Senator the Hon Helen Coonan was Minister for Communications, Information Technology and the Arts from 18 July 2004 to 3 December 2007. This site is available for archival purposes only.

Senator Stephen Conroy is the current Minister for the Department of Broadband, Communications and the Digital Economy

086/06
12 September 2006

New Digital Television Services for Australians

Australian consumers could be watching TV on mobile devices during their daily commute and enjoying new digital television channels in home as part of the Government's media reform package, the Minister for Communications, Information Technology and the Arts, Senator Helen Coonan, announced today.

The Minister today announced that the Government will allocate two currently unassigned channels of television broadcasting spectrum nationally for new digital services for Australian consumers.

This builds on the Minister's announcement in July of a comprehensive media reform framework for Australia.

The first channel will allow new free-to-air, in-home digital services and the second channel could be used for a wider range of services, including mobile television services.

“This is fantastic news for Australian consumers. As we convert from an analogue world to a digital one, Australian consumers will be able to increasingly access new and innovative services and this is a significant step towards that,” Senator Coonan said.

“The allocation of this spectrum provides a significant opportunity for the emergence of new digital services such as true mobile television in Australia.

“It will also make digital television more attractive, offering new free-to-air digital-only content and services to act as an additional incentive for consumers to take-up digital television. For instance, a mobile TV service could offer 30 channels under some models.

“The Government also views the allocation of this spectrum as an opportunity for industry to expand and respond to the challenges of the digital environment.”

Consistent with the Government's view that these channels should be used to offer new and innovative digital services for consumers, neither channel will be permitted to be used for traditional in-home commercial television or subscription broadcasting services.

The allocation process, which will be conducted by the Australian Communications and Media Authority (ACMA), will start as soon as possible in 2007, subject to the passage of legislation.

“I have always said that Australian consumers are the end-game in the media reform process,” Senator Coonan said.

“In addition to these new digital services I am announcing today, consumers will be able to access improved multichannels from the two national broadcasters – ABC and SBS.

“The commercial broadcasters will also be permitted to provide a High Definition multichannel from 2007 and a Standard Definition multichannel from 2009.

“These changes will revolutionise the television viewing experience in Australia and add to the wide range of services now available to Australian consumers.”

Further detail of the allocation of the new channels is set out in the attachment.
Background

The two channels (“Channel A” and “Channel B”) will be allocated as separate, national licences. They will each be allocated through an auction process.
Both licences will be issued for ten years with the possibility of a further five year renewal.

CHANNEL A

Channel A will be permitted to be used for the transmission of free-to-air services which can be received on a standard digital TV receiver (in-home services). The types of services that could be offered on this channel include datacasting and narrowcasting services. These services will contribute to digital take-up in the home.
There will be participation criteria for bidders for Channel A relating to financial capability and willingness to roll out and maintain national services.
Channel A will be subject to an annual licence fee based on revenue, consistent with the arrangement for commercial broadcasting licences.
ACMA will have the power to impose licence conditions on Channel A relating to the roll out of services and the Minister for Communications, Information Technology and the Arts may direct ACMA in relation to the nature of those conditions.

CHANNEL B

Channel B will be permitted to be used for a wider range of uses. Under this “highest and best use” approach, these uses could include emerging new digital services such as mobile TV.
Channel B will not be subject to an annual licence fee, consistent with the model for spectrum licences.
The wider range of possible service options on this channel are potentially more speculative and complex than Channel A and the Government considers that an upfront licence fee alone is appropriate.
A potential model for the use of this channel could be a mobile TV offering, integrated with 3G mobile phone services and internet services and made available on a subscription basis.
Channel B will be subject to a condition that the applicant must commence a service within 18 months of the allocation.

WHO CAN CONTROL THE LICENCES?

Incumbent free-to-air broadcasters will be prohibited from controlling Channel A. These broadcasters already have access to digital spectrum on which they can provide datacasting services and from 2007, limited multichannelling services.
Incumbent free-to-air broadcasters will be permitted to control Channel B, however, consistent with the restrictions on Channel A, they will not be permitted to use it to provide in-home services.
No other control restrictions will apply.
However, all bidders will be subject to the usual competition constraints about substantial lessening of competition that are set out in the Trade Practices Act and apply to acquisitions in any industry.
Consideration will be given to additional measures to protect competition, such as competition limits, in consultation with the Australian Competition and Consumer Commission, in the context of allocation.
Incumbent free-to-air broadcasters will be able to provide content to either Channel A or Channel B, subject to complying with the control restrictions on the licences.
This strikes a balance between the objective of encouraging new operators in the digital television sector with the need to ensure that new services are sustainable and successful.

OTHER MEASURES

Consistent with the Government's intention that these channels be used for new and innovative digital services for consumers, rather than replicating traditional television services, neither Channel A nor Channel B will be permitted to be used for traditional commercial free-to-air TV services or subscription TV services to fixed in-home receivers.

TIMING

The allocation process will be conducted by ACMA. It will commence as soon as possible in 2007, subject to the passage of legislation.