© Cable Authority 1989

British Cable :KeyFads

31 March 31 March 31 March 1989 1988 1987 Number of franchises awarded 32 23 22 Number of franchises operating 10 10 8 Homes to be passed by franchises awarded 4.601.000 2,365,000 2,297 .000 Homes so far passed 470,203 307,453 168,436 Homes connected to franchises 65.874 44.565 21,873 Average franchise penetration rate 14.0% 14.5% 13.0% Average subscription paid per month £17.08 £17.86 £18.50 Licences for upgrade/SMATV systems 144 119 73 Homes passed by all UK cable 1,478.583 1,372,856 1,189.655 Homes connected to all UK cable 283,816 256.527 193.173 Average penetration rate 19.2% 18.7% 16.2% Proportion of viewing of cable channels 36% 39% 30% The Rt Hon Douglas Hurd CBE M P Secretary of State for the Hom e Department Hom e Office 50 Queen Anne's Gate LONDO N SW1H 9AT

10 July 1989

Dear Secretary of State

I have pleasure in sending to you, inaccordance w ith section 21 of the Cable and Broadcasting Act 1984, the Annual Report of the Cable Authority, together w ith the statement of accounts, covering the period from April 1988 to March 1989 .

Yours sincerely ~ - /' Richard Burton

• M r Richard Burton Chairman of the Authority

Members oftheAuthority

Chairman MR RICHARD H BURTON

Deputy Chairman PROFESSOR JAMES RING CBE

MRS ANNE BALLARD

M RPHILlP DARW IN

MR PAUL JOHNSON

M RS ELIZA BETH MACDONALD-BROWN

M R PETER S PAINE CBE DFC

2 Chairman's Foreword

W hen I said in my foreword to last year's report that the prospects for cable w ere better than ever before. I littl e thought that the interest then beg inning w ould explode so rapidly in the year that has followed. On the basis of prop ositi ons accepted by us. we advertised twentysix franchises in the year. compared with only five in the previous year. There is now every sign of that accelerated activity continuing through the coming year. to the point w here most of the urban centres of the country are likely to be inclu ded in the franchising process very soon . How ever. despite the more positive perspect ive on cable w hich th is activity reflects the Authority cannot yet be content with the position of cable. The rising tid e of franchises has not yet resulted in much new cable in the grou nd. Cable needs to be establ ished as a fact in many more areas and to be supplying a range of new and worthwhile programming and services before it will be taken very seriously by the people of this country. It is a matter of regret to the Au tho rity that there is not mo re British investment in cable but there is great current interest based on North American investment. I commented last year on th e harmful effect of uncertainty and delay. w ith special reference to the restrictions on foreign control of cable operations here. It is therefore gratifying that the Governme nt announced in May that it proposes to repeal these restrictions. The polit ical uncertainty engendered by the Broadcasting White Paper caused some hesitation within the industry and undoubtedly slowed down some of the developments which would ot herwise have occurred. At a stage w hen interest in cable had at last become widespread. such uncertainty w as anot her cause of regret to the Authority . Happily. the Government has since accepted that many of the proposed changes should not after all be made. but the fact that they were proposed in the first place has had a damag ing effect in undermining confidence and stabil ity. It is understandable that the Government no long er wishes to grant cable special favours. but it is diffi cult to understand w hy it seems to see a need to reverse the process by imposing adverse restricti ons on an industry already facing strong competitio n. The most recent example is the prop osal that SMATV systems in single buildings should be taken out of the normal licensing arrangement s and therefore out of the automatic territory of the local broadband franchisee. Each such propo sal creates uncertain ty and delay. The Authority nevertheless remains co nvinced that its consis tent ly held belief that cable is a necessary and inevitable part of this country's futu re is we ll on the w ay to vindicatio n.

3 • The Authoritys senior staff

Jon Davey _ Director General

Tony Currie Controller of Programmes Chris Quinlan Controller of Advertising Anthony Hewitt Secretary to the Authority (from January 1989)

(Edward M ercer, who had been Secretary to the Authority, left in December 19881

The role oftheAuthority

The Authority came into existence on 1 December 1984 as a result of the Cable and Broadcasting Act 1984. The Authority is charged by Parliament wi th

• grant ing franchises for the installation and operation of large-scale broadband cable systems

• licensing the provisio n of cable programme services in addition on older systems (upgrades) and new smaller systems (SMATVI • licensing the provision of television for public showing • drawing up codes on programme standards, advertising practice and sponsorship

• exercising oversight of cable programm es to make sure that the rules are kept

• exercising its licensing functio ns in the w ay that best promotes cable services, especially those on the new generation of broadband syste ms .

4 REVIEW OF THE YEAR

1 Reviewof theYear

This year w as distingu ished by the rapid upsurge of interest in cable for w hich th e Authority has been looking since it w as established. This was manifested in the greater accessibi lity of finance for cable investment and in a consequent and dramatic increase in the demand for cable franchises. The Au thority has long believed that percept ions of cab le. w hich have previously denied the industry the fin ance it needed. would inevitably change as the long term advantages of cable became clearer. It is. how ever. w orth seeking to identify the consideratio ns w hic h have led to this speedy turnarou nd in the year und er review . They are of three kinds .

The effect of satellite television The first concerns developments in satellite television . The year saw the launch of the Astra satellite and the co mmencement of the first of the new television channels w hic h are using it. Th is has increased and improved the range of prog ramme channels w hich cable operators can relay to their customers. It has therefore given them a bett er product to sell. and the industry is confident that it w ill make it easier for operato rs to attr act new customers and keep them. But the immense publicity given to Astra and Sky Television. w hic h is already transmitt ing four channels via the satellite. means that publ ic aw areness of a new choice of television is now far higher than it wa s previously. Th is agai n is perceived as making the job of cab le operators easier as they seek to sell their services to the publ ic. It also became clear during the year that the onset of these new satellit e television services would be associated with some co mp lexity in individual reception. and the need for a significant amount of receiving equipment if a view er wa s to attempt to take advantage of the full choice coming on offe r. It therefo re became evident that cable's role would be even more important than had previously been realised. overcomi ng the co nside rable confusion betw een diffe rent satellite systems. and th e substantia l expe nse of the individual receiving equ ipment w hich non -cable viewers would need. Although. therefore. the arrival of new satellite television services was perceived in some quarters as reducing the incentive to install cable systems. the attractions of cable remained stro ng. The panel on page 7 co mpares the features of cable. satellite dishes and MVDS as a means of explainin g w hy interest in cable is growing.

Telecommunications becomes rea l The second main consideration co ncerns cable's role as a telecommunications medium . The Authority reported last year the commencement of the fi rst cable telephone services by Cable Camde n Ltd and Windsor Television Ltd. Dur ing the year. East London Telecommunications Ltd became the th ird operator to offer a telephone service. and the experience of these develo pments - particu larly in Windsor. where the service wa s most extensive - did much to establish the credibility of cable as an alternative telecommunications med ium. For the first time. the value of being able to derive a second stream of revenue from the infrastructure investment became quantifiable: it was possible to include in a cable operato r's business plan some realistic projections for revenue from telecomm unications services.

5 • ------

REVIEW OFTHEYEAR

North American investment grows The third main consideration w as the motivation and ability of North American companies to invest in cable in thi s country. In the last five years. cable has achieved a new level of maturity and success in the United States. as it has in Canada. There are few oppo rtunities for expansion left in North America. and cable operators there have been looking in ever increasing numbers at the possibility of expansion to the United Kingdom. The restrict ions in the Cable and Broadcasting Act on the non-European Community control of cable operations had previously been seen as a substantial hurdle. In the year under review . however. some operators found a means of investing w hich satisfied the law and at the same time gave them comfort about their ability to mainta in sufficient influence over the use made of their investment. This usually meant the control of the operat ing company in this country resting with a discretionary trust in the Channel Islands. This is a cumbersome and time-consuming legal expedient w hich both the Authority and the operators concerned wou ld like to see made unnecessary. Those engaged in cable operations in the United States and Canada. and those members of the financial community w ith experience of backing them. have a famil iarity and sense of ease w ith the long term investment that cable involves that has been lacking in this country. They recognise that there are differences in the market. and that their experience of North Am erica cannot translate directly to the United Kingdom. Nevertheless. they see sufficient similarities in the television market to believe that cable investment in Britain w ill be w orthwhile: and the possibility of providing telecommunic ation s services will be a bonus. M ost of the new-found interest in cable therefore originated in North America. from cable operating companies both large and small and from telephone companies of the stature of Pacific Telesis and US West. The Au thority regretted that more Briti sh investment was still not forthcom ing. but in the circumstances regarded the possibility of North American investment as entirely desirable. filling the void that had otherwise been left.

AberdeenCable celebrated the completion of their cable s ystem - the first franchise to do so.

6 REVIEWOF THE YEAR

Whyis cable still preferred?

Cable Satellite D ish MVDS

Number of channels Virtually unlimited Depends on satellite : 10 16 on Astra 5 on BSB

External aerials needed No Yes Yes

Hardw are required Single connection New dish for each Mi crowave aerial. Set supplied by operator. satellite (or steerable top converter/ decoder. with any necessary dish). set-top box . New receiver (or combined receiver) for each transmission standard (PAL. DMAC. D2MAC. SECAM). New decoder for each scrambli ng method (Eurocrvpt. Eurocypher . Videocrypt)

~ View ing one satellite Connection supplied by Second satellite Separate converter/ channel wh ile recording cable operator receiver. possibly decoder another second dish and decoder. - Non -satellite channels? Yes No Possibly - Local channels? Yes No Possibly -~ Interactive services? Yes No No (shopping. security etc)

Telephone services? Yes No No

Data transmission? 2 way 1 way only No - I-- ~ Planning permission? No Sometime s Probably not

Availability Comprehensive in cable Only to those with sight Only to those w ith line areas of the satellite(s) of sight to microwave transmitter -~ Maintenance Included as part of M aintenance contract Arrangements not yet- service may be available clear , Cost Small connection fee. Substantial capital cost Substantial capital cost Monthly subscription (somet imes plus I (could be supplied by depending on equipment rental) . local operator). programme channels Monthly subscription M onthly subscripti on received. depending on depending on programme chann els programm e channels received received

W idespread cable is still for the f uture Because of th e necessary length of the franchis ing and licensing procedures. co upled with the time-consuming nature of cable construction. litt le of th is new int erest in cable had found its way into physical cable systems by the end of the year. The small amou nt of cable in the ground co ntinued to be a disapp ointment to the Authority; but there is at least now solid grou nd for co nfidence that the amou nt will be inc reasing substan tially in the next few years. and the Authority w ill be enco uragi ng the speedy move fro m franchise awa rd to co nstructio n. At the end of the year. several cable operato rs we re preparing fo r the start of services on new systems. but no new systems started transmission during the year.

7

• ------

REVIEW OFTHEYEAR

Changes proposed by the White Paper The other major developm ent of the year w as the reform of the broadcasting framework proposed by the Government's White Paper " Broadcasting in the 90s". The Authority understood better than most the changing circumstances which led the Government to propose the substantia l shift towards allow ing market forces greater scope for influ encing the development of broadcasting . While generally sympathetic to many of the changes prop osed. therefore. the Authority could not help being concerned about the effect of some of the initial proposals relating to cable. The cable industry was similarly perturbed about the effect of proposing changes in the cable regime at such an early stage in the development of the industry. ironically at just the stage w hen the Government's 1984 strategy showed every sign of beginning to w ork. The positiv e feature of the Government's proposals was that they we re subject to consultations and the Government made plain that they w ere w illing to reconsider them in the light of comments received. The Au thority's comments. along wi th comments from all sections of the cable indu stry. left the Government in no dou bt as to the problems likely to be caused by the prop osals. and in April 1989 the Home Secretary anno unced that they were being modified. M any of the propo sals w hich had caused misgivings we re dropped. but furt her conc ern was caused by the fresh proposal that a cable system in any single build ing w ould be automatically licensed. depriving cable franchisees of the exclusive right s they had previously been led to expect. The proposals in the White Paper did at least have one positive effect. It became clear to the Authority as soon as the White Paper was published that

FreshEuropean restrictions

British practice in television regulat ion wi ll have to become more restrictive as a result of European agreements being entered into by the United Kingdom Government. in the form of the Council of Europe Convention on Transfrontier Broadcasting and the forthcoming European Community Directive on Broadcast ing The Authority has been closely involved in discussions about the draft ing of these two measures and has expressed strong concern about effo rts in a number of directions to impose new burdens and restrictions on the developm ent of the new media. Pressure has resulted in a number of beneficial changes in the Coun cil of Europe Convention which seem likely to be follow ed in the Commu nity Directive. In particular. a formula on European programm e quota s seems better to recogn ise the realit ies of programme production than earlier drafts: restrictions on advertising have been modified: and the previously harsh approach to sponso rship has been diluted. Nevertheless. compromises have been made w hich limit the United Kingd om's freedom to impose the form of regulation which it judges best. The Authority regrets w hat it still sees as an unnecessarily restrictive approach to the new channels which are currently trying to introduce more choice for the view er. There are various changes w hich may need to be imposed by United Kingdom legislation to give effect to the European instruments. In some respects it may be possible so to interpret the European requirements as to maintain existing British practice; in other respects. however, the requirements are specifically incompatible wi th what has so far been consi dered approp riate by the United Kingdom Parliament and regulatory bodies. The main areas of difference are as foll ow s.

European programme The Conventio n requires that "where practicable" broadcasters shall quotas reserve a majority of their transmission time for European works. This compa res with the duty on the Cable Aut hority to ensure a " proper proportion" of EE C material. It seems likely that the "w here practicable" qualification wi ll be sufficie nt to allow the survival of film channels and those specifically for ASian or Arab viewe rs, as we ll as others w here the conditions of a new industry militate against large amounts of new production. It remains to be seen whether effort s by some countries to make the European Directive more stringent succeed

8 REVIEW OFTHEYEAR

the plan to enact legislat ion w hic h would create a new form of franchise subject to different conditio ns w as likely to concentrate interest on the value of the existing typ e of franchi se. This factor was undoubtedly one of those lying behind the acceleration in demand for franchises w hich the Authori ty experienced in the second half of the year.

European agreements Amon g the oth er political develop ments of the year was the effective finalisation of the Coun cil of Europe's Convention on Trans-front ier Broadcasting . This w as a matter on w hic h the Au thority had expressed concern in the past. in view of the various attempts to use European instruments as a means of imposing new obligations and restrictions on television services transmitted by cable and satellite . It now looks as if these measures w ill introdu ce some inh ibitions on the freedom w hic h the new media have hitherto enjoyed. but discussions over the past year have succeeded in averting many of the disadvantageous prop osals w hich had been put fo rvvard. The Authority draws some satisfactio n from the improvements that have been secured. The conclusion of the European discussions coincides with moves away from pan-European broadcasting. w hich render the agreements less necessary. Sky Television. w hich was the pioneer of pan-European satellit e television. took the decision to con centrate instead on its British market. This reflected the view of many commentators that. 1992 notwithstanding. a single European market for television wa s not a realistic goal in the foreseeable future.

