1 6 th World Media Economics Conference Centre d’études sur les médias and Journal of Media Economics HEC Montréal, Montréal, Canada May 12-15, 2004 The Long, Hard Road to Digital Television in Europe Allan Brown, Griffith University, Australia Robert G. Picard, Jönköping University, Sweden Although the main platform for analogue television has historically been terrestrial, the transition to digital in Europe has so far been driven by satellite and, to a lesser extent, cable. The take-up of digital terrestrial television (DTTV) has been poor and below official predictions in each European country where DTTV transmissions have commenced. The market-based introduction of DTTV appears to be failing. There are indications that market forces alone may not bring about sufficient consumer take-up of DTTV to allow the analogue networks to be closed down. Introduction Digital technology for the production, transmission and reception of television is clearly superior to analogue, and the eventual complete transition from analogue to digital throughout Europe, and indeed the world, seems inevitable. The main issues relating to digital television (DTV) do not concern whether or not to make the switch to digital, but when and how. Digital simplifies, streamlines and reduces the costs involved with the production, editing, storage and transmission of television programmes and services. DTV transmissions generally provide improved picture and sound quality, and are much less susceptible to distortion and atmospheric interference. Because less power is required for digital transmissions, the energy consumption and broadcast cost for each television service is lower than for analogue. Digital is also more versatile. It facilitates ‘enhanced’ programming (multiple camera angles, additional information to complement programming etc.) and interactive services. The development of digital compression techniques has reduced the amount of spectrum required for television transmission, and thus provides scope for a substantial increase in the number of television signals available to viewers. Digital terrestrial television (DTTV) creates the potential to reassign part of the spectrum released by the eventual termination of analogue transmissions to other communications uses, and provides the opportunity for national governments to generate revenue from the sale of part or all of this released spectrum capacity. For European countries, the transition from analogue to digital needs to be seen within the context of the massive changes to which the television industry has been subjected to over the past