Interreg IIIC DICE Component 3 Working Group 2

Interactive Services, Migration, Implementation & Business Opportunities

C3WG2 Final Report:

Version: Final 1.0 – 31.10.06

CONTENTS

Introduction...... 2 Executive Summary ...... 3 C3WG2 membership and contributions...... 7 Meetings...... 7 Work Area ...... 7 Market Situation in DICE member countries (DTV) ...... 8 Definition of Interactive TV (i-TV)...... 9 Summary ...... 9 Opportunities for i-TV via mobile synergies ...... 13 Consumers’ Definition...... 14 Mobile TV developments in DICE countries ...... 14 Overall Conclusions ...... 15 Best Practice ...... 17 Recommendations ...... 17 Glossary ...... 18 Acknowledgements ...... 20 Further Resources...... 20 ANNEX 1: i-TV in DICE Member Countries ...... 21 ANNEX 2: Mobile TV in DICE Member Countries...... 31

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Introduction

This document represents the final report of the DICE Project: Component 3 – Working Group 2 (C3WG2).

Those in the C3WG2 group were tasked with exploring aspects of Digital Terrestrial TV (DTT) based Interactive Television (i-TV) to include migration, implementation & business opportunities that could potentially be adopted in a standardized manner.

The primary objectives of this report are to highlight the different status for each member country’s digital and i-TV platforms plus scope for mobile TV as an i-TV solution. The report then draws some conclusions on best practice elements that could be commonly applied.

The report’s content is primarily derived from the output and discussions from four C3WG2 group meetings required under the DICE project and contributions from other members of other DICE groups. It also draws from elements of DICE conferences and other workshops plus trusted recent market analysis sources. The report also points to a number of helpful websites and documents in its Annexes, Acknowledgements and Further Resources sections.

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Executive Summary

• The C3WG2 group was chaired by UK representation and its core membership came from Aus- tria, Germany and Poland. However contributions were gained from all DICE members plus ex- ternal parties invited to attend workgroup sessions at conferences held in Gävle Sweden and Vi- enna in Austria. Activities centred on exploring opportunities to develop take up of the Multimedia Home Platform (MHP) Application Program Interface (API) consistent with the European Commis- sion’s support for open and interoperable standards.

• This report considers both enhanced TV and true two way i-TV variants. The former being one- way services without a return channel and including digital teletext, on screen menus and Elec- tronic Program Guide (EPG) access plus also broadcasted applications and downloads stored in digital receivers enabling users to play games select different camera angles or even different events. True interactive services are the “two-way” services running between the consumer and service provider, reliant on some form of return path (telephone line connection; inherent link in a cable or Digital Subscriber Line (DSL) Internet Protocol TV (IPTV) feed; or mobile phone text messaging).

• Through the four C3WG2 meetings required by the DICE Project Management plus associated conferences, it became clear that views on MHP and its deployment were extremely polarized. Both Germany and Sweden who had initially supported and launched MHP proactively, had pulled back to include stopping services. Poland and Hungary had yet to introduce Digital Terrestrial Television (DTT) and therefore MHP commercially and only a limited DTT service had begun in Lithuania’s capital city of Vilnius. The UK leads the world for DTV switchover and had over 72% penetration in homes with products based on different platforms and APIs giving no scope for mi- gration to MHP. On the other hand, to support its limited TV service offering, Austria is actively embracing MHP in its forthcoming DTT service launch from October 2006.

• In Germany, public broadcaster ZDF had lowered MHP capacity to 200 kbit/s for the benefit of better picture quality and private broadcasters had ended their MHP activities on all platforms. Also German cable operators who had decided to support MHP in their networks in 2005 had not implemented it and now the majority of them have no interest in it.

• Sweden’s public service broadcaster, Sveriges Television (SVT) began broadcasting MHP ser- vices on all digital platforms in 2004. However due to there being no commercial MHP receivers available on the market, MHP has failed to make a major impact. This is despite the NorDig re- gional agreement for a standardized API and aims for an open, standardised market with horizon- tal competition across the relevant countries.

• DTT and MHP roll outs in both Hungary and Poland have been hindered by political issues. Gen- eral lack of Government support and media law constraints as hit the former while Government changes in 2005 and to the regulatory bodies have impacted Poland.

As with Lithuania both face a further challenge from their distribution channels refusing to carry stock of receivers due to uncertainty over use of MPEG-2 or MPEG-4 video compression.

• As the longest established DTV market, the UK had a massive and growing legacy of more than 18.6 million products1 deployed in homes spread between satellite (OpenTV/WtvML); terrestrial (MHEG-5 and no return channel); cable (Liberate) and emerging IPTV platforms.

• Austria’s new DTT service commencing in October 2006 is to carry just three TV services (ORF1, ORF2 and ATV+). Consequently, MHP is beings supported proactively as a core means to differ- entiate digital from analogue.

• The core barriers to MHP adoption were found to be:

1 Ofcom Report: “The Communications Market 2006” Published 10 August 2006

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o Costs and Capabilities: A radically higher price for relatively little extra benefit causing distribu- tion channels to reject ranging products.

o Legacies and Performance: Maintaining large bases of established platforms plus no radical improvements from new alternatives to encourage adoption.

o i-TV demand: Interactivity is not a key driver of DTV take-up. While users may experiment with it initially they will discard i-TV if there is no offer of compelling entertainment based applica- tions reflecting normal user of a TV.

• MHP still has a role to play, not least for those European countries yet to deploy DTT in accor- dance with the European Commission’s (EC) policy for new service launches. The EC has reiter- ated its support for open and interoperable i-TV standards. However, it recognizes the technologi- cal and market complexities plus market players’ very different perceptions of interoperability and the fact that interactive DTV has not yet taken off substantially in many member States. Conse- quently, the Commission feels that the DTV market should continue to develop unhindered for the present. It points to further commercial and technical efforts being needed and consideration being given to other interoperable standards such as the Portable Content Format (PCF). MHEG-5 and WtvML.

• Importantly, through DICE and other initiatives, members have learned lessons on how to move forward. Poland’s Switchover strategy is now largely based on experiences from the UK, Sweden and Germany. Austria’s DTT /MHP roll-out plans recognize the need to keep things simple and to implement more basic services first while heeding lessons from the leading MHP markets – nota- bly from Italy on applying a subsidy programme.

• As a result of Government subsidies, Italy is now by far the country with highest number of de- ployed DTT MHP receivers. As of May 2005, 2.2 million MHP-enabled DTT receivers had been sold in the country accelerated by a €110 million subsidy package in 2004. Some 900,000 were said to be sold without subsidy. The 2005 subsidy was cut to €70 per STB and the retail price is below €100. Market Researchers’ GFK Eurisko now report about 4 million DTT receivers being sold with over 50% being purchased with a Government subsidy.

• Finland was the first to pioneer MHP-based interactive services on DTT from August 2001. Cur- rent services include digital teletext, banking and game applications, advertising sites and a 7-day electronic programme guide (EPG). A mobile telephone assures the return channel. The city of Tampere also runs a regional MHP portal providing local information. Similar is also planned for Helsinki.

• Learnings from other areas such as proprietary API providers are needed. They are not standing still and continue to develop alternatives to challenge MHP. Such includes OpenTV’s develop- ments for a next generation TV zoomable interface.

• The C3WG2 group saw that mobile TV in most countries was at a similar stage of technology trials and pilots. As of September 2006, all DICE member countries except Lithuania were trialing broadcast based (DVB-H; T-DMB; DAB-IP) mobile TV propositions. Most of these initiatives had not explored interactivity – especially any elements that could tie to DTT services. However, many are planning second phases to explore interactivity as a key revenue generator. All members in- cluding Lithuania were also engaged in mobile TV via 3G unicast propositions, most of which were commercial services rather than trials.

• It was felt this might give some scope for generating common positioning and associated technical solutions for i-TV not possible on MHP. i-TV can benefit from the personalized and secure attrib- utes of Mobile TV plus broadcasters have already shown a desire to link with mobile operators for SMS and phone ties to popular TV programmes. Use of mobile TV might also provide important two way interactivity not least for basic zapper or other STBs without built-in return channel.

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technologies; uncertainties over spectrum allocation and more importantly due to a number of other unknown commercial factors – not least when bringing together mobile operators and broadcasters as partners.

• These factors include the development of new relationships with mutually attractive commercial models that address ownership of customers and their associated data plus content aspects. Mo- bile Telcos are well versed in managing and billing customers but it may be broadcasters’ content that attracts them to services.

• There are some other fundamental differences to address. As well as development of suitable revenue sharing levels there is the need to take account of mobile telephony typically being seen as pay based whereas TV (especially DTT) is largely perceived to be free to view. Some users may also prefer the anonymity that broadcasting brings, i.e. no one knowing what they are watch- ing. They may be concerned that this will be lost if they are compelled to have usual direct rela- tions with a mobile telco.

• An outcome may be the development of new stand-alone joint ventures rather than partnerships which could lead to regulatory bodies being required to think differently on managing collaboration and competition constraints.

• Content rights and reach remains a key issue. Current provision for national boundaries may be at odds with customer desire to replicate mobile telephony use abroad and to see home content wherever they are. Digital Rights and Conditional Access solutions for mobile have yet to be fully developed and could be hindered by disagreement over such as advertising carriage rights.

• Technical issues still abound too. Battery life is a core concern not least if power loss results in a lost interactive link or application download. There is also the need to maintain sufficient power to continue the mobile phone’s core voice functionality.

• As with MHP, Italy has been able to develop a lead in broadcast based mobile TV. The large number of regional TV operators there and regulatory flexibility on change of use for broadcast li- cences has enabled mobile telco 3Italia to effectively become a broadcaster. Its leading status makes Italy best placed to offer guidance on deploying MHP and broadcast mobile TV plus some radically different approaches to channel and content provision.

• In short, the status of member countries’ DTV markets is so diverged with major differences in existing TV networks, DTT market maturity and commercial positioning it proved impossible to ap- ply a common methodology for MHP development. The situation is potentially better for mobile broadcast platforms development. However fully commercialised mobile TV is still an unproven concept with a raft of different technologies, unproven business modelling and polarised views on its potential from market analysts. Most broadcast based mobile TV trials are based on free is- sue/loan equipment and with no charge for services. Consequently little real evidence exists of pent up consumer demand when reflecting the real cost to acquire products and subscribe to ser- vices.

• DVB-H and/or DMB are the likely winner mobile broadcast technologies driven by large scale global deployment & related economies of scale. IP datacast (IPDC) support enables valuable ad- ditional services including interactivity. Currently, the Korean led T-DMB alternative does not sup- port IPDC. However, industry’s current work on combining the best of DVB-H and DMB could ulti- mately address this.

• Spectrum allocation remains a key constraint – better visibility of release plans for all key bands is needed to encourage industry stakeholders plus enable them to plan effectively for time to market and most appropriate technology investments. This will need to be considered in parallel with the growing threat/opportunity from wireless and fixed broadband networks twinned with personal me- dia storage devices. Governments and regulators will also need to consider how such might im- pact commercial opportunities for broadcast based offerings and subsequently related spectrum sales opportunities.

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• Countries with a single “super” regulatory body in control of all areas of broadcast and telecoms appear to be better placed to appreciate technical and commercial overlaps and to organize plans accordingly.

• It was concluded that MHP can still play a key role in delivering compelling enhanced and i-TV applications when best practices are adopted such as those summarized below:

– Applying subsidies from Government or another body – consistent with EC state aid rules. However compelling applications could also be delivered by other potentially cheaper ETSI ap- proved open-standards (e.g. MHEG-5 and PCF).

– Continue to focus on developing interoperability to develop common user experience on differ- ent DTV platforms and services.

– Keep things simple and recognize how DTV operates differently to established and habitually analogue counterparts. i-TV services have to be interesting and reflect the capabilities and normal TV use rather than trying to be a “virtual PC.”

– Recognise that interactivity is not a key driver for DTV take-up but a desirable add-on to core channel offerings that should be focused on first. Such includes improved picture and sound, digital teletext with clearer words and images while allowing continued programme watching plus EPGs – not least in digital video recorders (PVR /DVD-Rs) for simple timer recording.

– Introduce more advanced i-TV applications as consumers become familiar with basic DTV fea- tures – not least those that operate differently to traditional and habitually used analogue predecessors.

– Clearly identify on screen any i-TV service access charges, such as rates for telephone call or line access.

– Consider developing i-TV links to mobile platforms – not least in the cases of DTV receivers with no built in return path. Focus on platforms that support IP.

– Monitor and learn from ongoing competing developments from proprietary providers or alterna- tive platforms such as IPTV.

– Those in Europe yet to deploy DTT should continue to develop ties with established DTV mar- kets and apply their experiences to any new roll outs.

• It is recommended that dialogue should be continued between EC member states and others to assist in developing interoperability and common approaches. To this end consideration should be given to continuing the DICE project or starting a second phase. In particular, work should con- tinue around mobile as a potential i-TV link with DTT plus work could start on exploring means for interactivity from emerging IPTV propositions – be they stand-alone or in combined with DTT.

• Membership should be widened to include new accession countries but also others such as Italy and Finland who are currently best placed to advise on MHP and mobile broadcast commercial deployments. Italy has also pioneered IPTV since 1999. Consideration could be given to Italy serving as the host nation for DICE or alternatively for a working party to visit key stakeholders there.