Advertisi ng minutage The Convention lays down maximum limits of an average 9 minutes an hour and not more than 12 minutes in anyone clock hour. The Auth ority prefers to let advertising find its own acceptab le level. and wo uld be sorry if the clock hour restriction had the effect of restricting the showin g of infomercials. Scheduling of The Conventi on prevents films between 4 5 and 90 minutes in length advertisements from being interrupted by more than one advertising break: films betw een 90 and 110 minutes from being interrupted more than tw ice: news. documentaries and children's programmes of less than 30 minutes duration from being interrupted at all: and advertising breaks w ithin programmes from appearing less than 20 minutes from another such break. The Authority imposes no such restrictions and. apart from considering them unnecessary. w ould wi sh to avoid restrictions w hich made attractive programming more difficult to fund or to justify purchasing Teleshopping The Convention restricts shopping programmes to one hour a day The Authority sees no purpose in being so restrictive. Sponsorship The Convention requires that no advertiser shall exercise any editorial influence over the content of programmes. Given the multichanne l environment. the Authority sees no reason w hy an advertiser should not make his own programmes, subject to a number of safegua rds and in particular to the proper labelling of programmes. The sponsorship of new s and current affairs programmes is prohibited by the Convention. W hile accepting that particular safeguards are needed for news and current affairs, the Authority has seen a total ban on sponsorship as Draconian. especially given the high cost of news programming

Tobacco advertising This is totally prohibited by the Convention, w hereas the Un ited Kingdom has so far permitted advertising for cigars and pipe tobacco. In practice. however, such advertising has been avoided on cable and satellite television. Alco ho l advertising Contrary to the Convention's claim to "facilitate transfrontier advertising", any country is entitled to block the retransmission of a channel w hich carries alcohol advertising, The Uni ted Kingdom allows alcohol advertising subject to extensive content rules and scheduling restrictions.

9

• ------

THE WORK OF THE AUTHORITY

2 TheWorkof the Authority

The work of the A uthority w as transformed this year by the enormous amount of new franchi sing activity. In the previous year the Au thority had advertised five franchises. The extent of the transformat ion is illustrated by the fact that in this year the Authority advertised twentysix. Full details are listed in the table on the Authority's franch ising programme. The Authority has always considered it right to be led by the market in deciding w hich franchises should be advertised. In previous years. the demand has led to a low er level of activity than the Authority w ould have preferred. In this year. the Authority concluded that it w as right to move with all possible speed to satisfy growing demand. M ore than ever. it seemed desirable to encourage the construction of new cable systems as soon as possible.

Adjusting the approach to the franchising process The grow ing demand has enabled the A uthority to be more demanding of its potential franchisees. The Authority has always required to be assured that the shareholders would put sufficient capital into the business to get it established du ring its initial build programme. but has been prepared in th e past to award a franch ise on the basis that th is condition will need to be satisfied at the licensing stage. It is now the rule that franchise applicants should demonstrate the sources of thei r proposed fund ing at the stage at w hich the franchise is awarded. instead of merely expressing hopes of raising fin ance. Moreover. the Authority requires to be reasonably satisfied th at such an ou tco me is likely before a franchise area is even advertised. This increase in franchising activity led the Au thority to intr od uce one modificatio n to its procedures. During the year. the Auth ority introdu ced consultations about the area to be advertised. before applications w ere formally invited. This enables local authorities. and other potential appli cants. to make an inp ut into the question of the appropriate boundaries of a franch ise area under consideratio n. With competition for franchises now the rule rather than the exception. these consultations enable the Aut hority to reach decisions about franchise areas in the light of fuller informatio n about local cons iderations and sensitiv ities and w ith more than one view of w hat makes com mercial sense. The Authority is pleased to note from these consultations that local authorities now take an extremely positive view abou t the prospect of their areas benefitting from the provision of cable services. The Authority took anot her significant step during the year. this time in relation to franchi ses w hich had been aw arded in the past. In earlier circumstances hopes of fina ncing franchises after aw ard we re often dashed and the result had been a number of franchises remaini ng unimplemented notw ithstanding a significant passage of tim e. With interest in franchises growing. and the risk of sterilisatio n of areas becoming stronger. the Authority considered it right to introduce a procedure for review ing franchises which had not started operations. with a view to assessing w hether the offe r of licences shoul d now be withdrawn. In January. therefore. letters we re sent to all tho se who had been awarded franchises more than tw elve month s previously. but w ho had not succeeded in movin g to the licensing stage. warning them that the Authority would review their progress in six mo nths' time. An aim was to spur some activity on their part but if it appeared that there we re inadequate signs of the franchise becoming operationa l. the

10 - THE WORKOF THEAUTHORITY

Authority would wish to cons ider revoking the franchise. This review is due to be undertaken in J uly 1989 and subsequent review s may become a regular feature.

Interest in SMATV also grows During the year. the Authority issued 28 licences for non -f ranchised systems. Some of these we re for new SMATV systems but some related to the provision of new services on substantial systems origina lly installed for broadcast relay purposes. SMATV continues to demand onl y a small part of the Authority's licensing activi ties. Towards the end of the year und er review . interest in SMATV rose with the start of services from Ast ra making it easier for indivi dual viewers. and the tenants of blocks of flats. to enjoy the new choice that was becoming available. This new interest prompted the Authority to initiate a review of its policy tow ards the licensing of SMATV within franchise areas. It appeared to the Authority important that its proced ures should not have the effect of denying choice of television to those w ho wa nted it. simply because a franchise for the area had been granted but the franchisee was not yet in a position to provide a service. The Authority continued to believe th at it did not make commercial sense for more than one licence to be in force for any one area. and approached the licensing of SMATV systems on the basis that they would provide on ly a temporary stopgap until the franchised system was providi ng its own se rvices.

Restricted services rules change Problems in the licensing of restricted services. referred to in last year's report. we re resolved in outline duri ng the year. The main outcome was a new Exceptions Order made by the Home Secretary w hich instituted tw o changes. One w as a technical chang e in the definition of a restricted service. w hic h had the effect of overcoming a contradiction w ith telecommunications licensing. but w hic h did not affect in practi ce the Authority's pow ers. The other had the effect of removing from the need for a licence restricted services provided over British Telecorn's telephone network. This w as made on the understandi ng between the parties that contractual arrangements would be instit uted w hereby the Authority's regulation and supervision would still be applied. These contractual arrangements had not been introduced at the end of the year.

Regulation develops During the year the Authority completed its regul atory structures for the control of prog ramme content . w hich enabled interim reliance on some of the IBA's codes and guidelines to be finall y dropped. In a similar way. the Authority also introduced its own code of advertising practice w hic h. w hile in the interests of simplicity and consistency following in many respects the code of th e IBA. departed from it in a number of ways w hich the Authority considered appropriate to the new media. At the same time. the Authority highlighted a number of poin ts on w hich its code mig ht appropriately be subject to further reform. The ado ption of these comprehensive codes and guidelines wa s followed up by seminars for prog rammers designed to ensure their smooth and effective imp lementation. The Authority also amended du ring the year its code on progr amme sponsorship. which had been the first of the codes w hich the Authority had adopted in 1985. The change permitted greater flexibility as to how spo nsored programmes should be labelled. In Nove mber. the Home Secretary exercised his pow ers to serve not ice on the BBC and the IBA prohibiting interview s with suppo rters of organisations advo cating terrorism. Parliament had given the Home Secretary no similar power to impose such a prohibition on cable programmes but had instead bestowed such powers on the Au thority. In the circumstances. the Aut hority con cluded that it would be wrong for cable prog rammes to be exploited for a purpose that wa s not open to broadcast prog rammes. The Aut hority therefore exercised its powers to give directions to its licensees w hich w ere of the same eff ect as the notices given to the broadcasters by the Home Secretary. "

• ---- ~--

THEWORKOFTHEAUTHORITY

T he Misleading A dvertising Directive of the European Community became effective in J une. an d t he Ca ble Author ity was desig nated for this p urpo se as th e respo nsible Authority for considering c o m plaints abo u t misleading advertising in cable programme serv ices. T hi s did no m o re than reflect the Aut hor ity's ex isti ng responsibilities in this f ield . and no su ch complai n ts were rec eived th ro ughout th e ye ar. Thecable franchising programme

Homes in Deadline for Number of Fra nchise Services Area area applications applications awarded started

1. Sw indon 75.000 31 August 1983 29 November 1983 September 1984 2. A berdeen 91.000 31 August 1983 29 November 1983 May 1985 3. Coventry 119.000 31 August 1983 29 November 1983 September 1985 4. Croydon 120.000 31 August 1983 29 November 1983 September 1985 5. Northwes t Glasgow & 112.000 31 August 1983 29 November 1983 October 1985 Clydebank 6. Westminster 107.000 31 August 1983 29 November 1983 October 1985 7. Windsor. Slough. Maidenhead. 110.000 31 August 1983 29 November 1983 December 1985 Ashford. Staines. Stanwell, Heathrow 8 Ealing 105.000 31 Aug ust 1983 29 November 1983 November 1986 9 Guildford (now combined with 22.000 31 August 1983 29 November 1983 July 1987 A ldershot below) 10. Belfast 136.000 31 August 1983 29 November 1983 11. Sou th Liverpoo l 125.000 31 August 1983 29 November 1983 12. Bolton 135.000 30 Ap ril 1985 13 August 1985 13. Cheltenham and Gloucester 90.000 30 April 1985 13 August 1985 14. Newham and Tower Hamlets 127.000 30 Apri l 1985 13 August 1985 April 1987 15. W and sworth 100.000 30 April 1985 13 August 1985 9a. A ldershot . Farnham . Fleet. 115.000 30 April 1985 13 August 1985 (see franchise 9) Cambe rlev. Waking. Farnborough. Godalming 16. Cardiff and Penarth 103.000 30 September 1985 1 5 February 1986 17. Camden 70.000 30 September 1985 1 5 February 1986 (pilot on ly) 18. Edinburg h 183.000 30 September 1985 1 5 February 1986 19 Preston. Chonev and Leyland 114.000 30 September 1985 2 5 February 1986 20. Southampton and Eastleigh 97.000 30 September 1985 2 12 September 1986 21. Lutc n. Dun stable and Leiqhton 97.000 30 Apr il 1986 1 10 July 1986 on existing Buzzard systems only 22. Kensington and Chelsea 68.000 31 October 1987 2 4 February 1988 23. Andover 12.000 15 December 1987 1 7 Apri l 1988 24. Blackbum. Accrington. Nelson. 168.000 18 January 1988 1 9 May 1988 Colne and Rossendale Valley 25. Birmingham and Solihull 465 .000 6 June 1988 2 19 October 1988 26. Southend . Basildon. 300.000 18 July 1988 2 16 November 1988 Brentwood. Chelmsford. etc 27. Gravesend. Chat harn. 145.000 20 Ju ly 1988 16 November 1988 Rochester. Gillingham. Maidstone and Sittingbourne 28. Hammer smith and Fulham. 280.000 25 Ju ly 1988 2 19 January 1989 Brent. Bamet 29. Bristol. Bath. W eston Super 300.000 27 July 1988 16 November 1988 M are etc. 30. Redbridge . Barking and 229.000 8 August 1988 3 15 December 1988 Dagenham . Bexlev 31. Reading , Bracknell. 215.000 10 Augus t 1988 2 2 December 1988 Basingstoke. Newburv. New bury ere 32 Northampton 72.000 3 October 1988 1 19 January 1989 on existing system only 33. Greenwi ch and Lew isham 175.000 12 December 1988 3 7 Apr il 1989 34. Crawlev. Hortev and Gatwick 40.000 15 December 1988 2 27 April 1989 Airport 35. Greater Glasgow. Paisley. 357.000 19 December 1988 Not awa rded Renfrew 36 M otherwe ll. Hamilton. East 125.000 19 December 1988 2 27 April 1989 Kilbride. W ishaw and Larkhall 37. Cumbernauld. Kilsvth. Airdrie 55.000 19 December 1988 2 27 Apri l 1989 and Coatbridge

12 - THEWORK OFTHEAUTHORITY

Home s in Deadline for Number of Franchise Services Area area applications applications awarded started

38. Dumba rton and the Vale of 18.000 19 December 1988 2 27 April 1989 Leven 39 Merton and Sutton 135.000 30 Ja nuary 1989 6 May 1989 40 . Kingston and Richmond Upon 124.000 6 February 1989 6 May 1989 Thames 41. Cambridge, Newmarket Ely. 125 .000 27 February 1989 4 June 1989 Saffron werrren. Hunti ngdon . St Ives. etc 42 . Dudlev. Sandwell. Walsall. 490.000 15 March 1989 2 Wolverhampton, Cannock, Kidderminster and Bromsgrove 43. Lambeth and Southwark 191.000 20 Ma rch 1989 2 44. Peterborough 58.000 5 April 1989 1 45. Norwich 83.000 10 Ap ril 1989 1 46. Colchester. Ipswich. 134,000 12 Apri l 1989 2 Felixstowe. Harwich and Woodbridge 47 . Haringey 80,000 17 Apr il 1989 2 48. Waltham Forest 83,000 17 April 1989 2 49 . Leicester 147 ,000 26 April 1989 1 50, Nottingham 160,000 3 May 1989 1 51, Brighton, Hove and Worthing 110,000 10 May 1989 4 52, Exeter, Plymouth and Torbay 202.000 3 July 1989 53 . Harpenden. Hemel Hempstead, 100.000 10 Ju ly 1989 St Albans etc 54 . Watford, Rickmansworth 96,000 10 July 1989 Bushev. Borehamwood. Potters Bar etc 55 , Stevenaqe. vvelwvn. Hatfleld . 100,000 10 J uly 1989 Hitchin etc 56. Stoke on Trent Newcast le 140.000 14 August 1989 Under Lvrne 57. Swansea, Neath. Port Talbot 110.000 16 August 1989 58 Newcastle. Gateshead, Nt h & 325.000 21 August 1989 Sth Tvneside 59 . Wa rrington. wldnes. Runcorn 121,000 23 August 1989 60 . Chester and Ellesmere Port 61.000 23 August 1989 61 . Stafford and Stone 24 .000 14 August 1989 62. Dorchester. Weymouth and 35 ,000 11 September 1989 Portland 63 Dundee. Monifieth and 79,000 13 September 1989 Carnoustie 64. Perth and Scone 16,000 13 Septemb er 1989 65 . Portsmouth, Fareham. Gospo rt. 150,000 15 Septemb er 1989 Havant 66 . Derby and Spondon 83,000 18 Septemb er 1989 67. Leeds 289 ,000 20 Septemb er 1989 68. Wa kefield, Ponte fract. 94 .000 20 September 198 9 Castletord 69 . Margate, Ramsgate and 51,000 22 September 1989 Broadstairs 70. Bromley 117.000 25 Septembe r 198 9 71. Loughb orough and Shepshed 24,000 20 October 1989 72. M ansfield. Sutton and 58,000 29 September 1989 Kirkby- in-Ashfield

• The "pilot projects" resulted from an invitation by the Government to companies to apply for any area of their own choice. The eleven franchisees were chosen from 37 applicants.

t 3

• - THEWORKOFTHEAUTHORITY

Thelighl touch'of regulation

The Authority has pioneered what has become known as the 'light touch' regulatory approach, This is often misunderstood and som~t im~s mistakenl y seen as a lack of regulation, Now that the same approach IS being proposed for the forthcoming Independent Television Commission, it is important to set the record straight. The following explains the essentials of the 'light touch',

• Licensees. not contractors The fact that the regulator is a licensing author ity rather than a broadcaster has a profound effect on the status of the regulator and on the relationship with those regulated. A broadcaster (like the IBA) is itself legally liable for the material broadcast. in such areas as defamation, copyright. blasphemy, and in the future, obscenity. A licensing body, on the other hand, can properly leave its licensees to take their own responsibility under the law.

