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BROADCASTING SERVICES (DIGITAL TELEVISION FORMAT STANDARDS) REGULATIONS 2000 2000 NO. 272
EXPLANATORY STATEMENTStatutory Rules 2000 No. 272
Issued by the authority of the Minister for Communications, Information Technology and the Arts
Broadcasting Services Act 1992
Broadcasting Services (Digital Television Format Standards) Regulations 2000
The Broadcasting Services Amendment (Digital Television and Datacasting) Act 2000 (the amending Act) amends the Broadcasting Services Act 1992 (the Act) and the Radiocommunications Act 1992 to, among other things, make changes to the arrangements for the implementation of digital television in Australia.
Section 217 of the Act provides that the Governor-General may make regulations, not inconsistent with the Act, prescribing matters required or permitted by the Act to be prescribed, or necessary or convenient to be prescribed for carrying out or giving effect to the Act.
Item 126 of Schedule 1 to the amending Act, among other things, repeals and substitutes clause 37 of Schedule 4 and inserts clause 37B into Schedule 4. Most provisions of the amending Act, including item 126 of Schedule 1, will commence on a day to be fixed by Proclamation, subject to automatic commencement six months after Royal Assent (subsections 2(2) and (3) of the amending Act). The amending Act received Royal Assent on 3 August 2000.
When item 126 of Schedule 1 to the amending Act commences, clause 37 of Schedule 4 to the Act will provide that regulations may determine standards that are to be observed by commercial television broadcasting licensees and national broadcasters in relation to the format in which television programs are to be transmitted in SDTV digital mode in non-remote areas. ("SDTV" means standard definition digital television. Clause 37B will make corresponding provision for remote areas.
Section 4 of the Acts Interpretation Act 1901 provides for the exercise of statutory powers between passing and commencement of an Act.
The purpose of the regulations is to implement an MPEG-1 Layer 2 audio standard for the transmission of television programs in SDTV digital mode. The regulations require that if a television program transmitted in SDTV digital mode by a commercial television broadcasting licensee or a national broadcaster has an audio component, the component must be capable of being decoded by a receiver that has only "MPEG- 1 Layer 2" audio decoding capability.
If an audio standard were not mandated and broadcasters were allowed to transmit the audio standard of their choice in SDTV format, then different broadcasters could transmit sound signals which conform to different standards. In such an environment receiver manufacturers would have to provide equipment which decodes both sound standards, or risk having consumers purchase equipment which cannot receive audio signals from a11 broadcasters. Receivers which comply with all possible formats will be more expensive for consumers. They also require more development work, meaning that it will be longer before digital television receivers will be available on the Australian market. Therefore, the lack of a "baseline" standard could increase costs to consumers and delay uptake of digital television.
The regulations do not prevent a broadcaster from also providing additional audio components that comply with other standards (for example, Dolby AC-3) with SDTV digital mode programs, in order to provide audio for receivers designed to decode such streams. That is, the regulations do not prevent a broadcaster from also transmitting another audio component with the SDTV version of the signal, provided the MPEG- 1 Layer 2 receivable audio component is provided continuously with that version.
Details of the regulations are in the attachment. Also attached is the Regulation Impact Statement.
Part 1 of the regulations commences on gazettal, and Part 2 commences on the commencement of item 126 of Schedule 1 to the Broadcasting Services Amendment (Digital Television and Datacasting) Act 2000.
ATTACHMENT
DETAILS OF THE REGULATIONS
Part 1 - Preliminary
Regulation 1.01 - Name of Regulations
Regulation 1.01 provides that the name of the regulations is the Broadcasting Services (Digital Television Format Standards) Regulations 2000.
Regulation 1.02 - Commencement
Regulation 1.02 provides that Part 1 of the regulations commences on gazettal, and Part 2 commences on the commencement of item 126 of Schedule 1 to the Broadcasting Services Amendment (Digital Television and Datacasting) Act 2000.
Regulation 11.03 - Definitions
Regulation 1.03 provides that the "Act" for the purposes of the regulations means the
Broadcasting Services Act 1992.