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C3WG2 membership and contributions.

The C3WG2 membership comprised of representatives from Government, Regulatory or industry stakeholders. Contributions to the report came from representatives of all DICE member countries plus also other external parties that were either invited to attend Workgroup sessions in Gävle and Vienna or those who presented at DICE conferences.

The UK representation took up the lead role in the C3WG2 from January 2006 after those from Den- mark elected to withdraw from the DICE Project.

Meetings

Four meetings of the C3WG2 group were held, consistent with the directives of the DICE Project management. To ensure maximum attendance by members and to minimise travel expenses, the meetings were held in the same country/location of main DICE conference events that they also needed to attend.

• London: 20th January 2006 • Gävle: 9th May 2006 • Vienna: 6th June 2006 • Berlin: 31st August 2006

Virtual meetings (telephone calls, e-mail correspondence) also took place for the co-ordination of the group’s work.

Work Area

Those in the C3WG2 group were tasked with investigating Interactive TV (i-TV) developments and in particular to explore any opportunities to develop take up of the Multimedia Home Platform (MHP) consistent with the European Commission’s support for open and interoperable standards.

Background In the EU regulatory framework for electronic communications networks the commission stated that “Interoperability of digital interactive television services and enhanced digital television equipment, at the level of the consumer, should be encouraged in order to ensure the free flow of information, media pluralism and cultural diversity. It is desirable for consumers to have the capability of receiving, regard- less of the transmission mode, all digital interactive television services, having regard to technological neutrality, future technological progress, the need to promote the take-up of digital television, and the state of competition in the markets for digital television services. Digital interactive television platform operators should strive to implement an open application program interface (API) which conforms to standards or specifications adopted by a European standards organization." (Recital 13 of the Direc- tive 2002/21/EC).

At the 4th EBU conference (March 2001) in Brussels, EU commissioner Erkki Liikanen welcomed the introduction of MHP as a European i-TV standard. He stated that the Commission welcomed in par- ticular the development of the Multimedia Home Platform (MHP) standardized by the Digital Video Broadcasting Group (DVB).

He went on to say that the MHP platform has been developed by the industry, for the benefit of the industry and that the Commission considered such voluntary, industry led standardization is the best process to reach interoperability, and to guarantee widespread implementation of the standard.

Much had been promised from MHP’s capabilities and expectations were high that it could deliver radically higher usage of interactive TV services and enable new means of e-Government services and communications with or by EC citizens.

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sion receiver equipment, subject to conformity with state aid rules, and monitoring of access to pro- prietary technologies.

A Communication set out the Commission's position on interoperability of digital interactive television services as required under Article 18 of Directive 2002/21/EC, on a common regulatory framework for electronic communications networks and services. Article 18 required Member States to encourage the use of open standards, and transparency of information on proprietary standards. If Article 18 failed to have the desired effect, then the Directive empowered the Commission to take steps to im- pose a standard.

In 2004 the European Commission called for a public consultation on “Interoperability of digital interac- tive television services” and received many responses.

The MHP Alliance called for the Commission to make it a legal obligation for member states to pick one open API most suitable for their national market from a future date no later than 2008, while rec- ommending MHP for all new ‘greenfield’ markets.

The EBU argued that the Commission should ensure that from a given date only open standard API systems should be used that is those recognised by a European standards body, and that MHP should be recommended but not mandated for all new green field markets.

The views from the UK as the leading DTV market were as follows. ITV, the UK commercial television company, largely echoed the EBU view, arguing that the standardisation of existing proprietary APIs over time while recommending MHP for new markets would provide a workable compromise that would not place a disproportionate burden on the market.

The BBC submitted that open standards should be required after a certain date, adding that mandat- ing a single open standard is currently unnecessary and mandating MHP would present the British market with daunting legacy problems.

BSkyB responded by observing that its WtvML browser, based on internet compatible technology, had been submitted to ETSI and adopted as an open standard. The satellite operator argued that any in- tervention by the Commission would be unwarranted and detrimental.

The response of OpenTV, who currently provide the middleware for BSkyB, was not made public.

On behalf of the UK Government, the Department of Trade and Industry argued that any move to mandate MHP would prejudice plans for digital switchover and that MHP should be considered as one among a number of voluntary standards, including MHEG 5 and WtvML.

More detail on the legacy issue for the UK can be found in the next chapter.

In March 2006, the Via Licensing organization caused major impact to interest in MHP. At the DVB World Conference in Dublin it proposed to introduce licensing fees on patents essential to MHP. The move was widely criticized and led to some parties suggesting that the steep royalties could impact take up of the MHP standard in Europe and beyond.

Links to reference papers with additional information on MHP technical elements are included in the “Further Resources” section of the report.

Market Situation in DICE member countries (DTV)

This section of the report considers the current market status for digital TV in each C3WG2 member country as at mid 2006 or later. It focuses on digital terrestrial horizontally marketed alternatives as the latest to be introduced and consequently most likely to support MHP.

For the countries yet to introduce services the section gives an outline of the relevant Government/ regulatory policies for migration to DTV plus figures on population characteristics and number of homes to be converted. Where appropriate, details on digital technology trial activities are included.

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To take account of the C3WG1 group report already addressing digital platforms development, this report does not address in detail the various platforms and service offerings available in member countries. Instead it focuses on i-TV areas alone to include potential related mobile TV developments.

Definition of Interactive TV (i-TV)

Confusion can still exist on what is meant by i-TV. This can be compounded by digitalisation bringing many new features or usage methods not consistent with those for existing, familiar and habitually used analogue products and services.

The industry has fuelled the potential for confusion through such as different broadcast platforms (sat- ellite, terrestrial, cable, IPTV), offering varying capabilities (one way or two way services, return path) linked to technology alternatives (e.g. OpenTV, MHP, MHEG) or marketing positioning (free to view; payTV or VoD).

To try and clarify and give some context, this report refers to i-TV on the basis of including both en- hanced and true interactive variants as below.

Enhanced TV services Enhanced TV refers to one-way applications available without a return channel – (typically a tele- phone/modem connection to the service provider.) Enhanced TV services includes such as digital teletext, on screen menus and EPG access. Such can also extend to services like applications that are broadcast, downloaded and stored in set top boxes enabling users to play games or select differ- ent camera angles or even such as different World Cup or Wimbledon matches.

Interactive services True interactivity comes via those “two-way” services running between the consumer and service pro- vider, reliant on some form of return path (telephone line connection; inherent link in a cable or DSL IPTV feed; or SMS mobile phone messaging).

Summary

This section summarises the current status for i-TV in the DICE member countries and others outside that are at the forefront of deploying MHP. More detailed information can be found in Annex 1: i-TV in DICE Member Countries

MHP has been adopted or trialled by various European countries, such as Germany, Sweden, Finland, and notably Italy where on the back of major government subsidies it has been able to deploy many receivers. However, the early MHP hype has failed to live up to its promise and caused a num- ber of countries’ operators to pull back on their interactive plans.

The chart opposite re- flects the wide polarisa- tion between DICE members for MHP based i-TV.

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Cost & Capabilities The substantially higher costs balanced with limited extra capabilities of MHP products has clearly impacted availability and take up of enabled products. This has culminated in distribution channels not marketing relevant models (Sweden) or for broadcasters to reduce or end MHP service carriage (Germany).

Legacies and performance: Established DTV markets are greatly constrained by existing legacies of receivers in the marketplace. The UK is a particular case in point. Now with over 72% DTV penetration, the country has more than 18.6 million devices in the market.

Of these more than 8.2 million have BSkyB Skydigital DSAT boxes or Sky+ PVRs both based on Open TV/WtvML and there are now more than 7.1 million Freeview DTT products in UK homes using MHEG-5. There are then more than 3 million cable homes based on STBs with Liberate based mid- dleware.

Consequently, it is not practical to consider a move to MHP. That said operators are also not prepared to consider a move to MHP when its performance cannot offer any radical improvements in perform- ance or cost saving over existing alternative APIs. Enhanced and Interactive applications currently offered by MHP are very akin to those provided at less cost by MHEG-5 or Open TV. i-TV demand Interactivity is not a key driver for DTV take up. No one is rushing to press the red button or buy equipment to receive interactive services – be they enhanced (one way) or true interactive (two way) variants. Use of i-TV applications can develop once the consumer has become familiar with basic DTV features – not least those that operate differently to traditional and habitually used analogue prede- cessors.

The TV remains primarily as a shared viewing entertainment based device – not consistent with the more personal, lean forward, and secure needs of most Interactive services. Most see the Internet as a more logical medium for this primarily through the PC but also new IPTV products/services too.

Increasingly mobile phones that offer always to hand, personalized solutions for secure services are being seen as a useful means of enabling i-TV links. Mobile phone/SMS texting ties to popular pro- grammes has been very successful and broadcasters are building on this as a primary route for de- veloping interactivity – not least in the case of models without inbuilt modem. Also the new mobile TV derivatives are been contemplated for interactivity and many trials around the world are now exploring if and how i-TV can be developed through the medium.

On DTV, digital teletext information only services have been one of the more popular enhanced ele- ments, including those with a phone /sms number for calls to action and cost for access. Costs for return channel access can put people off from using interactivity – not least when said costs are hid- den or not clearly referenced.

The most successful interactive applications are those that are entertainment based. Leading are those that are directly associated with or form part of the TV programme. Usage increases when the service is announced by a presenter and peaks immediately at the end of the programme. i-TV usage is characterised by short visits typically running from 1 to 10 minutes. Gaming and gambling applica- tions remain as the most popular stand alone interactive elements.

Older age groups can be encouraged to use i-TV when the programme is relevant of interest to them. However, many continue to ignore the red button through being confused or due to other cognitive factors.

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Fundamentally, i-TV services have to be interesting and reflect the capabilities and normal use of a TV rather than trying to be a “virtual PC.” Users may experiment with iTV initially but soon discard it if does not provide compelling applications.

Ofcom Findings This is demonstrated by OFCOM’s Communications Report of 2005. It revealed little growth in use of interactive services as identified below:

Familiarity with enhanced and interactive TV services and functionality grows as Digital TV usage continues to increase. Accordingly total use of interactive (one way and two way) services has grown has digital penetration has advanced. However, individual usage is static or possibly declining. In 2003, 43% of UK respondents claimed to have used interactive services via their remote control; this fell to 39% a year later.

As would be expected aided by the wider options on Skydigital and cable, subscribers to these have made the most of the interactivity. 46% of those using satellite as their main TV platform used the Skydigital interactive services, down by 6% on 2003. This compares with 38% of Freeview using the less advanced interactivity available in 2004. Data was not available for 2003.

OFCOM went on to suggest that some people may be feeling less positive about interactive services. In 2003, 62% of respondents agreed that “interactive services enhance TV viewing for the viewer”. This figure fell to 47% a year later, rising to 55% amongst satellite viewers. In 2004, 17% of adults claimed to have bought products or services via their TV. Nearly a third (32%) contacted or responded to TV programmes by telephone, text message or email. This is broadly consistent with 2003 figures.

Lessons to be learned Despite the issues above, MHP still has a role to play. Those countries yet to deploy DTT (Poland, Hungary) will need to adopt it in accordance with EC Policy for new services. However, they are well placed to learn from the issues others have faced before, ignore the hype and deploy MHP in an ap- propiate manner. This has already been done by Austria in its recent DTT launch. Those responsible there have learnt from the Italian market and recognised the merit of applying a subsidy programme.

Furthermore, through such as DICE, they have recognised the merits of keeping things simple and leading initially with more basic services such as digital text (multitext) that can build on and better the previously well-used analogue counterparts. They can then develop the richer interactivity as users become accustomed to using DTT.

DTV can offer many benefits over its analogue predecessor but focus should be given initially to the core offerings such as improved picture (no ghosting/sparklies) and sound, digital text with clearer text and images while enabling continued programme watching, EPGs – not least in digital video recorders (PVR /DVD-Rs) for simple timer recording. i-TV is a nice to have ancillary that may develop over time – once consumers become familiarised with the basic DTV offering.

The European Commission Current Position The European Commission has reiterated its support for open and interoperable standards for interac- tive television, but says implementation should not be made legally binding. Member States should continue to promote open and interoperable standards for interactive digital TV, including the MHP standard, on a voluntary basis.

Proposals made by the Commission included setting up a Member State group on MHP implementa- tion, confirming that Member States can offer citizen subsidies for interactive TV receivers subject to state aid rules and monitoring access to proprietary digital interactive TV applications.

Enterprise and Information Society Commissioner Olli Rehn has advised that in view of the complexity of the technological and market environment, the very different perceptions of interoperability held by market players, and the fact that interactive digital TV has not yet taken off on a larger scale in many Member States, the Commission felt that the digital television market should continue to develop un- hindered for the present.

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Further commercial and technological efforts are required as the market success of i-TV television remains limited at a time when the switchover to digital is accelerating.

Other standards, such as the Portable Content Format (PCF), will also be considered with a view to being added to the list of others such as MHP, MHEG-5 and WtvML as soon as possible.

PCF An open standard defined by the DVB organisation, PCF is a tool being developed to enable cross pollination of content between different platforms and devices. Essentially, it aims to provide a com- mon language to enable the translation of certain types of interactive service between different plat- forms.

