MinDig TV - digital TV without a subscription fee

With the entry of two national commercial channels and the two channels of the public television last summer, digital terrestrial broadcasting has become a true alternative for cable and satellite services, which can be attractive for those who watch the analogue broadcasts of the three stations available through the terrestrial platform using a rooftop or an indoor antenna. The price of the receivers has dropped over 50% in the last year, and the situation will likely continue to improve in the near future.

Digital terrestrial broadcasting - named MinDig TV - was not launched smoothly in Hungary: before the start in December 2008, Antenna Hungária had been able to reach an agreement only with Duna TV on broadcasting its two programs through the digital terrestrial platform.

Prior to the agreements made with the commercial channels and Hungarian Television, at the beginning of May the National Communications Authority started an inquiry to find out what market circumstances and the behaviour of which market players could be held responsible for the nature of the digital switchover that could be called anything but seamless. Then the situation changed for the better; on the 8th of May RTL Klub also signed a contract with Antenna Hungária, and then on the 28th of May TV2 made an agreement on digital terrestrial broadcasting as well. In accordance with the provisions of these contracts, both national commercial channels will be available through the DVB-T system until 2020, and finally Hungarian Television also joined the digital platform. So now 88% of the population can receive seven different free-to-air channels in digital quality, including Duna Television, Duna II Autonomia, m1, m2, TV2, and RTL Klub, as well as euronews, in addition to the two encoded channels, ATV and Hír TV, that cost 6,250 Hungarian forints per year. Whats more, Duna TV, m1, and m2 broadcast in HD quality.

In addition to the fact that there is no subscription fee for the MinDig TV service, one of the key factors in the spreading of digital terrestrial broadcasting is the price of the devices, so it is not surprising that according to experts engaged in digital switchover, the state should support the purchase of set-top boxes just like in many other European countries. For example, in Italy people who choose to buy a set-top box or a television set with a digital tuner are rewarded with a tax relief, while in Austria the state gives (226_130_172)40 to the buyers of digital set-top boxes. The Hungarian government made it clear, even when it announced the frequency tender for concession rights, that it was not willing to support the switchover from the budget, and this position has not changed ever since, although even a limited support for the socially needy population could have a positive impact. On the one hand, the poorest people could upgrade their reception to digital, and on the other hand, the increased demand would drive the prices down, so digital switchover could become even more affordable for everybody.

High resolution and cinema-like visual experience

Besides the price, however, certain extra services that are offered by digital systems in comparison to traditional analogue television broadcasting also play an important role. In Hungary you can buy a set-top box with a hard drive that is suitable for receiving digital terrestrial broadcasting services, so that they can provide these convenient services, but you can record the programs with a MinDig TV stickered set-top box that costs as little as 26 thousand forints if you connect a pen drive or a USB external hard drive to it.

Another attractive service is the high-resolution broadcast, since the SD-quality picture with traditional resolution in the most recent HD television sets may be annoyingly pixel-like, even for viewers that are used to the old cathode-ray tube television sets. Many believe that only HD broadcasts look really nice in these television sets, but one thing is sure: the possibilities inherent in the highly developed technology of LCD and plasma TVs can fully be enjoyed only if the picture is of HD quality.

In addition, some other important criteria for the viewers may include the electronic program guide, EPG, which can be accessed in all the channels currently in the system, the 16:9 (that is, wide-screen picture format) that is in line with the screen size of currently available TV sets, and the language selection, so with a simple push of a button you can enjoy the programs in the original language (a good example for that is euronews, which is currently available in English, German, and French).

They are still biding their time

"Under the present economic circumstances the market is not mature for HD content, so we are not planning this development in the near future," Ádám Rényi, the communications manager of RTL Klub told us, and TV2 made a similar statement.

"For now we do not plan to introduce HD content in the channel. We will make a decision later on the basis of market needs. In my view it would be reckless to set out concrete numbers or percentages even for the end of 2010 in the present situation, and I would not like to get engaged in any prediction," Attila Fekete, the digital media manager of TV2, told us. He stressed that the entry into the digital system would not require much development on their part, so they would make the decision on expanding bandwidth, if required, on the basis of how widely the platform can spread and how rapidly viewer's needs grow in the future.

RTL Klub is also ready for HD broadcasting; they are just biding their time, since according to Ádám Rényi, their system is fully digital.

