Act 1989 : This Act establishes a framework for management of the radio spectrum. The Act:
 Provides for the creation of tradable property rights in the radio spectrum of up to 20 years duration (ie long-term leases over right to manage or use) ;
 Provides a framework for the allocation and trading of those rights, but does not prescribe an allocation mechanism;
 Permits spectrum to be reserved to meet social policy objectives and Treaty of Waitangi obligations in broadcasting.

The framework for considering reservation of spectrum for non-commercial purposes is being reviewed as part of the work plan approved by Cabinet in Cab(00)M12/2G(2). The intention is that Cabinet will consider this issue in September this year.

The Commerce Act 1986: This generic competition law applies to the broadcasting sector in like manner as it applies to other sectors.

16. The key features of the current broadcasting regulatory frameworks in the United Kingdom and Australia are provided in Appendix 1.

New Zealand’s Current Broadcasting Environment

17. In simple terms, broadcasting is the transmission of audio or audiovisual information by radio waves or other means of communication (eg cable) for reception by the public using suitable receiving equipment, eg television or radio sets. To date, broadcasting has been a one-way process, from broadcaster to viewer (ie “one to many” transmission). In contrast, telecommunications services are two-way, usually established on a “one to one” basis, and have historically developed with largely separate infrastructure.

18. Transmission networks for broadcasting services in New Zealand are of three basic types, each requiring viewers to have suitable receiving equipment: terrestrial transmission (requiring a suitable antenna or dish), satellite transmission (requiring a satellite dish), and cable services (requiring a physical cable link to the receiving equipment). Terrestrial and satellite transmission both utilise radio spectrum. Most broadcasting networks will use combinations of these three approaches. The different network transmission, distribution and reception methods are represented diagrammatically at Appendix 2.

The New Zealand television broadcasting market now comprises:

Broadcasters Platform Platform Owner Coverage
TVNZ, CanWest
(TV3, TV4, Prime,
Sky UHF* and regional providers Terrestrial (requires spectrum and transmission towers) Broadcasters own the spectrum. BCL owns the transmission towers and provides transmission services (however increasing number of other high site providers such as Sky Tower) Ranging from small geographic areas to 99% of New Zealand
Sky* Satellite (requires spectrum and satellite transponders) Broadcasters own the spectrum. International entities own the satellites (broadcasters only lease satellite space) 100%
Saturn* Cable Saturn Wellington, with coverage planned to expand beyond 60% in 5 years
*Subscription television services

Part 2: Trends

Digital Technology and Convergence

19. The key feature of digital technology is that, subject to capacity (i.e. bandwidth) constraints, any form of information content (eg video, graphics, sound, text or voice) can be made available via any transmission platform (eg cable, satellite, wireless networks) to a range of traditional and new consumer reception devices (eg mobile phone, television, PC).

20. Digital technology generally improves quality and, just as significantly, enables more information to be carried than is possible using analogue technology. As analogue terrestrial television technology is supplemented by digital transmission, there will be a four-fold increase in available capacity.

21. Accordingly, the traditional domains of telecommunications, broadcasting, and information technology are “converging” as industry players seize opportunities to participate in existing and new markets for content-based services. Eventually all information is likely to be carried in digital, rather than analogue, format.

22. For consumers this offers the potential for a substantial expansion in the range and quality of services available through the “television” set. For example, TVNZ’s digital proposal included accessing the Internet and email and also providing interactive television. Developments are occurring at a rapid pace, such as new set-top boxes containing large capacity disk drives, which in essence are a digital video cassette recorder device enabling viewers to skip all advertisements, and eventually being able to download programmes of their choice (i.e. an online video rental store).

Future Developments

23. Together, the development of digital technology and the process of convergence are likely to have significant effects in the following respects:

Bandwidth and Service Offerings: Transmission networks are likely to be distinguished by their bandwidth and whether they are one-way or two-way transmission, rather than the type of information they may carry. As discussed, viewers with access to high-bandwidth networks to their home will be able to have a wider range of services delivered via “television” sets. The bundling of these services will blur the distinctions between televisions and computers. Commentators speak of the development of a product known as a “screen” which will provide access not only to television, but also to a range of other digitally delivered services.