Importantly, PCF enhances interoperability by enabling content providers to author their content once and run it on multiple platforms. It will be able to cover 80% of interactive television applications. With three different broadcast distribution systems to support – satellite, terrestrial and cable – the BBC in the UK has been looking at cross-platform authoring technologies for over five years. Their work is now feeding into the DVB-PCF or Portable Content Format initiative.

In February 2006, EU Commissioner for Information Society and Media, Viviane Reding said, “Our policy is to encourage investment and promote freedom for industry to innovate. It is good news that interoperability is no longer a major obstacle for interactive TV, thanks to the growing number of tech- nical solutions supporting it. This is proof of the successful development of digital TV standards in Europe, which increasingly ensure that TV buyers get the maximum benefit from their investment.”

On the 7th February 2006, a new Communication from the European Commission on interoperability of digital interactive TV was published. It reported that there are over 47 million digital receivers in use in Europe, of which about 26 million have a proprietary API and about 4 million have MHP. The two most successful DTT roll-outs in Europe rely on standardised APIs (MHEG-5 in the UK and MHP in Italy). Such successful developments demonstrate how flexibility and consensus among market players can achieve genuine interoperability, and generate economies of scale that lead to price reductions for consumer equipment.

So far, the growth of interactive TV services across Europe has been slower than many expected. The Commission sees a need for business models to evolve further and for more investment, before the practice of delivering on-line government services via TV, for example, can become more widespread.

Proprietary API providers still driving forward Despite the ongoing work around MHP and other interoperable standards, providers of proprietary alternatives are not standing still.

As an example, Interactive TV company OpenTV has demonstrated a vision of next-generation televi- sion with a prototype zoomable user interface. It claims it would fundamentally change the way view- ers navigate and choose video programming. OpenTV believes that channel surfing is no longer an adequate way to deal with the expanding range of live, recorded and on-demand programming now available. The company, which is best known for its interactive television set-top box middleware, (provider to BSkyB) is aiming to take a leadership position in defining future navigation models and driving hardware requirements.

As shown in the pictures below, video icons in the screen’s margins replace textual information, with navigation using familiar directional buttons on the remote control providing one-touch access to the menus. As in (Fig.1) the top margin provides access to broadcast channels, while the bottom margin offers direct access to scenes with the current programme. The left margin shows previously recorded and bookmarked shows and on-demand programming, while the right margin shows recommenda- tions based on what the viewer is currently watching. A ‘scenographic’ menu provides DVD-like selec- tion by scene, with relative time references (Fig.2) and the on-demand grid sorts recorded and book- marked content into viewer-defined categories (Fig.3).

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The latest OpenTV Core2 middleware supports Flash, based on the MachBlue implementation from Bluestreak Network, which allows the production of enhanced programming using standard Adobe Flash authoring tools.

Fig.1 Fig.2 Fig.3

IPTV In addition to the above, it is worth highlighting that major iTV developments are set to arrive through emerging Internet Protocol TV (IPTV) solutions. Typically, recognized TV and radio services plus data applications are served over a Digital Subscriber Line (DSL) broadband connection and the resulting direct connection between the customer and the service provider enables true 2 way interactive possi- bilities. IPTV falls out of the DTT focused scope of this report, consequently no further detail is pro- vided. That said, there are a number of developments taking place in various markets for combined DTT/IPTV propositions. A key example is the forthcoming BT Vision service in the UK. Any future DICE initiative exploring i-TV applications should consider and work on IPTV as a core contender.

Opportunities for i-TV via mobile synergies

The previous chapter shows the perception of and support for MHP between members of the DICE C3WG2 group was very polarized and that a common way forward for MHP based interactivity was not going to be found. However, it quickly became clear the countries involved were all at a similar early stage with regard to mobile TV developments and that this might enable some common ar- eas/synergies to be explored with regard to developing interactive links to DTV via mobile phones.

Mobile phones offer the key personalized and secure elements that are required for interactivity, plus mobility to enable communication with the user wherever they are in or outside of the home.

There is a lot of interest in Mobile TV around the world. The current state of play in most countries, DICE members or not, is much the same with many running mobile TV trials and a few with relatively recent commercial roll-outs.

Some have, or are moving to, 2nd stages and exploring interactivity opportunities. Many view that this is where significant revenues can be generated whereas base free to air TV or Radio services will be simply the means of “hooking-in” consumers.

The map below based on data to September 2006, points to the countries where most activity is run- ning plus the platform technologies being used.

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Consumers’ Definition

A number of different definitions apply as to what mobile television is. This was further highlighted by the first session of the DICE Berlin /Medienwoche conference on 1st September 2006 when each speaker began their presentation with their particular interpretation. This report is based on the typical consumer standpoint below:

• Mobile television can be considered as any technology providing familiar TV content on some form of portable hand-held or vehicular device.

• This is regardless of whether it is broadcast live, being streamed, or has been downloaded in advance. It also includes short video clips as well as full length programmes.

• This definition takes account of different technology platforms derived from broadcast, mobile telecoms and broadband standards plus encompasses true (“one-to-many delivery”) broad- cast services plus others derived on typical (“one-to-one”) mobile telephony delivery models.

Mobile TV developments in DICE countries

The C3WG2 group reviewed the respective trials or commercial services in member countries plus others through the DICE conferences – notably the Medienwoche event in Berlin.

Emphasis was given to broadcast based platforms (e.g. DVB-H, DMB, DAB-IP) that potentially provide the most direct relationship with DTT transmission architecture in Europe.

The section below summarises the findings of the group. Full details of the status of mobile TV in DICE countries and leading ones outside of the project can be found in ANNEX 2: Mobile TV in DICE Member Countries

With the exception of Lithuania, all DICE member countries were trialing broadcast based (DVB-H; T- DMB; DAB-IP) mobile TV propositions as of September 2006. Most of these initiatives have yet to explore forms of interactivity – not least any that can tie to fixed DTT services. However, many are moving to 2nd phases in trials to explore interactivity as a key revenue generator.

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All members including Lithuania were also engaged in mobile TV via 3G unicast propositions, most of which were commercial services rather than trials.

There is already strong interest from broadcasters for developing ties between DTV services and mo- bile phones. This is demonstrated by the existing wealth of SMS, MMS and telephone number links to popular programmes (e.g. Big Brother and the World Cup). Some organisations are keen to move this on further and looking closely at mobile broadcast propositions.

However, as demonstrated in Gävle by representation from SVT – Sweden’s public service broad- caster; this is only as part of exploring all options – fundamentally broadcasters do not want to ignore any channel that can deliver their services.

C3WG2 members were unable to agree on if and how mobile broadcast propositions could be devel- oped to assist with Interactive DTV. This was essentially due to the associated technologies still being very immature, uncertainties over spectrum allocation and more importantly due to a number of other unknown commercial factors as below:

There is a need for new relationships between mobile telcos and broadcasters. Establishing a com- mercial model equally attractive for partners is set to remain as one of the core issues impeding the roll out of full services. Much work is still required for addressing the ownership of customers, their associated data and content as telecoms and broadcast networks combine to offer mobile TV.

Such partnerships will raise questions of who owns the customer and when. Mobile telcos are well placed with their existing direct billing arrangements with customers but arguably many newcomers to mobile TV will be attracted by the broadcasters’ content/services.

Much work is still needed in appropriate business modelling. This includes development of suitable revenue sharing levels but also needs to take account of mobile telephony typically being seen as pay based whereas TV (especially DTT) is perceived to be free to view. Some users may also prefer the anonymity that broadcasting brings, i.e. no one knowing what they are watching. They may be con- cerned that this will be lost if compelled to have usual direct relations with a mobile telco.

Such issues may culminate in the development of new stand-alone joint ventures rather than partner- ships between established telecoms and broadcast organisations. This in turn could lead to regulatory bodies being required to think differently on managing collaboration and competition constraints.

Content rights and reach remains a key issue. Current provision for national boundaries may be at odds with customer desire to replicate mobile telephony use abroad and wishing to see home content wherever they are.

Digital Rights and Conditional Access solutions for mobile have yet to be fully developed and can be hindered by disagreement over such as advertising carriage rights as recently seen in the UK.

Italy has been able to develop a lead through mobile telco 3Italia essentially becoming a broadcaster and bypassing many of the issues above. However other countries with the possible exception of Spain do not have the same width of local TV stations that could deliver means for potential acquisi- tion and move to mobile broadcast models.

Technical issues still abound too. Battery life is a core concern not least if power loss results in a lost interactive link or application download. There is also the potential need to maintain sufficient power to maintain the mobile phone’s core voice functionality.

Solutions need to be found that are consistent on a global basis to support product standardization and related capability for volume production.

Overall Conclusions

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networks, DTT market maturity and commercial positioning greatly impedes any real opportunities to collaborate fully on i-TV though MHP. That said there are a number of important lessons that can be learned and applied by all as below.

2. The situation is better for mobile broadcast platforms development. However there is much work yet to be done on commercial modelling and technology areas before the real potential of the me- dium and opportunities for shared practices is clear.

3. While MHP has been adopted by various European Countries, it has yet to become a successful open interactive standard. It is still a relatively costly proposition that does not deliver radically im- proved performance, services or benefits over entrenched proprietary alternatives.

4. Subsidies from Government or another body can help generate major take-up of MHP devices. However such have to comply with EC state aid rules and critically need to tie to compelling appli- cations for the consumer. However, such applications could also be delivered by other potentially cheaper ETSI approved open-standard alternatives (e.g. MHEG-5 and PCF).

5. There is then the prospect of IPTV for bringing direct communication between customers and op- erators without need for broadcast based APIs as above. More work is needed to explore the i-TV potential from existing and emerging services on this platform.

6. Fully commercialised Mobile TV is still an unproven concept. There is a raft of different technolo- gies, unproven business modelling and polarised views on its potential from market analysts.

7. The vast majority of broadcast based mobile TV trials are based on free issue/loan equipment and with no charge for services. Accordingly there is little real evidence of pent up consumer demand that reflects the real cost to acquire products and subscribe to services.

8. Italy is the leading MHP market, was first to launch commercial DVB-H services and has pio- neered IPTV since 1999. Accordingly, Italy is currently best placed to offer guidance on deploying these and also on some radically different approaches to channel and content provision.

9. DVB-H and/or DMB are the likely winner mobile broadcast technologies driven by large scale global deployment & related economies of scale.

10. IP datacast support enables valuable additional services including interactivity. While DAB-IP as used in the UK can provide this, the current Korean led T-DMB alternative does not. However, work is currently being undertaken by industry to bring together the best of DVB-H and DMB and this could ultimately address this.

11. Spectrum allocation remains a key constraint – improved visibility of release plans is needed to encourage industry. This would ideally cover all key bands (L-band; Bands IV and V, Band III and S-band) to enable industry stakeholders to plan effectively for time to market and their most ap- propriate investments in technologies.

12. This will need to be considered in parallel with the growing threat/opportunity derived from wire- less and fixed broadband networks twinned with personal media storage devices. Governments and regulators will also need to consider how such might impact commercial opportunities for broadcast based offerings and subsequently spectrum sales opportunities.

13. It was noted that countries with a single “super” regulatory body in control of all areas of broadcast and telecoms appear to be better placed to appreciate technical and commercial overlaps and to organize plans accordingly.

14. MHP can still play a key role in delivering compelling enhanced and i-TV applications. The section below gives some areas of best practice that can help develop this capability via MHP or indeed another API:

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Best Practice

• Continue to focus on developing interoperability between different DTV platforms and services.

• Ignore the hype and deploy MHP or another open standard API in a manner that recognizes the need to keep things simple and also how DTV operates differently to established and habitually analogue counterparts.

• Recognise that i-TV services have to be interesting and reflect the capabilities and normal use of a TV rather than trying to derive a “virtual PC.” Note that the television remains primarily as a shared viewing entertainment based device and may not be consistent with the more personal, lean for- ward, and secure needs of most Interactive services.

• Focus initially on the core DTV offerings such as improved picture (no ghosting/ sparkles/snow) and sound, digital text with clearer words and images while enabling continued programme watch- ing and EPGs – not least in digital video recorders (PVR /DVD-Rs) for simple timer recording.

• Recognise that interactivity is not a key driver for DTV take-up but a desirable add-on to core channel offerings.

• Lead initially with more basic services such as digital text (multitext) that can build on and improve on the previously well-used analogue counterparts.

• Introduce more advanced i-TV applications once the consumer has become familiar with basic DTV features – not least those that operate differently to traditional and habitually used analogue predecessors.

• Clearly identify on screen any interactive service access charges, such as rates for telephone call or line access.

• Consider developing i-TV links to mobile platforms – not least in the cases of DTV receivers with- out inherent return path. Focus on those platforms that support IP.

• Monitor and learn from ongoing competing developments from proprietary providers or alternative platforms such as IPTV.

• Those in Europe yet to deploy DTT should continue to develop ties with established DTV markets and apply their experiences to any new roll outs. This has been applied by Austria in their MHP deployments and Poland’s switchover strategy is now based largely on experiences learned from the UK, Sweden and Germany.

Recommendations

1. Dialogue should be continued between EC member states and others to assist in developing in- teroperability and common approaches.

