Tiers Before Bedtime

Mistakes in Pay TV Regulation, March 1996

Like fishing with bare hands the government has found catching hold of the multichannel pay television industry - and ensuring we viewers high quality and efficient services at a fair price - to be a tricky business. Influencing what global media players do in Australia and accommodating the effects on the local industry of global trends in film and television was never going to be easy. But overseas subscriber dissatisfaction with ever-rising fees, poor service and the loss of important sporting and other programming to pay seems to suggest it's worth trying.

With the Australis/Galaxy and Foxtel merger in the process of being "hobbled" by the Australian Competition and Consumer Commission (ACCC) and the "anti-siphoning" list of programs that must be shown on broadcast television before they can be shown on pay - it appears the government at least has the industry by the tail. But some fish have got away.

These include the "surprise" discovery of a cable industry too late for decent license fees to be charged - such as the millions paid for satellite licences - and the much-vaunted "open access" principles - allowing any program provider to access the cable networks - on hold until at least mid-1997. And broadcast networks are battling cable system operators for payment to retransmit their programs on cable.

In the US - leaving aside the complexities of their television regulations - many of the problems of the multichannel environment are addressed by "tiering" of services where several different channels are bundled together to cater for the diverse needs of viewers. Some cable services deliver an economy or "lifeline" tier which carries unencrypted or unscrambled programming such as retransmitted broadcast and other advertiser-supported channels, community access channels - like Optus Vision's Local Vision channel launched last week in Parramatta (and next year in Melbourne) - and government information channels. The lifeline tier charges a small fee to mainly pay for carriage or delivery - similar to a monthly telephone line connection fee.

Pay services - not supported by ads - are available on the additional Premium tier for a charge to pay for specialist programming such as sports, Home Box Office and Disney. You buy a variety of more expensive services depending on your budget - services that will soon include telephony and Internet connections.

Here in Australia operators claim there are currently only enough channels to offer Premium services which means the broadcasters have to fight for a share of subscription fees. And government and access channels - with the exception of Local Vision - are restricted or left out completely. With few places to go - and no government legislation in place - this important component of our communications lifeline stands in danger of swimming out of our grasp forever.

< Index

Issue 4 >

< TechTonic is a production of 3V © 1995-2002