COMMUNICATION: Brazil Key in Global Digital TV Competition

By Mario Osava Reprint | | Print |

Mario Osava

RIO DE JANEIRO, Jul 18 2001 (IPS) - Brazil has turned into a powerful judge in the global digital television business by delaying its decision to opt from among the three technologies that are competing for the international market.

Three consortia – from the United States, Europe and Japan – are offering systems that have different characteristics and levels of development.

The 50 million TV sets in Brazil that will be replaced over the next 10 to 15 years represent a market to be conquered, one that would be a big leg-up for any of the three proposed systems. In the economy of scale Brazil would help reduce prices, which are currently very high and are preventing the new technology from taking off.

Furthermore, Mercosur (Southern Common Market – Brazil, Argentina, Paraguay and Uruguay) is discussing adopting a common digital system in order to facilitate industrial and TV-related integration of the bloc, which is home to more than 200 million people and represents at least 80 percent of South America’s combined gross domestic product (GDP).

The US system developed by the Advanced Television Systems Committee (ATSC) was launched in November 1998 and has already been adopted by Canada, South Korea, Taiwan and others.

Also in 1998, digital television was introduced in the European Union (EU) by the Digital Video Broadcasting (DVB) system, made up of more than 200 public and private organisations.

For its part, the Japanese ISDB-T (Integrated Services Digital Broadcasting), based on the European DVB, is slated to begin operating in 2003.

Brazil’s inclination towards one of these technologies will be decisive for Mercosur and will influence the choices made by the rest of the South American nations.

As a result, an intense game of seduction is occurring in Brazil as the competing consortia try to convince the government and the other decision-makers of the advantages their specific technologies have to offer.

Nevertheless, the National Telecommunications Agency (Anatel), Brazil’s regulatory body, has been studying the characteristics, potential and limitations of the three alternatives for the last two years and shows no signs of being in a hurry to make a recommendation.

Numerous tests have been conducted of each of the systems, and now the process is to continue with a series of public consultations in order to evaluate all of the aspects at play.

Caution is essential because the decision will have an affect on the future of 162 million Brazilians, industrial production, the creation and broadcast of television programmes, as well as entailing financial, cultural and political questions, said Renato Guerreiro, Anatel president, in justifying the deliberate pace of the agency’s investigations.

In addition to providing high-definition images, digital television permits a vast number of channels and transmission of data and of voice in both directions. It means interactivity and services, including telecommunications.

These attributes would change the nature of companies that today are limited to the production and emission of programming, and would demand heavy investment and financing, Guerreiro has stressed in articles and statements published here in recent weeks.

Brazil should choose “what is most appropriate for the country,” not only in technical terms, but also economically, says Ethevaldo Siqueira, an expert who was editor of the National Telecommunications Journal for more than two decades.

We have to consider whether Brazil will be able to produce the new televisions, and even export them, and negotiate reimbursement for adopting one of the three digital TV systems, such as access to the technology with an exemption or reduction of patent payments, Siqueira told IPS.

Meanwhile, the Brazilian Association of Radio and Television Broadcasters (ABERT) has already cast its vote for the Japanese system.

The Japanese proposal is the only one that offers high- definition transmissions for mobile televisions, points out Fernando Bittencourt, director of ABERT and head of the engineering division at TV Globo, Brazil’s communications giant.

Mobility opens a whole new market: the 20 million cars and buses that circulate on Brazilian roads, and the millions of passengers who spend hours travelling by public transport every day, Bittencourt said.

The enthusiasm of the owners of the major broadcast companies surprised Siqueira, who believes that the Japanese model “promises greater possibilities, but is not very realistic,” in part because it will not begin operating until three years from now.

The Japanese themselves recognise that mobile digital televisions will be very expensive so the market would be limited, the telecoms expert stressed.

The three technologies have been approved by authorities in various private and public sectors despite being at different stages of development, but will evolve according to the market’s needs, commented Siqueira.

He pointed out that colour television in the United States was criticised in the beginning for its instability, but was recognised later as the best of that technology.

The arrival of digital TV now presents countries with a problem similar to the one faced in the 1970s, when they had to choose between three colour television systems: Europe’s PAL N, a modified version known as PAL M, and the US-created NTSC.

Each digital TV model has its advantages and disadvantages. The Japanese version is most flexible and opens new doors for business, but it is still being developed and its adoption in Brazil would limit the scale of production due to a reduced export market for the system, according to Siqueira.

The European technology offers the easiest transition from the current analog system to digital because it does not require a high-definition TV set to improve the image. But it would face eventual obstacles in its evolution due to the differences within the EU.

The United States opted for high-definition, with an image far superior to that of the “old” analog television. The market for the US technology, however, is expanding slowly because the digital set is very expensive: 3,000 to 5,000 dollars.

Even so, Siqueira believes the tendency in Brazil – and Latin America as a whole – is towards the US-based model of ATSC, a government-approved private organisation.

Economic factors, such as domestic production of digital TVs and their potential for export to neighbouring countries, are decisive. It is also a concern for Brasilia as the Western Hemisphere heads toward the creation of the Free Trade Area of the Americas (FTAA), slated to enter into force in late 2005.