2. Consideration should be given to funding the continuation of the DICE project or a new initiative started to continue work especially around mobile as a potential i-TV link with DTT and/or com- bined DTT/IPTV propositions. Membership should be widened to include new accession countries but also others such as Italy and Finland who are currently best placed to advise on MHP and mobile broadcast commercial deployments.

3. A DICE working party should visit Italy and possibly other countries to promote the DICE project output and establish links with stakeholders in an effort to develop cooperation in any new pro- jects.

4. DICE to initiate a trial in an accession country to apply and ratify the findings of the current project.

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Glossary

3G 3rd Generation: typically refers to UMTS based mobile telecoms An API is an operating system which provides EPG and interactive functions in a digital receiver. Essentially it is the equivalent of Windows in a PC. Since the introduction of digital TV a number of different API or “middleware” options have emerged. Proprietary APIs such as MediaHighway, API OpenTV and Liberate have fought hard to achieve the same dominance that Windows achieved but the tide has turned in favour of some form of open standards API. That said there are large legacies of products in established markets still based on one of the former. BMCO Broadcast Mobile Convergence Forum Forum DAB Digital Audio Broadcasting Digital Audio Broadcasting with Internet Protocol. Like DMB is a subset of the DAB ETSI standards. DAB-IP However DAB-IP sends video using IP packets rather than using the DVB transport stream as DMB does. Also DAB-IP is based on a Microsoft WM9 codec. DMB Digital Multimedia Broadcasting DTI Department of Trade & Industry – Government Department Digital Terrestrial Television – often interchanged with DVB-T for European markets. DTT describes DTT the delivery of digital services via a conventional aerial/antenna. DVB-T describes the standard deployed for the DTT platform DTV Digital Television Digital Video Broadcasting (DVB): a European derived project that has created a set of standards that define digital broadcasting using satellite (DVB-S), cable (DVB-C), and terrestrial (DVB-T) in- frastructures. Today, the DVB Project consists of over 220 organizations in more than 29 countries worldwide. DVB-compliant digital broadcasting and equipment is widely available and is distin- DVB guished by the DVB logo. The term digital television is sometimes used as a synonym for DVB. However, DVB is not alone as a digital TV standard, for example another is the Advanced Televi- sion Systems Committee (ATSC) standard deployed in the USA as the digital broadcasting stan- dard. DVB-H Digital Video Broadcasting – Handheld. EBU European Broadcasting Union EPG Electronic Programme Guide – essentially an onscreen equivalent of a TV Listings magazine. ERP Effective Radiated Power ESG Electronic Service Guide ETSI European Telecommunications Standards Institute FEC Forward Error Correction GPRS General Packet Radio System – often referred to as 2.5G mobile telecoms HDD Hard Disk Drive IPDC Internet Protocol Data Casting IEEE Institute of Electrical and Electronics Engineers IDTV Integrated Digital Television Set Internet Protocol Television – TV derived from IP Packets delivered via a broadband Internet con- IPTV nection ITU International Telecommunications Union Interactive Television – refers to an application or service. Sometimes referred to as DiTV – Digital i-TV Interactive TV. Not to be confused with IDTV, this refers to an integrated Digital TV. MBMS Multimedia Broadcast Multicast Service Mbps Megabits per second A mobile TV technology from QUALCOMM that uses the Forward Link Only (FLO) technology to MediaFLO deliver video to cellphones. MPE-FEC Multi-Protocol Encapsulation – Forward Error Correction) Motion or Moving Picture Experts Group – MPEG-2 was the 2nd standard for compressed video MPEG delivery that the group defined and MPEG-4 not surprisingly the 4th and updated/advanced stan- dard. An acronym for Multimedia and Hypermedia Experts Group. This group develops within several MHEG standards within the International Standards Organisation (ISO) which deal with the coded repre- sentation of Multimedia and Hypermedia Information.

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This is simply the fifth part of the MHEG standard suite and critically is what UK Freeview DTT models are based on. It was developed to support the distribution of interactive multimedia applica- MHEG-5 tions in a client/server architecture across product platforms of different types and brands. The standard defines a final-form representation for application interchange so that the application only has to be developed one time. MHP is an open standard API for interactive digital TV, originally developed by the DVB Project. It has been adopted by a number of countries all over the world for future i-TV broadcasts, and forms the basis of the OCAP and ACAP standards. Java is the common denominator and has been adopted by the DVB Project for MHP development. This could enable established alternatives such MHP as MHEG-5 and other existing systems to become plug-in classes to a Java Virtual Machine. It defines a generic interface between interactive digital applications and the terminals on which those applications execute. It supports many kinds of applications including electronic program guides, information services, synchronous enhancements, e-commerce and secure transactions. Multichannel Multipoint Distribution System. Terrestrial microwave system used to distribute high- MMDS bandwidth services to end-users at homes and offices. Advantage of MMDS over satellite-based services is in its ability to include local content programming. NHH Nemzeti Hírközlési Hatóság: Hungary’s National Communications Authority The OpenCable Application Platform is largely based on the European Multimedia Home Platform (MHP) middleware specification created by the Digital Video Broadcasting (DVB) organization OCAP (DVB-MHP).It is CableLabs middleware specification. CableLabs has selected Sun Microsystems, Liberate, and Microsoft as the primary software authors for OCAP. Going beyond the requirements of ATVEF, this specification includes key components of JavaTV. OFCOM Office of Communications (Regulator) Open Mobile Alliance – a 350-member industry consortium comprised of software vendors, elec- OMA tronics manufacturers, content creators and game developers. www.openmobilealliance.org ORS Österreichische Rundfunksender GmbH&Co KG ORF Österreichischer Rundfunk – Austrian public broadcaster PDA Personal Data Assistant PMP Personal Media Player PSB Public Service Broadcasts – in UK: BBC, Channel 4, ITV, Channel 5 Personal Video Recorder – typically refers to any receiver with one or more onboard digital tuners PVR and a hard disk drive to make tapeless digital recordings QAM Quadrature Amplitude Modulation RF Radio Frequency RRC ITU Regional Radiocommunication Conference RTR Rundfunk und Telekom Regulierungs-GmbH – Austrian regulatory authority RTVV Radio-och TV-verket: Swedish Radio & TV Authority Satellite Digital Multimedia Broadcasting. DMB broadcasts served by satellite. Well placed to offer a service with national reach but may need number of repeater /gap filler land based relays to reach S-DMB some areas. The world’s first commercial pay based S-DMB service was launched in Korea on May 1st 2005. TDD Time Division Duplexing –used in 3G mobile telecoms networks Terrestrial Digital Multimedia Broadcasting – DMB broadcasts through land based network of T-DMB transmitters. Well able to deliver local TV services. Korea was the first to launch pilot services and is expected to launch full commercial services from the end of 2006 UKE Urząd Komunikacji Elektronicznej – Office of Electronic Communication UMTS Universal Mobile Telephony System – often referred to as “3G“ Wireless Broadband – mobile version of WiMAX based on IEEE802.16e standard. Deployed in WiBro Korea currently with potential to move to 4G proposition Wireless Fidelity. WiFi is a trademark of The Wi-Fi Alliance (www.wi-fi.org) (formerly WECA) the global Wi-Fi organization that created the Wi-Fi brand. A non-profit organization, formed in 1999 to certify interoperability of IEEE 802.11 products and to promote them as the global, wireless local WiFi area network (WLAN) standard across all market segments. The Wi-Fi Alliance has instituted a test suite that defines how member products are tested to certify that they are interoperable with other Wi-Fi certified products. WiMAX Worldwide Interoperability for Microwave Access. WLAN Wireless Local Area Network WRC ITU World Radiocommunication Conference

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Acknowledgements

Sources of information outside of DICE included the following: http://www.medienboard.de/WebObjects/Medienboard.woa/wa/CMSshow/1114276 www.bmcoforum.org www.dvb.org www.ebu.ch www.istat.it www.mhp.org www.mhpkdb.org http://www.mi-friends.org www.ofcom.org.uk www.dtg.org.uk

Further Resources

This section carries a number of URL links to technical reference papers on MHP and other technolo- gies:

• The MHP Knowledge Database - D1: Analysis of the current MHP situation Version 3 (Updated in March 2006) http://www.mhp-knowledgebase.org/publ/mhp-kdb_d1-ver- 2.pdf#search=%22mhp%20kNOWLEDGE%20DATABASE%20Analysis%20of%20the%20Current %20Situation%22

• DigiTAG: Analogue Switch-off Strategies to end analogue terrestrial television in Europe – 24/08/2006 http://www.digitag.org/DVBHandbook.pdf

• Leading industry players commit to accessible interactive television - Digital Interoperability Forum launches in Brussels – 26/11/2003 http://www.difgroup.com/press/26112003.doc

• Cenelec: Standardisation in digital interactive television – April 2003 Strategy and recommendations for a standardisation policy supporting the effective implementa- tion of the Framework Directive 2002/21/EC and the establishment of required interoperability lev- els in digital interactive television http://www.cenelec.org/NR/rdonlyres/CCC0D181-330E-4275-BF5F- 95DE06BA2298/0/DigitalTV_Sec0002_DC_Final.pdf#search=%22contest%20consultancy%20Sta ndardisation%20in%20digital%20interactive%20television%20final%20version%22

• Interactive Digital TV in Europe: Would Mandating the MHP Help or Hinder? An Independent Re- port Commissioned by the European Cable Communications Association 14/03/2003 http://www.ecca.be/docs/Interactive%20Digital%20TV.doc

• EBU Technical Recommendation R106-2001 - Use of DVB-MHP – 23/03/2001 http://www.ebu.ch/CMSimages/en/tec_text_r106-2001_tcm6- 4701.pdf#search=%22EBU%20Technical%20Recommendation%20R106-2001%22

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ANNEX 1: i-TV in DICE Member Countries

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Austria

A DVB-T test including the broadcast of MHP based interactive content was ran in Graz, commencing June 2004 and finishing 3 months later. It was undertaken by public and private broadcasters and offered the 3 regular TV services ORF 1, ORF 2 and ATV+ and an interactive service called “!TV4GRAZ”.

150 trial households were provided with MHP-enabled DVB-T set top boxes incorporating a return channel, for using the broadcast interactive service. The interactive content was accessible to the consumers via an MHP-Portal. It contained enhanced applications, like EPG or news ticker as well as interactive applications using the return channel, like a quiz and an interactive advertisement that in- cluded the possibility of requesting further information.

To support and develop the market research programme during the trial, the Evolaris Research Labo- ratory was hired to conduct comprehensive usability tests in their customer experience lab. Of the consumers involved in the research, 82% felt that the new digital teletext services were a significant improvement over analogue teletext services. Importantly, even the vast majority of elderly triallists were enthusiastic about the new digital teletext services.

With regard to the ongoing development of i-TV services, the most important message from Evolaris was to keep applications simple and smart.

On 23rd February 2006, RTR the Austrian regulator granted a license to operate two nationwide DVB- T multiplexes to the “Österreichische Rundfunksender GmbH&Co KG” (ORS). The ORS will serve as a platform operator for these two multiplexes. Part of this license is the obligation to use MHP for in- teractive applications.

Regular DTT services are planned to start on 26th October 2006 using one of the two multiplexes (MUXes) operated by ORS. Those being served by the DTT service will see analogue services end in 4 to 6 months.

This first MUX will deliver the three regular nationwide Austrian channels (two from public service broadcaster ORF and the other from commercial broadcaster ATV). Initially these services will be supplied to 70% of the approximate 3.37 million TV homes in Austria, rising to 95% before 2010.

On 1st April 2007, the 2nd MUX is expected to start offering three more channels, one of which is hoped will offer regional/local content. The second MUX will cover 70% of the Austrian households from day one but this coverage will not be extended. Digital and analogue services will be simulcast for around four months after digital switch-on.

MHP remains as the chosen Applications Programming Interface (API). Rather than acting as a full interactive TV enabler it will be positioned to provide digital replacements for conventional popular analogue teletext services. However, some interactive services (voting) will be offered and interactive DTT STBs will be available.

The ORS, TV stations (ORF and ATVplus) and RTR the regulatory authority have published a receiver specification (to be found at www.ors.at) which requires the implementation of MHP 1.1.2 for compli- ant receivers. The Specifications have been developed for 3 different types of DTT STBs:

Interactive: for STBs with MHP and broadband return channel. Enhanced: for STBs with MHP with or without modem return channel. Zapping: for STBs without MHP/interactive possibilities.

Manufacturers have been invited to submit their STBs to be tested and certified by an independent laboratory. For certified STBs manufacturers can buy stickers showing an approved symbol. The specification set is also valid for the satellite market as the relevant services including the MHP appli- cations could also be distributed via DVB-S when these services show to be a success in DTT.

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An EC approved “digitisation fund” was set up in 2004 and is now administered by the Regulatory Authority RTR. The fund will provide for a €40 subsidy to be granted to each of the first 100,000 cus- tomers who purchase an MHP enabled STB between the October 2006 launch date and 31st Decem- ber 2006. In addition, poorer households can apply for a similar subsidisation until 31st of July 2007. This could lead to a further 200,000 MHP STBs being subsidised.

The “digitisation fund provides €6.75 million per year from which broadcasters or content developing companies can request funds for projects that encourage the development of digitisation in the Aus- trian TV market. Another part can be used for social targets related to digitisation.