Audience Size and Configuration: Increased channel numbers and multiple service offerings will, in turn, impact on audience size and configuration. Market “fragmentation” is a term commonly used. Pay, or pay per view programming, will become more common on commercial television. At the same time there will be a greater capacity to carry programming targeted at minority and other community interest groups. Notwithstanding those trends, it seems likely that free to air television – whether commercial and entertaining and informing mass audiences so as to sell time to advertising “customers” or supported by public funding – will continue, albeit probably with smaller overall market shares.

Network and Industry Structures: Previously discrete networks carrying non-competing services will now offer competing services and platforms. They offer the potential to improve services and “reach” to remote areas. Urban areas, however, will continue to be provided with a greater choice and quality of services. In response, a range of firms – previously operating in distinct markets – are amalgamating. Most significantly these include Internet service providers (eg America on Line) and content providers (eg Time Warner). New Zealand’s small broadcasting and telecommunications market is similarly building international alliances to secure the expertise, capital and content held offshore. For example, the Telstra/Saturn cable venture and Telecom/INL/SKY “links”.

Part 3: Implications for New Zealand

24. This paper now investigates how these trends may affect government objectives relating to networks as identified in Part 1.

Promoting Efficient Use of Resources and Encouraging Innovation

25. A key resource issue to be addressed in the transition to digital broadcasting services is the allocation of spectrum suitable for digital television. The aim of the spectrum management framework encompassed in the Radiocommunications Act is to ensure that spectrum is allocated to uses which society values most. The Act does not, however, specify how spectrum is to be allocated. The Government retains flexibility to select the allocation method best suited to the spectrum concerned.

26. Auctioning spectrum rights is the preferred approach for spectrum for commercial use. A framework for consideration of non-commercial allocation of spectrum is the subject of a separate report back to Cabinet [refer CAB(00)M6/38].

27. Spectrum suitable for digital television is expected to be ready for allocation following the 2GHz auction. A later paper on Digital Transmission will seek Government agreement to a mechanism for allocating this spectrum and include comment on:

 Decisions by the previous government to guarantee an allocation of spectrum to existing broadcasters for simulcast transmission (ie to broadcast in both digital and analogue).

 Issues relating to the transition from analogue to digital technology, including comment on international approaches to spectrum management. The Australian Government requires analogue broadcasting to be maintained until 2008 to ensure availability of services to viewers. In the United Kingdom, no decision has yet been made on a fixed date for analogue switch off.

 Competition issues, including consideration as to whether any specific competition safeguards are required to supplement the Commerce Act. (For example, specific auction rules will be applied in the forthcoming auction of spectrum in the 2 GHz band. The use of pro-competitive auction rules has, however, not generally been required and may not be needed in the future due to the changes to the Commerce Act recently agreed to by the Government).

28. The preparation of that paper will involve consultation with the industry. It is not proposed that that paper be submitted to Cabinet before the report of the Telecommunications Inquiry is available. On that basis, Cabinet is likely to be in a position to consider those issues in the fourth quarter of this year or early in 2001.

Ensuring Equitable Consumer Access to Services

29. The changes in broadcasting services are marked, and in many senses driven, by improving consumer access, and quality of that access, to a whole range of digitally delivered products and services. This tends to suggest that consumer access will become less, not more, of a problem as time passes. For example, the Internet makes vast amounts of entertainment and information available to consumers via telephone lines.

30. As for consumer reception equipment (such as digital television sets or set-top boxes), experience strongly indicates that costs will decline with technology developments and competitive pressure.

31. Nevertheless, questions have been raised regarding consumer access to broadcasting services in a digital environment such as:

 Whether and to what extent various services (such as free-to-air broadcasts) will be available to people in remote areas? The combination of technological change and increasing competition will help to ensure that services are available in remote areas, with satellite broadcasting particularly well suited to this purpose. However, where equity issues arise, the Government may need to intervene, as it does now through NZ On Air, and subsidise the transmission of services to remote communities.

 Whether and to what extent access of content providers to transmission networks needs to be considered? Some countries require network owners (mainly cable operators) to carry free to air broadcasts on their network to assist consumer access to content – often referred to as “must carry rules”. These rules are being revisited in light of convergence, expected increase in competition, and the increased capacity resulting from digital technology. In New Zealand, free to air broadcasters have indicated concerns regarding the Copyright Act's provisions permitting cable network operators, such as Saturn, to transmit their broadcasts for a negotiated charge.