• Lay down clear codes and guidelines The Authority's aim is to give to those it regulates codes and guidelines w hich are easy to understand and clear in their application and interp retation , in order to minimise errors, encou rage consistency and preserve respect for the rules.

• Place the onus for compliance on licensees The Authority makes plain to all those origina ting programme services that the responsibili ty for obeying the rules laid dow n by the Authority rests wi th them. They are told that the Authority wi ll not expect to exercise co nstant supervision of the services they provide and that they must ensure that there is no breach of the regulatory requirements. They are made aware that the Aut hority wi ll investigate any complaints and will in any case sample the programmes to keep in touch with w hat they are doing, and that they infringe at their peril. In the case of a programme channel which ignored the rules, the sanction would be a direction to cable operators that the channel concerned was no longer acceptable to be carried on cable systems.

• Ensure that licensees are equi ppe d f or t he j ob The Authority has taken care to see that the responsibility devolved to licensees is properly organised and undertaken. There are three principal aspects to this. 1. The Authority insists that an identified member of staff is given responsibility for ensuring that the rules are kept. 2. The Authority ensures that the individuals concerned are properly trained and kept up to date on the nature of the Authority's requirements and their application. Induction training seminars and refresher cou rses are supplemented by support materials designed to make the job easier. 3. The Authority has required to see the institution of systems for the proper vetti ng of material before it is transmitt ed. A programmer needs to be able to assure the Authority that internal arrangements are in force to ensure compliance w ith the Authority's codes and guidelines .

• Concentrat e c lo se monitoring where it is needed Some areas of special sensitiv ity may require to be singled out as those wh ere the regulatory body must be consulted. For example, under the Authority'S code on programme sponsorship. any sponsor of news or current affairs programming must be cleared wi th the Authority in advance. This allows the Authority to vet the editorial arrangements and seek a numbe r of special assurances that editorial independence w ill not be prejudiced .

• Do not regulate what can be left to the m arket There is no need for a regulatory body to exercise a nanny role in respect of matters in w hich it is perfectly acceptable for the market to regulate itself. For example. the Authority decided at the outset that. as mult i-channel choice of television developed. viewers rather than the regulators shou ld determine w hat amount of advertising was acceptable on cable and satellite services. Those programmers w ho antagonised viewe rs by including too much advertising would simply lose audiences.

14 - THECABLEINDUSTRY

3 The Cable Industry

The increase in the Au thori ty's franchi sing activity dur ing the year did not have time to w ork its way through to the actual provision of cable services. During the year. no new franchised systems started operations. Throughout the year. therefore. ten broadband systems we re operational. All of these we re still in the construction phase. though at the end of the year the first - Aberdeen - completed the building of its system. Abe rdeen is therefore the first city in the United Kingdom to be full y w ired with broad band cable. During the year. the ten systems added 162.750 to the number of homes passed. an average rate of constru ctio n of 1356 homes passed a month. alth ough not all the systems we re bui lding throughout the year. By the end of the year. they passed a total of 470.20 3 homes. On 31 M arch 1989. 65.874 homes we re subscribing to the systems. That compares w ith 44.500 subscribin g homes at the end of the previous year. Because the bui ld rate was proportionately higher than the rate at w hic h subscribers were connected. the penetration rate dropped marginally. to 14.0%. For the time being. subscribers to the new broadband franch ises still represent a minority of the cable subscribers in the country. Most cable viewi ng homes. of w hom there we re 283.816 at the end of the year. still receive their services from one of the older systems first installed many years ago for the purpose of overcoming poor television reception. Naturally. these older systems do not give cable viewers the same range of choice that is available on the modern broadband systems. and the Authority expects them to be steadily superseded by new franchises. The new systems w ill be able to provide two-way communicatio ns as we ll as the larger range of channels.

Some of the children regularly involvedin makingcommunity programmesfor cableradio in Woolwich.

15 - THECABLE IN------DUSTRY Howacable business works

Cable is a new business in the United Kingdom . It has no track record to demonstrate and the nature of the business is often not well understood. This imaginary and over-simplified business plan is designed to illustrate the essential s of a fairly typical cable operation . It uses an average-size franchise area of 130,000 homes in which the syste m takes between four and five years to build. Wh ile the system is under construction, capital costs are considerable and revenue s are small. The assumption is made that. in line w ith historical experien ce of new media developments (television, colour television, video recorders) publ ic take-up w ill increase steadily as an initially novel service gains more general acceptance. The assumption is also made that a steadily expanding teleco mmunications business

Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Home s passed (cumulative) 10,000 45,000 80,000 115,000 130,000 130,000 Homes connected (net) 1,800 9,450 19,200 31,050 39,000 42,900 Penet ration rate 18% 21% 24% 27% 30% 33% Capital expend: netw ork 2,500 6,475 6,475 6,475 2,775 Capital expend : connections 270 1,166 1,557 1,778 1,503 975 Capital expend: othe r, renew als 1,000 1,000 1,500 500

Revenue: connection fee s 56 250 364 490 442 366 TV subscriptions 162 1,080 2,922 5,427 7,986 9,828 Telecommunications 108 438 1,085 1,996 2,949 Gross revenues 218 1,438 3,724 7,002 10,424 13,143 Costs : programmes 65 405 1,031 1,809 2,522 2,948 Telecoms 92 372 922 1,697 2,507 Operating expenses 2,000 2,000 2,000 2,000 2,000 2,000 Operating profitl(loss) (1847) (1059) 321 2,271 4,205 5,688 Less depreciatio n 151 496 878 1,208 1,379 1,418 Less interest 903 1730 1,946 1,674 Profitl(loss) before tax (1998) (1555) (1460) (667) 880 2,596

NOTES: Capital expendit':Jre is splitbetween the cost of the network. which will varyaccordingto local conditio ns but will remain constant whatever the number of subscribers (and for this area is taken as eq~atl~g to £185 forevery home passed); and the costof connecting thosehomes w hich subscribe. WhIC~ IS,here taken as £14.0 per homeconnected.reducing overtime as reconnections become a steadilyIncr.easlng proportion of the new connections made. . The figuresassumea "churn" rate of 25%. meaning that 25% of allsubscribersdisconnect dunng each year. It followsthat the net growthin the numberof subscribers represents only a small proportion of the total connecttons made. .Th.e fee charged for connection. or reconnection. to the system is £25. Average monthly s ubscnp t lon~ ~ tart at £1~ a.nd rise by Year 6 to £20. thereafterremaining static. . Television sub scriptions are calculatedon the average numberof subscribers during the year midway between the numbers subscribing at the beginning andthe end of the year. .

16 - ______.::TH:.:;E;,;;CABLEINDUSTRY

wi ll be generated, although this may vary according to the nature of the area and in any case the margins w ill be smaller than on the television business. The simplification of the plan means that many possible sources of extra revenue (advertising, rental of remote control units or additional connections, sale of programme guides etc) have been ignored. In a similar way, the operational costs of the business (staff, accommodation, vehicle s etc) have been put at a uniform level throughout. even tho ugh they can be expected to vary at different phases of the development of the operation . For these reasons - and others - it is reempha sised that this plan is illustrative of the general wa y in which a cable business is expected to develop, and is not an all-embracing mod el.

Year 7 Year 8 Year 9 Year 10 Year 11 Year 12 Year 13 Year 14 Year 15 130,000 130,000 130,000 130,000 130,000 130,000 130,000 130,000 130,000 46,800 49,400 52,000 54,600 57,200 59,800 62,400 63,700 65,000 36% 38% 40% 42% 44% 46% 48% 49% 50%

1014 858 884 464 364 364 364 182 182 500 500 500 250 250 250 250 250 250

390 374 390 406 422 439 455 431 439 10,764 11,544 12,168 12,792 13,416 14,040 14,664 15,132 15,440 3,767 4,618 5,476 6,396 7,379 8,424 9,532 10,592 11,580 14,921 16,536 18,034 19,594 21,217 22,903 24,651 26,155 27,459 3,229 3,463 3,650 3,838 4,025 4,212 4,399 4,572 4,633 3,202 3,925 4,655 5,437 6,276 7,160 8,102 9,003 • 9,843 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 6,490 7,148 7,729 8,319 8,916 9,531 10,150 10,580 10,983 1,458 1,513 1,568 1,597 1,621 1,646 1,670 1,688 1,705 1,158 602 303 3,874 5,033 5,858 6,722 7,295 7,885 8,480 8,892 9,278

Telecommunications revenues are a factorof the numberof linesconnectedand the usage! made of each line. They arehere calculated arbitrarily as a percentage of television subscriptions. growingby 5 percentage points eachyear. Programme costsare takenas £6 per subscriber per month. Telecommunications costs- largely paymentsfor interconnection with national networks- are takenas 85% of telecommunicationsrevenues . Depreciation represents the amortisation of capital expenditure over an averageof 25 years, taking intoaccount the valueof the infrastructure longbeyond the franchise period of 15 yearsfor whichthe business plan is constructed . The business plan assumes that capital expenditure over the first two and a half years(£17 million) isfinanced entirelyfrom equityand thereaft er from a combination of borrowing and cashflow. The interest rate on borrowingsis taken as 12%. Allfiguresare inthousandsof poundsandare in real terms. without allowance for inflation.

17 - THECABLE INDUSTRY

Attitudes t o cable technology A debate continued dur ing the year on the respectiv e merits of switched star and tree and branch systems. Most of the franchise application s received by the Au thority proposed the use of tree and branch systems. though there continued to be sign ificant support for the advantages offered by. for examp le. the Cablet ime switch. Some of the advantages we re more potential than real. in that they facil itated interactive services some of w hic h are un likely to be a practical reality for a little while to come. and many regarded tree and branch systems. w ith the enhanced interactivity they are now developing. as offering all that was required in the short term. There w as. however. recognition th at switc hed systems. by siting active equipment outside the home. offered an operator a degree of security of signal. protection of apparatus and ease of access that represented a quantifiable benefit. Tw o different techno logies were proposed during the year. both of which claimed advantages in flexibili ty and capability over what was otherwise available. West Midlands Cable Communications proposed the use of a France Telecom system which they termed 'Transfer Un it Technology'; and Sou thampton Cable anno unced that they will use the Canadian Videoway system. The introduction and use of these systems remained for the fut ure. For the time being. the absence of integrated swi tch techn ology means that the growing number of cable operators intending to provide telecommu nications services do so by means of a separate overlay network employing optical fibre or tw isted pairs. At least. how ever. th is separate network shares the new duc ti ng installed in the highway or footpaths by the cable operator. and the marginal cost is comparatively low . The year saw some additio nal interest in the use of optical fibre. but on ly for super-trunk ing use. Coaxial cable remains the standard medium for the television distribution network and will do so for the foreseeable future. Plans w ere developed dur ing the year. however. for a small - scale trial of a totally optical system. involving British Telecom and some other partici pants.

Changes in ownership Commercially. the year saw the industry still in flu x. Three of the ten operational franchises experienced changes of control. British Telecom enlarged their stake in Ab erdeen Cable to assume overall con trol: City Centre Communications acqu ired Cabletel Communications of Ealing from its previous shareholders; w hile in East London refinancing involved the arrival of two new principal investors from the Uni ted States. Jones lntercable and Pacific Telesis. with con trol moving to a Jersey Trust. As part of the progress of other franchises towards becoming operational. new North American finance injected into Southampton Cable. East Lancashire Cablevision and Cotswold Cable Television also resulted in changes in control of those com panies. The Au thority was consul ted in each case and approved the new arrangements.

Marketing and pricing The flux extended to marketing strategies. A debate intensified as to w hether it w as better to maximise the number of subscribers. even if the revenue per subscriber had to be reduced. or to maximise the revenue from each subscriber. There was a trend away from the tiered packages w hich had previously been the norm towards either delivering an extensive basic package at the lowest possible price or off ering the maximum variety of a la cane channel choices in addition to a relatively small basic package. At a time when no cable franchisee is yet generating revenues sufficient to cover the high capital costs. these are crucial issues for the industry and operators study their own experience and that of their fellow operators in other areas with close interest and with open minds. It is an imperative for the industry to achieve steadily increasing penetration rates from w hat is current ly experienced. Research"by the Authority show ed that as a result the average mo nth ly subscription paid by those connected to broadband systems fell du ring the year from £17.86 to £17.08 . incl usive of VAT.

18 - ______..:.TH:,;:E;,;CA:::Bl EINDUSTRY

Thebroadband operators

ABERDEEN Aberdeen Cable Services Lld, 303 King Street ABERDEEN AB2 3AP Telephone: 0224 649444 ABERDEEN CABLE Principal shareholders: British Telecom (59%) ; Legal & General (9% ). Time Life International (8%);Standard Life Assurance (8%). Investors in Industry (6%), North of Scotland Investment Co., Abingdon Management Co, APA Venture Capital, Royal Bank, Clydesdale Bank. Directors: Martin Gilbert (Chairman); Malcolm Arnold ; John M iller;Clive Pratt ; Stephen Redfarn; Gordon Sleigh ; Ben Tyler. Senior staff: Managing Direc tor John Mi ller ; Finance Manager Alisdair McKenzie ; Head of Sales & Marketing Gordon Sleigh ; Sales Manage r Denise Wilson. Franchise area: Aberdeen and surrounding areas (91,000 homes). The 15 year licence commenced on 4 M ay 1985. Cable system: a 29 channel tree and branch system is being provided for Aberdeen Cable's use by British Telecom. Construction commenced in January 1984 and the syste m is the first of the new broadband systems to be compl et ed, in early 1989. Services provided: Aberdeen Cable provides all the national cable channels together w ith several foreign channels . Its own Aberdeen Channel com prises text based local services and community access.

COVENTRY Coventry Cable Ltd. Blackburn House Wh itley Village, London Road, COVENTRY CV34HL Telephone: 0203 505345

Principal shareholders: British Telecom (74%); CUC Broadcasting (15%); Equity & Law Life Assurance Society (11% 1. Directors: Ken Leeson (Chairman); John Smith; Alan Burke; Stanley Clarke; Graham Blakeman; Roy Emerson; Brian Parker. Senior staff: Chief Executive Roy Emerson;Finance Directo r Brian Parker; Operations Director Graham Blakeman ; Personnel and Administration Manager Maria Wilson; Sales Manager Chris Igoe.