Austria’s broadcasters have followed the Evolaris “keep it simple” advice. Rather than launching and specifically advertising radically new 2-way interactive services they have elected to focus initially on digital teletext based enhanced services. Furthermore they have branded the new services as “Multitext”. This forms an important link to existing, trusted and highly used analogue teletext (or video- text) derivatives while the “multi” reference highlights the new multimedia aspects that digital can de- liver.

Some simple interactive services like voting will be possible from the beginning in an effort to promote to consumers the need for and benefits from purchasing an interactive specified STB.

Reference to MHP as a name is being reduced to minimize use of unimportant technical jargon for the user and critically remove association with failed /reduced MHP take-up elsewhere in Europe. Unfor- tunately, this has been impacted by the need to use the term “MHP Multitext” for legal reasons.

In August 2006 the RTR launched a website for customer information giving a detailed overview of all digital broadcasting platforms including DVB based variants (DVB-T, DVB-S and DVB-C) but also on IPTV, Mobile TV and digital radio. (www.digitaler-rundfunk.at). The website explains the relative ad- vantages and disadvantages of the different platforms and aims to help customers decide which the best option is for their personal circumstances.

Looking ahead, in Austria there is a vision of digital enhanced and interactive TV, services with con- nection to a return channel that could ease life for the handicapped and for seniors.

Apart from all kinds of entertainment and information based services, the new interactive MHP Multitext might be used for e-Government applications that could help the elderly and impaired com- munities. Such might include “on screen signing” for the deaf i.e. sign language videos in a small sec- tion of the screen while the TV programme runs on the remainder.

Austrian cable network operators also tested MHP via DVB-C and cable-based return channel. The cable network operator Salzburg AG ran test applications, including news ticker, SMS/email applica- tions, games and ticket ordering, until February 2005. Plans now exist to test e-Government solutions on digital cable network.

Germany

Since 1995, the introduction of digital television including interactivity has been actively considered by Germany’s major market players.

Their original planning was based on proprietary systems. However, it became clear that these sys- tems were not suitable for open, horizontal mass markets and consequently, German stakeholders contributed very actively to the development and deployment of MHP.

MHP was first demonstrated publicly in Germany at IFA 1999 and the first regular services were started in mid 2002. Several free to air broadcasters offered a number of regular MHP services and some new players entered the stage such as “Otto“ the large German mail order company and “Hörzu”, a well established TV print magazine. The former offered its products via TV using an interac- tive MHP application while the latter broadcasts an MHP version of its magazine on TV.

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Despite more digital satellite receivers being sold than analogue alternatives for the first time in 2003, and the start of DVB-T and the German digital switchover programme MHP has not yet developed into a market success.

Public broadcaster, ZDF has lowered MHP capacity to 200kbit/s for the benefit of better picture quality and private broadcasters have ended their MHP activities on all platforms.

Digital Terrestrial Switchover commenced on 28th February 2003 in the Berlin/ Brandenburg region accompanied by the introduction of MHP based enhanced TV services. Other regions have followed and currently close to 50% of the population can receive DVB-T programmes.

In Germany, digital terrestrial represents a low cost TV solution offering less programmes, less service and less cost than cable. At the beginning of 2005, three MHP enabled DVB-T set top boxes were available on the market with prices ranging from €225 to €800.

This compared with non-MHP models available for just €70. Now, basic zapper non-MHP boxes cost as little as €39. Consequently, MHP enabled boxes are seen as too expensive for little added benefit.

In January 2005 some German cable operators decided to support MHP in their networks but no regu- lar services were been implemented and now the majority of the cable operators have no interest in MHP.

T Online has dropped plans to launch an MHP based PVR (STB with hard disk) and interactivity ele- ments in its forthcoming service offering high bandwidth internet access over a VDSL network.

Hungary

Although DVB-T experimental transmission began in Budapest during 1999 the transition to DTT has been slow. Commercial Digital Terrestrial TV services have yet to be introduced in Hungary and the lack of political decision has impacted the ability for the market to develop.

At present Antenna Hungaria (AHRT) is the only company providing national terrestrial TV and Radio broadcast and distribution services in Hungary. This is on a public service broadcast and commercial basis and AHRT now intends to become the key player in the market for digital terrestrial TV and Ra- dio broadcast services.

However, according to Géza Laszlo, the company’s CEO, a better content proposition and regulatory framework are needed if DTT is to be a success in Hungary. He has pointed to the Hungarian media law not really covering DTT and there being some debates on whether it is open enough to start the project, or even whether the law should be changed to commence professional broadcasting.

Mr Laszlo believes that DTT in Hungary will be a success but not in the near term. A pilot project pro- viding about 25% coverage (3 transmitters in the Budapest area and 1 transmitter in West Hungary, simulcasting the national public service programmes) was launched by Antenna Hungária in October 2004, but there is no approved digital strategy for a full commercial DTT launch in Hungary.

Mihaly Galik, the head of the Institute of Marketing and Media at Corvinus University in Budapest, also believes there are significant regulatory issues impacting DTT in Hungary. As well as the broadcasting law not fitting DTT requirements he also highlights that the government has yet to decide on the strat- egy of introduction of DTT and anticipates cable companies protesting against the state subsidies attached to the introductory process.

The potential market in Hungary is substantial. The 2005 microcensus gave the country’s population as 10,090,330 persons. At the DICE Berlin conference, Laszlo Toth of NHH – Hungary’s National Communications Authority referred to a total of 3.86 million TV homes. However Cable TV in Hungary already addresses around 60% of the market.

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In September 2005, NHH the Na- tional Communications Authority in Hungary conducted some useful consumer research by interviewing cable subscribers on the type of DTV services that they are inter- ested in and would be prepared to pay for. As their chart opposite shows, enhanced and interactive elements were bottom of the list on both counts.

Lithuania

A limited DTT service has been launched in Lithuania. In July 2006, the country’s telecom provider TEO LT launched a DTT service in the capita city of Vilnius. The new platform uses MPEG-4 and pro- vides access to three commercial services at present and these are likely to cover 95% of the country by 2009.

For context, the 2005 census reported a population of around 3.6 million persons in some 1.36 million homes. Of the latter 935,814 are located in urban areas and 421,012 homes are in rural areas.

TEO LT owned by TeliaSonera was granted licenses to operate four multiplexes in Vilnius, during October 2005 by the Communications Regulatory Authority (CRA).

In October, RTK also awarded broadcasting licences on the DTT platform to Baltijos TV, Tele-3 and TV1 as well as the public services broadcaster.

In February 2006, a DTT licence was awarded to Lithuanian MMDS operator UAB Mikrovisatos TV. The company, based in Kaunas, is expected to launch a 24 channel subscription service in Vilnius in six months time and gradually extend it to the rest of the country.

On the 27th June 2005, two winners were announced for DVB-T licences. One licence to create two national SFN networks was granted to the Lithuanian Radio and TV Centre and the second for two further SFN’s was awarded to Lithuanian telecom.

According to the government’s document “Resolution on Adoption of the Model of Switch-over to Digi- tal television in Lithuania” dated 25th November 2004, DTT will be developed both in Band III and Bands IV & V.

No less than 5 free-to-air programmes must be broadcast through all DTT networks, including 2 pro- grammes of the public institution Lithuanian national Radio and Television.

The expansion of the TV networks will be done in stages starting in the biggest cities. By the 30th June 2006, DTT transmitters capable of 20 TV programmes should be installed in Vilnius and then in five of the biggest cities with a capability of 16 programmes by the end of 2007. At the beginning of 2009 at least one DTV network is intended to cover 95% of the population. Switch-over to a complete digital service must begin in 2012 on a regional basis but a final date for completion has not been an- nounced.

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over the deployment of MPEG-2 or MPEG-4 compression. As referred to above in the TEO LT case, MPEG-4 has been selected and fortunately, an increasing number of MPEG-4 models are being launched and should be in the Lithuanian market by the end of 2006.

A second challenge comes with prices of set top boxes varying from €60 to as much as €400, MPEG- 4 and interactivity enabled products being at the higher end. Many Lithuanian inhabitants are either unable or unwilling to pay for extra services. Consequently, it may be necessary to introduce some form of compensation mechanism, partial financing or tax reimbursement system to stimulate DTV penetration in Lithuania.

In Lithuania awareness of DVB-T and its benefits is low and gives industry stakeholders a further chal- lenge to create the necessary general information campaign to make it a success.

Poland

The Polish Government adopted the Broadcasting Switchover Strategy for Terrestrial Television (“the Strategy”) on 4th of May 2005.

The Strategy’s activity schedule assumed the start of regular digital transmissions no later than 10 months after the adoption of the Strategy. However, it turned out that this scenario was too optimistic and implementation has been delayed by more than a year and this is expected to increase.

The situation is attributed mainly to the fundamental changes of the regulatory bodies’ organization and competences brought by political changes in Autumn 2005 plus delay in adoption of the specific legal regulations adequate to digital environment.

In January 2006, the government of Poland established the Office of Electronic Communications (UKE) to replace the Office of Telecommunications and Post Regulation (URTiP). This new regulatory body will assume the powers of URTiP as well as certain powers of the National Broadcasting Council (KRRiT). UKE’s responsibilities include authorisation of frequencies for radio and TV transmission (both analogue and digital), the provision of electronic programme guides and the regulation of the telecommunications market.

Fortunately it appears that the new political elites and new top management of Poland’s public service broadcast company realize that digitalization is a necessary and irreversible process. In February 2006, work was begun by a new Governmental Committee charged with amending the Strategy and this has now been accelerated after the results of the RRC-062 Conference.

Certain elements of the original strategy have been retained. These include the necessary forced transition model, end of transition period by 2014 and achievement of 95% availability as a condition necessary to execute the analogue switch-off. However, the Committee members now lean towards to rejecting the second criteria of conversion, i.e. 90% penetration (affordability) and establishing a fixed date for ending analogue transmissions within the relevant region, regardless of take-up.

Essentially, Poland now appears to be applying a mix of the Switch-over policies for the UK, Sweden and Germany as reported to DICE, e.g. a combination of a regional roll out, simulcasting and enforced date for shutting analogue down.

However, the delays incurred are likely to lead to rescheduling the DTT multiplex licensing process. Allocation of licenses is now expected at the end of 2006.

Similarly, the delays have now led to a debate regarding the newer MPEG-4 video compression stan- dard being used instead of or as well as MPEG-2 as originally defined in the strategy.

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The MPEG-4/MPEG-2 issue is being compounded when homeowners close to the German border have purchased models to receive compelling content, notably World Cup soccer coverage. As a con- sequence there is understood to be a growing legacy of MPEG-2 products in Poland currently totaling around 20,000 units.

That said, based on recent census data there are approximately 38.5 million inhabitants in Poland and according to RTR’s recent “Media Digitization in Europe” report 13.25 million TV homes of which 6.07 million receive TV via terrestrial means.

There is therefore strong potential for DTT in Poland based on MHP enabled devices consistent with the EC’s proposals for new DTV launches by member states.

DVB-T field trials took place in Warsaw from November 2001 and from October 2002 included use of Advanced Digital Broadcast (ADB) MHP set-top boxes designed in Poland. In early 2004, tests begun in Rzeszów and Lezajsk after a successful frequency agreement with Slovakia.

However, cable and satellite alternatives are already available. The former accounted for 31% pene- tration of homes in 2002 and a year later satellite accounted for 1,5 million homes based on recent data.

Sweden

Sweden has established DVB-T services and a switchover programme in place. Northern Smaland, Gästrikland and Gotland are now completely digital. Further areas including Dalarna and Hälsingland were set to end analogue TV services in May 2006.

MHP services have been introduced by public broadcaster SVT. However as a result of no commer- cial MHP receivers being available on the market, MHP has failed to make a major impact. This is despite the NorDig regional agreement for a standardized API and aims for an open, standardised market with horizontal competition across the relevant countries.

Sweden began its transition to digital television on 19th September 2005 with the first analogue transmitters and broadcasts of SVT1, SVT2 and TV4 being turned off, on the island of Gotland. The Switchover programme then continued with analogue transmitters closing in the in the cities of Motala and Gävle. There are a total of five stages to the digital switchover in Sweden and all of the country is to be digital-only by the time the UK starts its transition in 2008.

Switchover only affects terrestrial television and half of households have cable TV and 17% have digi- tal satellite television already, so will not be affected. Just 23% of Swedish households have ordinary TV antennas on their roofs and will need to get digital terrestrial boxes.

The pay DTT platform operated by Boxer TV Access has proven to be a successful model. While slow growth initially plagued the DTT platform in its early years, the platform has witnessed high growth in the past two years. Already the fastest growing digital platform in Sweden, it is likely to become the largest digital platform in 2006.

DTT penetration stood at approximately 12% by the end of 2005 and in April 2006, Boxer reported an increased subscriber base in previous quarter. At March 31st it had 569,000 subscribers, an increase of 38,000 for the quarter. Boxer says that the repackaging of its content in 2004 and the ramp up to digital switchover is resulting in an average increase of 35,000 subscribers per quarter.

Sveriges Television (SVT) the public service broadcaster initiated broadcasting of MHP services on all digital platforms in 2004. These services consist of advanced text information services.

