The BBC and ITV are to collaborate to launch a new free-to-view satellite TV service, aiming to offer Freeview type services to those people who live in areas that the terrestrial digital network cannot reach (currently about a quarter of the population live in such areas). The aim is to ensure everyone can access digital TV signals without paying a monthly subscription fee ahead of the government's planned turn off of analogue TV services.
When the Freesat service launches, ITV will stop encrypting their satellite broadcasts. At the moment ITV's satellite output can only be viewed via Sky's platform because it is broadcast in an encrypted way - Sky's set top boxes 'unencrypt' the signal. Encryption was used to stop satellite TV viewers outside the UK, and especially in Eire, from tuning in to ITV's channels because in theory ITV would be contravening its agreements with movie studios and sports organisations if people outside the UK were able to watch its broadcasts of films or sporting events for which it only had UK rights. But the same was true for the BBC, who controversially stopped encrypting their satellite output a couple of years back, much to the annoyance of Sky who were paid by the terrestial broadcasters to run the encryption service. The BBC hasn't experienced problems in licensing films or sports events because of broadcasting unencrypted satellite signals, hence ITV's decision to follow suit. Does any of that make sense?
Anyway, the BBC and ITV's plans to launch the Freesat service provides more bad news for Sky, or in theory at least. Sky run their own free satellite service which offers viewers the chance to access free-to-air channels via a satellite dish for a one off charge. Sky don't make much money from that service in itself, but use it as a way of upselling its pay-to-view subscription packages. In theory if people opt for the BBC/ITV Freesat service, Sky will have a smaller audience to flog its premium services too. That said, Sky actually welcomed BBC/ITV's Freesat plans, convinced that when consumers get multi-channel TV of any kind they become more likely candidates to upgrade to a Sky-type mega-multi-channel TV package. A spokesman for Sky said yesterday: "Freesat services already form part of Sky's strategy for continued pay-TV growth. As analogue switch-off approaches, we welcome increased promotion of satellite reception by ITV and the BBC"
Channel 4 remained non-committal about the whole thing, except to say they had no intention of unencrypting their satellite output. A spokesman told reporters: "We broadly welcome any development that offers more UK homes the chance to receive the full range of digital services and creates more competition between platforms. We will watch how Freesat develops with interest. However, we have carriage agreements for all our channels with Sky Digital and we have a number of years to run on these deals. We're happy with our current distribution deals with Sky and have no present plans to review these arrangements."
A recent OfCom report said that more than 60% of UK households now receive digital TV of some kind. Government types keen to push for analogue turn off will be very happy that the BBC and ITV are planning to make free-to-view digital TV available to those 25% of households who can't get Freeview. However all of this still ignores the fact that most of those households with access to digital TV will still have second and third television sets accessing analogue signals, which makes an imminent turn off of analogue output seem a little unrealistic.