Franchise area: The City of Coventry (119,000 homes). The 15 year licence commenced on 12 September 1985. Cable system: a 29 channel tree and branch system is being installed by British Telecom, with many of the final links to subscribers being associated with BT's exist ing overhead telephone distrib ution. Construction comm enced in March 1985. Services provided: Coventry Cable provides a multi channel television service as well as radio. All the national cable channels are carried, and tw o from overseas. One channel is devoted to COLT (Coventry's Ow n Local Television) in w hich Coventry Cable works w ith Mercia Sound for new s services.

CROYDON United Cable Television (London South) plc.. Communications House Blue Riband Estate, Roman W ay, Croydon CR3 3RA Telephone: 01-760 0222 Principal shareholders: Cablevision-UK (40% ); Crystal Palace Radio Lld (15%); Balfour Beatty Lld (10%) ; A.S.M . Robinson (19% ); J.F.Gill (8%); R. Subba Row ;(6%). Directors: Sir Paul Bryan DSO MC (Chairman); Jim Dovey ; Graham Robertson; Peter Lynch, Jack Gill CBE; Robert Stiby; Sir Richard Storey; Raman Subba Row. Senior staff: Managing Director George Stewa rt. Franchise area: the London Borough of Croydon (120,000 homes). The 15 year licence commenced on 15 October 1985. Cable system: United Cable is installing a 38 channel tree and branch cable system in a star configuration , utilising Jerrold Starcom 450 set-top decoders in subscribers' hom es, w ith a separate institut ional netw ork laid in the same ducts . Construction commenced in June 1985. Services provided: United Cable provides a 31 channel television service and an 8 channel FM radio service comp rising all the nationally available programme channels, several for eign channels and a range of local channels.

19 - THE CABLE INDUSTRY

EALING Cabletel Communications Ltd.. Fieldway Greenford. Middlesex UB6 8UN CableTel Telephone: 01-5759000 Principal shareholders: City Centre Comm unications Ltd (100%).

Directors: Brian Deut sch (Chairman); Bill Hulton .

Senior staff: General Manager John Hastke. Franchise area: the London Borough of Ealing (105.000 homes). The 15 year licence commenced on 15 November 1986. Cable system: Cabletel Communications is installing its ow n 28 channel swi tched star netw ork utilising the Cabletime sw itch. Construction com menced in September 1986. Services provided: all the national cable channels are provided along w ith several foreign channels. Cablete l was the first British cable operator to carry Moscow Television, and originated the Hindi channel, Indra Dhnush.

EAST LONDON East London Telecommunications Ltd.. ELT House, 2 M illharbour, London E14 9TE Telephone: 01-538 4838

Principal shareholders: Jones UKHoldings Inc. 145%); Pacific Telesis International (45%) ; Fleming Mercantile Investment Trust; Investors in Industry: GEC. Directors: lan Hint on (Chairman); Alan Bates; David Cronin ; Brian Jones; Yves Levy ; Patrick Lomba rdi ; Peter M addock; Roger M arshall; Jan Neels ; Elizabet h Steele; Barrie Turner-Smith ; Gerald Yutkin . Senior staff: Managing Direc tor Gerald Yutkin; Finance Directo r Peter Maddock; Sales and M arketing Director Barrie Turner-Smith ; Technical Director David Cronin. Franchise area: the London Boroughs of Newham and Tow er Hamlets (127,000 homes). The 15 year licence commenced on 6 April 1987. Cable system: The first stage of the system was built using the GEC switched star network. A separate optical fibre telecommunications network is being provided. Construction commenced January 1987. Service provided: All the national channels are provided. together w ith a range of foreign channels. No local te levision service is yet provided but local text information is carried.

GLASGOW Clyde Cablevision uc., 40 Anderston Ouay Glasgow G3 8DA Telephone : 041-221 7040

Principal shareholders : GEC 125%); Scottis h Daily Record/BCS (25%): Cable &Wire'ess (25%); Balfou r Kilpatrick; Invest ors In Industry; Charterhcus e Group; Prudential Assurance: Scottish Mutual Assurance ; Scottish Am icable Nomin ees; Ensiqn Trust. D irectors : SI[ lan MacGregor (Chairman); Sandy Stew art (Deputy Chairman); David Carnpbell; Victor Horwood ; M ichael Kelly; Robert Maxwell:John M orrish, Gordon Owen. Stuart Park, Gerry Richardson; Simon W einstock. Senior staff: Managing Director Stuart Park; Finance Direct or John Morrish; Marketing Director Gordon Hellyar; Enginee ring Manager Alex Huygebaert : Construction and Installations Manager ; Neil Mo rrison.

Fra nchise area: Central and Northwest Glasgow and Clydebank (1 12.000 homes and 16.000 business prem ises). The 15 year licence commenced on 9 November 1985. Cab le sy st em: Clyde Cablevision has been installing a 30 channel sw itched star system utilising the GEC swi tch system. Construction com menced in July 1985. Services ~rovided: all the national channels are provided. as we ll as a range of foreign channels and Clyde Cablevision s own Glasgow Channel which Includes community access.

20 - ______THE CABlE INDUSTRY

SWINDON Swindon Cable Ltd ..New come Drive Hawksw orth Estate,SW INDON, W iltshire 11 Telephone: 079361 5601 Principal shareholders: British Telecom (100% ). Directors: Brian Rigby (Chairman); Malcolm Arnold; Alan Burke; Peter Gosling; Andrew Hurley; Joan Kiernan; John Moffitt;Nicholas Tresilian; Roger Wil son, Senior staff: Chief Executive Roger Wil son; Operations DirectorJ oan Kiernan; Sales and Marketing Manager David Richards; Head ofFinance Peter Franklin. Franchise area: Sw indon (75,000 homes!. The 15 year licence cornmenced on 15 September 1984. Cable system: A 16 channel tree and branch system w as provided by Thorn EM I for the first phase of the new system in early 1984, supplementing the old broadcast relay netw ork w hich has existed in Swindon for many years. Follow ing Thorn EMl 's sale of the company to British Telecom, BT have upgraded the new system to 32 channels and are exte nding it. Services provided: Swindon Cable carries all the national channels toget her w ith community access and local text.

WESTMINSTER Westminster Cable Com pany Ltd .. 87/89 Baker Street London Wl M 1 AG Telephone: 01-9356699

Principal shareholders: British Telecom (45%); City Centre Communications (45%) ; Sanoma Corporation (10%). Directors: Brian Deutsch (Chairman); Frank Bateson; Tapio Kallioja; Brian Rigby; Bill Pittman. Senior staff:Managing Director Bill Pittman; Financial Controller Tony Tucker; Head of Operations Roger Blakew ay; Sales Manager lan Johnston; Head of Corporate Services Helena Kania. Head of Marketing Dorothy Devlin; Personnel and Public Relations Manager Samantha Gates; Manager of Commercial Developments Paul Hensby. Franch ise area: the City of W estminster (107,000 hom es and 14,000 business premises). The 15 year licence comm enced on 15 October 1985. Cable system: British Telecom are installing for We stm inster Cable's use an advanced swi tched star system using BT's own switch. It is the only British broadband network currently to be making extensive use of optical fibre, in all the trunks down to each local sw itching point. Serv ices provid ed : We stm inster Cable provides most of the national cable channels, along w ith some foreign channels. It provides in addition an Arabic Television Channel. using programmes supplied by Dubai TV. Although no local programmes are yet available, it provides extensive local text services, offe rs access to Prestel services and is experimenting on part of the system w ith allowin g access to a library of interactive videodiscs.

WINDSOR Windsor Television Ltd. Cable House, Waterside Drive, Langley, Berkshire SL3 6EZ Telephone: (07531 44144 Telex: 8467 17 Facsimile: (0753) 49310 Princi pal sh areh olders : Standard Life Assurance; Compagnie General des Eaux; USWest International; CIN Industr ial Investments; Mc Nicholas Construction; Investors in Industry; Drayton Consolidated Trust; Sharp Technology Fund; Kleinwort Grieveson Investment Management;County Development Capital; GrosvenorTechnology; Fountain Development Capital Fund, Directors: Michael J Davis (Chairman); Joe Delahunty; Tim Halfhead; Marc Noble; Ernest Potter; Michel Reay; Nicholas Taylor; Michel Villaneau. Senior staff: Managing Director Tim Halfhead; Operations Director Colin McKee. Franchise are a : Wi ndsor, Slough, Maidenhead, Ashford, Staines, Stanwell and Heathrow Airport (110,000 homes). The 15 year licence commenced on 2 Decemb er 1985. Cable system : Windsor Television is installing its own sw itched star netwo rk using the Cabletime swi tch. Construct ion commenced October 1985. Services provided: All the national cable channels are provided. Tw o foreign channels are carried, and it provides the Hindi channel lndra Dhnush . Local text services are provided, plus a new local information and advertising channel called Arcade, but no local originated programming is yet produced. A local telecomm unications service commenced in December 1987.

2 1 - THECABLE INDUSTRY

GUILDFORD British Cab le Television MAXWELL 170 W alnut Tree Clos e. Guildford.Surrey, GU1 4RX - CABLE TV- Telephone : 04 83 505200

Principal shareholders: Met romode Lld (Pe rgamon Press) Senior staff: General Manager, Home Counties Norman Asbv, Franchise area: Gu ild fo rd, Woking. Camberley. Aldershot. Farnham . Farnbo rou gh. Fleet and Goda lming (137.000 homes). The 15 year licence com m enced on 1st July 1987. Cable system: A pilot scheme has been const ruc te d by BCS uti lising th e system 8 switch developed in Red iffusion 's re search laborato ries. The rem aind er of the system is under review . Services provided: Ten satellite-delivered channels are carried in add it ion to th e terrestrial broad cast channels. together w it h o ne tape-de livered cha nne l. A program m e guide in text form, as w ell as a spli t-screen sam pler channel. IS also pr ovided . Other cable franchises so far awarded

ANDOVER (Franchise area: Andover. Hamp shire - 11.500 homes) Andover Cablevision Ltd.. PO Box 77. Andover. Hants. SP10 l YB. Tel: 0264 332 300. M anaging Director -Peter Funk. AVON (Franchise area:(Bristol. Bath. Weston ·Sup er·Mare, Prome. Melksham etc - about 300.000 homes) West Country Cable Ltd.. Communications House, Blue Riband Estate. 5 Factory Lane, Croydon CR9 3RA. Tel: 01 -7600222. President - Jim Dovey. BELFAST (Franc hise area the wh ole of Belfast - 136,000 homes) Ulster Cablevision, 40 Victoria Square. Belfast BT! 40B. Tel: 0232 -249141. Executive Vice Chairman - George Alton. BIRMINGHAM (Franchise area: Birmingham and Solihull - 465,000 homes) Birmingham Cable Lld .. Cable House, Waterside Drive, Langlev. Berks SL3 6EZ. Tel: 021-777 1309. Managing Director - Joe Delahunty. BOLTON (Fran chise area: the M etrop olitan Borough of Bolton - 135.000 hom es) Bolt on Telecable ct« Natio nal Telecab le. 19 Stratford Place. Lond on Wl N 9AF, Tel: 01 -49 3 8388. M anaging Director - Ma lcolm Mats on. CAMBRIDGE (Franchise area: Camb ridge . New market. Ely. Saffron Walden . Huntingdon. St Ives etc - 125.000 ho mes). Cambridge Cable t.td. 24 Thornpson's Lane, Cambridge. CB5 8AO. Tel: 0223 4642 01. Manag ing Director ­ Hugo Davenport. CAMDEN (Franchise area: The London Borough of Camden - 70.000 homes) Cable Camden Lld .. The Elephant House. Haw lev Crescent. Camden Tow n, London NW1 8NP, Tel: 01 ·528 0555 , Chief Executive -Jerrold Nathan. CARDIFF (Franch ise area: Cardiff and Penarth - 130.000 homes) Briti sh Cable Services Ltd. Southern Hou se. 1-4 Cambridge Terrace. Oxford OXl 1UD. Tel: 0865 250110. Managing Director - David Hilton. CENTRAL LANCASHIRE (Franch ise area: Preston . Chorley and Leyland - 114 .000 homes) Lancashire Cable Television Ltd .. cto Ovston Cable, Ovston Mill (2nd floor). Strand Road, Preston. PR1 8UR. Tel: 0772 721505. Ma naging Director -David W hitaker. CHELTENHAM AND GLOUCESTER (Franchise area: the two urban areas - 90.000 homes) United Cable Television (Cotswol ds) t.td .. c/o Wiggin & I Co.. The Ouad ranqle Imperial Square. Cheltenham, Gloucestershire GL50 1YX. Tel: 0242-224114, Director ­ Tim Osbo me. CRAWLEY, HORLEY AND GATWICK AIRPORT I (Franch ise area: Craw tev. Horley and Gatwick Airport - 40.000 homes ) M id Dow ns Cable Ltd .. Sirnp son House. 6 Cherry Orchard Road, Croydon. CRO 6BA. Tel: 01 ·686 7261 , Managing Director - Alan Hobin son. CUMBERNAULD, KILSYTH, AIRDRIE AND COATBRIDGE (Franch ise area: the fou r urba n areas and places in between - 55.000 home s) Cabl e Nor th Ltd .. 5 Woodlands Terrace, Glasgow G3 6DD . Tel: 041-333 9292 . Managin g Director - David Stewart. DUMBARTON AND THE VALE OF LEVEN (Franchise area' Dumbarton. Alexa nd ria, Bonhi!l. Ballo ch. J amestown and Renton - 18.000 hom es) Cabl e North Lld

