Digital Television
   

Issue 6: Implications for Public Broadcasting

    Programme Funding

  1. Currently, funding for public interest broadcasting is made available on a contestable basis through NZ On Air. Under the Broadcasting Act, when examining a proposal for the funding of a television programme, NZ On Air must take into account the potential size of the audience likely to benefit from the programme. In practice, this means that NZ On Air funding has been used mainly, if not exclusively, for programmes that have an undertaking to be broadcast by a nationwide broadcaster (TV One, TV2 or TV3). The restructuring of Television New Zealand as a Crown company, and the adoption of a charter, will give additional mechanisms for promoting public interest programming.

  2. While Television New Zealand and CanWest both currently maintain a nationwide analogue terrestrial television network, it may not be economically viable to maintain these networks in the future. This may have implications for the funding of public interest broadcasting, and consequently on whether all sectors of both urban and rural communities are able to receive public interest programming from a free to air broadcaster, through any of the various transmission methods.

    168 Should broadcasters arrange free to air carriage on a digital satellite service, then potentially anyone in New Zealand regardless of location will be able to view free to air programming, provided they have the correct reception equipment. This could serve to increase the number of broadcasters that meet NZ On Air's coverage requirements for funding public interest broadcasting for free to air viewing.

    Audience Fragmentation

  3. Digital technology allows many more television channels to be broadcast on a given bandwith than analogue technology. Overseas experience suggests that as consumers begin to convert from analogue to digital services, they are faced with an increasing array of viewing choices. This tends to result in audience fragmentation and a smaller viewing audience for each channel. This in turn has implications both for public interest broadcasting and for commercial broadcasters reliant on advertising revenue.

    170 Audience fragmentation may make it more difficult for public interest programming to reach its intended audience. Conversely, the wider variety of channels that are anticipated in the digital broadcasting environment could make it easier for broadcasters to target special interest programmes at the appropriate audience segment.

  4. Advertising revenue is tied to viewing numbers. A proliferation of channels may reduce the number of viewers watching any given programme and hence the price companies are prepared to pay to place their advertisements. An increasingly fragmented television market also may tend to spread advertising revenue over a greater number of channels and/or broadcasters. This has the potential to affect the financial viability of both commercial and non-commercial broadcasters.

    Non-Commercial Television

  5. A number of licences have been granted at no resource cost to facilitate the broadcasting of programmes which may not attract a commercially viable audience. On one hand, the increased capacity available with the introduction of digital broadcasting could enhance the ability of these non-commercial broadcasters to reach a carriage arrangement with a commercial broadcaster. On the other hand, the increased audience fragmentation that is expected in a digital environment could make this more difficult.

    Maori Television

  6. UHF spectrum was reserved in the early 1990's for the purpose of promoting Maori language and culture. There is sufficient reserved spectrum for both terrestrial analogue and terrestrial digital signals, covering approximately 80% of the population, if the future Maori television service chooses to undertake such a course.

  7. If a greater level of coverage is desired, a practical alternative could be digital satellite transmission. Digital satellite transmission would give 100% coverage without the cost of building and maintaining a terrestrial network. The success of satellite broadcasting would depend on sufficient capacity being available on the Optus B1 satellite (or any other satellite available in the future) and potential viewers purchasing the necessary reception equipment or being able to use existing Sky set top boxes.

    Retransmission Rights

  8. The Ministry is currently consulting on possible changes to the Copyright Act. At present, cable operators have the right to re-broadcast free to air programmes in certain circumstances (free to air broadcasters may impose a licensing arrangement but cannot prevent a cable operator re-broadcasting their programmes). Satellite services are specifically excluded from this provision.

  9. Arguably, the right currently enjoyed by cable operators should simply be removed on the grounds that it is no longer needed. If the right were to be extended to include satellite transmission, however, one option would be to require any such re-broadcasting to be on a free to air basis.
What are the implications of digital television for public broadcasting services and local and special interest content?

6.1  Does the Government have a role in ensuring that all New Zealanders have access to digitally broadcast public interest programming? How can/should this be achieved?

6.2  What issues are seen in the broadcasting of public interest programming in a digital environment?

6.3  Should special account be taken of the availability of channels which currently carry public interest broadcasting, i.e. TV One, TV 2, TV3 and non-commercial regional stations?

6.4  In what ways will audience fragmentation positively or negatively impact on public interest programming?

6.5  How will the audience fragmentation likely in a digital environment affect broadcasters financially?

6.6  How will the introduction of digital television broadcasting impact on non-commercial broadcasters?6.7 How will the introduction of a digital television broadcasting environment affect the future Maori television service?

6.8   Are there issues unique to the introduction of digital broadcasting which will be affected by either expanding section 88 of the Copyright Act to include satellite broadcasters, or conversely, repealing section 88 to remove the ability of cable broadcasters to re-broadcast free to air programmes on their cable network?



 
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