Beyond switchoverthe future technical evolution of digital terrestrial television in Australia Discussion paper

JANUARY 2012

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Executive summary
Purpose Approach
Chapter 1introductory question Chapter 2technological innovation issues Chapter 3technological migration options

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1 1
1 2 2

Scope Submissions

2 3

1. Introductory question
Meeting the challenge of ever-improving technical standards The ACMAs role
The technology standards ecosystem Approach to regulatory intervention

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4 5
6 7

Approach Scope
Timing Subject matter Remit

7 8
8 8 9

2. Technological innovation issues

Broadcast technical standards DTTB platform standards
Implications of new platform standards

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10 10
12

DTTB service standards

Implications of new service standards

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13

Pressure for change in Australia

Multiplex capacity in Australia Platform standards currently used in Australia Service standards currently used in Australia Receiver readiness in Australia

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14 15 16 16

3. Technological migration options

Supplementation and replacement
Examples of technology supplementation and replacement

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Options for implementing MPEG-4 and DVB-T2 Transmission-side implementation

MPEG-4 technology path MPEG-4 regulatory path DVB-T2 technology path DVB-T2 regulatory path

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21 22 24 25

Receiver-side implementation
Potential ACMA interventions

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Options for implementing 3DTV, audio description and other service standards

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Invitation to comment
Issues for comment Making a submission
Effective consultation Publication of submissions Release of submissions where authorised or required by law

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29 30
30 30 30

Appendix Athe ACMA approach to regulation

ACMA role Graduated approach to intervention in DTTB standards
Non-regulatory Self-regulation Co-regulation Direct regulation

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32 33
34 34 35 35

Executive summary

Purpose
In the 10 years since digital terrestrial television broadcasting (DTTB) commenced in Australia, there has been rapid evolution in DTTB platform and service standard technologies. Other early adopting countries have acted to supplement DTTB deployments as previous technologies have been superseded and new or enhanced capabilities become available. Countries that are only now making the move to digital television are taking full advantage of new versions of tried and proven standards. As Australia nears completion of the switchover from analog to digital terrestrial television broadcasting, and the associated restacking of digital television services is due to take place, it is timely for the ACMA to look to the future and consider whether there is anything the regulator should do to manage the progression to new DTTB technologies over the next decade and beyond.

Approach
The ACMA seeks industry and community comment on the post-switchover, postrestack technical evolution of digital terrestrial television broadcasting (DTTB). The ACMA seeks input on the drivers for change, the paths for implementing change and whether intervention by the regulator is necessary. This paper is designed to encourage discussion by outlining information about the current state of DTTB standards evolution and inviting comment on the following: Introductory question (Chapter 1)should the ACMA do anything to meet the challenge of ever-improving technical standards? Technological innovation issues (Chapter 2)what issues does technological evolution raise and is there pressure for change in Australia? Technological migration options (Chapter 3)what are the potential options for promoting standards migration and how might they be implemented?

The purpose of commencing early consultation on standards evolution is to identify what, if any, short- to medium-term interventions may yield benefits in the long term. The ACMA is interested in exploring actions that may be needed now to foster or create the conditions for the realisation of benefits for the Australian community. Should proposals for change emerge from consultation on this discussion paper, the ACMA will undertake further public consultation before taking action. Chapter 1introductory question Chapter 1 poses the preliminary question underpinning this discussion paper: Should the ACMA do anything to meet the challenge of ever-improving technical standards? The ACMA seeks comment on what, if any, actions it might take to facilitate the progression to new DTTB technologies, how best to balance the costs and benefits of evolution in technical standards and whether principles with specific relevance to technical migration should be developed. The role of the ACMA in the DTTB standards environment, which is characterised by international activity, market considerations and industry self-regulation, is outlined in this chapter.

The approach the ACMA is taking to address the preliminary question is set out, along with an outline of the scope of topics under consideration and the consultation process. Chapter 2technological innovation issues Chapter 2 provides information on the status of technological evolution in television standards and considers whether these innovations are creating pressure for change in Australia. Some recent developments in technological standards are canvassed, as are the benefits they could offer broadcasters and audiences in terms of additional capacity for new or enhanced broadcasting services. The implications of the use of the more efficient next generation platform standardsMPEG-4 and DVB-T2are considered as current examples. The paper also briefly explores the new service standard enhancements that enable 3DTV and audio description. Information on the status of transmission capacity and receiver readiness in Australia is set out as context for ascertaining whether there is pressure for standards evolution in Australia, and whether any problems or issues would benefit from anticipatory action by the ACMA. The ACMA wants to understand what new platform and service standards or content it is anticipated broadcasters will want or need to carry, and why and how this might translate into pressure for change and drive standards migration. Chapter 3technological migration options Chapter 3 presents some options for implementing technology migration by examining potential interventions on both the transmission and receiver sides. Technical and regulatory pathways are considered, along with related push and pull factors that work together to influence the success rate of implementation. In general, the ACMA is not disposed to any particular course of action at this stage. The discussion in this chapter is to inform the ACMAs understanding of potential options as well as to guide public and industry submissions about which options the ACMA should pursue, if any. However, in the specific case of the supplementation or replacement of current broadcaster service offerings with MPEG-4, the ACMA is signalling a preliminary disposition. It would be concerned by any broadcaster proposal likely to have a significant impact on the range or quality of services available to viewers with legacy receivers during the switchover and restack periods. The ACMA is interested in obtaining a better understanding of broadcaster thinking around further introduction of MPEG-4 transmissions onto existing multiplexes.

Scope
This paper starts a discussion about some of the issues for the future technical migration of free-to-air DTTB. While the discussion paper and consultation is intended to be broad-ranging, certain matters are outside their scope. In terms of timing, realising the digital dividend is a key policy objective for the government and the ACMA does not envisage that any action that would have a negative impact on the digital conversion and restack processes may be undertaken. Steps to facilitate future technical evolution may be taken if they do not negatively affect these processes. In terms of subject matter, this paper is concerned with standards that relate to free-toair terrestrial digital television transmission and reception. However, the paper takes note of the ongoing evolution of television receivers, from purpose-built devices designed to show free-to-air television into multi-purpose displays for a proliferating range of home entertainment. Noting that developments in free-to-air television standards are no longer the only drivers of receiver evolution, the paper invites

submitters to consider whether standards development in any other areafor example, in point-to-point, online delivery of television programs after they have been transmitted free-to-airshould also come into scope, and if so, why. In terms of remit, while technologies or technical migration strategies that might require additional spectrum can be considered within the scope of this paper, decisions about the future use of vacant spectrum are, in general, for the government rather than the ACMA to make.

Submissions
The ACMA is interested in hearing from organisations and individuals with views on: where the potential for technological change may lie whether or not change would be worthwhile what the potential benefits from any such change may be how change might be effectively managed, should it occur.

Submissions on this first discussion paper close on Friday 30 March 2012. A number of specific questions are presented in this discussion paper, but submitters are invited to make any other comments. For further information about making a submission, go to the Invitation to comment section.

1. Introductory question
A decade after the successful choice of the Digital Video Broadcasting Project (DVB) family of standards in Australia, the ACMA believes it is timely to begin a dialogue with interested parties about whether, where, when and why they expect pressures to augment current standards for digital terrestrial television broadcasting (DTTB) to arise. The question underpinning this discussion paper is whether the ACMA should do anything to meet the challenge of ever-improving technical standards. Consequently, is there anything that needs be done in the short term to promote the progression to new DTTB technologies in the longer term?

Meeting the challenge of ever-improving technical standards

The method of transmission and reception of analog television in Australia remained relatively stable for almost half a century, from its introduction in 1956 until 2001. Enhancements to picture quality, screen size and audio were gradual and innovations relatively few, ranging from teletext and closed captioning to the introduction of colour in March 1975. This slow pace of technological change is a striking feature of analog television, to the point that a television set purchased in 1956 could still be used today, wherever VHF analog television signals are still available. The introduction of digital television opened the door to a range of enhancements to television. It promised not only improved quality of standard television fare but also a wider range of different and more versatile services. Digitalisation has enabled broadcasters to offer enhancements including: wide-screen and high definition television (HDTV) picture formats cinema-quality sound multichannels electronic program guides.

It has also created the potential for much more rapid future evolution of technical standards than in the past. Before the 2001 commencement of DTTB in Australia, the government and broadcasters assessed the competing technical standards of the day and chose DVBT from the DVB family of open standards. Adoption of DVB has served Australia well. From its European origins, DVB has been extensively adopted worldwide, benefitting Australians through economies of scale in the manufacture of both receivers and head-end equipment. Combined with the allocation of a full, 7 MHz channel to each broadcaster in each area, the choice of DVB-T and MPEG-2 has delivered a terrestrial free-to-air network that is already able to deliver the high definition (HD) services that some overseas television audiences are only now experiencing through the introduction of later versions of these technologies. There are indications that the digitalisation of free-to-air television transmission and delivery has exposed the medium to the comparatively rapid evolution of technical standards traditionally associated with the computer and IT industries. In the decade since 2001, the consortium responsible for creating DVB standards has developed a more spectrally efficient successor to DVB-T and the Moving Picture Experts Group, developers of the MPEG suite of standards, has developed a later and improved version of the MPEG-2 encoding standard. These successor standardsDVB-T2 and MPEG-4offer large improvements in the spectral efficiency of DTTB. Migration to these standards could in theory allow broadcasters to deliver much more digital content to viewers, or the same amount of content using less spectrum.

Overseas, some other digital television early adopting nations have already chosen to augment their DVB-T/MPEG-2 television platforms with MPEG-4 and, in some cases, DVB-T2 as well. A common motivation has been to accommodate new, highbandwidth applications, such as HDTV. Although Australias large spectrum allocations to individual broadcasters have already delivered capacity for HDTV, the pressure to upgrade standards is beginning to emerge in other ways: MPEG-4 functionality is increasingly a feature of most television receivers sold, reflecting widespread adoption of MPEG-4 in other countries and for other content platforms. Most broadcasters are operating full multiplexes, meaning their capacity to add more content is constrained. In the short term, substituting MPEG-4 for some MPEG-2 content offers a way to offer more content using fewer bits. The recent trials of 3D television have highlighted the potential, in the longer term, for new formats to emerge that cannot be accommodated on existing DVBT/MPEG-2 multiplexes.