32. These issues will be investigated in the Digital Transmission paper. Many of these issues also need to be assessed in light of the Government’s competition policy and objectives to encourage and support technical standards, which are discussed next.

Encouraging and Supporting Appropriate Technical Standards

33. In reality, New Zealand tends to be an acceptor of standards developed internationally, rather than an originator of such standards. At the same time, New Zealand does from time to time need to choose between “competing” international standards.

34. Where different standards are available, each will typically offer different service features, costs, and performance quality. It is therefore generally seen as preferable to permit industry to determine which standard should be used in each instance. There, is however, a role for Government to encourage acceptance of a standard should industry developments give rise to competition concerns. This approach has generally proved satisfactory and minimises risks to the Crown. It is interesting to note that the United States Government mandated standard for digital television is proving problematic and may well be changed.

35. Standards New Zealand provides a forum for debate and adoption of transmission standards for use in New Zealand. In many cases industry players have simply co-operated to determine a suitable standard (i.e. as for NICAM Stereo). There is currently a strong level of industry co-operation through Standards New Zealand in regard to digital terrestrial television and consensus on a standard seems likely.

36. The potential downside of not imposing technical standards is that a commercial interest may capture an initial market with a proprietary system and potentially force higher costs onto consumers. There is also a risk of a proprietary system becoming dominant whether or not a standard is formally developed, as occurred with Microsoft products for computers. These types of actions, however, will be subject to scrutiny under the Commerce Act.

Protecting Competition

37. The impact of these forces of convergence involves trends which at the same time enhance competition and threaten it. The content objective of encouraging a diversity of information sources will of course be helped by greater competition. Whether the competition framework, in itself, is sufficient to achieve the desired diversity will be considered in the work on Content Objectives.

38. Convergence enhances competition by breaking down the barriers between traditionally discrete markets. Both the intensity of competition and the number of competitors is increasing in content and network businesses.

39. Convergence has, however, sparked a high level of mergers and acquisitions, which may reduce competition. Market power could also result where control of key broadcasting content combines with a strong market position in networks.

40. The influences of convergence will be relevant in the application both of those parts of the Commerce Act that apply to mergers and acquisitions as well as of those parts that deal with the use (or abuse) of market power for exclusionary purposes and exclusive dealing arrangements. The government has recently agreed to strengthen the Commerce Act’s merger and abuse of market power provisions.

41. The forthcoming Digital Transmission paper will look at whether and to what extent competition for services may be impeded by the cost or standards applied to key equipment, such as set-top boxes and, if so, the extent that these may be adequately addressed under the new provisions in the Commerce Act. Set-top box standards, particularly in the context of proprietary set-top boxes (i.e. those controlled by a specific broadcaster) are an issue being investigated by other countries. Also subject to scrutiny are devices and standards that can corral viewers into certain services or content, such as electronic programme guides or the position occupied by channels on the remote control.

42. The transition to full multimedia/broadcasting competition will require finely balanced competition judgements. Careful and effective enforcement of competition laws will be necessary.

43. The Commerce Act also governs transmission networks such as BCL’s terrestrial network. BCL’s predominant position in broadcast transmission services is being eroded by convergence of technologies and the expansion of transmission networks. Cable and alternative high sites (eg Sky tower in Auckland) offer alternative networks in metropolitan areas, while satellite extends competition to all New Zealand. Phone networks are already providing video for the Internet (although currently of low quality), so there is a strong possibility that as consumers have access to high-bandwidth they may also develop into broadcast transmissions as technology evolves.

44. As for satellite transmission, Sky only leases satellite space. International companies own the satellites under international agreements. Other broadcasters may similarly lease satellite space as satellites become available and replicate the 100% coverage achieved by Sky.

45. These developments, combined with the Commerce Act, provide a number of safeguards against, and process to rectify, any abuse of market power in the provision of transmission services. The Telecommunications Inquiry will consider the competition issues in the transmission services market in more depth. Following the outcome of the Inquiry, a further paper for Cabinet will look at the ownership and regulatory issues concerning the separation of BCL from TVNZ. It is proposed that Cabinet consider this paper at the same time as the paper on Digital Transmission (fourth quarter of 2000/early 2001).

Content Objectives

46. At the outset this paper identified three objectives for content regulation. These were:

 enforcement of standards;
 promotion of national culture and identity; and
 promotion of participatory democracy.