22 - THE CABLE INDUST RY

EAST LANCASHIRE (Franchise area: Blackburn. Acc rington. Burnlev. Nelson. Colne and Rossendale Valley - 168.000 homes) East Lancashire Cablevision lid.. Glenfield Park. Northrop Avenue. Blackburn. Lancs. BBl 50G. Tel: 02 54 680094. M anaging Director - Edw ard Ma dden. EDINBURGH (Franchise area: the whole of the City - 183.000 homes) Cablevision (Scotland) plc. 4 Mel vill e Street. Edinburgh EH3 7NZ. Tel: 031-453 1919. Director - Eric Sanderson. GREATER LONDON EAST (Franchise area: the London Boroughs of Barking. Dagenham. Bexley and Redbridge - 22 9.000 homes) East London Telecomm unications lid.. ELTHouse. 2 Millharbour. London E14 9TE. Tel: 01 -538 4838. M anaging Director - Gerald Yutkin. GREENWICH AND LEWISHAM (Franchise area: the two London Boroughs - 175.000 homes) South East London Cable Company. Cable Centre. 62 -64 Beresford Street. Woolwich. London SE18 6BG. Tel: 01 -316 1200. M anaging Direct or - Tim Duoman. KENSINGTON AND CHELSEA (Franchise area: the Royal Borough - 68.000 homes) Westside Cable. Parkways. 179 -181 The Vale. London W3 70S. Tel: 01-740 4848 . Managing Director - Frank Bateson. KINGSTON AND RICHMOND (Franchise area: the two Greater London boroughs - 124.0 00 homes) United Cable Television (London South) plc.. Communications House. 5 Factory Lane. Croydon. CR9 3RA. Tel: 01 -7600222. Managing Director ­ George Stewart. LIVERPOOL (Franc hise area: South Liverpool - 125.000 homes). Merseyside Cablevision Ltd.. clo Ovston Cable. Oyston M ill (2nd Floor) . Strand Road. Preston PRl 8UR. Tel: 0772 721505. Managing Director - David w httaker. MERTON AND SUTTON (Franchise area: the two Greater London boroughs - 135.0 00 homes) . United Cable Television (London South) plc.. Comm unications House. 5 Factory Lane. Croydon . CR9 3RA. Tel: 01 -7600222. M anaging Director - George Stewa rt. MOTHERWELL, EAST KILBRIDE AND HAMILTON (Franchise area: M otherwell. Hamilton. East Kilbride. Bellshi ll, Larkhall and Wishaw - 120.000 hom es) Cable North lid.. 5 Woodlands Terrace. Glasgow G3 600. Tel: 041 -333 9292. Manag ing Director - David Stew art. NORTHAMPTON (Franchise area: The City of Northampton - 72 .000 homes) Cable Television Ltd.. Forsyth Road. Sheerwater. Woking. Surrey. Tel: 04862 6186 1. Managing Director - Ron Dean. NORTH WEST LONDON (Franch ise area: Barnet, Brent, Hammersmith and Fulham - 280.000 homes) Westside Cable. Parkwa ys. 179 -18 1 The Vale. London W3 70S. Tel: 01-7404848. M anaging Director - Frank Bateson. SOUTHAMPTON (Franchise area: The City of Southampton and Eastleigh - 97.000 homes) Southampton Cable lid.. Ocean House. West Ouay Road. Southampton SOl OGY. Tel: 0703 333020. Managing Director - Peter A lden. SOUTH BEDFORDSHIRE (Franchise area: The Districts of Luton and South Bedfordshire - 91,000 homes) . Cablevision Bedfordshire Ltd., Camp Drive. Houghton Regis. Dunstable. Bedfo rdshire LU5 5HE. Tel: 0582 865095. Manag ing Director - Phill ip M organ. THAMES ESTUARY NORTH (Fran chise area: Southend-on -sea. Basildon , Chelmsford. Billericav. Grays. Brentw ood etc. - about 300.000 homes) North Estuary Cable Ltd.. Communi cations House. Blue Riband Estate. 5 Factory Lane. Croydon e R9 3RA. Tel: 01 -7600222. President - Jim Dovev THAMES ESTUARY SOUTH (F ranchise area: Gravesend. Chathem . Rochester. Gillingham , Maidstone and Sittingbourne - about 14 5.0 00 homes) South Estuary Cable Ltd. Communi cations House. Blue Riband Estate. 5 Factory Lane, Croydon CR9 3RA. Tel: 01 -7600222. President - Jim Dovev. THAMES VALLEY (Franchise area: Reading , Twyford. Henlev-on -Tharnes. Wok ingham . High Wycombe. M arrow . Basingstoke. Bracknel l: Newbury and Thatcharn - 215.000 homes) Cable Thames Valley Ltd . BT Vision. Room 26/20. Euston Tower. London NWl 3DG. Tel: 01 -728 3798. M anaging Director -Roger Wilson. WANDSWORTH (Franch ise area: The London borough of Wandsworth - 100.000 homes) Wandsworth Cable lid.. 87 Jermyn Street. London SW1Y 6J D. Tel: 01-8 39 7106. Chief Executi ve - Richard Tripp .

23 - THECABLEINDUSTRY

The cable audience

THE AVAILABILITY OF CABLE SOFAR

ALLCABLE SYS f EM S BROADBAND FRANCHISES

Homes Hom es Homes Homes passed connected Penetration passed connec ted Penetration January 1986 975,430 127,481 13.1% April 1986 994,822 143,857 14.5% 66,238 7,523 11 4% July 1986 1,052,174 172,405 16.4% 90,768 10.238 11.3% Octo ber 1986 1.133,531 174,726 15.4% 107,703 13.094 12.2% January 1987 1.176,096 188,459 16.0% 143,066 19,758 13.8% April 1987 1,189.655 193.173 16.2% 168,436 21.873 13.0% July 1987 1.251,353 207.938 16,6% 211,643 26,584 12.6% October 1987 1,288.678 222.169 17.2% 235.858 30,653 13.0% January 1988 1.360,773 249.642 18.3% 276.671 40,609 14.7% 0 April 1988 1,372.856 256,527 18.7 / 0 307,453 44.565 14,5% July 1988 1.415.778 265,645 18.8% 344,073 48,568 14,1% October 1988 1,464,830 267.774 18.3% 380,4 11 53.445 14.0% January 1989 1,507.555 272.559 18,1% 426.056 62,728 14.7% Source JICCAR April 1989 1.478.583 283,8 16 19,2% 470,203 65,874 14,0%

TH E FUTURE AVA ILAB ILITY OF CABLE

The advan ce of the franch ising pro gramme has enabled the Aut hority for t he fi rst time to publish 13 Upgrades. SMATV etc project ions for the spread of cable, based on th e timetable fo r im plementing th e franchises already Possible 1989 Franchises \ awa rded or applied for. Th e projections illustrated here show the Probable 1989 Franchises timeframe for th e co nst ruction of the cable sys te ms franch ised in early 1989. tog eth er w ith tw o different est imates of how the growth m ight be affected by th e Authority 's franch ising activiti es through the rest of 1989 . The cabled un iverse is com plete d by upgrade and SM ATV systems. w here th e projections assume th at the growth in SMATV w ill compen sate for the shrinking of upgrade sys tems as they are superseded by f ranchises . Existing Franchises

1986 1988 1990 1992 1994

W HO ARE THE AU DIENCE?

/ % % %

Social Classes AB 15.4 o 3.6 Social Class Cl 23 10.3 23.9 Social Class C2 24.3 43.3 42.3 Social Class 0 17.3 30.0 20.2 Social Class E 19.6 16.4 10.0 Children under 15 30.2 62.3 58.3 More than one TV set 46.1 71 .6 53.0 Video recorder 49.6 76.4 79 .8 Time wa tchi ng TV 27hrs/week 30.7hrs/week 25.8hrs/w eek

Television hou seholds Cable upgrade home s Cable franchise homes generally (source: BARB) (Source: (Source : AGB International Research) A GB International Research )

24 THECABLEINDUSTRY

WHAT ARE THEY WATCHING7 Share of viewing in homes receiving a range of cable channels

November 1985 November 1986 December 1987 December 1988

Source: JICCAR Source : JICCAR Source : AGB Inrem arional Research

VIEWING OF INDIVIDUAL 5 10 15 20 25 I I I 1 CHANNELS ITV I BBC1 I Weekly audience shares in Premiere I broad band cable homes (%) Sky I Childrens I Channel 4 I HVC I MTV I Bravo I BBC2 I Screen Sport r-- NOTES: The share Indicated here IS the Lifestyle - share of viewing In household s receiving the Super Channel channel co ncerned . For this reason the CNN percentages add up to more than 100%. It sho uld be borne in m ind that RAI channels have w idely diff ering transmission An, r hours. Others Source: AGB International Research. LJ December 1988

A PEAK-TIMEELECTRONIC SNAPSHOT M odern switched cable systems are capable of mon itor ing viewing behaviour electron ically across their subscribing homes. Such measurement systems are still at the development stage but can provide valuable advertising and market research data. as well as information to assist in programme schedul ing and packaging. The Authority arranged for four different cable systems to take an electronic snapshot of viewing by their subscribers at the same time. 8.15pm. on two evenin gs - a Tuesday and a Saturday - in mid-May 1989. The audience shares are summarised here. the first time there has been any att empt to consolidate electronic audience data from more than one system . 5 10, 1,5 20, % ITV I BBCl I NOTES: It shou ld be noted that audien ce Premiere I share in th is case is not co nfi ned to hom es Sky rece iving each channel : in other w ord s, for I exam ple, the viewing of the film channels In MTV hom es pay ing to recei ve such a channel w ill Arabic be significantly higher than indicated here. The transmission hours of channels Channel 4 vary, which expla ins why the Children's Indra Dhnush Channel doe s not figure in a snapshot taken atB.15pm; and Life style is primarily a BBC 2 dayti me channel. which some system s Super Channel I repeat in the eve ning. Sky News I The value of cable in serving eth nic m inorities is illustrate d by the high aud ience Discovery I share of the Arabic Channel and Ind ra HVC Dhnush. - Bravo The programme sampler is th e split - screen channel showing what is on a number Sky Movies of other channels, w hich many viewers Eurosport - clea rly like to watch. - The total share of viewing of cable Lifestyle channels in these samples was 53 %, w ith Screen Sport - the broadc ast channels taking 47%. ~ CNN -. Local ..... 25 ------

THECABLE l N O,;,UST~RY;",.__• .....__

Whats onwhere

• in cheapest package o for extra payment

en u.J en en Z a:: a:: u.J u.J z u.J z 0 !:: a f- I >- - Z a:: Z a:: 0 u.J c; Z !:: a Z z l? >- ur f- a a a a LU a:: '"Z CL !:: l? a L.L en « 0 z 0 --' o 0 0 :2' 0 a a ::::J z LU Z f- 0 L.L f- u.J !:: a:: >- f- en --' Z u.J 0 u.J > a en Z :2' 0 --' en --' en - u.J u.J - u a:: u.J en a a::

26 ------

CABLEAND SATElLITEPROGRAMMES

4 Cable and Satellite Programmes

The most notable feature of the year was the substantial growth and development of programme services. The audi ence may still be extremely small. but the strengthening of the prog ramme services w hich cable systems are now able to offe r their custome rs signifies the early maturi ng of the industry and the growing confidence about the futu re prospects. The positio n was reached towa rds the end of the year w hen even some of the new broadband systems came close to uti lising their capacity. Some indeed had to take decisions about w hic h chann els to leave off their systems and such choices are likely to become more common in the next year. The Authority noted that virtually all franch ise applications now being made propose the use of 550 M Hz systems - sometimes up to 860 MHz - instead of the 450 M Hz systems w hich had previously been the rule. This means that there w ill be capacity for about 48 television channels as a matt er of routine. The range of choice which is now developing in cable programm es demonstrates the advantages of cable. There is not realistically any other way in w hich the viewer can have access to so much television programming. certainly with as littl e trouble and expense as is possible wi th a cable system.

Astra and Sky Television launch The most significant development of the year was the successful launch of the Astra satellite w hich enabled two new chan nels to be provided by Sky Television in February. In add ition to Sky Channel w hich transferred to the Astra satellite. Sky New s and Sky M ovies began transmissions for the first time. as did Eurosport. a joi nt venture of members of the European Broadcasting Union. These channe ls we re followed by others which transferred to Astra from low-powered satelli tes. This developme nt was significant not only for the increase in cho ice w hich it brought. but for the new levels of pub lic aw areness w hich foll ow ed the immense publicity given to the new services. Now that satelli te television became more accessible to those outside cabled areas. the new choices in television became a subject of more regular comment and discussion.

Other programming de velopments The channels on Astra we re not the only new ones to start dur ing the year. In Octo ber. the Landscape Channe l started transmissions . This represented possibly the most original concept since cable programme services began. consisting of noth ing but film of the natural world set to familiar and less familiar music. The service conta ins no speech whatsoever and is designed to offer stress-free view ing. Its intended source of revenue is from the mail order sale of records of the music it features. The Landscape Channel wa s followed in November by the European Business Channel . a service of business news and comment which is produ ced in Sw itzerland and w as offe red as a distinct segment of the Sky Channel service. Other forthcoming channels we re announced during the year. The Discovery Channel. a programme service provided exclusively for cable systems by United Programmi ng consists of documentaries about nature. travel and human life. and began three weeks after the end of the year. Other channels promised for later in 1989 were the Disney Channel and Sky Arts. To

27 CABLEAND SATELLITEPROGRAMMES

these of course w ill be added the services of British Satellite Broadcasting w hich. w hen this was w ritten. we re due to start in September. Of those channels already in operation. two experienced major changes of their ownership. Superchannel. w hich had been launched by many of the ITV companies. passed first into the control of Virgi n Broadcasting and was then acquired by Beta Televisio n of Italy. A number of changes to its program ming and scheduling too k place. The A rts Channel passed during the year into the control of United Programming. the offs hoot of United Cable Televisio n. w ho we re assuming an increasing ly influential part in the development of cable in Britain. Sadly. shortly after the end of the year. a further injection of finance was denied the channel. and it closed.

European Community programme content The Authority is requ ired to do all that it can to ensure that cable prog rammes include a proper proportion of matter originating in the European Economic Community. and it is requi red to inclu de in its annual report an account of how this responsibility has been exercised in the course of the year. The Aut hority has conside red it appropriate to consider channels individually. partly because an overall evaluation across a multichannel system w ou ld be bot h com plex and meaningless and partly because what may be proper for one channel would not be for another. For example. channels carrying nothing but feature films will fi nd it diff icult to include more than a small proportion of British films. simply because most English-language films are American. More particularly. a channe l providing films for ethnic minorities w ill even more obv iously depend on material from outside the European . Commu nity.