There is also anecdotal evidence that television lifecycles are decreasing, with consumer pressure for new features and enhancements being a driving force for continuous technological development. As a digital television early adopter, Australia faces the challenge of whether and how to take advantage of the increased efficiency offered by more recent digital television platform technologies while minimising disruption to viewers and costs to broadcasters. The benefits of permitting technology evolution include the capacity to provide more and/or enhanced television services in an environment where spectrum is a finite and very valuable public resource. Increased transmission capacity for broadcasters could create new opportunities within existing spectrum allocations. These opportunities could include introducing additional standard definition (SD) multi-channels, upgrading existing services to HDTV, and introducing services, such as 3DTV or accessibility services, for example, audio description (AD). These opportunities, while opening the door for new revenue models for broadcasters, will also carry the additional costs of upgrading transmission infrastructure and higher acquisition charges for premium content. Advantages are not limited to broadcasters, with viewers benefitting from the social cohesion, information and sense of belonging brought about through a vibrant and effective free-to-air transmission sector. Benefits can include access to a greater number of services and the implementation of services that speak directly to accessibility and social equity issues. Conversely, the deployment of new digital television platform technologies or new content formats can leave viewers behind when the new technologies and formats are incompatible with the existing population of digital set-top boxes and integrated digital television receivers. To address the challenge, the ACMA wants to start a dialogue with industry and the community about what the regulator should do, if anything, to take advantage of or facilitate technical evolution in the post-switchover, post-restack DTTB environment in Australia.

The ACMAs role

As Australias communications regulator, the ACMA has wide powers to make mandatory technical standards, register industry-developed codes of practice and monitor and participate in standards-setting processes relating to digital television

broadcasting. For broadcasting services, the ACMA has a legislated role in providing a regulatory environment that: enables public interest considerations to be addressed in a way that does not impose unnecessary financial or administrative burdens on providers of broadcasting services and datacasting services will readily accommodate technological change encourages the development of broadcasting technologies and their application encourages the provision of services made practicable by those technologies to the 1 Australian community. The ACMA also has a key role in managing Australias radiofrequency spectrum. In this role it must, among other things, endeavour to maximise the efficient allocation and use of the spectrum to realise the greatest public benefit while maximising opportunities for Australian industry. Migration to more spectrally efficient technologies is a relevant consideration in the ACMAs strategies for spectrum management in the broadcasting sector. The technology standards ecosystem Australia chooses its DTTB technology standards within a global standards ecosystem comprised of interconnected international, national and industry standards-setting activities. The needs of industry, both domestic and worldwide, help to drive the evolution of standards. In turn, the completed standards will shape the activities and behaviours of broadcasters, manufacturers, importers and retailers. At the international level, standards and specifications are developed collaboratively by bodies representing a range of industry, government and consumer group stakeholders. The aim of such standards-making is to provide a common technology reference point for industry, with the goal of widespread adoption, in whole or in part, by national administrations. At the national level, various stakeholders with interests in DTTB contribute to the adoption or modification of standards and specifications that follow international norms but also address domestic issues and concerns. It is important that Australian standards makers pay close attention to the international context, otherwise technical migration in Australia may fall out of step with international practice and industry and consumers will lose the many benefits of harmonisation, such as economies of scale in the manufacture of equipment. The ACMA can, if appropriate, engage at the international level to try to ensure Australian considerations are built into international standards. At a domestic level, the ACMA monitors and participates in local standards-setting activities to ensure consistency with specific government policies or the wider public interest. If required, it has the power to mandate standards and specifications created at the international or national levels or, if no appropriate standards exist, to determine its own standards to address public policy issues. A key issue for the ACMA is whether to allow economic forces to operate while monitoring events, or to intervene in order to guide or direct the technological development of the terrestrial broadcasting network. Implementing new platform and service standards in Australia would directly affect many stakeholders including freeto-air broadcasters, audiences and manufacturers and vendors of reception equipment. It also has the potential to affect, to a lesser extent, stakeholders that support the broadcasting sector including content providers and developers. Although any change will give rise to both costs and benefits, the objective of standards-setting
1

Subsection 4(2) Broadcasting Services Act 1992 (BSA).

should be to realise the greatest public benefits and minimise costs while maintaining the viability of the broadcasting and equipment supply sectors. Approach to regulatory intervention In pursuing its strategic intent to make communications and media work in Australias public interest, the ACMA sees itself as undertaking three key activities communicating, facilitating and regulating. In the area of technical migration, the ACMAs role is as much to communicate and facilitate as it is to regulate. The ACMA takes a graduated approach to market intervention. Prior to taking action, the ACMA will examine which of the available approaches best promote the introduction of new technologies. The ACMA may utilise non-regulatory approaches (such as research, education and participation in industry standards-making committees), self- or co-regulatory approaches (such as requesting the development of an industry code) or direct regulatory options (such as mandating a standard or 2 licence condition). Examples of ACMA intervention in the technical standards arena include undertaking research on receiver penetration, educating consumers on the choice of services available, and examining changes to the digital television receiver standard. It may also consider other measures that might limit or cap the uptake of television receivers that do not support the next generation of television technologies. The ACMA plays a significant part in industry standards development. Standards developed by industry only become a regulatory instrument if determined as a mandatory standard by the ACMA. While the ACMA has powers to accelerate or facilitate technical migration those same powers can be exercised, if required, to limit any technical migration until a later date. In considering its approach to regulation, the ACMAs decision making is always informed by the principles of good regulatory process that are endorsed by government, developed by the 2005 Taskforce on Reducing Regulatory Burdens on Business and have now been incorporated into the Best Practice Regulation 3 Handbook. The principles of good regulatory process are broad in application and are consistent with policies articulated in the Broadcasting Services Act 1992. However, there is a further question: Are there other more specific principles that should be considered in regard to regulation of technical migration? For example, in the past, factors such as backward compatibility, economic efficiency and investment certainty for network operators and consumers have been relevant. As the ACMA thinks about an increasingly complex technical environment, it is considering whether these considerations remain relevant, or whether there are other matters it should be taking into account. Information about the ACMAs approach to regulation, including different regulatory mechanisms and their respective enforcement options, and the principles for good regulatory process, is in Appendix A.

Approach
To assist in meeting the challenge posed by ever-improving technical standards, the ACMA hopes to initiate a discussion about the future evolution of digital terrestrial television technologies in a post-switchover, post-restack environment. Information
2

The ACMA approach is laid out in the occasional paper Optimal conditions for effective self- and coregulatory arrangements, September 2011, www.acma.gov.au/WEB/STANDARD/pc=PC_410165. 3 The handbook is available at the website of the Office of Best Practice Regulation at www.finance.gov.au/obpr/proposal/gov-requirements.html.

provided by stakeholders will enable the ACMA to consider whether action in the near term could ease the introduction of service standards or transition to platform standards in the longer term. If appropriate, it will also generate a set of principles that will be considered when addressing technical migration issues. The ACMA seeks input on the type of anticipatory action it should take, if any, to promote the progression to new DTTB technologies. The ACMA is calling for comment on the following: 1. 2. 3. Introductory question (Chapter 1)should the ACMA do anything to meet the challenge of ever-improving technical standards? Technological innovation issues (Chapter 2)what issues technological evolution raises and whether there is pressure for change in Australia. Technological migration options (Chapter 3)what are the potential options for promoting standards migration and how might they be implemented?

Specific questions for comment can be found in the Invitation to comment section. This discussion paper is the first step in a consultation on the technical evolution of DTTB beyond switchover in Australia. While changes in television platform or service standards are realistically some distance off, the value in exploring the issue now is to identify what, if any, interventions in the short to medium term may yield benefits in the longer term. The ACMA has not yet formed any views on whether specific paths should be adopted. This discussion paper does not canvass or pre-empt any particular outcome. Rather, it marks the beginning of consultation with industry and the community on the implications of technical evolution and the potential for migration to new DTTB standards over time. Should proposals for change emerge from consultation on this discussion paper, the ACMA will undertake public consultation before taking any action.

Scope
This paper examines the future technical migration of free-to-air digital terrestrial television broadcasting. While it is broad ranging, certain matters are outside the scope of this paper in terms of timing, subject matter and remit. Timing This paper is directed at the post-switchover and post-restack digital terrestrial television environment. Successful completion of the switchover from analog to digital television is in the public interest and is a key policy objective for government, including for the ACMA. The ACMA acknowledges that government does not propose any move to a new standard before switchover is completed and recognises that no action should be taken that would have a negative impact on the digital conversion and restack, for example, discouraging uptake of existing digital receivers, which is 4 expected to be completed by 2015. However, steps to facilitate technical evolution in future may be taken if they do not affect the switchover. Subject matter This paper concerns digital terrestrial television and does not attempt to canvass implementation paths for other broadcasting delivery platforms such satellite television, IPTV, mobile television or digital radio. While these delivery platforms are

The Department of Broadband, Communications and the Digital Economy, Digital Dividend Green Paper, 2010, available at www.dbcde.gov.au/__data/assets/pdf_file/0005/125267/Digital_dividend_green_paper.pdf.

useful points of comparison to digital terrestrial television, discussion of standards evolution for these platforms are not considered within this paper. While the ACMA has chosen to focus on DTTB, it notes that terrestrial television standards are not the only thing that will shape the future evolution of television. Convergence is seeing major changes to the domestic TV set. Originally a purposebuilt receiver for free-to-air TV transmissions, TV sets are increasingly multi-purpose displays for a proliferating range of home entertainment, either with or without the 5 addition of plug-ins such as pay TV STUs, PVRs, DVDs or games consoles. The ACMA acknowledges that developments in the DVB-T family of standards for free-toair television are no longer the only drivers of receiver standards evolution. For example, we are starting to see free, point-to-point, online delivery of television programs after they have been transmitted free-to-air, via services such as the ABCs iview service. These developments suggest the significance and influence of online television standards development, such as HBB (hybrid broadcast broadband), might increase over coming years. The ACMA invites comment on whether the present scope of the paper is right, or whether it should also be taking account of the evolution of other standards, and if so, why. Examination of technological evolution in digital television broadcasting may inform other work in a converged communications environment. While the ACMA has not attempted to develop a set of principles for technological evolution or technological migration, we welcome any comments on whether general principles might be applicable, and will consider this as part of our overall review of innovation in DTTB. Remit Some industry participants have already proposed that certain of the technological developments outlined in this paper would be best achieved in an environment where additional spectrum is available. While the ACMA has wide powers to mandate digital television standards, the assignment of broadcasting bands spectrum is a matter for the government. While technologies that might require additional spectrum can be considered within the scope of this paper, whether that spectrum is available is a matter for the government. The ACMA is seeking submissions on: 1. 2. 3. Should the ACMA do anything to meet the challenge of ever-improving technical standards? The approach and scope of this discussion paper. Are there principles that should be codified for the regulation of technical migration, within the framework set by the principles for good regulatory process? What factors should these principles consider?

For further information about making a submission, go to the Invitation to comment section.