Part 2 - SDTV format standards
Regulation 2.01 - SDTV format standard for audio component of programs remote and non-remote areas
Subregulation 2.01(1) provides that for the purposes of subclauses 37(1) and 37B(1) of Schedule 4 to the Act, the standard mentioned in Schedule 1 is to be observed by commercial television broadcasting licensees and national broadcasters in relation to the format in which television programs with an audio component are to be transmitted in SDTV digital mode.
Subregulation 2.01(2) provides for the standard mentioned in Schedule 1 not to prevent commercial television broadcasting licensees and national broadcasters from transmitting television programs in SDTV digital mode with an additional audio component which does not comply with the MPEG-1 standard in Schedule 1 (for example, Dolby AC-3), provided that an audio component that complies with the MPEG-1 standard in Schedule 1 is also transmitted.
Schedule 1 SDTV format audio standard
Item 1 provides definitions of the terms "IEC", "ISO" and "MPEG-1 Layer 2" for the purposes of the regulations.
"IEC" means the International Electrotechnical Commission.
"ISO" means the International Organization for Standardization.
"MPEG-1 Layer 2" is defined to mean a digital audio stream which complies with the requirements of either of the two joint ISO/IEC international standards listed in the definition. The two standards are compatible. The later standard is an extension of the earlier standard.
Item 2 sets the audio standard for the transmission of television programs transmitted in SDTV digital mode. Item 2 provides that if a television program transmitted in SDTV digital mode has an audio component, that component must be capable of being decoded by a receiver that has only MPEG- 1 Layer 2 audio decoding capability.
REGULATION IMPACT STATEMENT
A. BACKGROUND
In August 1999 the Standards Australia committee agreed on a standard for digital television transmission. In November 1999, it agreed on a digital television receiver standard. These standards were premised on transmission being in HDTV. The standards are based on the European "DVB-T" standard, with some modification for Australia.
The standard allows broadcasters the choice of transmitting the audio component of their signals in one of two technical formats: MPEG or Dolby AC-3:
* MPEG audio is the base audio standard adopted in the DVB suite of technical standards for digital television. It allows mono, stereo or multichannel surround sound, and is the main standard used in digital pay TV receivers in Australia and overseas;
* AC-3 is a proprietary digital standard developed by the Dolby Laboratories. It allows stereo or six channel surround sound, and is currently the default audio standard in DVD players (which usually have both AC-3 and MPEG sound capability).
The inclusion of both audio standards allows broadcasters the option of transmitting the audio standard of their choice but has the result that all receivers must be able to operate with either standard. However, it is not normal practice for countries using the DVB standard to broadcast SDTV without MPEG audio.
The government's decision to require commercial and national broadcasters to carry a continuous SDTV signal at all times did not specifically address the issue of audio standards. However, the Minister in the second reading speech for the Broadcasting Services Amendment (Digital Television and Datacasting) Bill 2000 indicated that "As part of the requirement to provide SDTV at all times, the government expects that broadcasters will provide an audio stream using the MPEG sound standard."
However, industry consensus has not been, and is unlikely to be, reached on the audio standard. This uncertainty is retarding the development of SDTV receivers and their availability to consumers. The Government is now implementing the MPEG audio standard through regulatory powers provided in Schedule 4 of the Broadcasting Services Act 1992 (the BSA).
B. PROBLEM IDENTIFICATION
The legislation requires that an SDTV version of the program be transmitted at all times. The rationale for this decision was that consumers should be able to buy low cost SDTV equipment and be assured that they will receive a continuous service. It is therefore important to ensure that all consumers can receive sound with their SDTV programs.
There is a lack of industry consensus on the audio standard to adopt in relation to the SDTV version of digital television in Australia.
If an audio standard is not mandated and broadcasters were allowed to transmit the audio standard of their choice in SDTV format, then different broadcasters could transmit sound signals which conform to different standards. In, such an environment receiver manufacturers would have to provide equipment which decodes both sound standards, or risk having consumers purchase equipment which cannot receive audio signals from all broadcasters. Receivers which comply with all possible formats will be more expensive for consumers. They also require more development work, meaning that it will be longer before digital television receivers will be available on the Australian market. Therefore, the lack of a 'baseline' standard could increase costs to consumers and delay uptake of digital television.