The first service, a digital teletext service, began broadcasting on 12 March 2004. The MHP services are broadcast from SVT’s own playout system and interwoven with the audio and video, meaning that the same signal goes out to all SVT’s digital operators regardless of whether they are broadcasting on the terrestrial network, cable network, or by satellite. SVT is investing around SKr300 million (€33m) in

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the transition ahead of full digital broadcasting by 2008. Ultimately the move will save the broadcaster an annual SKr150m.

In Gävle, an interesting MHP- based community information service is being trialled on the DVB-T network by around 500 users. Plans also are in place for testing DVB-RCT3 based services later. This will involve local government and other local interests.

The Nordic satellite operator, Canal Digital, is committed to following other Nordic broadcasters in supporting MHP and launched services following pilots in 2003/4.

Sweden is planning further DTT based services in the near future. In March 2006, RTVV, the Swedish broadcasting authority announced a new 6th multiplex is to be launched and has allocated 7 service licences to be available on it. The new multiplex will include both free-to-air and pay DTT services from Boxer.

As a world first, in partnership with manufacturers Sagem and Thomson, Sweden’s Teracom made a public demonstration of HDTV on the DTT platform at the end of 2005. This used the MPEG-4/AVC video compression standard. Teracom also showcased DVB-H for the first time in Sweden. A number of television programmes were transmitted via the DVB-T network to a Nokia multimedia terminal.

UK

Ofcom’s latest Communications Report produced in August 2006 revealed that homes with multichan- nel television broke through the 70% barrier in 2006 and by the end of the first quarter of 2006 the figure had risen to 18.6m, or 72.8% of homes.

For the first time, main sets in the home with Freeview exceeded the number of analogue main sets (though satellite is still the most popular method for receiving television on the main set in the home), but when all sets are taken into account the majority (60%) are still analogue-enabled.

BSkyB’s pay-based satellite based service currently remains as the primary UK DTV platform based on its dedicated Skydigital boxes, Sky+ Personal Video Recorders (PVR) and new HDTV PVR all based on Open TV/WtvML middleware. All provide true interactivity with return channel provided by a PSTN modem or in the case of the latest PVRs via Ethernet connection to broadband. Having taking over ISP Easynet, BSkyB has also now launched its own Sky broadband service to PC users.

NTL and Telewest merged in 2005, giving the UK a near single cable operator (Wight Cable remains independently owned and operated). The merged business had 3.32 million subscribers by the end of Q1 2006 (including analogue and digital subscribers), up 43,000 in 12 months.

NTL:Telewest became the first ‘quad-play’ operator in the second quarter of 2006 with its acquisition of Virgin Mobile. The focus for cable in the UK is very much now on service bundling and video on demand services rather than development of interactivity. Receivers deployed including Telewest’s new HD PVR are based on a Liberate API.

Following the closure of Kingston Interactive Television (KIT) in February 2006, which had been avail- able to 105,000 homes in the Hull area of East Yorkshire, TV over DSL (delivered over an unbundled exchange) was available to approximately 2.4m homes in the London area by May 2006. These ser- vices were provided by Homechoice which now has around 45,000 total subscribers. Homechoice owner, Video Networks has stated that it plans to work with alternative providers of unbundled ser- vices to extend its coverage area throughout 2006 and 2007. In September 2006, Video Networks completed a merger with Tiscali UK.

3 Digital Video Broadcasting – Return Channel Terrestrial (DVB-RCT) is a Wireless Return Channel system in the VHF/UHF Bands for Interactive Terrestrial TV incorporating Multiple Access OFDM.

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The main driver of multichannel television growth is Freeview, which added 2 million homes in the 12 months to the end of March 2006. There are now 7.1million homes in which the main set receives television via digital terrestrial. The vast majority of the various DTT STB, PVR and IDTV offerings are based on MHEG-5 middleware and critically do not carry an onboard modem or means of connecting to an external one.

However, on 11th September 2006, a working group was set up to develop and deliver a specification for a broadband return path as an extension to the existing 1.06 profile of MHEG-5 used in the UK. The project is co-coordinated by the Digital TV Group (DTG), the industry association for digital televi- sion in the UK. Interested parties, including international contributors are invited to join the group to provide input of international standardisation through the relevant bodies. With the UK now having widespread broadband availability, the prospect of an always-on broadband return path, rather than a slow dial-up modem, could open up a range of new interactive applications, including voting, games, communications and transactions, and importantly it would allow data to be delivered over broadband, or even downloaded or provide streamed audio and video.

Under a separate initiative, a group of middleware companies has formed an International MHEG Promotion Alliance, IMPALA to help broadcasters and receiver manufacturers with the deployment of MHEG-5 interactive services in international markets. The founder members are S&T; Cabot Commu- nications and EchoStar Europe, which owns Eldon Technology.

Public service broadcasters launched a range of new free-to-air channels in 2005/06, including ITV4, CITV and More4. Channel 4 took E4 free-to-view and ITV and Channel 4 launched quiz-based chan- nels ITVPlay and Quiz Call. Interactive elements with the latter are largely based on “calls to action” via SMS or a telephone number.

In September 2005, the Secretary of State for Culture, Media and Sport announced a firm date for digital switchover, which will commence in 2008 with the Border region and come to its conclusion four years later.

The not for profit organization tasked with implementing switchover is Digital UK (formerly Switchco) launched the first advertising campaign to raise awareness of switchover in June 2006.

Telewest and Sky launched high-definition TV services in time for the World Cup, offering a combina- tion of broadcast channel content and pay-per-view Films and the BBC launched a pilot of its internet media player (now re-named BBC iPlayer) offerings triallists on-demand access to a range of downloadable television programmes and radio content.

Other markets

This section briefly considers European countries outside of the DICE project that have actively devel- oped MHP in their markets.

Finland Finland pioneered MHP-based interactive services on DTT when it launched services in August 2001. Services currently include digital teletext, banking and game applications, advertising sites and a seven-day electronic programme guide (EPG). A mobile telephone assures the return channel. Cur- rently, a regional MHP portal is available in the city of Tampere to provide local information and a simi- lar portal will soon be launched in Helsinki. The government has actively supported the development of MHP-based services through its project ArviD.

Nearly half of all Finnish households have converted to digital television according to a statement from the country’s transport and communications minister. The recent Finnpanel survey shows that 975,000 households now have access to digital television. The analogue switch-off process is also underway in the Aland Islands and the whole switch-off process in Finland is expected to be completed in 2007.

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Italy Italy is now by far, thanks to Government subsidies for interactive receivers, the country with the high- est number of MHP set top boxes actually deployed in consumers’ houses. Italian national broadcast- ers (RAI, Mediaset, La 7) have adopted DVB MHP as the standard for interactive applications for the Italian DTT platform.

As of May 2005, 2.2 million MHP-enabled receivers for DTT had been sold in Italy. A government sub- sidy (€110 million for 2004) accelerated the deployment of MHP boxes, although over 900,000 were reported to have been sold without subsidy. The subsidy for 2005 was reduced to €70 per set top box and the retail price is below €100.

More recent research published by GFK Eurisko in July 2006, estimates that 4 million DTT receivers have been sold in Italy during the last two years – more than half being purchased with a government subsidy.

In the period between January and November 2005 2.6 million DTT receivers were sold of which most were MHP-enabled. A pre-payment DTT service offered by Mediaset and LA 7 also proved popular further boosting sales for boxes with MHP capability.

The success of these projects has been attributed to factors such as the presence of free interactive content from the beginning with effective marketing. The wide range of services on air include news, weather, audience polling, the ability to send and receive text and multimedia messages through the set-top box, and travel booking services. Some commercial broadcasters have also launched pay-per-view services, mainly centred on live football. Various trials to test the effectiveness of interactivity are also taking place in Italy and one by Telecom/TV International to 4000 households is using GPRS and ADSL return channels.

To allow optimum interoperability between the various networks carrying MHP applications and the available decoders the DGTVi has generated a “D-Book” (http://www.dgtvi.it/stat/Industry/D- Book/Page1.html). The DGTVi is an association (composed of RAI, Mediaset, La7, MTV, and the Fondazione Ugo Bordoni) working to enable the deployment of digital TV.

Much work is still required to migrate all of Italy’s 23.6 million households and around 58.7 million in- habitants from analogue TV to digital replacement services. Of these some 5 million homes already have digital satellite and 300,000 digital cable.

In August 2006 Italy’s Communications Minister, Paolo Gentiloni, called for the creation of an open DTT platform similar to Freeview in the United Kingdom. The new platform is to be called ‘Tivu’ and Gentiloni hoped that new broadcasters would be able to provide services on the DTT platform. The Minister also announced that the new analogue switch off date, 2012, could be achieved and went on to say that a frequency plan would be put together in early 2007.

Also in August, Minister Gentiloni announced the formation of “Italia Digitale” a committee of organisa- tions which will define and co-ordinate the necessary activities for the transition to DTV and the sub- sequent switch of existing analogue services. The committee is made up of representatives from vari- ous organisations such as: 3 Electronica, AGCOM, Ministry of Communications, Alps Association, Coord. To Aeranti Corallo, Fastweb, Foundation UGO Bordoni, FRT, Gruppo Editoriale L’Espresso, Prima TV, RAI, Independent region of Sardinia, Independent region of Aosta, Rete Capri, RTI-Reti Televisive, SKY, Telecom Italia Media.

A committee chaired by Minister Gentiloni, has also been set up to co-ordinate the whole activity and consisting of representatives from AGCOM, DGTVi, Ministry of Communications, RAI and RTI.

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ANNEX 2: Mobile TV in DICE Member Countries

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Austria

In September 2005, the Austrian public service broadcaster ORF, the mobile operators Hutchinson 3G Austria and Mobilkom Austria, the broadcasting services operator ORS and Siemens AG Austria re- sponded to a call from RTR the Austrian regulatory authority for the cooperation of a broadcaster, mobile operators and technical solution supplier to set up a DVB-H trial in Austria.

The consortium applied for subsidies from RTR’s Austrian Digitization Fund set up at RTR in early 2004 to initiate a trial in Salzburg and Vienna. In 2006, RTR decided to support the project with 1.2 million Euros from the Digitization Fund.

The trial is currently based around two phases. The first was the ongoing technical evaluation of the DVB-H network system in Salzburg. In August 2006, DVB-H transmissions started in Salzburg for the technical pre-trial in a very restricted small area. No triallists were involved. Phase 2 will cover a field trial in the area of the Austrian capital city, Vienna and run for a few months. This is supposed to start in December 2006.

The trial is based on Siemen’s IT solutions for return channel applications including billing (interactive services, video clips on demand via UMTS), Head-end network equipment comes from the ORS and handsets are to be supplied by LG (Hutchinson) and Samsung (Mobilkom) – serving nearly 600 so called friendly customer triallists in Vienna.

Similar to conventional Austrian terrestrial television services, the number of channels is restricted to the main ORF1 and ORF2 services and two ORF radio services. The partners have also developed an electronic service guide (ESG) which will offer a menu of the channels and other services,

Significantly, the ESG technology can differentiate between Hutchinson and Mobilkom phones and will only display the particular offers available to their customers.

It is unclear to what extent that interactivity will be explored in this phase. However, an important as- pect of the Austrian DVB-H trial is that unlike the vast majority of others around the world, it is operat- ing with multiple rather than single mobile telecom operators. Through this it will hopefully reveal some useful data on business models; customer ownership and revenue sharing areas.

3G Telecoms based mobile TV is also offered in Austria. For example, from 2004, Hutchison 3G Aus- tria, Austria’s first 3G mobile network operator operating under the brand “3”, has a wide range of video content services to subscribers. This includes music videos, entertainment and sports from channels such as ORF, MTV and Universal Music. In July 2006, the company contracted Siemens to build out its W-CDMA network to increase coverage from 50% to around 95% by the end of 2007. This will enable users to enjoy the higher throughput and transfer rates offered by high speed packet ac- cess (HSDPA) technology.

Germany

The hosting of the 2006 FIFA World Cup benefited German partners with opportunities to either initiate new mobile TV trials or to move others to commercial services based on DVB-H and T-DMB mobile broadcast platforms.

At the end of August 2006, the DVB-H pilot project that had launched in the 4 cities of Hanover, Berlin, Hamburg and Munich was declared a success.

The pilot commenced at the end of May to coincide with the World Cup after the regional media au- thorities, mabb (Berlin and Brandenburg); HAM (Hamburg); NLM (Niedersachsen) and BLM (Bayern) – in close cooperation with mobile network operators and content providers, created the necessary conditions for the project.

Users were impressed by the excellent picture quality, good reception and the extensive range of pro- grammes made available. 14 TV programmes and 6 radio programmes were included in the service.

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As it was compliant with the DVB IP Datacast specifications, key features such as an electronic ser- vice guide (ESG) and service purchase and protection (SPP) were also supported. Over the 3 month period, around 1,000 test devices were made available in total. These handsets/terminals were pro- vided by BenQ, Motorola, Nokia, Sagem and Samsung.

The Mobile operators involved were E-Plus, O2, T-Mobile and Vodafone. They are now calling on Federal and State authorities to put in place the conditions that would allow for a rapid launch of ser- vices nationwide. They are reported to be ready to invest millions to meet this objective. However, in order to ensure this they are calling for transmission frequencies to be made available across the whole of Germany and a harmonised regulatory framework to be created.

