BBC 'direct' on satellite

["Kenneth Watt" <kwatt@xxxxxxx>]

18 March 2003=20
BBC 'direct' on satellite=20
THE BBC is to pull out of Sky's conditional access system and broadcast
its eight TV channels, unencrypted, direct to UK digital satellite
viewers.

The Corporation will begin broadcasts from the Astra 2D satellite on May
30 - the month its current five-year contract with Sky comes to an end.

It claimed the move - which has already been hailed by ITV - should save
it =A385 million over the next five years.=20

Around =A340m of these savings have been earmarked to make BBC national
services in Scotland, Wales and Northern Ireland and, for the first
time, all 15 English regional variations of BBC 1 available to satellite
viewers.

The BBC channels will be available on Sky's electronic programme guide -
a point confirmed by Sky - but the Corporation will require a change in
Sky's EPG software to allow viewers to select the regional service they
want.

It said it has offered to pay Sky "a fair price" for this service
"including a profit margin".=20

Even if agreement cannot be reached, the BBC said it would still go
ahead with its plans for unencrypted satellite broadcasts.

"For the first time ever," said BBC director-general Greg Dyke,
"all the
BBC's regional and national services will be available to viewers right
across the UK. This means that a Scot living in London can get BBC 1
Scotland, or a native of Yorkshire, living in Cornwall could watch
regional programmes from their home region."

He said the decision was an important one for the BBC that would not
only save money but bring new benefits to viewers. He added it should
also broaden the appeal of digital satellite TV.

It was a point taken up by Hugh Peltor, consumer electronics director at
makers' group Intellect.

The BBC's move, he said, will make digital switchover so much easier as
satellite broadcasts will be able to reach the 15% or so of UK viewers
who will be difficult geographical targets for digital terrestrial TV.=20

"Intellect has long argued that the UK needed an open digital
satellite
market similar to that in Germany. This is a very welcome
development."

And, he added: "The likelihood of achieving digital switchover by 2010
has been considerably improved by the BBC's decision."=20

Astra 2D's signals are tightly focused, so, by carrying all its services
to this satellite, the BBC can largely limit broadcasts to the UK and so
remove any need for encryption to protect its rights.=20

Sky's response to the BBC's announcement was low key.

A spokesman pointed out that as Sky was an open platform, channels had
the choice either to broadcast unencrypted or use its conditional access
system.

"The BBC's proposals mean that all digital satellite viewers would
continue to receive its channels," the spokesman said. And he added
"Sky
looks forward to negotiating charges with the BBC for the technical
services it is requesting."

ITV joint managing director Clive Jones said he understood
"entirely"
why the BBC made its decision.

"The public service broadcasters have long argued hat the price Sky
charges for conditional access it too high," he said. "ITV
currently
needs Sky's conditional access facilities in order to deliver the best
regional service to viewers. The =A317 million per annum ITV pays for this
service bears no relation to the actual cost of the service - which we
estimate to be no more than a few hundred thousand pounds."

The Office of Telecommunications (to become the Office of Communications
towards the end of this year) rejected ITV's complaint last November
that Sky's prices were excessive.

Maintaining that ITV was happy to pay "a fair rate" to Sky, Mr
Jones
said: "We are calling for an amendment to the [Communications] Bill
that
will require Ofcom to take account of the particular nature of public
service broadcasters and their obligations to viewers when deciding
whether Sky's charges are appropriate.. but if we have to divert
millions of pounds from on-screen investment to underwrite Sky's pay-TV
business it is viewers who will ultimately lose out."

He pointed out that ITV's current contact with Sky for conditional
access services runs until autumn 2004. "In the meantime we will
review
all options and follow developments with interest."

Earlier this year, at the Westminster Media Forum, Sky chief operating
officer Richard Freudenstein defended the satellite broadcaster: "Sky
has invested over =A32 billion in the digital satellite platform. To
borrow a phrase from Tony Ball [BskyB's chief executive], Britain did
not wake up one morning to find that the tooth fairy had left a fully
interactive, digital satellite platform with over six million
subscribers under the public service broadcasters' pillows."