STUs: set-op units; PVR: personal video recorders; DVD: digital versatile disc.

2. Technological innovation issues

This chapter outlines the recent technological evolution of television standards and the benefits they may offer broadcasters and audiences in terms of capacity for additional, new or enhanced broadcasting services. The implications of the more efficient next generation platform standards MPEG-4 and DVB-T2 are considered, as are new service standard enhancements that enable services such as 3DTV and audio description. These are two of the technologies which are known candidates for adoption in Australia. Information on the status of transmission capacity and receiver readiness in Australia is set out as context to the question of: whether recent technological innovations are creating pressure for change in Australia why change might be necessary or desirable whether the ACMA should consider taking any anticipatory action to assist with change.

Broadcast technical standards

Broadcast technical standards, such as MPEG-2, DVB-T and their successors, can be compared to technological toolkits from which systems designers are able to select what they need. In general, the major technical standards are developed through consensus-driven processes conducted by standards development organisations with open membership. For example, DVB standards are developed by the Digital Video Broadcasting Project, an industry-led, international consortium of around 250 broadcasters, manufacturers, network operators, software developers, regulatory bodies and others. However, a range of other documents can perform a standards-setting function. Similarly, the ACMAs powers (discussed later) to mandate technical standards are broad and allow the ACMA to adopt a range of technical documents. Other documents that could perform a de facto standards function include: proprietary standards requests for comments (RFCs) developed by the Internet Engineering Task Force (RFCs are often a precursor to technical standards) the operational practices engineering guides maintained by Australian broadcasters.

In this paper the term technical standard has been used broadly. For the purposes of the following discussion, we have treated broadcast technical standards as falling into two general typesplatform standards and service standards.

DTTB platform standards

Platform standards determine the way in which terrestrially based digital television information is transmitted to television receivers over a radiofrequency channel. DVB-T and MPEG-2 (and their successors) are examples of platform standards. The DVB-T standard deals with the method of transmission and reception of television signals, while MPEG-2 deals with compressionthat is, the way television services are packed for carriage via the digital signal for reassembly and display on viewers television screens.

The DVB-T transmission standard, in conjunction with the MPEG-2 video compression standard, has been employed since digital television broadcasting began in Australia 6 in January 2001. DVB-T has become the most widely adopted DTTB transmission 7 standard in the world. Its wide acceptance has led to significant economies of scale, pushing down the price of receivers. DVB-T2 is an emerging platform standard, and is the second generation of the DVB-T 8 terrestrial television system. Many late adopter countries (countries that did not make the early move to DVB-T) are now choosing DVB-T2 for terrestrial services. DVB-T2 can offer substantial transmission efficiencies of 3050 per cent in its use of spectrum 9 compared to DVB-T. The current most commonly used operating capacity of a DVB-T 10 system in Australia is around 23 Mbit/s. Operating in enhanced modes, DVB-T2 can be used to provide data rates of around 38.5 Mbit/s with a signal of very similar robustness or higher data rates up to almost 48 Mbit/s (if robustness is not a consideration). MPEG-4 is a successor to the video compression standard MPEG-2 currently used by Australian free-to-air broadcasters. Switching to MPEG-4 has the effect of increasing the capacity of a 7 MHz channel, enabling more television content to be carried. While it is difficult to give exact values to the compression benefits of MPEG-4 over MPEG-2, the MPEG-4 standard offers substantially increased video and audio coding efficiency through improved compression algorithms that enable it to carry the same digital 11 content at lower bit rates. For example, the use of MPEG-4 may reduce MPEG-2 SD program streams from 46 Mbit/s to 23 Mbit/s, potentially doubling the capacity of any broadcast multiplex. MPEG-4 is a compression standard and does not require a dedicated multiplex. That is it can be incorporated as a compression standard for one or more services within an existing multiplex (for example, MPEG-2 and MPEG-4 encoded services can co-exist) 12 so its introduction is possible without finding additional spectrum. The ability to transmit both MPEG-2 and MPEG-4 services on the same multiplex means that
6

The DVB-T standard was published in March 1997 and adopted by Australia as the technology for DTTB

in 1998 on the recommendation of the DTTB Selection Panel (the panel). The panels recommendation of the DVB-T standard is set out in the June 1998 Federation of Australian Commercial Television Stations (FACTS) publication Digital Terrestrial Television Report of the DTTB Selection Panel, http://happy.emu.id.au/lab/rep/rep/ausdtvsr, accessed 8 June 2011. The panel was established by the FACTS, now known as Free TV Australia. While there is no formal regulation in place to require the use of the DVB-T and MPEG-2 technologies, they were incorporated into the domestic transmitter and receiver standards by Standards Australia for DTTB (The current versions are AS 4599.1 - 2011 Digital television Terrestrial broadcasting Characteristics of digital terrestrial television transmissions) and (AS 4933.1-2010 Digital Television - requirements for receivers. Part 1: VHF/UHF DVB-T television broadcasts). The ACMA identifies the voluntary Standards Australia standard for transmission (AS4599) in its Technical Planning Guidelines. 7 DVB.org, 2010, DVB-T deployment data, www.dvb.org/about_dvb/dvb_worldwide/index.xml, accessed 15 December 2010. 8 First published by ETSI in 2009 (EN 302 755). 9 Estimates of the efficiencies offered by DVB-T2 relative to DVB-T are set out in the DVB-T2 Fact Sheet www.dvb.org/technology/fact_sheets/DVB-T2_Factsheet.pdf, accessed 8 June 2011. 10 This is based on appropriate guard intervals and forward error correction to give a robust signal. 11 MPEG-4 is the generic name for a suite of standards for the recording, compression and distribution of high definition video. The version of MPEG-4 used in terrestrial television receivers is most commonly H.264/AVC or part 10 of the suite of H264 standards and was not published until 2003. 12 MPEG-2 and MPEG-4 encoded services already co-exist on the same multiplex in France, where free-toair services are broadcast via the terrestrial network using MPEG-2 and pay services are broadcast on shared multiplexes on the same network using MPEG-4. More recently, Seven West in Australia has commenced transmission of a MPEG-4 datacasting service as an adjunct to its MPEG-2 broadcasting services in a number of Australian capital cities.

introducing MPEG-4 services might occur within the existing allocation of spectrum to broadcasters. Implications of new platform standards New platform standards have implications for both the transmission and receiver sides. On the transmission side, new platform standards increase the capacity of a DTTB transmitter, which means broadcasters can offer more of the same services or new services. To harness these opportunities, broadcasters may have to bear the cost of upgrading their transmission equipment in order to pursue the benefit of increased or new revenue streams. On the receiver side, new platform standards increase the range of services available to audiences. To take advantage of these opportunities, audiences may have to bear the cost of upgrading their receiver equipment to receive any additional or new services. The primary benefit of a move to more advanced platform standards is the increased data capacity within a single channel. Adopting MPEG-4 for part or all of a multiplex or, over a much longer timeframe, transitioning to DVB-T2, would increase the capacity of the multiplex. Accordingly, new platform standards could permit an increase in the number of SDTV or HDTV multi-channels or services broadcasters would be able to offer, or the transition of existing SD services to HD. While MPEG-4-capable television receivers are backward compatible and able to receive MPEG-2 encoded services, MPEG-2-only devices cannot receive MPEG-4 program streams. Consumer ownership of a large number of MPEG-2 legacy receivers is a significant impediment to early introduction of MPEG-4 as a transmission technology. While MPEG-4 services can be transmitted alongside MPEG-2 services in the same multiplex, none of these MPEG-4 services would be available to legacy MPEG-2-only receivers.

DTTB service standards

Service standards are concerned with what is on display to viewers. SDTV and HDTV can be described as service standards. While almost all digital television worldwide is SDTV or HDTV, new service standards are beginning to emerge internationally, notably services such as 3DTV and Ultra HDTV. 3DTV has already received wide publicity in Australia, with several free-to-air trials held in the course of 2010 in connection with major sporting events. Service standards also describe and specify the features and operation of ancillary services and enhancements to television, such as electronic program guides (EPGs), audio description, closed captioning and interactive services (such as Project Canvass/YouView in the UK). In essence, new service standards offer new or enhanced service functionality. The range of new service standards available is expected to grow over time. Technological advances over the past few years, together with the success of 3D cinema releases such as Avatar, have led to worldwide interest in 3DTV, as well as other equipment that employs 3D technology, such as Blu-ray players and gaming consoles. Common technical transmission and reception standards for 3DTV services 13 are, however, still under development. The trials of free-to-air 3DTV services

13

The European Telecommunications Standards Institutes (ETSI) DVB Steering Board approved the 3DTV specification on 17 February 2011. This will start the process of the development of a standard for 3DTV. See www.dvb.org/news_events/press_releases/press_releases/DVB_pr208-3DTV-Steering-BoardApproval.pdf.

conducted in Australia during 2010 used the frame-compatible delivery system. These trials, reportedly the first terrestrial transmissions in the world, enabled the Australian broadcasting industry to collect information about the production, transmission and reception of 3DTV services using this particular method. They also took advantage of the supply into Australia of reception equipment that was compatible with the 3D standard but still suitable for non 3D reception. 3D transmission, especially of high quality HDTV services, uses a considerable amount of capacity within a multiplex. The Australian trials showed data rates up to 14 Mbit/s in MPEG-4 transmission streams within the DVB-T multiplex, consuming more than half 15 of the capacity of the DVB-T multiplex considerably higher than current HD services. Ultra HDTV (also identified as Super Hi-Vision or Ultra HD) is a format of television that allows for screen resolutions some 16 times the pixel density of HDTV. Though still in its development phase led by NHK Science & Technical Research Laboratories, Ultra HD is a technology that some industry participants have predicted may see 16 limited use in home A-V equipment by 2020 and broadcast by 2025. Demonstrations of Ultra HDTV in 2007 required compressed video capacities at almost 12 times the capacity of a current DVB-T multiplex in Australia. Utilisation of Ultra HDTV as a FTA broadcast service would require significant changes to Australian DTTB infrastructure. The ACMA sees audio description (AD) as a significant service enhancement for members of the disability community. AD improves the accessibility of DTV services for people who are vision impaired by providing a descriptive audible narration of the visual elements of a television program. AD has the potential to offer significant benefits for the vision-impaired and is championed by a number of disability 17 representative bodies within Australia. The introduction of AD was a key 18 consideration in the Australian Governments December 2010 Media Access Review. AD comprises the addition of a single mono audio track to the transport stream. In its submission to the ACMA discussion paper on 3DTV, Media Access Australia noted the additional data overheads for AD inclusion into the average 23Mbit/s capacity of a multiplex would only consume between 64 and 192 kbps, depending on the type of AD 19 in use. Implications of new service standards As is the case with platform standards, service standards have both cost and benefit implications on both the transmission and receiver sides. On the transmission side, new service standards increase the range of service offered, and broadcasters may exploit new revenue streams but may have to upgrade their transmission equipment to pursue such benefits. On the receiver side, service standards can offer benefits for consumers and potentially society generally, though audiences would need to acquire compatible receivers. New service standards can provide viewers with benefits through improved access and additional features that give rise to social benefits. New service technologies may come in the form of complete stand-alone formats or as service enhancements that are complementary to existing services. New, stand-alone services include formats

