It is right to highlight the potential of digital broadcasting, writes Jamie Smyth, but its economic viability at present is highly questionable
The Forum on Broadcasting has recommended the establishment of a digital terrestrial television network which would deliver television and internet services to households throughout the State.
The proposed network would create the kind of "information society" which is essential if the Republic is to take a lead in e-commerce and it should be addressed as a matter of urgency, according to the forum. It also calls for the impact of digital television on RTÉ to be kept under review.
The report follows five years of Government dithering on the issue, suggesting that astute consumers will not trade in their Sky mini-dishes or cable television subscriptions anytime soon.
Digital television offers consumers more channels with better sound and picture quality. It can also offer some interactive features and, as the forum suggests, access to the Internet. It could as well provide a platform for the distribution of local television channels to serve urban centres such as Dublin, Cork or Galway.
The idea of establishing an Irish digital terrestrial television network has been around since at least 1997 and it was specifically provided for in the Broadcasting Act, which finally passed into law in 2001 following a year-long delay caused by squabbling over the ownership of the proposed network.
More than a year later, the Government has not yet awarded a licence to operate a service in the Republic despite running a 12-month tender. The sole bidder for the licence, a consortium known as "It's TV", has not been able to satisfy the Government that it has the necessary financial muscle to fund a network.
Media analysts believe that it would cost up to €100 million to fund the construction of a digital terrestrial network, subsidise set-top boxes for consumers and market the digital television service. It would also prove extremely difficult for the new service to compete against existing operators such as Chorus, NTL and Sky.
The current cash crisis afflicting the technology, telecoms and pay TV sectors would also make it extremely difficult to attract financing for the service. The demise of several European digital terrestrial television services over the past 12 months - most notably ITV Digital in the UK - suggests that setting up a network would prove challenging.
Bearing in mind the current economic difficulties facing the Government, it would prove politically difficult for the public sector to shoulder the costs of the network.
The difficulties in establishing a digital terrestrial network have also impacted on RTÉ's ability to raise cash through the sale of a stake in its network. It is running a separate tender process which has attracted a shortlist of at least three firms, but most analysts believe that it cannot sell the network before establishing whether a digital terrestrial service is feasible.
RTÉ's cash crisis has left its own plans to develop a digital television strategy in disarray. The broadcaster originally planned to fund several new digital channels, including a 24-hour news channel, a youth channel and a channel which would cover the Oireachtas.
These new channels would have cost RTÉ about €72 million by 2006, but they were put on hold in March this year when RTÉ's director-general, Mr Bob Collins, said that he could make "no prediction" about digital television amid the station's worsening financial position.
The forum rightly considers that there is enormous potential in digital technologies and it suggests that their impact on RTÉ should be kept under review. But the prospects for a full digital terrestrial television service are not good at present.