The operators believe that interactive entertainment and information-based services can provide a positive benefit as an educational and business tool.

In January 2006, four companies applied for licences to test T-DMB based mobile broadcast services in the German state of Baden-Württemberg ahead of the World Cup. This pilot served towards estab- lishing a "platform operator" that would collaborate with the country's mobile phone companies to launch four commercial mobile TV channels and two radio channels in 2006.

Several other German states planned to launch similar pilots around the World Cup, coordinated through their own state communication agencies and importantly all planned to share the results of their pilots before selecting the platform operator for the World Cup coverage and beyond.

This culminated in the commercial start of DMB services by MDF (Mobiles Fernsehen Deutschland) on 24th May 2006 in five World Cup-cities. The single L-Band layer attributed to the whole of Germany was dedicated to MDF to deliver four TV-services and one audio service.

ZDF, the German public broadcaster operates on a free-to-air basis while the other three TV services are encrypted. Cost to access these is around €7 per month. Handsets came from Korean manufac- turers LG and Samsung.

T-DMB was first shown at the 2005 Cebit trade show in Germany when Deutsche Telekom AG dem- onstrated a broadcast mobile TV service with a DMB-based phone from Samsung.

Germany has a long history of testing mobile TV – predominantly DVB-H based alternatives. As early as July 2004, Nokia, Philips, Universal Studios Networks and Vodafone ran a small test in Berlin based on twenty “friendly users” – (all employees of one of the participating companies).

This offered four TV services and one interactive service (VIVAplus “Get The Clip”) that relied on SMS or telephone calls. The test service was fed by two transmitters outputting on UHF Channel 59 and was based on head-end equipment from Udcast and handset terminals from Nokia and Philips.

Other devices were tested in another trial that commenced in October 2005. Covering the south of Erlangen and the northern part of Nuremberg, a DVB-H trial was initiated by the Fraunhofer Institute for Integrated Circuits and Friedrich-Alexander University. Head-end equipment came from Scientific Atlanta and Plisch that served TV and radio services, bit eXpress – a fast data service, plus live mod- eration to PDAs connected to DiBcom DVB-H receivers. Laptops fitted with DVB-H cards were also used.

The BMCO Forum Germany hosts the Broadcast Mobile Convergence Forum (BMCO Forum) an international organisa- tion of companies that aims to shape an open market environment for mobile broadcast services. It promotes exchange of business experiences between countries, companies and public institutions and provides a platform for its media and telecommunications sectors’ members to promote pre- commercial phases and to develop joint future projects

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1. In 2006: Reliable frequency designation for mobile broadcasting in the UHF bands both for initial trials and pilots plus for full commercial implementations post digital switch-over.

2. In the first half of 2007: Ensure spectrum availability for at least one multiplex within the UHF bands for mobile broadcasting services in regions/areas with highest consumer demand.

3. After 2008: Provision of a minimum 2 national coverage multiplexes needed to address apparent growth in market demands needed in accordance with growing market demands and facilitate a competitive market framework to generate sufficient opportunities for all value chain stakeholders.

4. RRC-06 procedures and regulations for implementation of the RRC-06 frequency plan to reflect the spectrum needs for new mobile broadcasting services and suitable to support implementation of such in European countries.

5. European-wide consultations on the requirements and plans of national administrations for mobile broadcasting. The general objective being to achieve an harmonised and user demand oriented (mobility without borders) deployment of mobile broadcasting in Europe.

Trial activity in Germany continues, including by some ini- tially focused on the World Cup. This includes the “Mi- Friends” DMB service. MiFriends is an acronym for “Mobile, Interactive Favourite TV, Radio, Information, Entertainment and New Digital Services.

The project went on air in Munich for the World Cup and continues to centre testing in the Regensburg region and in the South Tyrol. “MiFriends” was initiated by BLM the Ba- varian Regulatory Body, It received official status as a European project and issued a budget for two years of around €18 million, terminating in 2007.

The project goals include developing and testing of new mobile media technologies from an economic standpoint, particularly with regard to the consumer and related social and cultural factors.

Courtesy of MiFriends

In addition to the broadcast technology based projects above, It should be noted that Germany also offers UMTS 3G Telecoms based commercial services. One of the latest comes from Vodafone.

The Düsseldorf-based mobile communications provider is delivering live and full-length broadcasts of all first and second Bundesliga matches to UMTS mobile phone users. This costs users an extra €7.50 a month and enables users to watch their favourite team play. If two matches have the same kick-off time, they can watch both of them using a conference function. The package also includes the “Voda- fone Freekick” programme, showing Bundesliga and UEFA Champions League highlights. Those football fans without a UMTS phone don't have to miss out, because they can book the 'Football Package' for an additional €5 a month. It includes a live ticker with images and many other football services. Vodafone live! customers have the opportunity to test them out free of charge and without obligation until 9 October 2006.

Hungary

A DVB-H trial in Hungary started on 3rd February 2006 in the Budapest area and is operated by the national broadcasting company Antenna Hungaria.

The DVB-H signal is carried on UHF Channel 51 and included in the multiplexer of the ongoing DVB-T pilot project.

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The DVB-H service contains the same Hungarian TV programs (m1, m2, Duna TV) as the DVB-T stream. Due to current regulatory constraints in Hungary only the public service programs can be in- cluded in the DVB-H and DVB-T multiplexes.

On 10th August 2006 licenses for a new experimental DVB-H transmission were given to the operator. These licenses, issued for one year will enable the DVB-H operation to continue on Channel 43. A relay station using Channel 28 also transmits the DVB-H service. These two transmitters are also part of the DVB-T pilot project in the Capital.

Also in August, a fourth Hungarian public service TV program (called Autonomia) was added to the DVB-H and DVB-T multiplex. With regard to 3G (UMTS) based Mobile TV alternatives, T-Mobile Hungary has run a service 28th June 2005. This offers users the most popular programs of TV2 and reports from the Napló and Aktív newscast services). Interactive elements such as TV programme related screen images and ringing tones are available to all T-Mobile subscribers.

Lithuania

DTT broadcasting is yet to commence in Lithuania. As a consequence, Mobile TV developments have focused on Telecoms network based provision of unicast (one to one) services. Mobile TV operations were begun by two Mobile Telco operators in 2005 and in February 2006, licences for 3G (UMTS) networks were granted. This has lead to the launch of UMTS services in April 2006 and availability of 21 TV channels from one of the mobile operators.

Poland

Technical testing of DVB-H has taken place in Poland. This was through the TP EmiTel mobile TV trial that ran in Warsaw from 8th May – 10th July 2006 and carried three TV channels – Polsat, TVN and ZigZap.

Two UHF channels were used. The first channel 21 had an effective radiated power (ERP) of 0.7 kW, whereas Channel 48 ran with an ERP of 1.3 kW. The latter delivered a combined stream of DVB-T and DVB-H whereas the former was for DVB-H only. QPSK and 16 QAM modulation methods were used and MPEG-4 (H.264) for video compression and MP3, HE AAC for audio.

The trial was run to assess aspects of coverage, system capacity, reception quality and interactive services. Siemens provided head-end equipment and BenQ/Siemens terminals/handsets.

EmiTel are now considering the initiation of a larger scale commercial trial after the revival of trans- missions.

This is expected to evaluate other terminals and head-end equipment plus also interactive applications and optimal service range (i.e. number of services possible from different modulation parameters).

Poland has been at the forefront of 3G UMTS developments in that Polska Telefonia Cyfrowa (PTC) was the first telecom operator in Central and Eastern Europe to provide UMTS. In September 2001, PTC was the first mobile operator in Poland to present voice transmission in a UMTS network, in Sep- tember 2002 – 'videophony' based on the 3G technology, and in August 2004 – a comprehensive so- lution for the integration of multimedia.

By the end of 2006, over 8 million people will be within the range of PTC's UMTS signal meaning that the company will have fulfilled its licence obligations to provide UMTS services to at least 20% of the Polish population.

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FranceTelecom’s Orange World 3G Telecoms service operating in Poland had 11.1m clients, or 34 percent of the market at the end of the second quarter 2006. Orange World offers them 11 live broad- cast television stations as well as downloading of selected TV programs like news or soaps.

Third Polish mobile telephony operator Polkomtel commercially launched a 3G UMTS service in Sep- tember 2004 and had 10,9m clients at the end of September 2006. It now offers videotelephony based on 3G technology.

Sweden

The European Athletics Championships held in Gothenburg during August 2006 provided Teliasonera the opportunity to run a smallscale DVB-H Trial based on use of 40 multimedia mobile phones. Resi- dents of Gothenburg and visitors to the city could also test the technology in Bältesspännarparken at Avenyn. Five television channels were shown initially during the test. These were SVT1, SVT2, TV4, Kanal 5 and Eurosport – all of which featured digital broadcasts of track and field events from the Championships.

Another pilot test was planned to be held a month later in the Hammarby Sjöstad suburb of Stockholm, where fifty families would be able to watch tele- vision on DVB-H enabled multimedia mobile phones serving around ten channels that would offer programming to suit the whole family. Telia would then evaluate the DVB-H technology and through establishing a close dia- logue with the test families map the needs and requests of family members.

Both tests were conducted in co-operation with Nokia, as the supplier of the DVB-H head end system and its N92 multimedia mobile phones – pictured above.

On the 28th June 2006, Teracom announced it was to partner with Nokia in another Stockholm hosted DVB-H based trial. This would commence in October 2006 and end in December 2006. Others in- volved include Boxer, Sveridges Radio and Sveridges TV/UR and Telenor.

Like the TeliaSonera trial, Nokia’s level 3.0 head end system and N92 handsets are to be used but by 400 triallists. They will be served fourteen TV and four Radio channels

More recently, in September 2006, Viasat and Tele2 announced plans for a short trial to run from 12th September to 24th October 2006 subject to the regulatory authorities granting a licence extension.

This trial to also be held in Stockholm is apparently aimed at finding out more about customers’ needs, their behaviour and willingness to pay. It is also aimed at testing the Government’s stated position for open competition between all interested parties including TV and Telecoms operators.

14,000 of Tele2 subscribers living in Stockholm have been invited to participate and the first 100 to sign up have been selected. They will be served a package of eleven channels free of charge for the trial period from four transmitters covering the city.

Rather than Nokia equipment again, this trial will use Head-end equipment from Grass Valley and Thales with the Samsung P910 handset.

All four of Sweden’s mobile telecoms providers (TeliaSonera Sweden, Tele 2, Vodafone Sweden and 3 Scandinavia) have started delivering TV to handsets in unicast mode over their networks.

TeliaSonera Sweden launched six TV channels in the summer of 2005, initially free of charge while trying to establish an appropriate pricing model. On the 15th November 2005, the Mobile TV provider Kamera launched a live streamed TV-channel (EXPRESSEN-TV) through Vodafone Sweden’s net- work. The news oriented channels carries coverage of sports and entertainment plus International and local news.

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Ericsson, Sweden’s native telecoms equipment giant favours sticking to a 3G network and building MBMS on top of it – rather than adding a totally new broadcast network like DVB-H and have pre- dicted the transition to MBMS-enabled 3G networks will start in 2007.

UK

The UK has become a primary testbed for mobile TV platform technologies. At the time of writing there were ten principle initiatives that were or had been operating in the country. Of these, six were trials based on different broadcasting technologies – one of which has since led to a commercial launch. Another project is trialling MBMS alternatives via 3G, and the remainder were commercial 3G Tele- coms offerings.

Arqiva/Microsoft Cambridge: DAB/DVB-H Focusing on the broadcast trials; these commenced in 2004 with the small scale but ongoing Arqiva and Microsoft led initiative in Cambridge. As a technical evaluation rather than consumer trial it has twelve Microsoft selected triallists. From being the first to explore use of DAB to provide TV services it largely focuses on investigating how mobile devices can interact with other devices in the context of larger hybrid networks.

The trial uses a range of networked devices including PDAs; Smartphones and Tablet PCs receiving Linear TV channels, plus files delivered via broadcast. A new phase began in March 2006 exploring migration from DAB to DVB-H.

Arqiva/Sky Cambridge: MediaFLO More recently Arqiva have collaborated with BSkyB and Qualcomm in Cambridge on another project to look at MediaFLO alternatives. This began in the summer of 2006 and is a technical initiative and not a consumer trial that will run to 100 handset users.

Arqiva/O2 Oxford: DVB-H The Oxford DVB-H Trial initiated by Arqiva and O2 commenced in October 2005 using loaned Nokia 7710 handsets. First Phase results were released in June 2006 for the project that had around 375 trial- lists selected by O2.

They were offered sixteen TV channels from the BBC, ITV, Channel 4, Five TV public service broad- casters plus BSkyB, Turner Broadcasting, Shorts International, Discovery, Eurosport and MTV.

The average weekly viewing of TV on mobiles was four hours. 37% of this was during daily commute periods with peak viewing in the mornings and early evenings.

As the trial progressed home viewing dropped to 32% as commuter viewing increased. News and soaps were the most popular content with news bulletins drawing a 44% share of viewers and 36% watching soaps. Overall 85% of users said that they were satisfied or more than satisfied with mobile television while 72% said that they would take up services within a year of a launch.

O2 and Arqiva are planning to extend the trial into the Autumn and possibly offer interactive services.