14

14

An explanation of 3DTV technology, including the frame compatible delivery system, is provided in the ACMAs discussion paper, Temporary trials of 3D TV and other emerging technologies, September 2010, www.acma.gov.au/WEB/STANDARD/pc=PC_312252. 15 The 2010 trials used 14 Mbit/s of capacity using MPEG-4 (or over 50 per cent of a single DVB-T multiplex operating in 64QAM mode). 16 ACMA Radcomms09, Foundations for the future presentation by Andrew King, Ten Network, www.acma.gov.au/webwr/_assets/main/lib310814/tv_new_technologies-a_king.pdf. 17 Both Media Access Australia and Vision Australia have indicated strong support for the incorporation of AD into Australian FTA television services. 18 www.dbcde.gov.au/television/television_captioning/media_access_review 19 www.acma.gov.au/WEB/STANDARD/pc=PC_312252

such as 3DTV, while new service-enhancement technologies include improved accessibility services such as audio description. HDTV can attract viewers to particular programming (for example, sports or feature films) through its high visual quality and can be an incentive for the take-up of new reception equipment but requires both an HDTV tuner and receiver display of sufficient 20, 21 resolution to enjoy its benefits. The impact of the introduction of 3D services on broadcasters and viewers will be affected by the choices made in relation to the type of 3D adopted and the underlying platform standards. The introduction of any 3D service standards can be expected to see financial costs incurred by broadcasters in relation to infrastructure and transmission capacity, and on viewers through the necessity to acquire 3D capable receivers. The ACMA notes that, while current 3D receivers are expected to have a useful life of years, they may not be compatible with possible future 3D transmissions systems (for example, transmissions that allow for glasses-free 3D). Similarly, the implementation of audio description services would require viewers to have reception equipment compatible with the AD format selected for use in Australia (anecdotally there is a proportion of equipment currently in use capable of receiving AD, though the extent to which older digital receivers may have AD capacity is unknown). For broadcasters, the migration to a new service standard would involve additional overheads in relation to implementation of broadcasting capability (for example, cameras and transmission infrastructure to support 3D or Ultra HDTV services), acquisition and production of content (for example, 3D or audio described content) and spectrum requirements associated with the transmission of the additional data streams within their DTTB broadcasts.

Pressure for change in Australia

The ACMA is interested in exploring what, if any, pressure for change is emerging in Australia, given Australian broadcasters enjoy greater multiplex capacity than their overseas counterparts currently do. While early adopters in other countries are now moving to augment their services, the ACMA notes this is largely driven by capacity constraints not faced by broadcasters in Australia. The pressure to adopt new service or platform standards generally arises where a change might benefit industry business models, by allowing new or more services using new or existing formats, or where viewers seek access to additional services or enhanced services. The ACMA is interested in exploring what, if any, drivers for change exist in Australia. Multiplex capacity in Australia Australias size, sparse pattern of settlement and geographical isolation gave it the choice, not available to its European counterparts, of allocating a whole 7 MHz DVB-T multiplex to each broadcaster. This has given Australian broadcasters greater transmission capacity than their overseas counterparts since 2001. This means Australian broadcasters have not been as constrained technically in their digital offerings as broadcasters in many other countries (though some other countries, notably the US, also gave broadcasters a full channel). Some of these countries are
20

Ofcom, The Future of Digital Terrestrial Television - Enabling new services for viewers, 2007, http://stakeholders.ofcom.org.uk/consultations/dttfuture, accessed 17 December 2010. 21 Programming recorded in a standard definition format can be converted to HD prior to transmission in a process called up-converting, although true native HD quality is only achieved when the original production has been made in HD as well.

now augmenting their broadcasting systems with the new standards to meet demand for HDTV, whereas in Australia, broadcasters have been able to transmit HDTV as well as SDTV since the inception of digitisation. It follows that the Australian situation of relative spectrum abundance is likely to have reduced the pressure for augmentation of existing technical standards, compared to many other countries. It is also unclear when pressure for standards evolution in Australia will emerge or what form it will take. Currently, all free-to-air broadcasters operate their multiplexes in a manner that sees them operated at or near maximum capacity. This leaves little or no spare bandwidth with which to introduce new services without affecting the suite of services currently on offer. Without upgraded platform standards, substantial amounts of additional materialwhether SDTV, HDTV, datacasting or new service standardscannot be added without changing the capacity used by existing services. Once the digital conversion and analog switch-off of terrestrial television around Australia is complete, free-to-air broadcasters will have greater freedom to decide the number and picture quality of television services they wish to provide. Some of the current regulatory settings that influence the range of services offered by broadcasters will lapse, notably the quota on HD programming; it is at this time that pressure for 22 change may start to materialise. Meanwhile, the ACMA is keen to improve its understanding of potential drivers or incentives to upgrade standards. Possibilities include: transmission of more of the same, for example, additional SDTV multichannels, or datacasting; or upgrading more content to HDTV transmission of new service standards, for example, 3DTV contingency planning for longer-term service enhancements in general, on the assumption something will emerge

Gaining a better understanding of broadcaster and wider industry expectations and motivations for upgraded standards, including a sense of the nature and timing of any desired enhancements, will affect how ACMA responds to the challenge of standards evolution. Platform standards currently used in Australia DVB-T and MPEG-2 are the platform standards currently in use in Australia, although the use of MPEG-4 is currently optional under the current standards and there has been some limited use of MPEG-4 to date (this issue is discussed further in Chapter 3). It is possible to transmit both MPEG-2 and MPEG-4 coded services using the same DVB-T multiplex. This means it is technically feasible for existing broadcasters to supplement their current transmissions with MPEG-4, although most would face the practical problem that they are fully utilising their multiplexes. This means the data capacity used to transmit MPEG-4 services might need to be freed up by making changes to existing MPEG-2 services. Issues and options for supplementation or replacement of existing MPEG-2 content with MPEG-4 are discussed in more detail in the next chapter.

22

HDTV quotas end at the end of the simulcast or simulcast-equivalent period in each licence area. Quotas are specified in Part 4 of Schedule 4 of the BSA.

Service standards currently used in Australia Currently, most broadcasters use their multiplex capacity to provide at least two SD services and one HD service. This may change when regulations specifying the HD 23 programming quota expire at the end of the simulcast period in each licence area. In 2010, there were trials of free-to-air 3D television services in several Australian cities. Although international experience to date suggests that 3DTV will mainly be provided by subscription services, the free-to-air trials generated considerable viewer interest. Given that multiplexes are being operated at near maximum capacity, 3D services on an existing broadcaster multiplex, using current platform standards, could only be achieved by limiting the number of other streams of television programming carried to one, or at most two, for the duration of the 3D transmission. For this reason, the ACMA does not anticipate much interest in the carriage of 3DTV on existing national or commercial television broadcasting services, unless at some future date multiplex capacity increases considerably, for example, through large-scale implementation of MPEG-4 or DVT-T2 platform standards. Receiver readiness in Australia Receiver readiness refers to the proportion of receivers that are already in the market and compatible with new standards. The state of receiver readiness in Australia is a factor in assessing whether there is pressure for a change in technical standards. The presence of large numbers of legacy receivers that are not compatible with emerging new standards may impede the introduction of new platform standards. Depending on how the new standards are introduced, viewers using legacy devices would not benefit or could even lose existing services. Conversely, low numbers of compatible receivers may deprive broadcasters of a large enough audience for services that use the new standard. The ACMA would like to improve its understanding of two factors that are relevant to receiver readiness in Australia, namely: viewer expectations and behaviour around the lifespan of television receivers the percentage of receivers already in the market that are compatible with new platform or service standards.

ACMA-commissioned research suggests that viewers expectations on TV set life are that digital television receivers will need replacement, on average, every seven and a 24 half years. This level of churn, if combined with incorporation of upgraded standards in all new receivers sold, would mean that any legacy receiver issue would eventually resolve itself. The ACMA would like to improve its understanding of the implications of churn for the introduction by broadcasters of new standards in the longer term. For example, given current rates of churn, in what circumstances would it be reasonable for broadcasters to begin to reduce services to legacy receivers in order to offer improved services using upgraded standards? In terms of current receiver compatibility with new platform standards, anecdotal evidence suggests a growing trend since mid 2008 for television receivers sold in Australia to be MPEG-4-capable, with most television sets now sold potentially able to display MPEG-4 content (MPEG-4-capable receivers are backwards compatible to MPEG-2). This trend appears to have been driven by the finalisation of the MPEG-4

23

The predominately metropolitan-based nature of network programming means that the end of the simulcast periods in the metropolitan cities will likely determine when HD programming is re-evaluated generally. This will be an important time for broadcasters who may decide to replace HD content will several SD services. 24 ACMA, TV Set Consumer Expectations Survey study, part of the Newspoll omnibus study 2729 May 2011 (unpublished).

standards and the introduction of MPEG-4 into a number of major markets. Other contributing factors may include: the requirement for MPEG-4 compatibility under the Australian Broadcasters freeview digital television labelling scheme the provision of MPEG-4-capable devices under the governments Household 25 Assistance Scheme.

While the ACMA has not seen a reliable estimate of numbers, it would appear MPEG4-capable devices already constitute a substantial quantity of the current receiver population. For other platform standards, even though also potentially backward compatible, it is likely that DVB-T2 equipment availability is very low, if not nonexistent, because that technology has only been standardised relatively recently and DVB-T2 devices are not yet widely available. It is possible DVB-T2 uptake and penetration on the receiver side will follow the same path as MPEG-4 in future, driven by the international settlement of the standard and its adoption in other receiver markets. With development of Ultra-HD at a very early stage, the only emerging new service standards likely to be incorporated into current receivers are 3DTV and AD. Media reports and anecdotal evidence suggests that a significant number of television receivers sold in the Australian market are 3D enabled, however industry sources indicate that these constitute only a small fraction (approximately four per cent) of the 26 total number of receivers sold. The percentage of AD capable receivers is unknown however anecdotally there is a significant proportion of equipment currently available that is capable of receiving AD. The ACMA wishes to improve its understanding of the uptake and penetration of receivers that are compatible with new platform or service standards. In addition to the overarching question for this chapter: 4. What issues does technological evolution raise and is there pressure for change in Australia? Whether Australia should be planning to introduce upgraded platform or service standards for DTTB, and if so: which standards? how quickly? why? 6. 7. Whether the ACMA should consider any other technical standards than those canvassed in this chapter. The rate of uptake and penetration of television receivers that are compatible with more advanced standards, including future prospects and any other issues that are relevant. The expected useful life of legacy digital television receivers, including the length of time required before replacement of MPEG-2/DVB-T content can be expected to be uncontroversial.

the ACMA seeks submissions on: 5.

