Digital TV – a stake of 1 billion lei. For whom authorities keep silent?

Ion TERGUTA, Media Expert

 

About 75 percent of Moldovan households could remain without TV service from 17 June 2015, when closure of all transmitters operating on analog frequency and switchover to digital broadcasting is planned. Although the analog terrestrial broadcasting is expected to cease in less than 2 months, there is no any valid law to regulate this process.

The Republic of Moldova committed, under the Agreement signed at the Regional Radiocommunication Conference held in Geneva in 2006 and ratified by the Law No. 69-XVI of 27 March 2008, to cease conventional analog broadcasting. Most existing analog terrestrial television networks cannot be used to broadcast the digital signal, except transmitters produced after 2011. Therefore, transition to digital television will affect virtually all radio and TV operators broadcasting on-air, which will have to invest in modernization. The spectrum of frequencies is a limited resource, owned by the state, for which several operators compete.

Transition to digital terrestrial broadcasting should solve this problem. The major objective of the transition to digital television is ensuring uniform access to alternative sources of information and increasing the number of received TV stations up to 42 units. At least 12 of them should obtain a national coverage. Another 12 stations will have the status of regional broadcasters and the remaining will obtain the status of local operators. The only problem is advertising market, which is unable to provide business opportunities for all. Besides all, the broadcasting costs for TV stations are extremely high, about 30 thousand Euros per month, for national operators, which makes this service quite unattractive. In confirmation of this, in Chisinau mun. 2 terrestrial digital television transmitters owned by the SE “Radiocomunicatii” (DVB-T and DVB-T2 standards, MPEG-4 compression), operate in the testing regime on channels 58 and 61. These two transmitters broadcast only 18 radio and TV channels (capacity 30) in a radius of about 30 km from the television tower in Chisinau mun.

 

Zero moment in audiovisual sector. Hidden fight for the distribution market

The transition to digital terrestrial broadcasting is not about, as it is wrongly believed, only a few technical changes, but it is a complicated process of audiovisual modernization. It is a real zero moment, which we have no right to miss. The high degree of exposure of the area and excessive penetration of the audiovisual space by foreign stations, force us to explore this opportunity for deep reforms. However in the circles of power it is discussed whether to implement digital broadcasting and establishment of multiplexes or to develop cable networks and distribution of TV signal to operators through IP TV. Discussions are motivated by the business opportunities offered by new market realities.
 
An analysis of the distribution market shows that 69.4% of households receive the TV signal through antenna, in analog format. 5% have no access to TV services. 25.34% of households are subscribers to cable networks, of which 19.79% are consumers of IPTV services. Simply speaking only ¼ of TV services consumers from the Republic of Moldovan are payers, and in 2014 the market is estimated at about 162 million lei. Most interesting is that the IPTV distribution network of the JSC “Moldtelecom” experiences a growth in terms of quantity and value, and the distribution market perspective, especially through IPTV, is as good as possible. Keeping the current parameters we can talk about a market of about 650 million lei annually. This may slightly increase up to 1 billion 86 million lei in case of an absolute monopoly of “Moldtelecom”.

 

Too small and too many

I have already shown above that the transition to digital terrestrial broadcasting can provide new TV opportunities, by broadening the distribution area and increasing business opportunities. The only problem is the advertising market that is unable to support such a large number of TV stations. The Republic of Moldova currently does not have a mechanism able to ensure free competition in the market. This issue becomes even more serious when TV stations with access in the first multiplex created with public money, will be determined. More serious is that the ACC does not have to date a regulation that would set criteria for its establishment. I also insist here that the transition to digital terrestrial broadcasting is a unique opportunity to reform the audiovisual sector. Here are some recommendations.
 

• Establishment of the Public Communication Agency. It shall provide a general concept of public communication in the Republic of Moldova.
•  Creation of a national concept of audiovisual development, and hence the Moldovan television market and industry.
•  Adoption of a special law for protection of Moldovan audiovisual space.
• Discouraging retransmission of foreign contents. Encouraging Moldovan companies to invest in creation of their own program services. Among them would be compliance with national law, with reference to broadcasting volumes in Romanian language and European works.
•  Changing the principles for establishment of the Audiovisual Coordination Council and removing this institution outside political influences. The ACC should be composed of one representative of:

1. the TV patronages
2. the Association of Advertising Agencies
3. the National Council for Protection of Competition
4. the National Regulatory Agency for Telecommunications
5. the Union of Journalists
6. the Association of Lawyers
7. 3 members appointed through public competition by the Parliament of the Republic of Moldova.

• Establishment of multiplexes with national coverage based only on companies with original content.
• Prohibition of the same person to hold more than one TV company with national coverage. Sooner or later the Republic of Moldova will have to do this
• Dissemination of advertising exclusively in Romanian language.
• Charging 50 percent of advertising income of the companies retransmitting foreign content.
• Charging 90 percent of income of companies without a distinct activity in the TV market in the Republic of Moldova, but which has income.
• Establishing measurements of audience by public auction, under the ACC control and the National Council for Protection of Competition.
• State involvement in financing audience measurements for a minimum period of 4 years.
• Mandatory doubling of movies and series in Romanian.
• Changing the nomenclature of professions to meet the deficit of staff in the TV market.