Opening the door to the digital era: regulating Australia's future broadcast and new media industry

Each of the five broadcasters has received an allocation of bandwidth sufficient to broadcast in digital mode: 7 megahertz. This is on the basis that they "use it or lose it".

The two national or public broadcasters, the ABC and SBS, may use their bandwidth to broadcast three or four different programmes simultaneously – as we say, "multi channel". Three commercial broadcasters in each city do not have this option, with one small exception, which allows different aspects of the same sporting contest to be broadcast or a sports broadcast to continue when it overruns and clashes with the scheduled news.

These restrictions have been put in place after seeing what has happened in the US. There, the broadcasters campaigned for sufficiently wide bandwidth to broadcast in high definition, but are under no obligation to do so. In other words, they potentially have a windfall.

Simulcasting analogue and digital broadcasting is to continue for a least eight years. Nor can there be new entrants into commercial TV until 31 December 2006. This moratorium was adapted by Parliament in recognition of the cost to existing broadcasters in introducing digital television. Until then, spare channels will be auctioned for datacasting, which by definition cannot equate to television. Datacasters may be allowed to convert into television stations from 2006, but this is subject to enabling legislation.

When the Parliament does allow these datacasters to become television broadcasters, our existing commercial broadcasters will no doubt demand that the present cross-media and foreign investment restrictions be reconsidered. This will, of course, be a matter for Parliament. But it would be difficult to justify different regimes applicable to two different classes of commercial TV broadcasters.

The Australian requirement that broadcasters transmit in both High Definition (HDTV) and Standard Digital (SDTV) mode gives the viewer four options. These are:

• staying with analogue television for at least eight years, or
• acquiring a set-top box to use with an existing receiver, or
• acquiring a lower-cost SDTV receiver with a wide screen, or
• acquiring HDTV receiver at, of course, a higher cost.

Had the Parliament not mandated HDTV, and later simultaneous SDTV, it is highly unlikely the consumers would have had this choice, at least on free-to-air TV. This scheme has its supporters and its critics.

The critics include the Productivity Commission. In its report last year the Commission argued that HDTV receivers will be too expensive for most Australians. It is claimed that to enjoy the full benefits of HDTV the consumer will need to acquire a large screen and a surround-sound system, a virtual home cinema. I am not in the business of predictions but I would expect that many people, and not only in Australia, would be attracted to home cinema. This would be especially so in a community which places a high priority on sport.

In summary, it will be seen that this scheme is at least in part transitory, that is there is a moratorium as to new entrants and the date for the shutting down of analogue broadcasting is delayed. In any event, this has broad support across the political spectrum, although the media is divided.

The Future

I propose now to refer the medium and longer-term effects of digitalisation and convergence.

This new technology enables a move away from mass production. It is said not to favour vertical and horizontally integrated corporate structures, but some recent developments in the real world challenge this assumption. Further it is said to permit a move from a domestic market focus towards greater internationalization.