8.

For further information about making a submission, go to the Invitation to comment section.
25

Freeview Australias digital television technical requirements currently specify MPEG-4 compression and all set-top boxes provided under the governments Household Assistance Scheme (HAS) are also MPEG-4 compatible. 26 www.theaustralian.com.au/australian-it/third-dimension-adds-360m-to-tv-sales-it-is-still-only-4pc-of-themarket-but-it-is-growing-at-300pc/story-e6frgakx-1226033570614

3. Technological migration options

This chapter considers some options for implementing technology migration and some of the specific issues that might arise either in implementing technical migration between platform standards or in augmenting the present standards with new standards. Supplementation and replacement strategies are considered, along with examples of technological migration implementation from other technology areas in Australia and overseas. Options for migrating to MPEG-4 and DVB-T2 by interventions on both the transmission and receiver sides are set out. Technical and regulatory pathways are considered (including action that the ACMA may take), along with related push and pull factors that work together to influence the success rate of implementation. Options for implementing service standards are also touched on briefly, with reference to 3DTV and audio description in particular. At this stage, the ACMA is not disposed to any particular course of action. The discussion in this chapter is to test the ACMAs understanding of potential options as well as to inform public and industry submissions about which options the ACMA should pursue, if any.

Supplementation and replacement

Strategies for introducing new DTTB technologies range from supplementation models that leave the current service offerings intact, through to the complete replacement of one set of platform standards by another. Supplementation of an old technology with a new technology has a far smaller impact on consumers than the replacement of the old technology. While the introduction of colour television in Australia (a form of technical supplementation) required viewers to purchase new television sets to obtain the benefit, there was no degradation to their existing service if they chose not to upgrade. In contrast, the digitisation of Australian free-to-air television (an example of complete replacement of one broadcasting technology with another) requires the acquisition of new receiver equipment to retain existing services. A technology replacement approach has a greater impact on industry and the community and increases the likelihood of outcomes that include market failure or poor social equity. In the past, replacement approaches have tended to attract government intervention to address such outcomes. To the extent that it leaves existing technology and services operational, supplementation is less likely to require intervention. Hybrid approaches are also possible. In the case of DTTB, for example, it would be technically possible for broadcasters to replace part of the current MPEG-2 service offering with the same offering in MPEG-4, thereby creating room for additional MPEG-4 content. Examples of technology supplementation and replacement Previous examples of successful platform technology supplementation and replacement in Australian analog and digital broadcasting illustrate the complex and sometimes fortuitous relationship between receiver uptake and the timing and duration of the introduction of new technologies.

Analog radio When FM radio was introduced in Australia, mandated local receiver standards were unnecessary to drive ownership due to the widespread pre-existing availability of dual AM/FM receivers from overseas. FM receiver ownership was estimated to be 10 per cent of all radio receivers before the decision to introduce FM broadcasting was actually taken. Widespread ownership and availability of FM receivers helped enable the first community FM services to begin broadcasting less than 12 months later, with mass-market commercial FM services soon following. As latecomers to FM radio, Australian broadcasters were able to hitch a ride on the prevalence of combined AM/FM radio services in major export markets overseas. Digital radio The introduction of DAB+ digital radio in Australia was explicitly intended to supplement rather than replace the AM and FM analog radio platforms. To date, the radio industry has used a combination of simulcasting analog services and providing enhanced content not available in analog to drive the uptake of digital radio. While there has been no suggestion of making digital radio mandatory in receivers, or any decision to date to switch off analog radio, initial uptake of digital radio has been 27 markedly quicker than the comparable initial uptake of digital television receivers. The uptake of DAB+ digital radio has relied entirely on pull factors, with broadcasters initially investing in attractive new content and improved sound quality to create demand for receivers. Analog television The widespread introduction of UHF television into Australia in the 1980s was assisted by the rapid uptake of colour television receivers, which contained UHF tuners. Only five years after colour was launched in March 1975, colour television ownership had reached about 80 per cent. The success of colour television had the effect of creating a large pool of UHF-capable receivers ahead of the introduction of UHF services. The major expansion of analog television in the 1980s and 1990s, notably through the aggregation of major regional television markets, relied on supplementing existing VHF channels with UHF channels. Clearance of some existing television services from VHF Band II to UHF also created room for more FM radio stations in what were previously television channels 3, 4 and 5. Both these policies benefitted from the popularity of colour television, which had previously seeded the market with large numbers of UHF-ready receivers. The history of UHF television provides an example of push preceding pull, with the popularity of one feature incidentally paving the way for another. Digital televisionAustralia In migrating from analog to digital television, Australia adopted a full replacement strategy (with simulcast period) to employ the most efficient standards available at the time (DVB-T and MPEG-2). Ownership of digital television receivers started from near zero when simulcasts began in metropolitan areas in January 2001. Although Australian digital television receiver standards had been developed, the government did not mandate their inclusion in television receivers and permitted retailers to continue selling analog receivers and recording devices after digital services started. While the continued availability of analog-only receivers undoubtedly contributed to a slower initial uptake rate for digital-ready receivers, there were sound reasons not to mandate digital-ready receivers. Mandating digital receivers in all sets would have caused significant market disruption and removed the cheapest television sets from the market, artificially forcing up the cost of television access. Conversely, there were

27

By September 2011, a little over two years after digital radio commenced in five cities covering 60 per cent of Australias population, Commercial Radio Australia has advised the ACMA that 605,000 digital radios had been sold.

expectations that set-top boxes permitting the simple conversion of existing analog sets to digital would get cheaper over time. Ultimately, full conversion of analog to digital television is occurring without the government mandating digital receivers in all television sets sold. At the same time as viewers are converting to digital-ready television sets, the lack of demand for analog receivers has seen the analog television receiver market collapse. While many consumers originally acquired digital set-top boxes to continue using analog receivers after switchover, the low availability of analog sets and significant falls over time in the cost of digital receivers has seen many analog sets replaced with digital. Digital televisionOverseas There are international examples of countries that have already migrated, or are currently migrating, from analog television to DVB-T and MPEG-2 taking steps to introduce later platform standards, such as MPEG-4 in some cases even whilst their current switchover process is in train. To the ACMAs knowledge, all are utilising supplementation rather than replacement strategies. Countries yet to migrate from analog to digital television enjoy a choice of more efficient standards than were available when Australia and other early-movers began digitising. These late-moving countries appear to be the only ones considering implementation of DVB-T2 and MPEG-4 via the type of replacement strategy that Australia used to move to DVB-T and MPEG-2. Other platforms Other industries, such as telecommunications, subscription television and satellite free-to-air television, have also produced examples of replacement and supplementation models. On rare occasions, the government or regulator has become involved in addressing public interest issues. Examples include: migration of remote area, free-to-air television services to new satellite platforms replacement of Telstras CDMA mobile telephone service in regional Australia with the third generation Next G service.

Strategies involving full replacement are generally more likely to attract government interest and involvement. The distinctive features of free-to-air broadcastingits ubiquity, the relationship between broadcasters, advertisers and consumers and individual consumer responsibility for installing receivers and aerialssuggest that historical examples of technology supplementation and replacement in the broadcasting industry will offer the most relevant case studies for future evolution of television.

Options for implementing MPEG-4 and DVB-T2

The following are some of the ways that MPEG-4 and DVB-T2 might in theory supplement the existing platform technology in Australia. Potential migration paths on both the transmission and receiver sides are considered, as are technical and regulatory constraints and options. The ACMA recognises that any strategy for introducing DVB-T2 and/or MPEG-4 to supplement the existing platform can be considered in terms of both push and pull factors and is likely to benefit from careful consideration of both. An approach that places obligations on both the transmission side and the receiver side could promote both content availability and receiver deployment to significantly accelerate technical migration. These push and pull factors are discussed further below. If the ACMA formed a view that regulatory intervention were necessary to promote the introduction of new technologies, it would consider whether intervention on the

transmission or reception side, or both sides, would most effectively achieve the desirable policy outcome. Hybrid transmission/receiver side intervention would involve consideration of a range of factors to assess the costs to industry and consumers against the benefits of an accelerated move to a new platform technology.

Transmission-side implementation
The current relatively high levels of multiplex capacity utilisation by Australian broadcasters means that the key issue in transmission-side implementation is how to obtain transmission capacity to accommodate technological migration to MPEG-4 and/or DVB-T2. The ACMA acknowledges that intervention on the transmission side would support the availability of program services in MPEG-4. This may exert a pull on the receiver side by attracting consumers to purchase MPEG-4 equipment, provided there was appealing content on the MPEG-4 services. Receiver-side implementation is discussed below. On the transmission side, the following possible DTTB platform configurations are available for implementation of MPEG-4 and DVB-T2: DVB-T modulation (as at present) with MPEG-4 compression. Increased capacity would be derived from the efficiency offered by MPEG-4. This option is referred to below as MPEG-4. DVB-T2 modulation with MPEG-4 compression. Increased capacity would be derived from the increased efficiencies offered by both DVB-T2 and MPEG-4. This option is referred to below as DVB-T2. MPEG-4 technology path MPEG-4 is a compression technology that can be incorporated for one or more 28 services within an existing multiplex. This capacity of MPEG-4 encoded services to co-exist with MPEG-2 services on the same multiplex means there are two theoretical options for obtaining transmission capacity for MPEG-4 services: addition of MPEG-4 content to existing multiplexes acquisition of additional spectrum from government for new multiplexes.

