Anthony Doesburg: Everyone in line to share in the digital dividend

By Anthony Doesburg

Viewers, broadcasters and government will reap rewards of switch from analogue.

The end of analogue transmission will free up waves for 4G, the next generation of mobile phone technology. Photo / Glenn Jeffrey
The end of analogue transmission will free up waves for 4G, the next generation of mobile phone technology. Photo / Glenn Jeffrey

When long-running hostilities such as the Cold War or Ireland's Troubles come to an end, not only does the world become a safer place, but there's a "peace dividend" too, as money is diverted from military ends.

Now we're hearing about a similar windfall: the digital dividend. It's not the result of a ceasefire in the Microsoft versus Google war, the Microsoft versus Apple war or the Microsoft versus open-source war - none of which are claiming many casualties these days.

This is the all-round benefit that will flow from the switch from analogue to digital TV. As 70 per cent of viewers have discovered, digital delivers better picture quality. For broadcasters, more channels can be squeezed into a smaller amount of spectrum.

But the biggest gains go to cellular network providers such as Vodafone, Telecom and 2degrees, and maybe even their customers. And the government, too, stands to get something out of it.

How can so much goodness flow from a single policy decision? It's just one of those happy outcomes of digital technology entering the invisible world of radio waves.

The policy decision in question is the announcement three weeks ago of November 2013 as the date for digital switchover (DSO), signalling the end of analogue TV transmission. That's sooner than the National Party allowed itself going into the 2008 election, when it said it would make the switch by 2015.

It comes sooner because of the speed with which New Zealanders have adopted digital TV, either as paying subscribers or watchers of free-to-air Freeview. It means New Zealand is falling into line with other countries that are making the switchover, such as Australia, the United States, Britain and European nations. All are now plotting what to do with the digital dividend spectrum - the block of radio frequencies in the 700MHz band that is freed up by turning off analogue TV.

"Every country is heading pretty much down the same route," says Brian Miller, radio spectrum policy and planning manager at the Ministry of Economic Development. "The intention is that it's generally used for the next generations of mobile phone technology, which is nominally 4G."

The technology that is making all the running is LTE, or long-term evolution, which is a follow-on from the current 3G-type technologies. Vodafone is already champing at the bit. The DSO decision "will enable ultra-fast broadband on wireless", says Vodafone New Zealand boss Russell Stanners.

And, indeed, 4G services are a match for the speeds that the government's ultra-fast fibre-optic broadband network will deliver.

"This technology is capable of delivering speeds of between 100Mbit/s and 200Mbit/s - five to 10 times faster than the maximum broadband speeds we see today," says Stanners.

"The impact these kinds of speeds will have on productivity both in urban and rural New Zealand is profound and will help New Zealand compete on the world stage."

Great expectations like those led to "crazy prices" being paid overseas when 3G frequencies were auctioned off, says Miller. In Britain, five bidders paid a total of £22.5 billion ($48 billion).

"I guess you'd like to think that some of the bidders overseas have learned the lessons of history. We haven't seen that sort of activity in New Zealand. Spectrum [here] has been relatively affordable; reasonably rational numbers is probably the way to describe it in New Zealand, compared to one or two auctions overseas where there have been some quite crazy numbers."

How the digital dividend frequencies might be divided up and sold, and whether Maori should be allocated some, will be the subject of a paper to go to Cabinet by the end of next year.

The attraction of the 700MHz band is that signals transmitted at those frequencies have a longer range and penetrate buildings better than those in the higher 2.5 to 2.7GHz range, also used for 4G. With a need for fewer cell sites, networks are comparatively cheap to build. When the Government announced the DSO date, Broadcasting Minister Jonathan Coleman put a figure on potential economic benefits to the country in the range of $1.1 billion to $2.4 billion over 20 years. "Countries the world over are going through the same process and by achieving DSO it means New Zealand keeps pace with technological developments," he says.

If there's a cost, it's the price of the set-top box and aerial for those who aren't yet watching digital TV. At up to $300, that's a small dent in the digital dividend.

TV's half-century

When the switchover to digital-only television happens in 2013, it will be more than 53 years since regular TV broadcasts began in New Zealand. While experiments had been going on for decades, the first regular broadcast - received only in the Auckland area - was on June 1, 1960.

Anthony Doesburg is an Auckland technology journalist.

- NZ Herald

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