ECC CONTENT AVERAGE TOTAL EEC NON-EEC (%) DAILYOUTPUT 13 WEEK SAMPLE HOURS HOURS HOURS 1988 1989 (HOU RS)

BRAVO 2160 210 1950 55 9.7 24 CABLEJUKEBOX 2160 2160 0 nla 100 24 CABLEONE(RADIO) 2160 1404 756 833 65 24 CHILDREN 'S CHANNEL 900 666 234 65.6 74 10 CABLENEWS NETWORK 2160 43 2117 1 2 24 EUROPEAN BU SINESS 45 39 6 nla 86.7 0.5 CHANN EL EU ROSPORT 330 203 127 nla 615 6 HOME VIDEO CHANNEL 1092 11 1081 96 1 11 INDRA DHNUSH 1638 NIL 1638 NI L NIL 18 LAN DSCAPE CHANNEL 247 216 305 nla 87.6 27 LIFESTYLE 540 143 397 20.3 265 6 MTV EUROPE 2160 1961 199 92.3 908 24 PREM IERE 1092 30.5 10615 11 28 11 SCREENS PORT 810 333 477 22 41 9 SKYCHANNEL 1550 687 863 53 443 17 SKYMOVIES 465 82. 5 3825 nla 17.7 5.5 SKYNEWS 1350 1097 251 nla 81.3 24 SKY RADIO 21 60 1080 1080 nla 50 24 SU PER CHANN EL 2070 51 6 1554 85 25 23 VISION BROADCASTING 26 105 155 nla 40 2 hours (Sundays on ly)

28 CABLEAND SATELLITEPROGRAMMES

The Au thority undertook a survey in the first th ree months of 1989 to ascertain how each channel performed in th is respect. The table sets out the results for the princip al channels. Some channels (Sky Movies. Sky News and Eurosport) started during the period concerned and were therefore not operational throughout the w hole of the sample period . The fact that the Arts Channel went into liquidation in April 1989 has prevented information being obta ined. and the chann el has been left out of the tabulation. The three film channe ls which had been operating for more than a year all had a low er EEC content than a year ago; but. as has already been suggested. film channels are a special case and entail no original production anyway. Changes in th e format of Sky Channel and Super Channel du ring the year also resulted in a low er proportion of EEC material. On the other hand. the Children's Channel. Lifestyle and - more notabl y -Screensport made a significant inc rease in EE C-produced programming . High proportions of EE C prog rammes are included in the Cable Jukebox. the European Business Channel. Eurosport. the Landscape Channel. MTV Europe and Sky News. All in all. the new channels established for cable and satellite distribution have led to a great deal of new prog ramme production which. given the small audiences so far receiving them. cannot yet show an economic return. In the circumstances, the Auth ority has con cluded th at the percentages of EEC prog ramme material set out in the table for this year represent what is a proper propo rtion.

Complaints Although the Authority has received a number of complaints about programmes during the last year, the level still remains enco uragingl y low . The majority of letters from viewers express conce rn over the scheduling of favourite programmes, an area over which the Authority has no jurisdic tio n. As a matte r of courtesy, such concerns are always passed to the relevant prog ramme provid ers. A very few complaints fell within the Authority's direct areas of concern. One co ncerned the content of three specific feature films shown on the Home Video Channel. After careful scrutiny and consultation with the programme staff at the channel concerned, it w as concluded that two of the films w ere closer to the borde rline than the programme provider wished to venture and they we re voluntarily withdrawn from subsequent transmission. The thi rd film w as considered to be w ell w ithin the Authority's codes. Conc ern w as expressed by a viewer over an interview by Sky News with the eleven-year old son of threatened auth or Salman Hushdie. apparently without parental permission, on the subject of his lack of police protection. The Authority w as assured by Sky News that Scotland Yard had in fact given an assurance to Sky New s that th e child w as in no danger, but nonetheless the Authority felt it appropriate on this occasion to amend the programme guidelines to include a new section designed to avoid endange ring any person by the making of a cable programme . or by its content. A complaint from a viewe r in Glasgow about a drama show n on Clyde Cablevision's Publ ic Access Channel suggested that the play implied that the leadi ng character - a vio lent. racist yo uth - was a Catholic, and that this in turn suggested a slur on all Catholics in the city . The Auth ority's staff viewed the programme, and agreed with the produ cers and Clyde Cablevision that no such suggestion w as apparent in the programm e. The complaint was not uph eld. Questions w ere also asked of the Authority about an Italian gameshow, "C asino, Casino," shown during the night tim e transmissions on Super Channel. There we re suggestions in the press that the programme was pornograph ic, but in fact the programmes so far viewed by the Au thority have been co nsiderably more subtle than page three of the average tabloid news paper. Given the transmission time of the programmes - 3am until 4am - and the fact that they we re not aimed at an Engli sh-speaking audience, the Autho rity considered that they we re w ell w ithin the gui delines on sex and decency.

29 - CABLEAND SATElLITE PROGRAMMES

Approved channels

The Authority licenses cable operators to carry all the television and radio channels listed below. Any other channel must be specially approved by the Authority before it is carried .

3-Sat Lifestyle American Forces Network MTVEurope Arabic Channel. The Premiere BBC1 and lor BBC2 Radio Nova BBC Radio Services Radio Phoenix INeath) BBC World Services Radio Thamesmead Barker Channel. The RAI-Uno Bravo RTE-1 Baz Radio RTE-2 Cable Juke Box RTL Plus Cable One Sat-l Channel 4 Satellite Shop Commanders Channel, The Screen Sport CNN Sianel Pedwar Cymru Children's Channel. The Sky Channel CRMK Radio Sky Movies Discovery Channel Sky News European Business Channel Sky Radio Eurosport Super Channel Greenwich Community Radio Meridian TSS-1 IMoscow) Home Video Channel TV Scandinavia House of Lords Channel TV-5 IBA Radio Services Vision Channel Independent Television Voice of America Indra Dhnush Worldnet Kindernet Woolwich Hospital Radio Meridian Landscape Channel

ClydeCablevision's production staff with awards won by programmes made at the station.

30 CABLEAND SATELLITE PROGRAMMES

The cable television channels '

BRAVO CABLE JUKEBOX

A 24 houra day service of classic movies, distributed to Popula r music videos supplied to United Kingdom cable United Kingdom cable operators on videotape. Financed operatorson videodisc. Can be operatedeither by a charge to operators, with a facility for local interactively in response to requests from viewers over advertising to be inserted. The service started in the cable system for particular videos to be shown or Septe mber 1985. non-interactivelv with a pre-programmed playschedule. Bravo , United Prog ramming, Communications House, The service started in November 1987. Blue Riband Estat e, Roman Way ,Croydon CR9 3RA Cable Jukebox, W .H. Smith Television Ltd, Tel: 01-680 1444; Fax: 01-681 2340 ; Telex: 88140709 The Quadrangle, 180 Wardour Street. President: Adam Singer London Wl V 4AE Tel: 01-439 1177; Fax: 01-439 1415; Telex: 265871 General Manager: Fiona McFadzean Managing Director: Francis Baron

CABLE NEWS NETWORK THE CHILDREN'S CHANNEL

A 24 hour a day service of news, distributed to European cableoperators via the IntelsatVSatellite live from Children's prog rammes between 5 a.m. and3 p.m., Atlanta, Georgia. Financed by a combinationof distributed to European cableoperators via the Intelsat V advertisingand a charge to operators. The service to satellite. but alsotransmitted for shorter hourson the Europe started in Septembe r.1987. Astrasatellite.Financed by advertisingplus a charge to CNN International Sales Ltd, operators.The service started in September 1984. 25/28 Old Burlington Street. London Wl Xl LB The Children's Channel. 9-13 Grape Street, Tel: 01-434 9323; Fax: 01-7346141 Telex: 269169 London WC 2H 8DR Tel: 01-2403422; Fax: 01-4979113; Telex : 28622 ManagingDirector: Robert W Ross Salesand Marketing Director/Southern Europe: Managing Director: Richard Wolfe Director of Programmes & Production : Dan Maddicott David Garland SalesDirector: David Harrison Salesand MarketingDirector/Northern Europe: Head of New Business Development: Peter Fau re Ma rk Rudolph GeneralCounsel: Amanda Seward

THE DISCOVERY CHANNEL EUROSPORT

Documentaryprogrammes about nature, history, travel Eurosport provides 12 hours a day of sports programmes and sciencetransmittedfor 6 hoursa dayto cable provided by a consortium of members of the European operatorson the Intelsat V satellite. Financed by Broadcasting Union. including the BBC. It is transmitted advertising plus a charge to operators. The service via the Astrasatellite to cableoperatorsand individual starte d in April 1989. dish owners in the UK, Ireland and Continental Europe. It The Discovery Channel, United Prog ramming, isfinanced by advertisingandthe servicestartedin Communication House, Blue Ri band Estate, Roman February 1989. Way . Croydon CR9 3RA Eurosport. Sky Television. Centaurs Business Park. Tel : 01-680 1444; Fax: 01-6812340; Telex : 265871 Grant Way, Isleworth, Middlesex , TW7 5QD Tel: 01.7823000; Fax: 01 7823113 ManagingDirector: Adam Singer Head of Programmes : Mike de Monceau Head of Programmes; Adrian Metcalfe Head of Production : Joyce Taylor Head of Marketing: Tracy Chamoun

31 - CABLEAND SATELLITE PROGRAMMES

A non-prem ium film channel running for about 12 hours Hindi films and television programmes. wi th some a day. distributed to UK and Irish cable systems on material also in other Indian languages. provided for 16 videotape. Financed by a charge to cable operators wi th hours a day by means of videotapes delivered to cable . a facility for local adve rtising to be inserted. The service operators. A subscription channel. The service started in started in September 1985. At the time of going to press. M ay 1986. it see med likely that HVC w ould cont inue in some form Indra Dhnush Ltd. Unit 7, Barratt Industrial Park. not w ithstand ing the dissolution of the Premiere Park Avenue, Southall, Middlesex UB 1 3AF Partnership. Tel: 01-471 2585 ; Telex: 94070904 Home Video Channel. The Premiere Partnership, Chief Executive: R Christopher Yates p.a . Box 2AD, 6-7 D'Arblay Street. London W 1A 2AD Tel: 01-4340611: Fax: 01-434 1507

"'~ THE LANDSCAPE CHANNEL LIFESTYLE

~1 F. L A N"D S'l AP E C H ANN E L Instru mental or orchestral mu sic accompanying film Daytime magazine programmes for women between 9 of the natural world. At first distributed via the ECS 1 a.m. and 3 p.rn.. distributed to cable operators via the satellite, the channel is now delivered to cable Intelsat V satellite and also transmitt ed to individual dish ope rators in the UK on video tape. in a 3 hour a day owners via Ast ra. financed by adve rtisin g plus a charge sequence designed to be repe ated through 24 hours. to cable operators . The service started in Octo ber 1985. Self-financing through the direct mail sale of the Lifestyle Television Ltd. The Quadrangle, 180 Wardour records featu red in the service. The service started in Street, London W1V 8M November 1988. Tel: 01-439 1177; Fax: 01-4391415 The Landscape Channel. 194 Union Str eet. Managing Directo r: Francis Baron London SEl OLH Director of Programmes: George Black Tel: 01-6202220: Fax: 01 Chairman : Nick Aust in Managing Director: M ichael Appleton

MTVEUROPE PREMIERE

Pop and rock music 24 hours a day distributed to A prem ium film channel. distributed to UK cable European cable operators and individual dish owners via operato rs via the Intelsat V satellite. Although operating the Ast ra satelli te. Financed by adve rtising plus a charge at the time of going to press, Premiere w as expected to to cable operators. The service started in August 1987. close in July 1989 on the dissolution of the Premiere MTV Europe, 20-23 Mandela Street, Partne rship. The service started in Septe mbe r 1984. London NW1 ODU The Premiere Partnership, 6f7 D'Arblay Street, Tel: 01-3834250: Fax: 01-3882064 London W 1A 2AD Managing Director: Wi lliam Roedy Tel: 01-4340611: Fax: 01- 4341507 Deputy Director of Netwo rk Development: Howard Smith Manager UK Network Developme nt : Chris Griff in

32 CABLEAND SATELLITEPROGRAMMES

SCREENSPORT SKY TELEVISION

Sports programmes between 3 p.m. and m idnight. Sky Television now provides 3 te levi sion channels distributed to Europ ean cable operators and to individual distributed to UK cable operators and individual dish dish ow ners via the Ast ra satellite. Provided with owners via the Astra sate llite, as well as managing the alte rnative French and German soundtracks for viewers Eurosport channel transmitted throughout Europe. elsewhere in Europe. Financed by advertising plus a Sky Television, Centaurs Business Park,Grant Way. charge to cable ope rators. The service started in M arch Islew orth, M iddlesex, TW7 5QD 1984 . Tel: 01-782 3000; Fax: 0 1-782 31 13 Screensport Ltd, The Quadrangl e, 180 W ardour St reet, London W 1V 4AE Executive Chairman: Andrew Neil Tel: 01-439 1177 ; Fax : 0 1-439 1415 Joint Managing Directors: Pat Ma standrea (Chief Operating Officer) and Managing Director; Francis Baron Gary Davey (Director of Network Programming) Deputy Managing Director: Stewart Till Director of Corporate Affairs: Jo natha n M iller Director of Press and Publicity: Fiona Waters SUPERCHANNEL SUPER SKY CHANNEL -----CHANNEL-- I CHANNEL A gen eral television channel comprising pop mu sic. General enterta inm ent between 5.30 a.m. and 12.30 new s . sport and en te rtainment betw een 6 a.m . and 1 a.m . Advertising suppo rted. plus a charge to cable a.m . Distributed to European cable operato rs via the ECS operators. The service started in April 1982. 1 sate llite. Finan ced by advertising . The service started in January 1987. but was relaunched under new General Manager: Ric Burns management in January 1989. Head of Programme Development: Gord on French Super Channel Ltd, Visi on Hou se, 19-22 Rathbone Place, London W l P 1DF SKY NEWS Tel: 01-631 5050; Fax : 01 831 5255 Managing Direc tor: Marialina M arcucci Assis tant Managing Director: Serenella Ciclit ira Head of Programmes: M ike Roles Director o(Prpgramme Developme nt: NEWS Simon Woodro ffe A 24 hour new s and current affa irs service . Advertising suppo rted, plus a charge to cable VISION CHANNEL ope rator s. The service started in February 1989. Head of News: Jo hn O'Loan

SKY MOVIES

A service of religiou s programmes, presently comprising 2 hours a week design ed prima rily for Sunday transmission. Distributed to UK cable ope rators on videotape. Financed by spo nsors hip. The service A premium film channel provided betw een 4 p.m . and originally sta rted on Swi ndon Cable in 1986. midnight. although transmissions have not yet bee n Vision Broadcasting Communications, encrypte d. The service starte d in February 1989. Shaftes bury Cent re, Percy Street, Swindon SN2 AZ. Deputy Managing Director: Stewart Till Tel: 0793 824 106 Chief Executive : Fran Wi ldish

33 - CABLEAND SATEUJTE PROGRAMMES

Radio on cable

I was in 1976 that the Government first moved to allow experiments in community radio by cable. as an exceptio n to the general rule that cable systems relayed broadcast services and nothing else. and to supplement some lim ited community cable television experiments. Since radio is a far more cost-effective way of providing local programmes than television. the community cable radio stations tended to be longer-lived than the television stations. and two still survive. The oldest is RADIO THAMESM EAD. based in the London new town. and celebrating over a decade of pioneer ing work in community radio programming . Now run by vol unteers recruited by CSV (Co mmuni ty Service Voluntee rs). the station offe rs daily programming from breakfast time until mid-evening. with a staple diet of local news and sport. consumer information and advice phone -ins. The statio n can be heard by subscribers to the local BCS upgrade system. as well as subscribers to the Woolwich and Plumstead system COMMUN ITY RAD IO MI LTON KEYNES has been operating on the BT Vision upg rade system in the new town for many years. and it. too. provides local news and information in its daily evening transmissions. The voluntary organisation provid ing the service is now part of a successful application to the IBA for an "over- the-air" local statio n in the town. due to open later this year. A third new tow n. Basildcn . also had its own community cable radio for a number of years. and plans are we ll advanced to reint roduce SAZ RADI O very soon. Since the process of franchising broadband cable systems began in 1983. new systems have been built with a useful capacity to carry a number of additional FM radio channels. and an early experimental venture in Seo land. RADIO SIX. available in Glasgow and Aberdeen during 1985·86. paved the way for a number of new kinds of radio station to line up alongside the new ventures in cable and satellite television. Satellites distribute a number of radio statio ns to cable operators in both the UK and European continent - these include pop music-based channels like CABLE ONE and SKY RADIO . both of which originate from studi os in the Netherlands. The US Information Agency provides their VOICE OF AMERICA station to a number of British systems. wi th a diet of music. news and featu res from VOA studios in M unic h and Washington DC. The BBC WORLD SERVICE bo th in both its 24 hou r a day English-language version and a numbe r of its other language services are beamed to operators from INTELSAT V and are available to subscribers at the touch of a switch. The communtrv stations in Thamesmead and M ilton Keynes have been joined in 1988 by GREENW ICH COMMUNITY RADIO MERIDIAN . a mult i-cultural service running for 24 hou rs a day from studios in Woo lwich. and offering ethnic speech and music. along with a number of programmes for listeners w ith specialised musical tastes. The voluntary radio service that provides programmes of record requests and messages to hospital patients in the Woolwich Memorial Hospital is also available on the local cable network. as is a similar service. RADIO PHOENIX. in Neath and Port Talbot. Some specialised radio services aimed at premises other than homes distribute their programmes via British Telecom circuits. and those " restricted services" also come under the aegis of the Cable Authority. They inclu de CARO USEL CA BLE RA DIO based in Hounsl ow . providing 24 hours a day of news. information and music to factories in the south of England: and two services aimed at providing background music and commercials for local wi ne bars - CITY CENTRE BROAD CASTIN G provides its ··POW ER STATION·· service in Newcastle-upon-Fvne. and GRAND CENTRAL NETWORK performs a similar funct ion in Sheff ield. More new cable radio services are in the pipeline - the Birmingham based NETWORK ELEVEN plan a Christian radio network offer ing discussions. news and music of a relig ious nature; and a number of ethnic language services are currently considering the opportunities that cable can affo rd them for the d istribu tion of their signals. As cable reaches into increasingly more British households and w orkplaces. cable radio services w ill expand on a similar scale to the new television channels.