Conversion of existing MPEG-2 services to MPEG-4 Australian DVB-T multiplexes are currently operated at near-maximum capacity to 29 carry MPEG-2 encoded services. Introducing MPEG-4 in Australia as a supplementary technology would require some of that transmission capacity to be made available, either by conversion of existing MPEG-2 services to MPEG-4 or the adjustment (reduction of bit rates) of existing MPEG-2 services to make room for MPEG-4 content. In order to introduce any substantial amount of MPEG-4 material, broadcasters would have the option of a phased approach using increasing amounts of their existing MPEG-2 capacity over time. For example, the conversion of a single existing MPEG-2 SD multi-channel could allow a network to carry either two SD services or one HD service in MPEG-4. This would decrease the range of services for viewers without MPEG-4 compatible receivers, but could increase the range of services for viewers with MPEG-4 compatible receivers. Following the completion of switchover and consequent/associated lapsing of legislated HD content quotas, broadcasters might choose to convert their HD channels
28

The ACMA recognises that there are still efficiencies to be gained through improvements to the MPEG-2 standards that may realise capacity increases. These are, however, unlikely to realise the step changes in capacity that would result in migration to MPEG-4 or DVB-T2 and do not involve a migration to a new standard so are not discussed in this paper. 29 SBS is currently using a different specification for their MPEG-2 multiplexes, which realises a lower bit rate (approximately 19 Mbit/s vs standard 24 Mbit/s for other broadcasters). Replanning of parts of SBSs network during the re-stack is expected to give SBS the opportunity to move to the higher capacity.

to SD to free up capacity. This would guarantee no decrease in the number of services, though potentially a loss of picture quality for some services. Another strategy involving conversion of HD channels to MPEG-4 services would decrease the range of available HD services on MPEG-2 and consequently the range or quality of services for viewers without MPEG-4 compatible receivers, but could increase the range of SD or new services for viewers with MPEG-4 compatible receivers. In practice, any move to incorporate MPEG-4 into existing allotments would need careful consideration by broadcasters. It is highly unlikely that broadcasters would make any move that denied services to a large section of its audience given business models rely on maximising audience share. Additional spectrum allocation With additional spectrum, a range of other options would be available for providing MPEG-4 services, whether using the additional spectrum to provide an MPEG-4-only multiplex or MPEG-4 in combination with MPEG-2 services. In either case the use of additional spectrum to provide MPEG-4 services would increase the range of services available to audiences with MPEG-4-compatible receivers, without decreasing the range of MPEG-2 services available. Whether additional spectrum is made available is a decision for the government and is discussed further below as a regulatory issue. MPEG-4 regulatory path The possibility of introducing some MPEG-4 services using existing DVB-T broadcasting multiplexes is only lightly constrained by current regulatory settings. HDTV quotas still apply in many licence areas and these limit the practical options for freeing up capacity before switchover. There are also, in some cases, limits on the number of multi-channels that can be provided in these licence areas before switchover. Otherwise, there are no existing constraints on broadcasters augmenting their services with MPEG-4. In Australia, domestic standards for both transmission equipment and receivers used in DTTB have historically been developed under the oversight of Standards Australia. The standards are developed through collaborative efforts between the various industry sectors and, when appropriate, government representatives. To a high degree, the standards reflect international standards for transmission and reception including the platform standards for MPEG-2 and DVB-T. The development of domestic standards allows for the incorporation of domestic requirements that have not already been included following Australias international engagement. Currently, there is little direct regulation of platform standards in Australia (neither the domestic standard for reception equipment nor the standard for transmission have been made mandatory) and broadcasters are not, in general, legally prevented from utilising MPEG-4. Current standards make MPEG-4 capability optional in receivers and otherwise do not prohibit or impede the use of MPEG-4. Although the ACMA has not intervened to either mandate or prevent broadcasters providing services in MPEG-4, it is within the scope of the ACMAs regulatory powers to do so. Two recent developments suggest that development of a clear, overall ACMA position on MPEG-4 transmission is timely. In relation to self-help re-transmissions of the VAST satellite service in remote Australia, the ACMA recently published for comment a draft policy that would see self-help service providers required to transmit services in MPEG-2 rather than MPEG-4. The ACMA adopted this position in response to requests to re-transmit VAST in MPEG-4 and in recognition of the likely number of legacy receivers only able to display MPEG-2 signals. The ACMA is currently considering submissions in response to the draft policy.

In November 2011, Seven West Media announced the commencement of TV4, a niche datacasting service in MPEG-4 in the five major metropolitan markets and 30, 31 regional Queensland. The Seven service in MPEG-4 was not expected to affect the suite of MPEG-2 services available to viewers with legacy receivers. (The service duly commenced, but in late December 2011 it switched to broadcasting in MPEG-2.) The Minister for Broadband, Communications and the Digital Economy recently indicated to industry his strong preference that the introduction of any MPEG-4-only services should be deferred until at least digital switchover has been completed nationwide. Given the number of receivers in the market that are not MPEG-4enabled, the government is concerned that the introduction of MPEG-4 services would add an additional level of complexity at a time when many Australian viewers are grappling with the conversion to digital television. The ACMA is interested in better understanding broadcaster thinking around the further introduction of MPEG-4 transmissions and in fostering dialogue between broadcasters, the government and the ACMA about MPEG-4 transmissions. Potential ACMA interventions A range of informal and formal options are available to the ACMA to address the approach and timing for MPEG-4 migration. Information about the ACMAs approach to regulation is set out in Appendix A. Additional spectrum allocation The governments options for making additional spectrum available for the introduction of MPEG-4 may be limited to: in some areas only, and subject to technical feasibility, the currently unoccupied 32, 33 UHF channel 27 in its existing 6 MHz form in some areas only, the currently unavailable UHF channel 27 in an expanded 7 MHz form, which would require a 1 MHz extension of the lower boundary of the broadcasting services bands and clearance of non-broadcasting incumbents from that spectrum. This option may also require a change to the defined broadcasting 34 services bands in all areas of Australia, the currently unallocated sixth 7 MHz DTV channel, sometimes identified as channel A.

In addition, the ACMA is able to make spectrum temporarily available for a range of uses, including technical trials, through its planning power in s.34 of the Broadcasting Services Act 1992. This power has been used to date to permit trials in MPEG-4, notably the recent trials of 3DTV, using vacant television channels. The ACMA is currently unaware of other options for sourcing suitable spectrum in addition to the channels already in use for existing broadcaster digital television services.

30

Seven West Media comprises Seven Television network; Pacific Magazines; Yahoo!7; The West Australian newspaper and associated WA regional newspapers and radio stations. 31 7 Brand New Media, Seven to launch datacasting channel, 7 November 2011 32 Channel 27 is only a single channel and is therefore not available for use everywhere. Channel A on the other hand, is a set of channels that allows for national coverage. 33 UHF channel 27 is presently 6 MHz wide with its lower boundary at 520 MHz. Fixed and mobile radiocommunications services are located below this frequency. 34 This assumes that the proposed new spectrum licences in the 700 MHz band are configured and sold for broadband communications.

DVB-T2 technology path DVB-T2 is a digital transmission technology that applies across an entire multiplex output and, therefore, requires a dedicated multiplex. Introducing DVB-T2 in Australia as a supplementary technology where existing DVB-T multiplexes remain operational is more complex and would require a minimum of one additional vacant television channel in each coverage area. In theory there are two options for obtaining transmission capacity for DVB-T2 services: reconfiguration of existing broadcaster spectrum acquisition of additional spectrum from the government.

Reconfiguration of existing spectrum allocations Establishing a dedicated DVB-T2 multiplex using existing broadcaster allocations (5 x 7MHz multiplexes in most areas) would only be possible if highly innovative approaches were used. For example, services currently on five multiplexes could be redistributed across four multiplexes to free up the fifth channel for potential migration. This has been suggested in industry submissions to a number of ACMA and DBCDE 35 discussion papers. Though the starting point and incentives for change were different, this type of strategy has been implemented successfully in 36 overseas jurisdictions. Once a single DVB-T2/MPEG-4 multiplex was in operation, upgrading of the remaining channels could presumably occur at some later date or dates, once receiver penetration was high enough. Major adjustments to current configurations would be necessary before broadcasters could fit onto four multiplexes. Since current multiplexes in Australia are at near full capacity, any local implementation of this strategy would require the sacrifice of an amount of MPEG-2 content. In the post-restack environment, this could be achieved by the cessation of some SD services, the conversion of HD services to SD, a reduction in picture quality of existing services (either SD or HD), or by using space generated by an upgrade in multiplexes over time to MPEG-4 encoding. Serious practical problems would need to be overcome before such a strategy could be employed. Barriers would include the need for considerable technical changes to the transmission and network distribution systems to allow different broadcasters to share multiplex space. The impact of any transition on consumer equipment would also need to be considered. Regulatory impediments are considered further below. Although the option is workable in theory, any such migration would be long in planning and implementation and would require an effective transition of the consumer equipment market over time, perhaps initially to MPEG-4 and only later to DVB-T2. Additional spectrum allocations Options for making additional spectrum available for the introduction of DVB-T2 are the same as the options for MPEG-4, discussed above.

35

Both the ASTRA (p. 6) and FOXTEL (p. 22) responses to the January 2010 DBCDE Digital Dividend Green Paper mooted the move to a common multiplex model to free up spectrum to allow space for migration to new technologies. 36 Implemented by Ofcom and industry body Freeview UK when a DVB-T2 national multiplex was established in the United Kingdom in December 2009, and by Teracom in Sweden for the launch of its DVBT2 multiplex in November 2010.

DVB-T2 regulatory path Establishing a dedicated DVB-T2 multiplex using existing broadcaster allotments, through consolidation of the current five DVB-T multiplexes into four, even if practical, would not be permissible under current law. As a general rule, transmitter licences are currently issued to each commercial broadcaster to transmit the services provided under its own broadcasting service licence. National broadcasters are subject to separate, individual transmitter licensing arrangements. The existing legislative framework has, in the past, provided commercial licensees in remote and in certain regional areas with limited scope to share one or more transmitters for the provision of all licensees services in an area. However, this exceptiondesigned to permit an affordable rollout of core services in areas of low population densitywas tightly confined, with all multi-channelling election arrangements currently being phased out. Allowing commercial (and national) television broadcasters the flexibility to distribute services across shared multiplex transmitters (or, for that matter, multiplex transmitters licensed to non-broadcasting service licence-holders), would require substantial 37 changes to the existing legislative framework. Multiplex sharing would require freeto-air broadcasters to operate far more like parts of a single program distribution network than they do at present. Such a development is likely to have wider implications for current legislation and licensing arrangements than the simple question of whether broadcasters are able to carry each others content. A fuller exploration of this issue is outside the scope of the present paper. Potential ACMA interventions A range of informal and formal options are available to the ACMA to address the approach and timing for DVB-T2 migration. Information about the ACMAs approach to regulation, including different regulatory mechanisms and their respective enforcement options, is set out in Appendix A. Additional spectrum allocations Options for making additional spectrum available for the introduction of DVB-T2 are the same as the options for MPEG-4, discussed above.