It is not considered appropriate or necessary to mandate an audio standard for HDTV transmissions ' to meet the Government's policy objectives of providing a low cost digital television entry point for consumers. HDTV receivers are a premium product. The relevant Standards Australia Committee has already agreed that broadcasters have the option of providing MPEG and/or AC-3 with respect to HDTV transmissions.
C. POLICY OBJECTIVES
The Government's key objectives are:
* To ensure the timely provision of digital television receivers in Australia which take advantage of the global economies of scale associated with the adoption of the dominant digital television audio transmission standard;
* To provide a low cost SDTV entry point for consumers consistent with other government decisions relating to the introduction of digital television;
* To provide certainty to the industry and minimise costs associated with the delivery and receipt of digital television; and
* To ensure the delivery of a diverse range of digital TV services by facilitating the efficient delivery (and receipt) of all programs using an effective audio standard for SDTV.
D. IDENTIFICATION OF OPTIONS
Option 1: To take no action and not mandate an audio standard.
Option 1 would allow commercial broadcasters to transmit a single audio stream of the audio standard of choice.
Option 2: To mandate an MPEG audio standard for the transmission of all SDTV programs
Option 2 involves setting a transmission standard as a basic requirement for the audio component of SDTV programs, which requires that the audio component be receivable by all receivers capable of decoding MPEG-1 Layer 2.
The Act does not provide for regulations to be made to mandate receiver equipment standards. Receiver equipment standards are generally agreed by industry consensus through the Standards Australia process. Standards agreed by Standards Australia are not compulsory (unless they are set in regulations). It is generally expected that if a certain standard is mandated or agreed for transmission, receiver equipment will follow that standard to ensure that receivers can always receive and decode available digital signals.
Option 2 would not prevent the transmission of other sound standards provided MPEG receivable audio was also transmitted.
Option 3: To mandate an AC-3 standard for the transmission of all SDTV programs
Option 3 involves setting a transmission standard requiring that at all times the sound component of any SDTV program transmit an audio component receivable by a receiver capable of decoding an AC-3 audio signal.
Option 3 would not prevent the transmission of other sound standards provided AC-3 receivable audio was also transmitted.
E. IMPACT ANALYSIS
Commonwealth
All options are budget neutral. The regulations do not have any direct financial impact on the Commonwealth's expenditure or revenue.
Broadcasters
Under Option 1, broadcasters would be able to transmit the audio standard of their choice, ie. either MPEG or AC-3. There may be small cost savings and spectrum efficiencies for those free to air broadcasters who chose to run AC-3 (or MPEG) only, in not having to convert the sound signal to MPEG (or AC-3) before transmission. However, there may be increased costs for anyone retransmitting these signals (such as pay television operators).
Under Option 2, broadcasters would not be obliged to transmit a sound signal other than MPEG. If they wanted to provide AC-3, it would be in addition to MPEG and two audio streams would need to be transmitted. This may result in spectrum inefficiencies but this would be a matter for broadcasters to determine consistent with their commercial judgement. Option 2 may also impose additional studio costs on broadcasters who choose to also offer AC-3 sound but it is not expected that these costs would be large.
Under Option 3, broadcasters would not be obliged to transmit a sound signal other than AC-3. If they wanted to provide MPEG, it would be in addition to AC-3 and two audio streams would need to be transmitted. This may result in spectrum inefficiencies but this would be a matter for broadcasters to determine consistent with their commercial judgement. Option 3 may also impose additional studio costs on broadcasters who choose to also offer MPEG sound but it is not expected that these costs would be large. Some broadcasters would prefer Option 3 ie. to transmit Dolby AC-3 only to minimise erosion of their capacity to deliver quality HDTV services, because of effects on bandwidth.
Neither Option 2 nor 3 would prevent broadcasters transmitting the full range of digital TV services.
No option would restrict competition in relation to provision of different types of sound. Option 2 would, however, mean that all broadcasters would need to provide a base level of service.
