Uptake is slow but don't give up on it, Angus Kidman advises

Published in AustralianIT, August 19 2003

THE Federal Government has long recognised that people will need enticing to take up digital television. Way back in 1999 (practically the Jurassic era in digital TV terms), communications minister Richard Alston put it this way: "You have to give ordinary Australians a reason to go out and spend maybe $1000 or more on a new television set or set-top box."

While we wouldn't want to stand in judgment, we're fairly sure the ability to watch Bert Newton in widescreen or to check out extra corners of the Big Brother house was not what Alston had in mind when he made that pronouncement.

But the news isn't all dire. Despite patchy adoption, initially slow sales of set-top boxes, and network complaints about the cost of upgrading, proponents remain confident digital television eventually will be widely accepted.

At the same time, no-one is holding their breath. "There's just a growing confidence about it," says Peter Webb, who heads up industry advocacy group Digital Broadcasting Australia.

"In the collective consciousness of Australians I don't think digital television is front-of-mind, but there's enough information going around the community."

Just how popular is it? "We have probably in excess of 100,000 sales now," Webb says. "It could well be over 150,000 by the end of the year."

While that is still less than 1 per cent of the population, it's a big improvement on the earlier years of digital television, when it took more than 18 months to sell the first 20,000 units. (This includes set-top boxes and integrated units.)

Many in the industry have blamed a lack of compelling applications for the slow uptake of digital television, but Webb argues that a lack of choice in set-top boxes and integrated television sets has been a much bigger factor. "The television networks have always been keen to promote digital on air," he says.

"They know they have the power to drive people to retail stores, but there's no point if there's nothing to buy."

Webb points to the example of an early digital TV awareness campaign, fronted by television luminary Bruce Gyngell, which ran before any broadcasts had begun. The net effect was that lots of people went to retailers to ask about digital television, but were disappointed to learn there was nothing available.

As a result, many consumers decided to defer any decision until the product had been on the market for a while. With analog signals guaranteed until at least 2007, it seems some are prepared to wait for a while.

"Getting the supply lines in place has been the most time-consuming part of this whole process," Webb says.

While the original legislation establishing digital television regulations was announced in 1998, the final specification for receivers wasn't completed until November 2000, largely as a result of bitter argument over which broadcast standards would be supported.

The result was that manufacturers only started planning set-top boxes for the local market at the same time the services were switched on in early 2001.

The design process was inevitably time-consuming. "It's not like building a PC. Set-top boxes need reliability," Webb says.

The selection of brands has now increased. Webb points to the recent cross-network promotion for digital television (once again, Bert Newton was prominent) as evidence of how the market has matured.

"It was the first time the supply lines were strong enough for that to be a useful endeavour," he says.

One promising sign for the industry is the general popularity of high-quality television screens.

"There has been a very large surge in the sales of high-end equipment," Webb says. "People are buying plasma and LCD displays in larger numbers. Widescreen is going to be 20 per cent of all television sales by the end of the year."

That popularity is partly due to phenomenal growth in the DVD market, but Webb argues that the shape itself is important. "We underestimated the benefits of flatness," he says.

Nonetheless, Australians also seem keen on the notion of high-definition images, which may lead them inevitably to digital TV.

"Many more high-definition set-top boxes have been sold than standard boxes," Webb says, although he acknowledges this may be a result of early adopters having higher technical expectations.

"Australians are happy for a few early adopters to take the first step," he says.

The mandating of 20 hours a week of high-definition broadcasts on all commercial networks has also made digital TV more appealing, but the disappearance of the ABC's digital youth channels, ABC Kids and Fly, is a setback.

Webb declines to comment in detail on the budget-driven demise of those networks, but says: "It hasn't been helpful. A surprising number of people are upset at the loss."

Nonetheless, Webb remains confident that over time, the change will be made.

"The replacement market for receivers is three-quarters of all sets," he says. "That's the market digital television is gradually going to take over."