3. ---~

FINANCE

5 Finance

• -, -, -

The Aut hority w as established by the Cable and Broadcasting Act 1984, w hich bestows on the Authority its general functions and its duti es in relation to its financial affairs, The principal activiti es of the Authority, reflecting the fun ctions laid upon it by Parliament. are described on page 4 of this report. The Authority is non -profit making but is required by law to ensure at the earliest practicable date that it generates suff icient revenue to cover its costs, Und er the 1984 Act, the Autho rity has two sources of revenue; the fees for the licences it issues and application fees for franchises, These fees are fixed at the Authority's discretion. The Authority review s every year w hat the level of its fees shou ld be and has felt obliged to increase fees ahead of inflation, It takes into account not only its duty to be self-suppo rting but the duty w hich is also set out in the statute, to exercise its licensing functions in the manner best calculated to promo te the provisio n of services by cable, In setting its budget at a time w hen the industry is still in its infancy. the Authority has to make predictions abou t the number of licences in force in the follow ing twelve month s and also abou t the number of appli cations it will receive for franchises, In an envi ronment which is market-led and which is perceived to offer uncertain prospects. making such predictions is extremely difficult. In the year und er review . the Authority for the first time made a surplus. Its revenue during the year amounted to £836.000. comp ared with £395 .000 in the previous year, The year's surplus of £76.000 compared with a deficit of £299.000 in 1987-88. calculated after taxation and interest due on loans from the Home Office. As loans matu re. the Authority wi ll be able to reduce its indebtedness to the Home Office, The difficulty of making predictions about future revenue is illustrated by the fact that the Authority's surplus this year derives from the enormous boom in franchising activ ity w hich w as generated by increased demand for franch ises. The Authority's application fee revenue rose from £43.000 in 1987 -88 to £356.000. On the other hand. how ever. the Authority issued fewer licences to approved appli cants for franchises than it had expected and revenue suffered a shortfall under this heading compared w ith budg et projections. Prospect s for the coming year are for the increased level of franchising activity to be maintained and for a larger number of franchised companies to be issued with a licence and to begin operations, The Authority's increase in revenue should therefore be mainta ined, The Members of the Autho rity. as appointed by the Home Secretary. are set out at the beginni ng of this report. There we re no changes during the year. The salaries of M embers are determined by the Home Secretary but paid out of the Au thority's fund s, The audit ed accoun ts for the Year to 31st M arch 1989 are appended to thi s report.

35 ------

FINA NCE

ACCOUNTS FOR THE YEAR ENDED 31st MARCH 1989

BALANCE SHEET AT 31st MARCH 1989

1989 1988 Note £'000 £'000 £'000 £'000

Fixed Assets Tangible assets 9 112 129 Current Asset s Debtors 12 27 31 Cash at bank and in hand 394 137 -- -- 421 168 Cred itors: Amo unts falling 13 (97) (91) due w ithin one year

Ne t Current Assets 324 77

Total Assets les s Current liabilities 436 206

Financed by: Provisions for Liabilities and Charg es 14 16 12

Capital and Reserves Loans from the Home Off ice 15 1175 1025 Income and expend iture account (755) 420 (831 ) 194 - - 436 206 - -

The notes and statements on pages 39 and 40 form part of the accounts.

Richard Burton CHAIRMAN Jon Davey DIRECTOR GENERAL Approved on 25th May 1989.

REPORT TO THE CABLE AUTHORITY BY THE AUD ITORS APPOINTED UND ER SECTION 20 (2) OF THE CABLE AND BROADCASTING ACT 1984 . We have audited the Accounts of the Authority on pages 36 to 40 in accordance with approve d Auditing Standards. In ou r opinion the accounts give a true and fair view of the state of affairs of the Authority at 31st March 1989 and of its surplus and source and applicat ion of fu nds for the year then ended and have been prepared in accordance with the Cable and Broadcasting Act 1984.

London. 25th May 1989 PEAT MARWICK MC LlNTOCK Chartered Accoun tants

36 - -

FINANCE

INCOME & EXPENDITURE ACCOUNT FOR THE YEAR ENDED 31st MARCH 1989

1989 1988 Note £'000 £"000 £"000 £"000

Income 2 836 395 Operating Expenses Staff costs 3 323 358 Depreciation 2 33 38 Other operating charges 3 326 (682) 211 (607)

Operating Surplus/IDeficit) 154 (212) Interest receivable 4 25 15

Surplus/lDeficit) before 179 (197) Taxation and Interest Payable Provision for taxation 5 (6) (4)

Surplus/IDeficit) before 173 (201 ) Interest Payable Interest payable 2&6 (97) (98)

Surplus/lDeficit) for the 76 (299) Year

Deficit brought forward (831) (532)

Deficit carried forward (755) (831)

37 •

FINANCE

SOURCE AND APPLICATION OF FUNDS FOR THE YEAR ENDED 31st MARCH 1989

1989 1988 ["000 ["000

Source of funds: Surplus/(Deficit) before taxation and interest 179 (197) payable Adjustment for items not involving the movement of funds: Depreciation less profit on disposal of fixed 33 38 assets Provision for repairs 4 4

Funds generated from operations 216 (155) Funds from other sources: Loans from the Home Office 325 275 Proceeds from sales of fixe d assets 6 10

Application of funds: Loans repaid to Home Offi ce (175) Purchase of fixed assets (23) (23) Taxation paid (4) (4) Interest paid to Home Off ice (102) (128) -- -- 243 (25) -- -- Components of increase/(decrease) in working capital : Debtors (4) (43) Creditors: Amou nts falling due within one year (10) (12) Movement in net liquid funds: Increase in cash at bank and in hand 257 30 -- -- 243 (25) --

38 ------_..._---~ FINANCE

NOTES TO ACCOU NTS

1. These accounts have been prepared in a form determi ned by (he Secretary of State for the Home Department. w ith the approval of the Treasury in accord ance w ith section 20 (1) of the Cable and Broadcasting Act 1984.

A cc ounting Polici es 2. The follow ing is a summ ary of the principal accounting policies which have been adopted in preparing these accou nts'> (a) The acco unts have been prepared under the historical cost convention. The accounts comply w ith the Statement s of Standard Accounting Pract ice issued by member bodies of the Consul tative Committee of Accountancy Bodies. and. so far as appropri ate. meet the requ irements of the Companies Act 1985. (b) The income of the Authority con sists of licence and appli cation fees and is accounted for on the basis of fees statuto rily due. (c) The amortisation or depreciation of tangible fixed assets is calculated on a straight line bears by reference to the cost and estimated useful lives. The rates of depreciation are as tollcws.r­ Expend iture on leasehold premises: over period of lease. M oto r vehi cles: 25% per annum Furniture and equ ipment: 15% per annu m. Office computer equi pment: 20% per annum. (d) In accordance with H.M . Government practice , loans from the Home Office are treated as capital and the interest payable thereon is not shown as an operating expense . Operating Expenses 3. Included in operating expenses are the following 1989 1988 £"000 £'000

M embers' remunera tion 62 58 Ot her remune ration 218 241 Social Secur ity costs 24 26 Pension costs 19 33 Auditors' remuneration and expenses 3 3 H ire of equipment - operating leases 10 4 H ire of other assets - operating leases 101 48 Travelling and subsis tence : Mem bers Staff 10 8 Int erest Rec e iva ble 4 Interest receivable on short-term deposits 25 15

Ta xa t io n 5. Apart from taxation on in terest received the Authority is not liable to co rporation tax Int erest Paya ble 6. Interest on loans from the Home Office (see note 15) 97 98

Members and Em ployees 7. The remuneration of Members of the Au thority excluding pension cos ts as determined by the Home Offi ce was :

Chairman 28 26 Deputy Chai rman 10 9 Other Members (in total) 24 23

The average number of emp loyees during the year was 9 ( 1988 : 9 ) The number of employees whose emo luments (exc luding pension co sts) exceed [30,000 fell within the ranges: 1989 1988

£ 35.001 - 40.000 40.001 - 45.000 45.001 - 50.000

Pensi ons 8. The Authority opera tes a pension scheme designed to accord with r e c ~ nt trends and practices . Contributions are based on each member's pensionable earnings and ale charged to income and expenditure account as they fall due . The scheme assets are funded com pletely independently of the finances of the Authontv

39 FINANCE

Tangible Fi xed Assets 9 Total Short Furniture M otor Computer Leasehold and Vehicles Property Equipment ['000 ['000 ['000 ['000 ['000 Cost at 1.4.88 215 65 55 38 57 Ad ditions in year 23 5 16 2 Disp osal in year (14) (1)(13)

Cost at 31.3.89 224 65 59 41 59

Amorti sation/ Depreciation at 1.4.88 86 24 24 15 23 Provided in year 39 8 9 10 12 Eliminated on disposal (13) (13)

Am ortisati on / Depreciation at 31-3.89 112 32 33 12 35

Net book amoun t at 31st Ma rch 1989 112 33 26 29 24 Net book amoun t at 31st M arch 1988 129 41 31 23 34

Op erating Leases 10. At 31st March 1989 the Auth ority had annu al commitments under non -cancellab le operating leases as set out below : 1989 1988 Land and Other Land and Other Buildings Buildi ngs ['000 ['000 ['000 ['000 Operating leases which expire: w ithin one year in the secon d to fift h year inclusive 101 10 48 10 101 10 48 10

Cap it al Commitments 11. There were no capital commitments outs tanding (1988 - nil) Debtors 1989 1988 12. Debtors consist of: ['000 ['000 Debtors for fees 13 5 Other debto rs 2 Preoavments and accrued income 14 24 27 31 Creditors - amounts fa ll ing due within o ne year 13 These consist of: Soci al Securi ty and PAYE income tax 9 9 Income tax on interest received 6 4 Other credito rs and accruals 82 78 97 91 Provi si ons f or Liabilities and Cha rges 14 Provision for leasehold repairs and renew als Balance at 1st Apri l 1988 12 8 Charge for the year in the income and expenditure accou nt 4 4 Balance at 31st Mar ch 1989 16 12 Lo an s 15 Loans outstandin g from the Home Off ice are as follow s: Date A dv an c ed Interest Rat e £'000 per annum % 17th November 1985 10 625 125 2. 21st J anuary 1986 12 000 100 3 2nd M ay 1986 8625 87 4 16th June 1986 8625 88 5. 7th October 1986 11.500 87 6. 9th December 1986 11500 88 7. 21st Ap ril 1987 9.375 75 8 26th June 1987 9 125 100 96th November 1987 925 0 50 10 17th Decem ber 1987 9 375 50 11 3rd Augu st 1988 nil 175 12 20th October 1988 nil 150 11 75 The above loans we re provided by .the Secretary of State for the Home Department with the consen t of the Treasury unde r section 19 (1) of the Cable and Broadcasting Act 1984. The repayment dates are subject 10 discussion and agreement with the Home Office after consultation with the Treesurv. The aggregate amount outs tanding by way of principal advanced may no t. under sectio n 19 (2) of the Cable and Broadcasting Act 1984. exceed £ 2 million

40 A cable glossary

Al B sw itch. A simple sw itch given to a viewer for selection Earth station. Transmitting or receiving point for satelli te between tw o input sources, such as an aerial and the cable system. transmissions Not necessary w ith broadband syst ems.

Access channel. A channel that the cable operator makes available ECS. European Commurucanons Satelli te A senes of satellite s for use by anyone with something to say or present (community operated by Eutelsat. The first of the series. ECS1. cames nine groups . individua ls. etc.) usually - though not necessarily - w ith European television channels distributed to cable systems. facilitie s made available free of charge by the operator. Includ ing two British channels (Sky Channel and Super Channe l).

