Kirch's d-boxes.........................................................
mediacentral.com
All's Still Not Quiet On Germany's Digital TV Front
By Candi Harper
The effort to launch digital TV in Germany on a widescale basis just can't gain any momentum. In the latest development in a battle that has been going on for more than two years, the European Commission has killed a Deutsche Telekom-Bertelsmann-Kirch joint venture created to roll out service. But some progress might be made if those three media giants offered Germany's very vocal Union of Private Cable Operators, better known as ANGA, a piece of the action.
There seems to be no end to the digital TV wars in Germany, which boasts some 16.5 million cable subscribers and a fat 67% penetration rate
Only weeks after the German public ended its opposition to Deutsche Telekom's planned launch of digital cable service, the European Commission recently responded to a request from ANGA -- Germany's Union of Private Cable Operators -- and suspended the German telco's latest digital alliance with the nation's two other major media players, Bertelsmann (CLT/UFA) and Kirch.
The EC, which nullified another Deutsche Telekom-Kirch-Bertelsmann digital-deployment venture two years ago, doesn't like the newest alliance because its sole aim was to develop a digital decoder.
After more that a year and a half of disagreements, Kirch and CLT/UFA agreed last summer to merge their competing digital programming packages, DF 1 and Premiere, respectively.
Premiere's analog pay TV service had more than 1 million subscribers, while DF 1's digital bouquet never attracted more than about 40,000. Because Kirch was stuck with a costly contract to buy 1 million d-Boxes from Nokia, the partners agreed to use that set-top as the platform for the combined programming package.
At first, Deutsche Telekom refused to accept the d-Box, maintaining that it would develop its own decoder specifications. In the end, however, the telco gave in to Kirch's demand that the d-Box be central to any deal.
Then, public broadcasters ZDF and ARD refused to go along with the d-Box. In August, the broadcasters launched their own digital offering. That package doesn't contain any new programming. Instead, it consists of existing shows arranged thematically.
The public broadcasters complained that the d-Box wouldn't play their electronic program guide (EPG) that helps viewers find programs by theme and provides some background material.
But just a few days before the EC decision suspended the latest Kirch alliance, the broadcasters agreed to go along with the d-Box -- at least until specifications can be written for an open application programming interface that will allow access for all programmers' electronic program guides.
The broadcasters' willingness to go along with the d-Box, at least until something better comes along, seemed to finally clear the way for digital cablecasting in Germany. Indeed, Deutsche Telekom has started carrying DF 1's encoded digital bouquet in many of its systems.
Still, one important group was left out: Germany's private cable operators, whose systems serve two-thirds of the nation's cable households.
"We have stopped all our negotiations with the joint venture partners and have asked the EU to force them to stop selling d-Boxes, unless and until the joint-venture is approved by the EU," says ANGA director Bernd Jaeger. "They put the programming on the air and the d-Boxes on the market before they received EU approval and before they signed any kind of agreement with us about carriage fees."
Along those lines, some ANGA members are filtering out the DF 1 digital signal in their systems.
"If they carry the program and sell the decoders, they bypass us entirely, and we won't get any money out of the deal," Jaeger notes. "What they have offered us so far is not nearly enough to finance the upgrading necessary to digitalize our part of the network."
ANGA represents about 80 private cable operators who serve some 7.5 million subscribers. The trade group includes Germany's largest MSOs: o.tel.o with 1.6 million customers and Bosch with 800,000.
ANGA's long-term goal is to retain control over its members' subscribers and participate in the effort to market digital services.
"We want to be allowed to provide and sell digital packages, bill our customers directly for them and give x% to the provider," Jaeger says. "Otherwise, we are just carriers with no chance to take part in the development of the market." At ANGA, digital's introduction in Germany is closely tied to Deutsche Telekom's ownership of the nation's cable infrastructure. Along those lines, ANGA has asked the EC to study what impact the telco's cable system interests has on competition. An EU-commissioned study on that subject was completed by Arthur D. Little of Berlin this summer. But so far, the EC hasn't released the results or taken a public stand on the issue.
"We believe there's a link between the two questions of the joint venture and DT's ownership of cable, and we have asked the EU to examine the two issues together," Jaeger says.
When Deutsche Telekom began to build out the nation's cable network in the early 1980s, the electronics workers union forced Germany's Parliament to divide the system between its members and DT. The result: The telecom monopoly was allowed to lay cable only up to the curb. That meant that large apartment buildings were wired by private cable operators, who continue to collect fees from their subscribers, even though their programming never diverges from the standard Deutsche Telekom feed.
A second group of private operators sprung up after Germany's reunification. Deutsche Telekom gave franchises for towns in the old East Germany with fewer than 10,000 inhabitants to cable entrepreneurs. Those operators can program their systems as they like.
(February 2, 1998) |
