Digital TV Development: TechnoEconomic Planning Considerations

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Digital TV Development Techno-Economic
Planning Considerations
John Yip Chief Engineer Radio Television Hong
Kong 28 March 2007
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1. Introduction

• Proposing a systematic and practical methodology
  for analyzing the numerous factors influencing
  the rollout/ growth of digital TV technologies.
• Focusing on the application of basic economic
  concepts to facilitate strategic development.
  Reducing guesswork.

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2. Delivery Systems

• The choice of a delivery system may affect
  rollout/ growth. However, growth depends also
  heavily on market dynamics and rapid
  technological adaptation of manufacturers.

DTT/HDTV
ATSC
ISDB-T
DVB-T
DMB-T/H
IPTV
ADSL/ADSL2 (for IPTV-SD)
ADSL2/ VDSL2 (for IPTV-HD/SD)
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2. Delivery Systems
S-DMB
DVB-H
MediaFLO
T-DMB
Mobile TV (Broadcast)
CMMB / STiMi
T-MMB
DMB-T/H
Mobile TV (Cellular)
3G
3.5G / HSDPA
UMTS/ MBMS/ TD-CDMA(TDtv)
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3. Generic Growth Equation and Methodology

• Equation (for current/ future digital
  technologies)

• Driving Force, DF
• function of (soft factors, hard factors)
• M (r, p, m, o) H (G, g)
• where M soft factors (regulatory, pricing,
  marketing, other), and
• H hard factors (G for macroeconomic,
  g for geo-physical)

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Generic Growth Equation, soft and hard factors
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S-curves of technological diffusion
Figure 1. S-Curves with picture quality as the
performance measurement
Source Technology Strategy, 15.912, Spring
2005, MIT, Sloan School of
Management
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Generic Growth Equation, illustrating
acceleration by soft factors
Soft factor effects
Growth (Penetration, )
Baseline growth
Critical Mass
Time (Years)
0
S-curve for growth (growth at 15 pa or more is
strong 5 pa or less is weak)
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• GDP-per-capita is significant if there is a
  significant outlay, e.g. for an HDTV display,
  and/ or a recurrent fee, e.g. in a pay-TV
  service, over an initial service period of 1-2
  years.
• Regulation can prevent new players from entering
  the market minimizing barriers enhances growth.
• International cooperation and IPR ie transaction
  cost minimization could allow world-wide use of a
  digital TV system, analogous to the Coase Theorem
  (R. Coase, 1959) in economics, on the allocation
  of property rights re radio frequencies.

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Methodology, using growth equation

• Proposed process
• Form a development team.
• Analyse hard factors, to form a baseline.
• For r, p, m, o, compile separate lists of
  relevant considerations.
• Assess soft factors through group discussions/
  market surveys (eg using Delphi Method).
• Analyse critical issues synthesize a roll-out
  strategy.
• Liaise with the government where necessary.

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4. HDTV
GDP GDP-per-capita, (or AI relative to 100)
Hard Factor
Soft Factor
Mh (r, p, m, o)
Propelling Factor, HDF Mh (r, p, m, o) (GDP
GDP-per-capita) where GDP is based on the PPP
(Purchasing Power Parity), (GDP GDP-per-capita)
Affordability factor, and Mh is a function of
regulatory/ pricing /marketing /other factors.
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4. HDTV
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4. HDTV

• On breaking down function M,
• HDF (Ar Ap Am Ao) (GDP
  GDP-per-capita)
• Ar - mandating early rollout / cessation of
  analog TV, built-in digital tuners in TV sets,
  on-air HD quota, spectrum allotment, licensing
  regime, standardization
• Ap - subsidies by governments / operators,
  assisting viewers eg on HDTV STB
• Am - promotional/ marketing campaigns, to promote
  viewers awareness
• Ao - quality leap using HD (eg USA and S. Korea,
  using ATSC, have achieved fast rollout),
  increasing HD production and sourcing attractive
  HD programs.

