Television Licensable Content Services Order 2006

rose to move, That the Grand Committee do report to the House that it has considered the Television Licensable Content Services Order 2006. The noble Lord said: The world of broadcasting is changing at a rapid pace. Over the past few years, the growth of the creative industries has been meteoric. The opportunities brought about by technological advances have revolutionised the way we look at, listen to and—crucially—interact with broadcast content. We need to keep adapting our rules to enable these opportunities to be realised, both for the growth of the industry and for the UK economy in general. If we want the UK to continue to be at the forefront of creativity, we need to ensure that the frameworks we rightly put in place can be flexible enough to adapt to these changes. Currently, a radio multiplex is distinguished by two key restrictions. It can carry only digital radio and use no more than 20 per cent of its total capacity for data services. It cannot carry television. The aim is to ensure that capacity is reserved for radio and not sacrificed for television. The orders amend both these key characteristics. First, the draft Television Licensable Content Services Order 2006 proposes to redefine the type of content that digital radio multiplexes can carry. This change will permit TV, as well as radio, to be carried. Secondly, the draft Radio Multiplex Services (Required Percentage of Digital Capacity) Order 2006 will increase the existing limit on data services from 20 per cent to30 per cent. Taken together, the orders will enable digital radio multiplex operators to offer consumers a combined package of television and DAB radio, making best use of valuable spectrum and utilising the most recent technology developments. Historically, legislation has sought to protect digital radio by preventing TV from being carried on radio multiplexes. This has protected the spectrum for digital radio that could otherwise have been sacrificed for TV services. However, we do not now believe that it is in the consumers’ interest that this limitation should continue. Technological advances in compression techniques and a reduction in the amount of capacity that is needed to carry a service have meant that TV can co-exist with, rather than replace, radio. We believe that rather than protecting spectrum for digital radio, the legislation is now preventing the development of innovative new services which will make digital radio more accessible and appealing by allowing it to combine with other services. The potential of a mobile TV and DAB package will further increase the attractiveness and demand for digital radio; this was tested in last year’s pilot by BT Movio, a subsidiary of BT. The pilot allowed more than 1,000 mobile phone users with specially designed phones to access three live television services and more than 50 digital radio stations. The trial, which was the largest of its kind in Europe, showed that even with the additional services, consumers listened to more DAB radio than they watched television. Additionally, more than 73 per cent of users said they would be prepared to pay for the service on their network. Evidence from the BT Movio pilot showed that only 11 per cent of users would be happy with fewer than five TV services. Consequently, BT Movio has stated that it cannot sustain a business model with fewer than five services. That is why we propose to increase the maximum data limit to 30 per cent. That will allow for five TV stations in addition to the existing DAB radio services. There may be anxiety that this represents an unfair advantage for BT when others will have to pay for valuable spectrum for this purpose. However, I emphasise that there is nothing to prevent other people from developing similar services on local multiplexes or on the proposed new national multiplex. It is important to note that the BT Movio proposals are as a wholesale content provider and that its services will be open to other phone operators. We all know that the pace of technological change is increasing. Both the Broadcasting Act 1996 and the Communications Act 2003 recognised this and anticipated that the technological changes in broadcasting would need us to revisit the regulatory regime. We believe that these orders will make possible innovative, converged services which can increase the take-up and listening to of DAB services. Not only will more people listen to DAB on new devices but, having got used to these services, they may want all their listening to be on DAB. We hope that this is the case. We at least want the consumer to decide. That is why we are introducing these orders. I beg to move. Moved, That the Grand Committee do report to the House that it has considered the Television Licensable Content Services Order 2006.—(Lord Davies of Oldham.)