Receiver-side implementation
For technological migration to be successful, the deployment of new technologies by broadcasters needs to be matched by receiver uptake. This uptake can occur either before or after broadcaster deployment. When new technologies supplement old technologies, the availability of ready receivers, and the associated audience levels, can be a precondition to sustaining new transmission services. Receiver deployment can be held back when consumers have insufficient reason to upgrade and broadcasters have insufficient incentive to provide enhanced services for the small pool of upgraded receivers. Alternatively, receiver uptake can establish a virtuous circle, where widespread receiver ownership creates an incentive for the provision of more services, which in turn drives further receiver take-up, and so on. Receiver ownership levels may be influenced by push and/or pull factors. Push factors include government or industry intervention in the form of mandating receiver standards to increase the availability of receivers that meet the new technology standards. These factors also include the incidental incorporation of new standards in imported receivers as overseas markets upgrade to the new standard. Pull factors
37

A broadcasting services licence (BSL) is a licence issued under the BSA, generally but not always authorising operation in the broadcasting services bands.

include attractive new content and services and are also important as drivers of receiver uptake. Moving early to change industry standards can enlarge the pool of compliant devices and reduce the number of legacy devices, bringing forward the date when it is feasible to take advantage of the new standards. Overseas experience to date with supplementation strategies for MPEG-4 and DVB-T2 introduction suggests a key factor in achieving effective receiver penetration is the availability of desirable new content. In countries where the transition to digital television is fairly advanced but where high definition services were not previously available, the appeal of new HDTV content has been identified as an important driver in fostering technical migration. The presence of a large number of MPEG-2 legacy receivers is a significant impediment to any introduction of MPEG-4 as a transmission technology. While MPEG-4 services can be transmitted alongside MPEG-2 services in the same multiplex, none of these MPEG-4 services would be available to legacy MPEG-2 only receivers. Potential ACMA interventions MPEG-4 readiness in television receivers has not been mandated in Australia but is optional under the current Australian receiver standard. MPEG-4 is, however, already present in many receivers sold in Australia, as receiver manufacturers respond to rising worldwide demand for MPEG-4 enabled devices. Intervention on the transmission side may help to ensure that program services were available in MPEG-4 which, provided there was attractive content on the MPEG-4 services, may exert a pull on the receiver side of the equation by attracting consumers to the proposition of purchasing MPEG-4 equipment. Intervening on the receiver supply side would only occur if the ACMA formed the view that the market would not otherwise achieve the desirable outcome in a reasonable timeframe, for example, if the ACMA considered it desirable for all receivers being supplied to the market to have MPEG-4 capability. Supply side intervention, while guaranteeing that all new equipment supplied to market from a specified date is MPEG-4 compliant, leaves the decision about whether to make MPEG-4 content available to viewers up to the broadcasters. Broadcasters would only move to supply new services when sufficient receivers were in the market and the disadvantages to the audience from the loss of a MPEG-2 service (sacrificed to allow the MPEG-4 transmission) were outweighed by the benefits. In Australia, receiver standards could be used to increase ownership levels ahead of the actual availability of new services. This is because MPEG-4, and potentially DVBT2 receivers, are backwards compatible with DVB-T and MPEG-2 and would not disturb access to existing services. However, mandating standards may impose additional costs on consumers where the market may operate to achieve the same outcome without imposing such costs on consumers. The ACMA would be unlikely to mandate a standard where the practical effect would be to reduce choice or impose substantial additional costs on consumers. Maximising receiver uptake also requires consideration of pull factors. Any strategy for introducing DVB-T2 and/or MPEG-4 should take account of potential benefits including when and how additional content would become available. Options involving access to the small amount of additional spectrum mentioned earlier in this chapter, or the shifting of content between existing broadcaster multiplexes, would require government agreement and action and, potentially, any necessary changes to legislation, and are outside of the power of the ACMA. On the other hand, options for introducing MPEG-4 content on existing broadcaster multiplexes would appear to lie

with the broadcasters and are within the mandate of the ACMAs current powers, if facilitation through regulatory intervention (or forbearance) was required. Potential ACMA interventions A range of informal and formal options are available to the ACMA to address the approach and timing for MPEG-4 migration. Information about the ACMAs approach to regulation, including different regulatory mechanisms and their respective enforcement options, is set out in Appendix A.

Options for implementing 3DTV, audio description and other service standards
Implementing new service standards, such as 3DTV and audio description (AD) raises similar issues to platform standard migration in terms of the interplay between push and pull factors, or transmission and receiver-side readiness. The ACMA understands that approximately four per cent of receivers sold are 3DTV ready, and that AD functionality is present in a proportion of newer receivers. 38 However, there is no 3DTV or AD content currently available over DTTB in Australia. The ACMA understands that implementing AD would not require a particularly large amount of additional transmission capacity, though current high broadcaster utilisation of channel capacity could still see capacity constraints limiting the inclusion of AD services. The additional transmission capacity made available by a move to more advanced platform standards (for example, to DVB-T/MPEG-4) could be used to make space for the future provision of AD services. Under current arrangements AD added to only one multichannel could conceivably consume all residual capacity available to a broadcaster on a near-capacity DVB-T/MPEG-2 multiplex. While international standards exist that describe audio description, it is not currently addressed in the Australian standards for DTTB transmission or reception. The ACMA understands that effective implementation of a new platform standard (for example, MPEG-4) might allow for adoption of one or more new service standards. In the absence of a clear direction from industry about implementation of 3DTV, audio description or other service standards, it is not practical to take this discussion any further without consultation. The ACMA invites comment on service standard implementation. Information about the ACMAs approach to regulation, including different regulatory mechanisms and their respective enforcement options, is set out in Appendix A. In addition to the overarching question for this chapter: 9. What are the potential options for promoting standards migration and how might they be implemented?

the ACMA seeks submissions on: 10. Any strategies you believe are both feasible and desirable for introducing new technical standards, including: which standards how they might be introduced, including transmission and receiver readiness issues any ACMA measures that would assist.

38

There are two types of AD broadcaster mix AD and receiver mix AD. While anecdotally there are receivers available in the market that have either or both of these capabilities the ACMA has no empirical data on quantities or receiver functionality.

11. For MPEG-4, the ACMA also seeks submissions on: When or in what circumstances augmentation of existing multiplexes with MPEG-4 content is desirable. Whether inclusion of MPEG-4 as a requirement in the Australian receiver standard, or measures to directly mandate MPEG-4, would increase the uptake of MPEG-4-ready receivers without imposing substantial additional costs on Australian television viewers. For further information about making a submission, go to the Invitation to comment section.

Invitation to comment
Issues for comment
The ACMA is not disposed to any particular course of action at this stage. The questions in this discussion paper are to inform the ACMAs understanding of potential options as well as to guide public and industry submissions about which options the ACMA should pursue, if any. Chapter 1: Introductory question The ACMA seeks submissions on: 1. Should the ACMA do anything to meet the challenge of ever-improving technical standards? 2. The approach and scope of this discussion paper. 3. Are there principles that should be codified in regard to regulation of technical migration, within the framework set by the principles for good regulatory process? What factors should these principles consider? Chapter 2: Technological innovation issues The ACMA seeks submissions on: 4. What issues technological evolution raises and whether there is pressure for change in Australia. 5. Whether Australia should be planning to introduce upgraded platform or service standards for DTTB, and if so: which standards? how quickly? why? 6. Whether the ACMA should consider any other technical standards than those canvassed in this chapter. 7. The rate of uptake and penetration of television receivers that are compatible with more advanced standards, including future prospects and any other issues you see as relevant. 8. The expected useful life of legacy digital television receivers, including the length of time required before replacement of MPEG-2/DVB-T content can be expected to be uncontroversial. Chapter 3: Technological migration options The ACMA seeks submissions on: 9. What are the potential options for promoting standards migration and how might they be implemented? 10. Any strategies you believe are both feasible and desirable for introducing new technical standards, including: which standards how they might be introduced, including transmission and receiver readiness issues any ACMA measures that would assist. 11. For MPEG-4, the ACMA also seeks submissions on: When or in what circumstances augmentation of existing multiplexes with MPEG-4 content is desirable?

Whether inclusion of MPEG-4 as a requirement in the Australian receiver standard, or measures to directly mandate MPEG-4, would increase the uptake of MPEG-4-ready receivers without imposing substantial additional costs on Australian television viewers.

Making a submission
This discussion paper seeks comment on the future technical evolution of digital terrestrial television broadcasting (DTTB) and whether any actions are necessary or desirable in the short term to enable the introduction of more advanced technical standards in the long term. The ACMA invites submissions on a range of questions. Written submissions marked DTTB Technical Review should made: By email: By mail: DPS@acma.gov.au Manager Digital Policy Section Australian Communications and Media Authority PO Box Q500 Queen Victoria Building NSW 1230

The closing date for comment is 5 pm AEDST, Friday 30 March 2012. Submissions received after this date may not be taken into consideration. Electronic submissions in Microsoft Word or Rich Text Format are preferred. Media enquiries should be directed to Emma Rossi on 02 9334 7719 or by email to media@acma.gov.au. Any other enquiries may be directed by email to DPS@acma.gov.au. Effective consultation The ACMA is working to enhance the effectiveness of its stakeholder consultation processes, which are an important source of evidence for its regulatory development activities. To assist stakeholders in formulating submissions to its formal written consultation processes, it has developed Effective consultation: A guide to making a submission. This guide provides information about the ACMAs formal written public consultation processes and practical guidance on how to make a submission. Publication of submissions In general, the ACMA publishes all submissions it receives. The ACMA prefers to receive submissions that are not claimed to be confidential. However, the ACMA accepts that a submitter may sometimes wish to provide information in confidence. In these circumstances, submitters are asked to identify the material over which confidentiality is claimed and provide a written explanation for the claim. The ACMA will consider each confidentiality claim on a case-by-case basis. If the ACMA accepts a claim, it will not publish the confidential information unless authorised or required by law to do so. Release of submissions where authorised or required by law Any submissions provided to the ACMA may be released under the Freedom of Information Act 1982 (unless an exemption applies) or shared with other Commonwealth Government agencies under Part 7A of the Australian Communications and Media Authority Act 2005. The ACMA may also be required to release submissions for other reasons including for the purpose of parliamentary processes or where otherwise required by law (for example, under a court subpoena).

While the ACMA seeks to consult submitters of confidential information before that information is provided to another party, the ACMA cannot guarantee that confidential information will not be released through these or other legal means.

Appendix Athe ACMA approach to regulation

The introduction of new DTTB technologies may require the involvement of the ACMA. This appendix outlines the role and general approach of the ACMA to regulation, as well as the graduated range of approaches available for intervening to address issues, problems and opportunities.