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5. IPTV

• Propelling factor, IPDF
• Mi (r, p, m, o) GDP-per-capita Population
  Density,
• Mi (r, p, m, o) GDP/population population
  /area
• Hence
• IPDF Mi (r, p, m, o) GDP /area
• GDP/area (ie US billion/ sq. km, PPP, pa) is
  analogous to annual crop yield in economic
  farming and harvesting GDP is computed yearly
  it is dimensionally similar to speed.
• IPDF applies only to a city-sized economy but not
  to countries with large barren areas.

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Potential, IPTV-SD
Estimated (GDP/ area) yields
Source Data from World Fact Book and
Wikipedia
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Potential, IPTV-HD, using IPDF estimate
Estimated (GDP/ area) yields, these to be
considered together with AI for HDTV
Source Data from World Fact Book and
Wikipedia
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IPTV, Soft Factors (r, p, m, o)

• Regulatory
• - licensing, cross-platform content-flow
  control
• regulatory hurdles to be minimized eg allowing
  cross-platform (terrestrial/ cable/ satellite)
  content-flow and leaving the market to decide.
• Pricing
• - smart and competitive bundling of channel
  services/ STB plus services, to entice consumers
  penetration pricing, using a bundling of
  attractive program channels plus broadband
  internet/ VoD and other value-added applications.

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• Marketing/ promoting
• - advertising and promoting increase awareness
  and the perceived value (total use value or TUV)
  of the IPTV services.
• Other factors
• - varied contents could be offered, as there are
  numerous channels. Interactivity, shopping, games
  and VoD could be offered. FTTH/ FTTP will cater
  for a very wide range of services on PON (passive
  optical networks).

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6. Mobile TV

• Mobile TV is a complex subject due to numerous
  factors, including
• Spectrum allocation
• Emerging standards and system maturity
• Handset designs/ functions and pricing
• Competition between broadcast and cellular system
  operators
• Viewing habits/ reluctance/ lack of understanding
• Reception reliability in a heavily built-up city
• continued investment in maintaining mobile
  
• reception reliability.

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6. Mobile TV

• Propelling Factor, MDF
• Mm (r, p, m, o) GDP-per-capita T
• where T is the Terrain Factor (0 lt T lt 1),
• and MDF applies to a city-sized economy.

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Terrain Factor

• Terrain includes hills and housing estates.
• If terrain is flat, T 1.
• T is a retarding factor, critical for pay TV.
• Dependent on frequency band, eg VHF for T-DMB or
  UHF for DVB-H, and on technology (eg satellite/
  terrestrial).
• By combining satellite, terrestrial and cellular
  networks, T can be enhanced.

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Factors (r, p, m, o)

• Regulatory
• - government-led or market-driven development.
• - allocation of RF spectrum (VHF, UHF, L and S
  bands)
• - licensing for broadcast and cellular
  operations.
• Pricing
• - handset cost and design eg battery life,
  antenna size, unit size and weight, screen size,
  channel switching/ signal recovery times,
  reception frequency bands, etc.
• - Competition between broadcast/ cellular
  operators.
• - In a built-up city, the costs of providing and
  maintaining a reliable network will be off-loaded
  onto consumers.

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• Marketing / promoting
• - to increase awareness of the technologies/
  benefits and to raise the perceived value of
  services, hence increasing the demand.
• - Promotion could take advantage of the young
  generations attraction to fashionable handset
  designs/ styles and to cultivate consumers
  habits.
• Other factor
• - content offerings (news, other real-time
  information, drama, sports, interactivity, short
  clips of compelling content including UGC).
• - consumer habits and attitudes.

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6. Comparison. (G, g), (r, p, m)
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6. Comparison. Soft Factor (o)
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Use slide show and ? to animate. g generic
model, usable for powering your Digital TV boat)
Dont miss the boat, the Digital TV boat.
Thank you.