TELECOMS GROUP Eircom and local television broadcasters TV3 and Setanta Sports are believed to have formed a consortium to bid for the three commercial digital terrestrial television (DTT) multiplex licences that are being offered by the Broadcasting Commission of Ireland. Ciaran Hancock, Business Affairs Correspondent, reports.
It is understood that the consortium has decided to bid for all three licences. Each digital terrestrial television multiplex will be capable of carrying up to eight digital channels and the operators will be able to charge households a fee for receiving the stations via a set-top box.
The Broadcasting Commission of Ireland (BCI) has indicated that it will consider applications for all three licences and for individual multiplexes. The regulator said it had an open mind at this stage as to how the DTT multiplexes should be operated.
The consortium combines Eircom's network infrastructure and telecoms expertise with content provided by both TV3 and Setanta, which has a large portfolio of pay sports channels, including live rights to Premier League football in England.
TV3 is owned by private equity group Doughty Hanson, which is also a substantial shareholder in Setanta. Doughty Hanson has previously indicated its desire to use TV3 as the launchpad for new channels here.
About 27 per cent of 1.5 million Irish households do not have a pay-television service and the BCI has estimated that these will be the likely customers for DTT, along with people who want a set-top box for their bedrooms.
Digital television is currently available in Ireland through cable operator UPC, which owns NTL and Chorus, and satellite broadcaster BSkyB.
DTT will replace the existing analogue signal, which is due to be switched off sometime between 2012 and 2015. RTÉ has already been awarded a licence by the Government to operate a free-to-air DTT multiplex that will carry its own channels and other terrestrial services, including an Oireachtas channel.
It is not clear if TV3 will feature on the free-to-air multiplex operated by RTÉ if its consortium is successful in winning the commercial licences.
RTÉ is also believed to be lining up a bid for the commercial DTT licences, possibly as part of a consortium.
Other operators thought to be weighing their options include UPC, which is owned by Liberty Global; Sky Ireland; Smart Telecom; Denis O'Brien's Communicorp radio group; and telecoms player BT Ireland. The BCI recently said it expected fewer than 10 applications for the multiplex licences.
According to industry sources, mobile operators Vodafone and O2 have decided not to enter the bidding.
The multiplex contracts will run for 12 years and could go live from 2010 onwards. They will offer a range of interactive services and support high-definition broadcasts that are not possible through the current analogue frequency.
The closing date for applications is May 2nd with an oral hearing of presentations pencilled in for May 12th.The BCI said it would appoint external consultants to help evaluate bids and it expected to select the licence winners on July 21st. Applications will cost €50,000, with 80 per cent of this fee refunded to unsuccessful groups. A regulatory fee of €225,000 a year has been proposed.
According to industry sources, RTÉ is planning to charge €3 million to carry each multiplex on its transmission service. Operators will also have to pay a spectrum charge to Comreg, the telecoms regulator.
Each household in the Republic will have to buy a set-top box to receive DTT.
Multiplex operators will be required to provide 90 per cent population coverage at launch.
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