Operators Focus on The Opportunity
SES Astra and Eutelsat are among the operators who are closely watching the HD developments. Alexander Oudendijk, senior vice president of sales and marketing at SES Astra, expects significant developments to happen by 2006. "We will see Premiere launch three channels this November and we will probably see CanalSatellite launch at least one channel before the end of this year. BSkyB will launch in 2006. So, I think the real impact for HDTV will come in the first part of 2006."
Oudendijk also expects significant developments to take place in Germany. "We expect Premiere will go first with a three-channel HD package," he says. "The first push will come in the pay-TV market. But commercial broadcaster ProSiebenSat is also very keen on HDTV. There is also a chance they may do a full HD launch once Premiere has launched. I don't think this will happen in 2006, but we may be surprised."
Eutelsat is also confident that throughout the next 12 months the HD industry will really crank into gear. "It has been marked already by increased collaboration between content providers, retailers, operators and TV set manufacturers to step up the number of curtain-raiser events that will build consumer awareness and to rollout the HD ready label on new TV sets in order to reassure buyers that the product in which they are investing is compatible to view HD channels," says Olivier Millies-Lacroix, commercial director at Eutelsat.
The quality of HD content could become a key weapon for satellite pay-TV operators as they try to gain an advantage. Millies-Lacroix added, "We can expect markets used to the concept of premium video will be the early adopters of HDTV, particularly France, Italy, Germany, the United Kingdom and countries in Scandinavia. Pay-TV operators are banking on the step change in picture quality afforded by HDTV which will fit into their customer acquisition strategy."
In the United Kingdom, according to BskyB, in the first three years following the launch of its digital offering, customer research showed that the main reason for digital take-up was improved picture and sound quality rather than channel choice, Millies-Lacroix adds. Another development that could influence the adoption of HD is the move to the MPEG-4 data transmission standard for HD broadcasts, which affords economies of scale for broadcasters and local storage, which will enable pay-TV platforms to develop new pay- per-view models for on-demand HDTV content such as films, he says.
The Big HD Sell
While satellite operators are confident that HD will enable them to boost revenues, it will be the content providers and pay-TV operators that will play a key role as they ramp up their HD content offerings.
Joseph Guegan, executive vice president in charge of technology at France's Canal+, says the company had a three-step plan in the HD area.
"We have started at the end of March putting together the infrastructure, planning everything and starting demonstrations," Guegan said. "We will have a demonstration channel on Astra in June, which will go to a promotion channel, which will be a kind of teasing channel for our set of HD channels on satellite in spring 2006."
DTT will be a key influence in the drive toward HDTV in France. Guegan admitted, "Thanks to a decision made in France about DTT, which is based on MPEG-4 for pay-TV, we will have to put our infrastructure in line with MPEG-4. That is going to happen sometime between September and December. What we do is adapt that to satellite in terms of the rest of the infrastructure. That is the good news in terms of having MPEG-4. It is quite expensive to go for HD and multiple premium channels and you must have a critical size to do it."
CanalSatellite will begin delivering HD-compatible set top boxes in September, and once some premium channels start offering HD content, it will have a snowball effect on the market, Guegan says. "I think that next year HD will make the first impact. I am not sure it is going to be huge in terms of numbers of subscribers. It is going to be big in terms of the improvement of quality of image. That is going to be the reference for premium channels in France and in Europe. As soon as some of the pay-TV players such as Canal+ are going to offer that, the others are going to align themselves. They have no choice. Premium is premium and it will be HD."
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