"For Hungarian Television, digital switchover is of primary importance in terrestrial broadcasting. With m2 becoming a terrestrial channel again after 12 years, since it was switched to satellite in 1997 following a decision made by the ORTT (National Radio and Television Board) and its terrestrial frequency is currently used by the national commercial stations, the programs broadcast by m1 and m2 can be watched by viewers in a much better quality. The digital switchover created an opportunity for high-resolution broadcasting too," Zoltán Vígh, digital switchover coordinator of the Hungarian public service television, said in a somewhat more optimistic tone. Incidentally, she believes that "free-to-air digital terrestrial broadcasting can boost competition, so it indirectly encourages the broadcasters to produce better productions."

A wider perspective

As for the switchover to the 16:9 format, the TV channels are more optimistic. For example, RTL Klub said they would, irrespective of the current economic situation, "begin to work on creating the technical conditions for broadcasting in 16:9 format," while when we asked them, MTV said that digital switchover "will result in the dominance of programs broadcast in widescreen format."

There are several other reasons why the public service television considers it important to make a better use of the multichannel sound transmission system offered by digital terrestrial television broadcasting in the near future.

"It is important to mention the multi-audio transmission, which not only offers superb surround sound and cinema-like visual experiences, but multilingual broadcasting can also be accomplished, so in addition to the Hungarian language the original language of featured films and the national language of ethnic minority programs can be easily selected. Through digital broadcasting subtitling will also be easy; the viewers can decide whether they want to see the subtitles or not when watching foreign language films," Zoltán Vigh replied to our questions.

They are getting ready

In addition to better picture and sound quality and the different convenient services, another important result of the digital switchover is that in principle the number of transmittable channels has increased significantly, even though according to some experts the Hungarian advertisement market will be able to support not more than five or six free-to-air commercial stations in this decade with current production and maintenance costs. In other words, a subscription-based cable channel, whose fees are paid to the service providers, should become a free-to-air station if the fees payable to the state and the costs of content production with the introduction of new technologies decrease.

IN SOME CASES THERE IS A CHANCE, However, that the digital terrestrial television system has much room to develop, according to some experts, since the predominance of the two national commercial channels in the advertisement market will slowly but steadily decrease, so the more courageous players in the market can come out with an unexpected move and get a bigger bite of the advertisement cake in the near future. This is what the digital terrestrial television system makes possible for them. With the new platform becoming more widespread, anybody can enter the segment that has been accessible before only for TV2 and RTL Klub.

According to rumours in the sector, several broadcasters currently in the market are now considering entering the digital terrestrial television system, but none of them has said anything officially yet. Viasat3 indicated as early as last year that they were interested in getting into the digital multiplex system, but when we contacted them they said the issue was not on the agenda.

In addition, the channels offered by the digital terrestrial system may also be expanded by the decision of the National Radio and Television Board, made at the beginning of last July, that amended the concession agreement of the two national commercial channels, and according to the new conditions both stations can launch thematic channels. We are told that both TV2 and RTL Klub would like to make use of this opportunity, and it is only the economic situation that will decide whether they can launch their thematic mutations with which they would likely wish to join also the digital terrestrial television system.

In addition to the unforeseeable consequences of the economic crisis, however, these channels are biding their time for now also because they do not know what percentage of households will be able to receive the digital terrestrial broadcasts and how many of them will choose this platform without a subscription fee instead of the pay-TV services. In any case, the tendency looks favourable, since after the program line-up was extended, the quantity of equipment receiving the MinDig TV service that are sold in the market is constantly growing, just like the number of users of the new platform.

As the Internet portal Index wrote, quoting sources quite close to Viasat3, "There are several possible scenarios that can be sketched for the impact on the different channels, on viewer ratings and on advertisement revenues, if they switch to the digital terrestrial television system or if they miss this opportunity. It is very difficult to select from the possible scenarios: everything depends on the percentage of the population that chooses the digital terrestrial television broadcasting, and the difference between success and failure is not more than a few percentage points." So, if the tendency emerging in the last quarter of 2009 continues in 2010, the MinDig TV service has a very good chance to stop the decreasing trend of the last few decades before the analogue switch-off, as far as the market share of the terrestrial platform is concerned.

(The interviews quoted in the article were taken in 2009.)