ACMA role
As Australias communications regulator, the ACMA has wide powers to make mandatory technical standards, register industry-developed codes of practice and monitor and participate in standards setting processes for digital television broadcasting. Parliament intends that broadcasting services and datacasting services be regulated in a manner that, in the opinion of the ACMA: enables public interest considerations to be addressed in a way that does not impose unnecessary financial or administrative burdens on providers of broadcasting services and datacasting services will readily accommodate technological change encourages the development of broadcasting technologies and their application encourages the provision of services, made practicable by those technologies, to 39 the Australian community.

As well as its broadcasting role, the ACMA has a key role in managing Australias radiofrequency spectrum. In this role it must, among other things, endeavour to maximise the efficient allocation and use of the spectrum to realise the greatest public benefit including by maximising opportunities for Australian industry. Migration to more spectrally efficient technologies is a relevant consideration in the ACMAs strategies for spectrum management in the broadcasting sector. Evidence-informed approach The ACMA takes an evidence-informed approach to the consideration of issues for which it has regulatory responsibility. Its regulatory processes are informed by highquality evidence from a wide range of sources. The ACMAs approach to evidenceinformed regulation is outlined in the ACMA document: Evidence-informed regulation: The ACMA approach. Effective consultation Effective stakeholder consultation processes are an important source of evidence for ACMA regulatory development activities. To assist stakeholders in formulating submissions to its formal, written consultation processes, the ACMA has developed the following guide: Effective consultation: A guide to making a submission. This guide provides information about the ACMAs formal, written, public consultation processes and practical guidance on how to make a submission. Principles of good regulatory process The Australian Government has endorsed the following six principles of good regulatory process identified by the 2005 Taskforce on Reducing Regulatory Burdens on Business:

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Subsection 4(2) BSA.

Governments should not act to address problems until a case for action has been clearly established. This should include establishing the nature of the problem and why actions additional to existing measures are needed, recognising that not all problems will justify (additional) government action. A range of feasible policy optionsincluding self-regulatory and co-regulatory approachesneed to be identified and their benefits and costs, including compliance costs, assessed within an appropriate framework. Only the option that generates the greatest net benefit for the community, taking into account all the impacts, should be adopted. Effective guidance should be provided to relevant regulators and regulated parties in order to ensure that the policy intent of the regulation is clear, as well as the expected compliance requirements. Mechanisms are needed to ensure that regulation remains relevant and effective over time. There needs to be effective consultation with regulated parties at all stages of the regulatory cycle.

These principles are regarded as consistent with policies articulated in the Broadcasting Services Act 1992 (BSA), namely that the ACMA should avoid imposing unnecessary financial and administrative burdens on industry. The ACMA, like all Australian Government agencies, must clearly analyse the costs and benefits of undertaking regulatory action and needs to consider alternatives to formal regulatory action before deciding that regulation is necessary. In considering intervention in technical migration, the ACMA would consider the objectives of any intervention, and the anticipated outcome or impacts, including the 40 benefits and risks for industry, consumers and government. Total welfare standard When assessing the net benefits for the community of competing regulatory options, one of the tools the ACMA uses where applicable is a total welfare standard (TWS) approach. With its foundations in welfare economics, the TWS takes into account the benefits and costs to consumers and producers and the broader social impacts directly 41 arising from a regulatory initiative. It is nonetheless important that decision-makers also need to consider separately any particular policy objectives expressed in relevant legislation.

Graduated approach to intervention in DTTB standards

The ACMA generally takes a graduated approach to market intervention and may utilise regulatory or non-regulatory approaches to best promote the introduction of new technologies. The range of approaches which may be available to the ACMA is: Non-regulatory describes activities undertaken by government and/or industry, such as research, education, assistance and promotion. Self-regulation describes actions and activities developed and undertaken by industry where the ACMA may participate in an advisory capacity only, and there would be no enforcement mechanism

40

A general discussion of the costs and benefits of regulatory intervention and a detailed exploration of the economics of regulatory intervention in response to market failure in the free-to-air broadcasting sector are provided on the ACMAs website. 41 Further information about the total welfare standard is available at www.acma.gov.au/WEB/STANDARD/pc=PC_311378.

Co-regulation describes mechanisms in which industry and the ACMA participate jointly, usually with registration by the ACMA of an instrument developed by industry, and often with some enforcement role by the ACMA. Direct regulation describes government regulation, including mechanisms determined by the ACMA and laws enacted by Parliament which are enforceable.

Any of these approaches may involve stakeholder participation, with public consultation being mandatory in a range of ACMA regulatory activities.

Range of approaches available to the ACMA

Non-regulatory

Self-regulation

Co-regulation

Direct regulation

Level of ACMA intervention

Non-regulatory The ACMA may utilise non-regulatory approaches to support standards migration, such as monitoring and research, education and assistance or promotional activities. Self-regulation Self-regulatory approaches centre principally on the setting of Australian technical standards by industry. The ACMA may engage in self-regulatory activities to support standards migration, for example, by participating in industry standards-making committees. The two main industry mechanisms for the setting of Australia DTTB technical standards are Standards Australia and the Free TV Engineering Committee. Standards Australia (SA) is an independent, not-for-profit organisation, recognised by the Australian Government as the peak non-government standards body in Australia. Committees that develop standards under the auspices of SA are widely representative of industry and other stakeholders. The ACMA has 42 considerable participation in the SA standards development processes. Once implemented, industry standards developed by SA are used by industry participants in the design or testing of equipment. These standards only become a regulatory instrument if determined as a mandatory standard by the ACMA. The FreeTV Engineering Committee is a forum exclusively convened and operated by the commercial broadcasting industry, with no ACMA involvement. This committee develops a range of operational practices (OP) documents that provide guidance to broadcasters on a range of DTTB (and analog) transmission and reception issues. Many FreeTV OPs reference national and international standards. None are mandatory under ACMA arrangements, although some are referenced in the description of requirements for DTTB features such as the ACMAs electronic program guide principles that specify guidelines for provision 43 of electronic program guides. Although OP documents are not mandatory, there is an obvious industry desire for effective service provision with a low risk of

42

The SA standards development process has recently undergone significant change. Proposals for standards development must now be considered against a net benefit assessment test, which will have an impact on how the ACMA and industry stakeholders engage to create standards. 43 The electronic program guide principles are available on the ACMA website at www.acma.gov.au/scripts/nc.dll?WEB/STANDARD/1001/pc=PC_311870.

failure (and commensurate costs for rectification) that sees wide adoption of these voluntary industry standards and guides. A further industry mechanism that promotes the use of technical standards is the Freeview accreditation process. Freeview is an industry body established by all freeto-air broadcasters to promote terrestrial digital television. Co-regulation Part 9B of the BSA provides for co-regulation in technical codes and standards. Parliament intends that bodies or associations that the ACMA is satisfied represent sections of the industry should develop codes. The ACMA may register codes developed by industry as well as request industry to develop codes for registration. The ACMA has reserve power to make an industry standard if there are no industry codes, or if an industry code is deficient. Compliance with an industry standard is mandatory. To develop a code the ACMA must, under section 130G of the Act, specify a section of the industry that is conducting an industry activity described in section 130F. The ACMA may then request that a body or association representing the section of the industry develop a code for registration that deals with matters specified under section 130K of the Act. Providing a commercial, national or community television service is nominated as an applicable industry activity under section 130F, as is importing, manufacturing or supplying domestic reception equipment. In these areas, the ACMA could request the development of a code that achieves effective policy outcomes for any technical migration process if the ACMA formed a view that intervention was necessary. Identification of a body or association that broadly represents certain sectors of an industry such as all suppliers of domestic reception equipment, and subsequently encouraging code compliance, is problematic due to the size and disaggregated nature of the sector. A code is registered under section 130M of the Act and, while not enforceable in its own right, total or partial failure of a code may lead to the ACMA developing an industry standard. Part 9B of the BSA allows the ACMA to develop an industry standard in a number of circumstances including where the ACMA has requested development of a code by industry but no code has been produced or the code has failed either partially or completely. Breach of such an industry standard may result in an offence or a civil penalty. To date there have been no codes registered under Part 9B. Direct regulation There are four potential sources of direct regulation available to the ACMA: 1. Statutory change: provisions could be inserted into the BSAmost likely as standard licence conditions in Schedule 2 to the Actthat would require licensees to provide a service that complies with certain specifications set out in the Act or established by the ACMA. Technical standards: Part 9A of the BSA provides for direct regulation in technical standards. The ACMA may, by legislative instrument, determine technical standards that relate to digital transmission and to domestic reception equipment. Compliance with an ACMA technical standard is mandatory. Part 9A was inserted into the BSA in 2006 to enable the ACMA to develop technical standards for both the broadcasting and reception equipment used in digital television and digital radio. For digital television, these may be standards developed for digital transmission (section 130A) or standards developed for domestic digital reception equipment (section 130B). Enforcement of standards made under section 130A is via a licence condition in Schedule 2 to the BSA (paragraph 7(1)(oa)) that requires licensees to comply with any transmission standards developed under

2.

section 130A. Enforcement of subsection 130B is via both criminal and civil penalty provisions described in section 130B that makes it an offence to supply domestic reception equipment that does not comply with a reception equipment standard. Standards made under section 130A result in a single regulation that applies to all television broadcasting services in specified categories (for example, commercial, community and national services). Standards made under section 130B result in requirements that apply to all specified domestic reception 44 equipment. 3. Licence conditions: The ACMA has broad power in section 43 of the Act to impose licence conditions on commercial television licensees (however there is no such power in relation to national services). Breach of a licence condition may lead to suspension or cancellation of a licence (s143), or to the ACMA issuing a remedial direction to the licensee (s141), a breach of which may constitute either an offence or a civil penalty (s142) or a suspension or cancellation of a broadcasting licence (s143). Other: Approaches such as the imposition of conditions on apparatus licences issued under the Radiocommunications Act 1992, and new requirements inserted into the Technical Planning Guidelines may also be utilised.

4.

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To date, the ACMA has exercised its powers under Part 9A of the Act in relation to two technical

standards: the Broadcasting Services (Digital Television Format Audio Component Transmissions in SDTV Digital Mode) Technical Standard 2007, which was determined under section 130A in April 2007 to continue requirements in effect under the Broadcasting Service (Digital Television Format Standards) Regulations 2000 which was repealed in May 2007; and the Broadcasting and Datacasting Services (Parental Lock) Technical Standard 2010, which was determined under section 130B in July 2010 to require that particular domestic reception equipment has parental lock capabilities, or distributes information that enables the parental lock capabilities in other domestic reception equipment to operate.