BT Movio/Virgin Mobile: DAB-IP The World’s first deployment of DAB-IP Com- menced on June 2005 when BT Movio /Virgin Mo- bile launched their trial that operated within the London M25 Orbital motorway served by the exist- ing DAB-IP Trial existing (band III) Digital One DAB radio network.

DAB-IP Architecture – Courtesy of BT/EBU

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BT Movio developed the technology to offer as a wholesale proposition to mobile operators. For the trial around 1000 existing Virgin Mobile subscribers aged up to 50 were selected. They were offered three TV channels, more than fifty DAB radio channels and an ESG. The trial handsets were custom made by HTC of China and with TTC Cambridge software.

DAB-IP can run a TV channel at rates from 64 kbit/s, compatible with current UK bandwidth and data carriage rule constraints. BT Movio pointed to this as the only means for provision of a potential com- mercial UK market proposition at present.

BT Movio’s technology exploits the IP protocol support in the World DAB standard, enabling broadcast TV and digital radio to mobile devices and also an extension into other services including such as application download, caching of content on devices – to deliver something like real-time podcasts on the move. Use of IP also affords BT Movio and their partners an easy migratory path to DVB-H and its similar use of IP Multicasting if and when new spectrum becomes available.

BT’s Movio technology is also founded on Microsoft’s Digital Rights Management (DRM) solution and created from the outset to support the more demanding digital rights management requirements to allow a subscription and pay-per-view system and also meets content owners’ requirements.

First results from the trial were released in January 2006 and revealed more users were interested in listening to digital radio through their handsets than watching mobile television services. 59% rated mobile TV as appealing or very appealing by the end of the six months test, 65% said the same about digital radio. Users watched an average of 66 minutes of TV a week on their phone but listened to 95 minutes of radio. Over 75% of the pilot users tuned into DTV on their mobile at least once a week.

73% said they would be prepared to pay for the service on their current network if it was priced com- petitively – i.e. between £5-£8 a month and 38% would be prepared to switch networks to receive radio and television. Users preferred to watch whole programmes or news bulletins rather than spe- cially prepared highlight channels. Mobile TV was particularly popular with rail commuters with usage peaking in the mornings and evenings.

Commercial Launch In September 2006, Virgin Mobile unveiled the launch plans for its commercial mobile TV service using the DAB IP-based BT Movio wholesale platform. The first broadcast is to commence from 1st October 2006, coinciding with a huge advertising blitz, fronted by Pamela Anderson.

The service will initially offer four TV channels comprising public service broadcast (PSB) channels – BBC One, ITV1, Channel 4 and also the latter’s general entertain- ment channel E4.

Programmes will be simulcast with fixed DTV offerings from these providers – with the exception of some film, sport and US-produced content due to content rights issues.

BBC One will be available on a trial basis for one year and provided free to consumers. Channel 4 will initially broadcast Channel 4 Short Cuts, its made-for-mobile TV channel, and expects that Channel 4 simulcast will follow. DAB radio is another key ingredient with the service providing access to all the UK’s DAB stations.

The BT Movio service broadcasts via the existing national commercial DAB digital radio network. This currently covers more than 85% of the UK population thus providing BT Movio with a near-national footprint at launch.

The other key components of the BT Movio service are a seven-day programme guide and ’red- button’ interactive services. The programme guide makes it easy for consumers to find their favourite TV and radio shows and also plan their viewing or listening schedule. The interactive function – which

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will not include BBC One initially, will allow users to participate in TV and radio programmes by direct- ing their phone’s browser to weblinks specific to the programme they are watching or listening to.

Virgin is offering the service via the Lobster 700 (pictured above) its first Windows-based smartphone.

Manufactured by HTC, this is the world’s first DAB-IP enabled device and first in a series of mobile phones being developed to support the BT Movio service. Those signing up to a contract of £25 per month or more, will get the handset and the TV service for free for the life of your contract. The Lob- ster is also available on pre-pay for £199 with the service free for 3 months, followed by a £5 a month charge.

UK/Korea London: T-DMB & DAB-IP To fully explore the DAB derived T-DMB and DAB-IP variants, industry stakeholders from the UK and Korea have come together and initiated a comparative technical trial in London. The project is particu- larly timely ahead of the expected sale of both L-band and Band III spectrum in the UK later this year.

The trial aims to demonstrate the multimedia capabilities of DAB including Enhanced Radio, Mobile TV and other multimedia applications like traffic information and how these can co-exist with the al- ready popular DAB audio radio services here in the UK. The trial will also analyse the viability of the two (T-DMB; DA-IP) approaches to data broadcasting on the DAB platform

Mobile TV via T-DMB has been a successful commercial proposition since the end of 2005 in South Korea and the UK trial aims to match lessons learnt in the Korean market with those learnt from DAB- IP in the UK and show how these lessons can be applied to other markets where DAB is already li- censed or being considered.

Using an L-band test and development licence supplied by Ofcom, the trial receives live broadcast content over DAB from two transmitter sites in London, one at BT Tower, the other in Croydon. The trial is to run for six months and will be conducted in two phases – the first testing and showcasing audio and visual capabilities, and the second covering the potential for data and interactive services.

The UK and Korean partners participating in the trial are Unique Interactive, Arqiva, GCap, BBC, BT Movio, iPark London, RadioScape, Factum and Virgin Mobile, the Korean Ministry for Information and Communication, LG Electronics, Samsung, Pixtree and Ontimetek. Mobile TV content is being pro- vided by BBC News 24, EMAP, ITV, Cartoon Network and Teachers TV.

NGW Stoke on Trent: DAB-IP & T-DMB On the 15th September 2006, National Grid Wireless the other UK DTV Transmission Provider also begun technical trials of DAB-IP and T-DMB. The services are being transmitted on the Stoke-on- Trent DAB multiplex and carry video and audio content supplied by the operators of the multiplex, UTV-Emap Digital. The technical trial based on Band III spectrum, is monitoring the relative perform- ance of both technologies in rural and urban areas, including within buildings. The trial will enable the company to determine the full requirements for the introduction of enhanced data services onto con- ventional T-DAB platforms. The multiplex system has been provided by RadioScape and is currently the only system operating that supports both T-DMB and DAB-IP. The video encoding system has been provided by Pixtree. National Grid Wireless will release the results of the trial in late 2006.

Commercial Mobile Telecoms based services Of the three primary commercial Mobile Telecoms based services in the UK the most successful ap- pears to be the BSkyB / Vodafone 3G service. On 22nd September 2006, Vodafone hailed the “coming of age for mobile TV” after revealing its mobile TV service is now more successful than ringtones. Over half of all of its new 3G customers choose to subscribe to mobile TV, paying £5 per month each for two Sky packs, or a Vodafone pack for £5, or all three for £10. The £10 option is the most popular. Vodafone attributes one of the reasons for success is that the service was made ubiquitous from launch, with no need for a need a specific application or phone.

The service commenced on 31st October 2005 giving BSkyB access to Vodafone’s then 250,000 3G customers while Vodafone benefited from Sky content to load their 3G network.

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The service delivers a mixture of live/streamed programming and short clips offers. There are 2 Sky packages offering a combined total of 19 TV channels carrying news, sport, music and documentary programmes. Some popular programmes such as Sky One’s “24” are not available due to content rights issues. BSkyB CEO James Murdoch reported 5m hits between November 05 and January 06.

Other commercial Mobile TV services in the UK include the Hutchinson “3” national subscription based service offering content such as Premier League Soccer clips, Big Brother, Coronation Street etc.

Rok TV is another that comes from ROK Entertainment. This is a GPRS (2.5G) commercial service that commenced in October 2005. Available nationwide, it was initially confined to 13 of Nokia’s hand- sets but is now expanding to other brands/models. The service offered 10 channels initially including live TV channels CNN, ITN and Cartoon Network. The other channels are available on a video-on- demand (VOD) basis and include music videos, comedies, cartoons, weather and lifestyle channels. ROK has indicated that more channels are to be included in the future. Users log on to a website to register for ROK’s subscription based service; they can download a free application there and can use the service under a free three-month trial period after which they then have to pay £9.99 per month. ROK TV also plans to offer a pay-per-view service.

Orange MBMS /TDD Trial: In partnership with IP Wireless This initiative was announced on the 15th February 2006 at the 3GSM Fair in Barcelona. Orange and IP Wireless as the organizers planned to launch the trial nationwide across the UK from mid 2006. The service will utilize the 1.9GHz TDD spectrum bands currently not utilized but already awarded to Or- ange with their 3G licence. According to IP Wireless this could offer up to fifty channels of TV for stan- dard cell phone screens, or seventeen higher resolution channels. Importantly use of MBMS and TDD potentially brings a real broadcast capability without need for new DVB-H spectrum or with 3G network constraints.

Other markets

This section briefly considers some European countries outside of the DICE project that have actively developed mobile TV broadcast services in their markets.

Italy As seen previously with MHP, Italy also leads the way in broadcast mobile TV.

The world’s first commercial mobile TV service using DVB-H technology was launched there on June 5th 2006. 3 Italia, the mobile network operator that launched the service, reported it had signed up 111,000 customers in the first six weeks of operation. This was clearly helped by coverage of the FIFA World Cup and Italy going on to win the tournament.

The operator is aiming to have 500,000 mobile television clients by the end of 2006. The service is currently available in about 2000 Italian towns and cities with 40 being added each day. Founded in March 2003, 3 Italia had 82% population coverage as of 23rd August 2006 for telephony (99% with 2G roaming) and 6.8 million subscribers.

Significantly, it is the only mobile operator that completely owns its own broadcast network. This came through 3 Italia buying out regional TV station Channel 7 from the Profit Group. Channel 7 held a net- work licence for national digital TV distribution on terrestrial frequencies and Italian licence regulations enabled automatic change of use from DTT to DVB-H provision. Coverage at launch time was close to 74% of the national population.

3 Italia currently has the highest average revenue per user (ARPU). In the first half of 2006 this stood at €35.4 for a complete package (i.e. calls, data & media services)

The small screens in mobile devices do not require the usual high quality broadcasting methods of traditional TV. 3 Italia has capitalized on this and taken a radically different approach to channel crea- tion at a considerable lower cost. La3 live was the first DVB-H channel on air. Running since June 5th it is a free channel operating 16 hours a day, 7 days per week. It broadcasts from a small corner of 3

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Italia’s office and has a team of twenty “3-Jays” – young people enthusiastic about mobile TV that were selected from 3 Italia’s call-centre employees.

3 Italia carried intensive World Cup coverage – 9.5 hours live a day and had more than forty VIP guests plus also showed user-generated content from German and Italian cities.

A second commercial DVB-H service has been officially launched in Italy by Telecom Italia Mobile (TIM) and Mediaset. This began service on the 9th September 2006. TIM proposes to provide broad- casts of Mediaset's three TV channels and football on its top-of-the-range mobile phones for five years from 2006. Mediaset is also reported to be planning an all – news channel for the new network. Nego- tiations with several possible partners are said to be underway including CNN.

Finland Finland was the first country to license commercial mobile TV services using DVB-H. On the 14th No- vember 2005 The Finnish Ministry of Transport and Communication announced it would start accept- ing applications for mobile TV licenses based on DVB- Six months later, the Finnish Government awarded a license to Digita to build and operate a DVB-H mobile TV network. Three other companies, Elisa Corporation, TeliaSonera Finland Plc and Telemast Nordic Oy, also applied for the license. Digita plans to roll out the network later this year with the aim of covering 29% of the Finnish population by the end of 2006.

On the 11th May 2006, Digita contracted Nokia to supply the DVB-H platform .The first stage of net- work rollout in 2006 will cover the area inside the Ring Road III in the Helsinki region and the cities of Turku, Tampere, and Oulu.

The network will reach 29% of the population in Finland by the end of 2006. Digita has already made plans to extend the network to cover the majority of Finns. Negotiations with the relevant service op- erators have been based on these plans.

Spain Spain is another country actively exploring mobile TV with a number of trial activities.

On 5th May 2006, Abertis Telecom, Nokia and Vodafone Espana reported the first results from their Seville DVB-H mobile trial at a special event in the city. The trial ran between March and July 2006 and revealed that 80% of the participants said they would recommend the Mobile TV service with 8 out of 10 saying that it was easy to use. Users watched the service for approximately 35 minutes each day and 38 minutes at weekends. The trial involved 300 users who had access to fourteen television channels from a variety of local broadcasters including, Antena 3 TV, Net TV, Sogecable, Telecino, RTVA (Canal Sur), RTVE, RTW (Canal Nou) and Veo TV.

Earlier at the end of March Abertis Telecom, Nokia and Amena had announced another DVB-H pilot test, in Zaragoza and Gijón. In this more than 125 Aroganese users were to test the characteristics of the system and how it works in the area around Zaragoza, centrally and in underground situations fed by simple repeaters. 75 users in Gijón were similarly tasked for their area.

A further DVB-H test is running in Seville between August 2006 and March 2007. This is involving the national and regional broadcasters plus different platform providers. The initiative will offer fifteen TV and ten radio services. It aims to verify theoretical models, evaluate coverage and also network di- mensioning in an urban environment compared to other cities. It also will undertake a detailed study of indoor coverage, test Gap-filler usage in an urban environment and test interoperability between vari- ous DVB-H equipment and terminals.

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