47. The changes in multimedia and broadcasting will have significant implications for the regulation of content. Some genres of programming targeted at minority and special interests may become more available because of the proliferation of channels and lower technology costs. At the same time other content objectives, such as the promotion of national culture and identity, may become more difficult as and to the extent that the “mass audiences” attracted by free to air television decline.

48. These, and other implications of these industry changes, will be considered in the companion paper to this paper dealing with the government’s content objectives, and in later papers.


49. The following departments have been consulted in the preparation of this paper: Ministry for Culture and Heritage; Treasury; Ministry for Economic Development; Department of the Prime Minister and Cabinet; Crown Company Monitoring Advisory Unit, Te Puni Kokiri.

Fiscal Implications

50. There are no fiscal implications directly arising out of the recommendations in this paper.

Legislative Implications

51. There are no legislative implications arising out of the recommendations in this paper.

Compliance Cost Statement

52. There are no compliance costs arising out of the recommendations in this paper.


53. It is recommended that Cabinet:

a. note the key feature of the new communications environment is that any form of information content (e.g. video, graphics, sound, text or voice) can be made available via any transmission platform (e.g. cable, satellite, wireless networks) to a range of traditional and new consumer reception devices (e.g. mobile phone, television, PC).

b. note that these trends are likely to increase the range of services and amount of content, impact on audience size and configuration, and change network and industry structures.

c. note that the primary focus of this report is policy implications of technological changes as they relate to broadcasting services, with implications for non-broadcasting services and the development of a knowledge economy addressed in separate fora such as:

 the Ministerial Inquiry into Telecommunications, which will comment on Internet access and other telecommunication services critical to the development of an information economy in New Zealand; and

 the recent Cabinet approved process for development and consultation on an electronic commerce strategy [CAB(00)M15/3G(1) refers].

d. note that the Ministerial Inquiry into Telecommunications and the Government’s electronic commerce strategy will have implications for the broadcasting industry.

e. note that changes to the Commerce Act covering market power and mergers and acquisitions will lower the threshold for scrutiny of anti-competitive behaviour in New Zealand media markets.

f. note that broadcasting work programme in regards to platform issues builds on the issues raised in this report in a further three papers covering:

 Digital Transmission – Regulatory Issues
 Reservation of Spectrum for Non-Commercial Purposes
 Separation of BCL from TVNZ

g. note that, given the issues identified in this paper, matters to be covered in the forthcoming report on Digital Transmission – Regulatory Issues will include:

 the allocation of spectrum for digital television, including competition issues, and issues relating to the transition from analogue to digital broadcasts; and

 consumer access to broadcasting services in a digital environment, such as geographic coverage, the control and design of set-top boxes and related equipment, and access by content providers to networks.

h. note that it is proposed that the paper of Reservation of Spectrum for Non-Commercial Purposes will be considered by Cabinet in September 2000.

i. note that the papers on Digital Transmission – Regulatory Issues and Separation of BCL from TVNZ will not be finalised before the outcome of the Telecommunications Inquiry is available and has been considered and on that basis will not be considered by Cabinet before the fourth quarter of this year or early 2001.

Hon Marian Hobbs
Minister of Broadcasting

Comparisons are often made between New Zealand’s broadcasting regulatory framework and the frameworks applied by the United Kingdom and Australia. The purpose of this appendix is to record key features of the current broadcasting regulatory frameworks in the United Kingdom and Australia.

Note, however, that regulatory interventions in both countries are subject to change as debate continues as their appropriateness and effectiveness in light of digital and convergence developments. Where applicable, the features of the UK and Australian regulatory experience will inform the subsequent papers being prepared by the officials committee.

In summary, the relevant features of the UK and Australian frameworks are:

 Both seek to achieve their content objectives through a mixture of state-owned broadcasters, quota, and conditions attached to broadcasting licences. New Zealand pursues its content outcomes through NZ On Air, Te Manga Paho and the Radio New Zealand Charter.

 Both supplement their generic competition policy framework with broadcasting specific regulation such as foreign and cross-media ownership restrictions. New Zealand relies on the competition policy framework provided by the Commerce Act.

 They have adopted different approaches to managing the transition to digital and ending analogue television broadcasts. Australia has mandated conversion and simulcast requirements, whereas the UK has indicated that digital transmission services must meet certain criteria (i.e. coverage and cost) before it will consider analogue switch-off.

