Digital terrestrial TV (DTTV) hit the headlines last week as the
deadline for bids closed, but the advertising industry has a mixed view
on the opportunities the new service will provide in terms of ad revenue
With the creation of over 30 new channels, advertisers will be faced
with further audience fragmentation, which could force the larger FMCG
advertisers to put their money elsewhere in their efforts to target
Christine Walker of Zenith Media believes that when the technology
becomes available in late 1997 it will be ’a slow-burn effect’ in terms
of take-up - similar to the growth of satellite television.
’Digital TV will present opportunities, but primarily for the
I can’t imagine the large FMCG advertisers increasing their spend. In
fact, the evidence is that they are decreasing their budgets and putting
it in-store,’ she said.
Taking the long view
However, digital TV will present better targeting opportunities as it
becomes more sophisticated, with advertisers able to exploit integrated
marketing opportunities through interactive TV.
Mandy Pooler, managing director of The Network, said: ’It will attract
more advertising revenue, taking revenue from traditional direct
marketing and possibly press, because you will be able to advertise on a
more local basis.’
There are still three-and-a-half multiplexes to be allocated by the
Independent Television Commission, and the decision will be made in the
spring of this year.
The British Digital Broadcasting (BDB) consortium (Carlton, Granada and
BSkyB) is seen as a clear favourite.
Its rival, the Digital Television Network (CableTel/NTL), is the cable
industry’s bid for a digital presence. Cable knows that the dawning of
the digital age in the UK could deal it a shattering blow, as it still
lags badly behind satellite television.
The BDB consortium is bidding for 12 channels in a basic subscription,
plus three premium subscription channels. DTN is offering 20 TV and data
services (text-based) channels which will include pay-per-view,
specialist channels and services such as home shopping.
S4C has bid for the other half of the multiplex upon which it is a
guaranteed place provider. It is proposing five channels, including a
channel from Turner Entertainment and Time Warner.
Pooler points to the marketing muscle of BDB. The consortium’s bid also
includes involvement from the BBC, which will be paid by BDB to provide
channels. ’It’s a very powerful line-up, not simply because of the
broadcasters - look at the Granada rental side and Sky’s huge customer
database,’ said Pooler.
Most advertisers, although dazed by the array of new advertising
opportunities, are optimistic about the benefits of digital terrestrial
Robert Bartlett, executive director of Wella, said: ’There will be more
choice. There will be more opportunities for better targeting, less
media wastage and, hopefully, cheaper advertising rates.’
A source close to Sky said digital terrestrial TV opens up a new
customer base hitherto inaccessible to satellite and cable
’It gives us the option of marketing to those who have resisted
satellite due to snobbery. DTTV will allow us to market to those who do
not want all of the multi-channels.’
Just under a quarter of homes have cable and satellite TV. DTTV’s task
is to persuade the remaining three-quarters of UK households to invest
around pounds 200 each in a set-top box and pay subscription fees for
the new channels.
BDB says it will win one million subscribers in the first three years,
and aims to make a profit after five years, if its bid is
Sharing the cake
By the end of 1998 there could be around 30 new digital terrestrial TV
Each ’multiplex’ carries up to six stations and will be split into the
- The BBC has one multiplex which will carry BBC1, BBC2, a 24-hour news
service and other BBC services.
- ITV and Channel 4 share a multiplex which will broadcast their current
channels plus two additional channels.
Teletext Ltd also has guaranteed capacity.
- Half of the third multiplex is split between Channel 5, S4C and Gaelic
programming in peak hours in Scotland.
- The remaining three-and-a-half multiplexes are available and licences
will be awarded in the spring