PS Consultants - ideas & solutions

Free View: That’s the way to do it!

May 03

The whole European telecoms, media and technology scene remains depressed, and whilst this is great news for Computer Shopper readers who continue to get ever more performance for less money, some pundits suggest that as much as 30% of the UK IT workforce is presently “resting”. From inside the industry, it’s easy to take a gloomy view as company after company continues to post gloomy trading news and more IT staff are let go by the likes of telcos and financial institutions. So when there is a bit of an uplifting tale to tell, it’s a good idea to see what has lead to such a trend-bucking moment.

The success story is that FreeView ( is ahead of expectations in terms of number of users  (not subscribers, remember, this costs nothing once the box has been purchased) – so how did that happen..?

Remember the disaster of BSB (British Satellite Broadcasting) and its assorted nonsense..? It all happened in 1990 (instigated by the government of the time) and the only thing I can now recall is the Lenny Henry commercial wherein he declared “It’s cool to be square” – a reference to the high-tech small size squarial phased-array antenna.

And despite a formula of all gathering the great and good with seriously respected businesspeople and advanced technology, Rupert Murdoch’s very basic (and in its launch period, free) Sky TV – cheap ugly dish; cheap and cheerful analogue STB, trashed it out of sight. So in less than a year, Sky absorbed BSB to become (somewhat perversely) BSkyB, and part of a face-saving deal was to allow Murdoch to operate what is apparently a monopoly.

The broadcast pedants (mostly fossils from the golden age of the BBC and IBA’s “not invented here” period) who insisted that the picture quality of DMAC would easily overhaul the basic PAL solution of Sky were proved to be irrelevant. Once again, the bean counters, politicians and financiers were proved to be devoid of any ability to discern any argument that required the ability to connect technology with commercial reality. The idea that BSB was only a 5 channel service didn’t seem to be relevant to a generation whose only experience was 4 channel terrestrial TV. But with the 50+ channel offering possible from Sky analogue, never mind the digital potential, it was doomed from the outset.

And then, of course, Sky Sports bought all the interesting live events from under the noses the dumbfounded “big four” terrestrial broadcasters – especially the BBC. 

So do the bankers, politicians and media chaps ever learn? Apparently not. When On Digital launched, it seemed obvious to some that this was a re-run of the BSB scenario. Once again the primary driver was political pressure – this time from a government that was keen to cut down on the valuable UHF bandwidth used by terrestrial analogue TV in order that it could flog to the telecoms industry for more mobile airspace.

By now Sky was well entrenched and had a 500+ channel proposition, so On Digital’s 50 channel bouquet was also already off the pace by an order of magnitude. And although the big mantra was “uses the antenna you have already got”, coverage was way short of 100%, and users frequently required new antennas anyway.

If anything, the cobbled compromise that they ended up broadcasting was a very effective commercial for the full Sky service, so guess what? Even amongst the million or so punters that signed up, subscriber churn approached 35%, and most migrated to Sky Digital

ON Digital fumbled about a while with the ITV companies who contrived it refusing to believe that they could have got things so wrong after 50 years of a charmed existence with their license to print money in the days of analogue terrestrial. So they re-launched it as ITV Digital, wasting some £500m spent on branding along the way.

ITVD realised that one of the strongest draws in Sky’s portfolio of services was the sports coverage – so with an absence of imagination and surfeit of arrogance, it agreed to pay a silly amount of money to cover the Nationwide League. However, there’s a basic law of the media universe that says if you can’t get the best, then you are better off not trying to compete with the second best. Instead, put some energy into “inventing” an alternative that can be the best of a different genre. With gridiron and baseball priced out of reach, the US has contrived various alternative pantomimes and freak shows including basketball, wrestling and beach volleyball; in the UK, Formula One, athletics and Rugby have been engineered to become big draws – but in this case, built on decent historic foundations.

So ITV digital went pop. The government called on the BBC to rally a ragbag of services to cover its embarrassment and try and keep the digital terrestrial hope alive.

And guess what? With essentially the same core services as ITV Digital – but for free – Freeview has taken off, as the punters seem quite happy to pay a one-off fee of £100 to get BBC3, ITV2 and one “all new” general entertainment service – FTV.

How can this experience be usefully leveraged? Well, satellite bandwidth costs its broadcasters about £100k per megabit per year and reaches a potential 400 million European audience; FreeView is charging £1m per megabit and is limited to 40 million brits.  So how about a 500 channel version of FreeView on satellite..?

Brace yourself, Rupert.