United Kingdom
Regulatory Framework

The Broadcasting Act 1990 (modified by the Broadcasting Act 1996) regulates television and radio services. The objectives of the BBC, as defined in its Charter, are very broad and include provision of public and commercial broadcasting services and a plethora of other services and activities (e.g. concerts, print media, wireless telegraphy, research and development).

The Broadcasting Act 1996 established the regulatory framework for the development of digital terrestrial broadcasting, including liberalised media ownership regulations to allow greater consolidation and cross ownership. The current range of regulatory interventions include:

Must Carry Rules. Digital cable operators are required to carry specified free to air broadcasts. Similar rules also apply to certain non-digital cable operators.

Foreign Ownership Rules. Only UK and EU entities may hold licences for analogue television, domestic satellite and national radio services. No such restrictions apply to licences to provide cable, non-domestic satellite or digital terrestrial services.

Cross Media Rules. No newspaper group with more than 20% of total national circulation may hold television licences (or own more than 20% of a company with such a licence).

Competition Rules. No one entity, excluding public service broadcasters, can control licences for more than 15% of the total analogue television audience. A similar points based scheme applies for digital television. Similar rules apply to radio.

The broadcasting regulator is required to make every effort to ensure holders of commercial television and local radio service licences do not obtain cable service licences.

Telecommunication companies with revenue exceeding £1 billion are prevented from holding licences to operate television, domestic satellite, national radio and cable services. Holders of such services are similarly prevented from controlling a telecommunications operator with turnover exceeding £2 billion per annum.

Quota. There are varying quota rules. For example, majority of satellite television time must be devoted to programming of European origin, and at least 65% of programming on Channel 3 regional licences must be produced or commissioned by the licensee.

Analogue Switch Off. No mandated date. A recent statement indicates two tests must be met before switch off would occur: the main free-to-air channels had to reach virtually everyone in the UK; and 95% of consumers must have access to digital equipment.

Regulatory Framework

The Broadcasting Services Act 1992 establishes the regulatory framework for the broadcasting sector. It applies to free to air radio and television, pay TV, digital broadcasting and Internet content. The Act sets out the objectives of the regulatory regime, which include promoting a diverse range services, facilitating the development of the broadcasting industry, ensuring that Australians have effective control over the more influential broadcasting services, and developing and reflecting a sense of Australian identity and cultural diversity.

The Act includes a regulatory policy statement outlining Parliament’s intention to achieve its regulatory objectives without imposing unnecessary financial and administrative burdens on providers of broadcasting services. The regulatory interventions for the broadcasting industry include:

Foreign Ownership Rules. Foreign control of commercial television broadcasting licences is prohibited. This does not apply to radio.

Cross Media Rules. These are complex rules prohibiting ownership of multiple media (i.e. television, radio and newspaper) within the same geographical market.

(the Australian Productivity Commission recently reported that these specific ownership rules are now out of step with Australia’s competition policy settings)

Quota. Australia operates a genre-specific quota system. Compliance with content quotas is a condition of holding a broadcasting licence.

The Australian Government also recently introduced further regulatory interventions to promote the transition to digital transmission:

Mandatory Digital Transmission. Digital transmission is to commence on 1 January 2001 to approximately 80% of the population, with full roll out required within 3 years.

Analogue Switch Off. Initial policies to switch off analogue by a certain date have been abandoned. Broadcasters must now simulcast until 2007 and achieve the same level of coverage and potential reception quality in digital as exists for analogue transmission.

Technology Standards. Australia has adopted the European digital transmission standard DVBT. The Government has mandated broadcasters to transmit at least 20 hours per week in high-definition format.

Assistance to Existing Broadcasters. To facilitate the conversion to digital, existing broadcasters are to be insulated from competition by banning new entrants until the end of 2006. This requires complex rules constraining the development of certain technologies and the convergence of television, telecommunications and Internet. Free to air broadcasters also received additional spectrum licences but are prohibited from providing multi-channelling (to protect subscription services).

There has been considerable, and ongoing, debate surrounding these interventions. Some create impediments to growth while others will be increasingly difficult to enforce. Accordingly, the types of interventions are likely to change as the transition to digital progresses.


1. Terrestrial/satellite transmission 2. Cable transmission

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