Add ressabifitv. The facility by which the subscriber's home Footprint. The earth coverage area of a transmission from a satellite. equi pment may be controlled remotely by the cable operator, in Like a torc h beam. the strength of the signal will w eaken the order la allow disconnection, the provision of pay-per-view. or further one moves from the centre. but this can be compensated for changes in the level of service. by using a larger receiver

AM L. Ampl itude modu lated link. A type of microwave transmission Franchise. The right to install and ope rate a cable svstem in an area for multichannel point-to-point television links. of more than 10.O

Bit. Unit of measurement of data transmitte d in digit al form Hence HDTV. High definition television. A clearer sharper picture USing the measurement of the capacity of a cable system to carrv considerably more lines than the present 625. Cable systems information w ill be in terms of Kilobits or M egabits per second already have capacity to carry such services when they are (Kbits/s . Mbits/s ). introduced

Broadband. Cable w ith the capacit y to carry a large number (eg 25 Headend. The control centre of a cable system or mo re) television channels. Interchangeable with wideband Hertz. The unit of frequen cy of electromagnetic w aves (cycles per CATV. Community antenna television . A cable system covering a second ) (see also Giqahe rtz and Megahertz). "Hennan" is wh ole community, eg a town. sometimes used as a description of over-the-air transmissions. as opposed to cable Churn. Turnover of subscribers/cancellatio n of subscriptions . Usually quoted as a percentage rate. Homes passed. The expression in common usage as the measurement of the size of a cabled area. meaning the total Closed user group . Cable channel available onJy to a specif ic group num ber of premises which have the potential to be co nnected to of subscribers. the cable system. Coaxial cable. Cable consisting of a central conductor (usually copper) surrounded by. and insulated from. another conductor. It is Hubsite.A n intermediate control point in a switched cable system between the headend and the loca l switching point. In systems the standard material used in present -day cable systems. Signa ls provided by BT. it is planned to locate hubs w ithin each local are transmitted through It at different frequencies. giv ing greater teleph one exchange . channel capacity than is possible with twisted pair cable but less than is allowed by optical fibre. Infomercial. A long-form advertisement desig ned to give CTA. Cable Television Association. The United Kingdom trade info rmation about prod ucts or services. associatio n. lnt eractivitv. The facility for two-way com munication . thoug h the DBS .Direct broadcasting by satellite . The use of a satellite to sophistication of the interactive capability may vary depending on transmit high-p ower television signals for recept ion direct by the techn ology used in the cable system. individual view ers. thoug h such services will also be carried on ITC. lndependent Television Commission . The proposed new cable systems. regulatory body which w ill absorb the functions of the Cable Autho rity together w ith mo st of those of the IBA. Dou b le il lu m in at ion, Transmission of a television channel from tw o separate satell ites, part icularly for a t ransitional per iod when a Leased access channels. A category of cable channel (pa rticu larly change from one satellite to another is being undertaken. in USA ) made available by the loca l operato r on a commercial basis rather than as a free community service. as will normally be Downlink. The tranmission from a satell ite to an earth stati on. the case with access channels.

Downstream. The direct ion of signals transmitted from the cable Local avail. The availabilit y w ithi n a nation al channel of slots tor the heaetend to the subscriber. insertion at cable systems of local advertising Drop. The cable co nnecti on from the street in to the subscribers' M ATV. Master antenna television. A cable system confined Within premises. The term is sometimes (but not always) confin ed to a block 01 flats. small housing development etc. served by a those subscriber connections from overhead rather than common aerial. In con tradistinction to CATV. underground cable

DTH. Di rect to home- Used to deno te satelli te signals received by M DS. Mu ltipoint distr ibution service. A television distribution an individual viewer via a dish aerial. as distinct from via a cable system to subscribers using omnidirectiona l microwave system. transmissions (sometimes now called M MDS. with an addi tiona l M 4' for m icrowave or muttichennet, or MVOS w ith a V for video). It Strand mapping . Preparation of preliminary map s prior to the depends on line of sight between transmitter and aerial and has a deta iled system design showing the likely rou te of cable du cting . range of about 10·20 miles. It has grown in the USA as a n€"AI So call ed from USA usage. where the strand is the wire Support for med ium for pay televisi on . It has not so far been authorised by the overhea d cable strung between po les. UK Government. Sub scrip tion channel. A channel for w hich the subsc riber pays a M egahertz.(M Hz). Frequency of one mill io n cyc les per seco nd . specific subscription over and above the charge for the basic service . Microwave. W ireless transmissions at very hig h frequ ency as a Tap. The feed off a main cable (u sually in tree and branch system) means of providing telecommun icati ons links (includ ing televis ion drstnbunon) between two places. Depe nds on line of sigh t. to the subscriber's 'drop'. Opera ted m the U K by British Tetecom and M ercury. See also MDS. Tier. A level of cable service depend ing on the amou nt of the subscriber's payment It reflect s the packagi ng of channels at MSO. Mult iple systems operator. A cabl e opera tor run ning a different prices. number of di ffe rent cable systems Transponder. A transmitter on a satellite M ust-carry. The obligation on cable systems to carry certain channels. usually the broadcast services Tree and branc h. Topology of one type of cable system. of trad itio nal design. It co mprises a tru nk cable from which each Narrowband . Som etimes used to d istinguish cable from subscriber link is tapped off. Because atl parts of the system carry broa dcas ting M ore parti cu larly. the function of d istrib uti ng a range the tota lity of the services provided. it is difficult to build mu ch of televisio n channels or programmes desig ned to meet various interactive capability in to suc h systems. m inority int erests rather tha n to offer mass appea l. TVRO . Television receive only . The d ish for receiv ing satelli te NCT A. National Cable Television Association. The representative television sig nals Ind ustry body of tne USA . Twisted pair. Type of cable used extensively in Brit ish cable New bui ld . Cable system installed In area not previously cabled A systems in the past. comprising twisted pai rs of wires each carryi ng term used to dis tinguish new systems . or part s of systems. from on e channel. Most systems of this kind have capacity for four upgrades. television chan nels: some have six. none have mo re.

OFT EL. Office of Teleco mmunications. The licensing and Upgrade. An ol d cable system installed for broadcast relay mcnitonnq body established by the Telecommunication s Act 1984. purposes but now utilised for the provisi on of new programme headed by the Director General of Telecommu nicati ons (Professor services Brvan Carsberg ) Uplink . The transm issio n from an earth station to satellite. Off-air. Normal broadcast televi sion signals. A term often used to drstmquish aenat reception from cable recept ion. or broa dcast Upstream. The direction of signa ls transmitted from a cable channels (BBC. ITV. etc) from cable channels. subsc riber to the operators headend.

Optical fibre. Cab le made of glass fibres through which signals are Wideband. Cable system with the capacity to carry a large number transmu ted as pu lses of ligh t Capacity for a very large number of (eg 25 or more) television channels. lnterchan qebte with channels can easily be prov sded . Not yet widely used in cable broadb and systems

Penetratio n. The measurement ol tbe take-up of cable service s. The number 0 1 subscnbe rs is expressed as a percentage of the hom es passed

PPV. Pay per view Payment made for in dividual cable progr ammes as opposed to a monthly subscrip tion for a whole channel or group of chennets. Not currently used in the U K. bu t env isaged as a means of providIng certain popular sporting events or blockbuster moves for which subscribers may be prepared to make a spec ial payment Cann ot very effective ly be done on an old-fashioned cable system but is straightforward WIth a system provid ing control of each subsc ribers services from the headend (addressabi lity) .

Premium channel. Chan nel available only for additional subscri ptio n ove r and above the basic service .

Programme provider. Company assemb ling pro grammes into a service to be prov ided to cable systems

Retu rn path. The means by which messages are transmitt ed back through the cable system from the subscriber to the headend.

SMATV. Satellite master antenna television. An M ATV system with a receiv ing dish for picking up and d istribu ting satellite television SIgnals. An y system of up to 10.0

Star sw itched system. New gene ration of cable system in which lull ban dwidth is prov ided from the headend to local sw itChing po ints w hich are programmed to supp ly each subscri ber. thr ough an ind ividual line of lower bandwidth . with which ever channels he pays for. Channel selection then takes place at the SWItch . rather than in the TV set or set-top bo x. but in respo nse to the subscribers operatio n of his remote control. Such systems have great er inte ractive capability

42 Cabled Britain

•• •• @El @ • Key to Map: •

Franchises for new broadband systems

Principalupgrade and SMATVoperators

Britis h Cable Services LId Cable and Satellite Television Cablecom Investments Ltd Southern House Holdings Ltd RAF Lakenheath 1-4 Cambridge Terrace urut 2 Brandon Oxford OX 1 1UO Dorcan Business Village Suffolk IP2 79PL Tel 0865250110 Murdock Road Tel 063881 2517 (Former Hedittusion systems in Swindon SN3 5HY (SMATV systems at USAF many towns around England Tel 0793611176 bases In England) and Wales) {Chatham. Hochester. Sitnnqboume. Heme Bay and Greenwich Ceblevision Lld Neath) lex House B T VISion 62 Beresfo rd Road Euston Tower Cable Television Ltd woolwrch London, SE18 6BH 286 Euston Road Forsvth Road Te101-31612oo London NWl 30G Sheerwater (Woolwich and Plumsread) Tel 01-7288000 Waking (Ba rbican. Brecknell. Irvine. Surrey GU2l 5SB Milton Kevnes and Tel 0486261861 Washington) (Northampton)

43 Cable towns inthe United Kingdom

Key to Index o ABERDEEN - Franchise in operation '" ACCRINGTON - Franchise not yet in operation + BRIGHTON - Franchise under consideration o ASHFORD - Upgradesystem in operation

0 ABERDEEN 0 DEAL + LAMBETH 0 ROCHDALE 'I' ACCRINGTON 0 DOVE R 0 LANCASTER '1' 0 ROCHESTER 'I' AIRDRIE + DUDLEY + LANCING 0 ROTHERHAM 'I' ALDERSHOT 'I' DUMBARTON 0 LARGS ROYSTON 'I' ANDOVER 0 EALING 'I' LARKHILL + RUNCORN 'I' ASCOT 0 EASTBOURNE + 0 LEI CESTER 'I' SAFFRON WALDEN 0 ASHFORD, KENT 0 EAST DEAN + LETCHWORTH SALTCOATS 0 ASHFORD, BERKS 'I' EAST KILBRIDE 'I' LEWISHAM + SANDWELL 'I' BACUP 0 EBBW VALE 'I' LEYLAND 0 SHOREHAM BY SEA 0 BARBICAN 'I' EDINBURGH 'I' LIVERPOOL '1' 0 SID INGBOURNE 0 BARGOED + ELLESMEREPORT 0 LLANDEILO 0 SLOUGH 'I' BARKING + ELSTREE 'I' LUTON 'I' SOLIHULL 'I' BARNET 'I' ELY 'I' MAIDENHEAD '1' 0 SOUTHAMPTON 0 BARROW-IN-FURNESS + 0 EXETER '1' 0 MAIDSTONE 'I' SOUTHEND ON SEA '1' 0 BASILDON 'I' FARNBOROUGH,HAN TS 0 MANSFIELD + 0 SOUTHTYNESIDE 'I' BASINGSTOKE 'I' FARNHAM 'I' MARLOW + SOUTHWARK 'I' BATH 0 FAVERSHAM 'I' MELKSHAM + STALBANS 0 BEITH + FELlXSTOWE 0 MERTHYR TYDFIL STIVES,CAMBS 'I' BELFAST 0 FFAIRFACH 'I' MERTON 0 STAINES 'I' BENFLEET 'I' FLEET 0 MIDDLESBROUGH 'I' STANFORDLE HOPE 'I' BEXLEY 0 FOLKESTONE 0 MILFORD HAVEN 0 STANWELL 'I' BILLERICAY 'I' FROME 0 MILTON KEYNES + 0 STEVENAGE 0 BILLlNGHAM 'I' FULHAM 'I' MITCHAM 0 STOCKTON ON TEE S 'I' BIRMINGHAM + 0 GATESHEAD 'I' MOTHERWELL + 0 STOKE ON TRENT 'I' BLACKBURN 'I' GATWICK 'I' NAILSEA 0 STROOD 0 BLAENAVON '1' 0 GILLlNGHAM, KENT + 0 NEATH 'I' SUDON 0 BLANEAU 0 GLASGOW NORTH 'I' NELSON + 0 SWANSEA 'I' BOLTON 'I' GLOUCESTER + NEWARK 0 SWINDON + BOREHAMWOOD 0 GLYNNEATH 0 NEWBRIDGE 'I' THATCHAM '1' 0 BRACKNELL 'I' GODALMING 'I' NEWBURY 'I' THORNBURY 'I' BRENT 'I' GRAVESEND + 0 NEWCASTLE ON TYNE 'I' TILBURY 'I' BRE NTWOOD 'I' GRAYS + 0 NEWCASTLEUNDERLYME + TOROUAY + 0 BRIGHTON 'I' GREENWICH 'I' NEWHAM 0 TOWER HAMLETS '1' 0 BRISTOL 0 GUILDFORD NEWMARKET 0 TREGEGAR + BROMSGROVE 'I' HAMILTON '1' 0 NORTHAMPTON 'I' TROWBRIDGE '1' 0 BURNLEY 'I' HAMME RSMITH + 0 NORWICH + WALSALL + BUSHEY + HARPENDEN + 0 NODINGHAM + WALTHAM FOREST 'I' CAMBERLEY 0 HARTLEPOOL 0 OXFORD 'I' WANDSWORTH 'I' CAMBRIDGE + HARWICH 0 PEMBROKE DOCK 'I' WARMINSTER 'I' CAMDEN 'I' HASLlNGDEN 'I' PENARTH + WARRINGTON + CANNOCK 0 HASTINGS 0 PENBRYN 0 WASHINGTON 0 CANTERBURY + 0 HATFIELD 0 PERTH 0 WELLINGTON 'I' CANVEYISLAND 0 HEATHROW + PETERBOROUGH 0 WELLlNGBOROUGH 'I' CARDIFF + 0 HEBBURN '1' 0 PLUMSTEAD + WELWYN '1' 0 CHATHAM + HEMEL HEMPSTEAD + 0 PLYMOUTH 'I' WESTON SUPER MARE 'I' CHELMSFORD 'I' HENLEY + 0 PONTADAWE 0 WESTMINSTER 'I' CHELSEA 0 HERNE BAY 0 PONTYPOOL 'I' WICKFORD 'I' CHELTENHAM 'I' HIGH WYCOMBE 0 PONTYPRIDD + WIDNES + CHESTER + HITCHIN 'I' PORTISHEAD 'I' WIMB LEDON 'I' CHIPPINGSODBURY 'I' HORLEY + 0 PORTTALBOT 0 WINDSOR 'I' CHORLEY '1' 0 HOUGHTON REGIS + PODERS BAR 0 WIRRALL 'I' CLEVEDON + 0 HOVE 'I' PRESTO N 'I' WISHAW 0 CLYDEBANK 0 HULL 0 PRINCESRISBOROUGH 'I' WOKING 'I' COATBRIDGE HUNTINGDON 'I' RAWTENSTALLL 'I' WOKINGHAM + COLCHESTER 'I' ILFORD 'I' RAYL EIGH + 0 WOLVERHAMPTON 'I' COLNE + IPSWICH '1' 0 READING + WOODBRIDGE 0 COVENTRY 0 IRVINE 'I' REDBRIDGE '1' 0 WOOLWICH 'I' CRAWLEY 'I' KENSINGTON 0 RESOLVEN 0 WORCESTER 0 CROYDON + KIDDERMINSTER 0 RHONDDA + WORTHING 'I' CUMBERNAULD 0 KILBIRNIE 0 RHOSMAEN 0 CWM BLAENAU 'I' KILSYTH 'I' RICHMONIl UPONTHAMES 'I' DAGENHAM 'I' KINGSTON-UPON-THAMES + RICKMANSWORTH

44 The Cbitaren 's Channel programme Roustabout visited Cabledareas during the year to co-produce w ith local operators quu programm es involving local children.

I : . 1 ~ "' J • I 1- ~