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The following is issued on behalf of the Communications Authority:
Taking into account its statutory duty to promote the efficient allocation and use of radio spectrum, the interest of the viewing public and the additional investment commitment by Television Broadcasts Limited (TVB) in high definition (HD) programming, the Communications Authority (CA) decided to temporarily vary the capacity sharing arrangement of the Multiple Frequency Network (MFN) for Asia Television Limited (ATV) and TVB to simulcast four analogue television channels (ATV Home, ATV World, TVB Jade and TVB Pearl) in digital format (collectively referred to as the Simulcast Channels) for the period from November 26, 2013 to November 30, 2015.
With the commencement of Digital Terrestrial Television (DTT) services in 2007, ATV and TVB were required under their Fixed Carrier Licences (FCLs) issued under the Telecommunications Ordinance (Cap. 106) (TO) to equally share the transmission capacity of one MFN multiplex for transmitting the Simulcast Channels. On November 12, 2013, the CA announced its decision to impose a financial penalty of $200,000 each on ATV and TVB for their failure to share equally the transmission capacity in the MFN, thereby contravening Special Condition 3.2 and Schedule 2(A)(ii) of their FCLs, with TVB using more than half of the transmission capacity in the MFN for broadcasting its Jade and Pearl channels in HD format while ATV continued to broadcast its Home and World channels in standard-definition (SD) format and allowed TVB to use part of ATV's transmission capacity in the MFN without the prior consent of the CA.
In context of the CA's investigation into the above contravention by ATV and TVB, the two broadcasting licensees have jointly applied to the CA to formalise the existing sharing arrangement on the MFN (the Application).
In the Application, ATV confirmed that it would continue to broadcast its Home and World channels in SD format up to 2015 despite using a more efficient source coding from October 2012, and that it would not require some 1.5 Mbps capacity in the MFN in the meantime. As for TVB, it has started broadcasting the Pearl channel in HD format since October 2012 and the Jade channel since March 2013, making use of the 1.5 Mbps transmission capacity not required by ATV.
In response to the CA's stipulation, TVB committed in the Application to investing some $300 million on HD programming for 2013 to 2015, which is in addition to its six-year Investment Plan for 2010 to 2015 as approved by the CA before and incorporated into its existing domestic free television programme service licence issued under the Broadcasting Ordinance (Cap. 562). Specifically, TVB will upgrade its studios and ancillary facilities to cater for HD production, produce in-house HD programmes for both the Jade and Pearl channels, and acquire HD programmes of various genres for broadcasting on both the Jade and Pearl channels.
In considering the Application, the CA was mindful of the fact that were TVB required to adhere to the original equal sharing arrangement as specified in its FCL, the Jade or Pearl channel would need to revert back to SD format. Under such circumstances, the viewing public would instantly suffer from a degradation in picture quality of the TVB channel. On the other hand, given ATV’s confirmation that it would continue to use SD to broadcast its channels up to 2015, the 1.5 Mbps transmission capacity in the MFN would continually be left idle. In sum, requiring TVB to revert back to the equal sharing arrangement as required under its FCL would not only run counter to the CA's statutory duty under section 32G(1) of the TO to promote the efficient allocation and use of the radio spectrum as a public resource of Hong Kong, it would also be against the interest of the viewing public who would no longer be able to continue to enjoy the enhanced picture quality of the two TVB channels through a reinstatement of the SD format in place of the HD format.
The CA has also given due consideration to the additional programming investment proposed by TVB in support of the Application, which would provide an increased variety of HD programmes for the benefit of the viewing public for the coming few years.
Having carefully considered the above factors, the CA decided, as a temporary measure up to the expiry of the existing domestic free television programme service licences of ATV and TVB, to vary the capacity sharing arrangement of the MFN multiplex by withdrawing 1.5 Mbps transmission capacity in the MFN from ATV during the period from November 26, 2013 to November 30, 2015, and re-assigning such capacity to TVB for its continued broadcast of the Jade and Pearl channels in HD format during the same period. The approval is subject to the condition that TVB honour its some $300 million additional programming investment according to the agreed timeline as stipulated in its commitment to the CA.
Ends/Saturday, November 30, 2013
Issued at HKT 13:58
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