Aspirant Datacasters
Option 1 or Option 3 may restrict the ability of aspirant datacasters to build a satisfactory business case for the introduction of datacasting services. Allowing a choice of standards is likely to increase receiver costs and thereby slow take up of digital technologies. Similarly, AC3 is seen as not providing a low cost entry point and therefore not encouraging rapid take-up of digital technologies - a key influence on the take-up of datacasting services.
Option 2 by applying a sound standard consistent with DVB-T (ie MPEG), and thereby providing a low cost entry point for consumers, will encourage the rapid take up of digital technologies, assisting datacasters to build a business case.
Equipment/Receiver Manufacturers
If broadcasters were to decide to adopt different sound standards, receiver suppliers would be faced with the choice of offering equipment which could only receive a limited range of program sound, or providing equipment which was able to decode both sound systems. There are few, if any, consumer receivers currently available capable of receiving both sound signals. Dual-capable receivers would need to be developed specifically for the Australian market which would delay availability and prove costly particularly when there is uncertainty in demand. There would be limited opportunities for manufacturers to capitalise on economies of scale. Any extra costs would almost certainly be passed on to consumers.
Option 2 allows for receivers which are commonly used in Europe and the UK (where digital TV is in the most advanced stage of introduction), and which generally decode MPEG only, to be introduced into Australia in the early years of digital television with minor modification. Thus MPEG is currently effectively the dominant sound standard for SDTV digital TV.
Option 2 would not preclude equipment suppliers from providing, in the future, AC-3 capable receivers provided these receivers also contain MPEG receiving capabilities.
Under Option 3, consumer set top boxes with Dolby AC-3 decoders only are not generally commercially available. This is because there are few, if any, DVB-T terrestrial broadcasters in the world transmitting in SDTV format only transmitting AC-3. To receive Dolby AC-3 an additional audio chip will be required in the set top box which will increase the costs for manufacturers and consumers.
Consumers
The consumer response to digital television will be influenced by, amongst other things, the cost of the receivers and consumer expectations about the services available from the receiver. It is therefore not possible to accurately predict the initial number of consumers affected by these options - however, it is noteworthy that around 99 per cent of Australian households have at least one television set. Clearly consumers will not be happy with receivers that may not transmit sound for some services. Option 1, which allows a choice of standards is likely to increase receiver costs and slow take up of digital technologies.
Mandating an audio standard will not remove consumers' choice of services. Indeed, it will guarantee consumers a low price option (ie Option 2) that may otherwise not be available, while at the same time allowing consumers the choice of purchasing at the higher price, higher quality end of the market. Option 3, while still allowing for consumer choice and providing certainty, is likely to result in higher base-entry costs for consumers than Option 2.
Option 2 provides consistency with decisions already taken by Government aimed at enabling rapid take up of the technology by providing a low cost SDTV entry point for consumers in the early years of digital television. Limiting the receiver audio specification to the basic requirement of MPEG audio only will result in a cheaper receiver than if the receivers have chips to decode both MPEG and AC-3 or receivers were to be developed for AC-3 alone. Also, set top boxes with an MPEG-only receiver are expected to be more readily and quickly available than set top boxes for AC-3 alone.
MPEG with SDTV can be seen as an important option for consumers in a period when AC-3 and HDTV entail a significant price premium and an important intermediate step in the transition to HDTV. This approach provides a transition path in the introductory phase when consumers are uncertain of the costs and benefits of digital TV.
This option also has the advantage for consumers of minimising potential problems for interoperability with cable and satellite services. (MPEG audio may be the only audio format offered in other devices.)
No option would restrict competition in relation to provision of different types of sound and resultant consumer choice. Option 2 would, however, mean that all broadcasters would need to provide consumers with a base level of service. Option 2 will not prevent consumers purchasing high priced models to enable receipt of AC-3 if they wish.
Consumers can experience a smooth transition from analogue to digital television in the timeframe set by the Government, and enjoy more diversity in audio choice in television services.
F. CONSULTATION
Consultations on this issue have been ongoing within the relevant Standards Australia Committee since the Government announced its intention to require free to air (FTA) broadcasters to transmit a standard SDTV signal at all times in December 1999. While the Committee has agreed the transmission standards for both video and audio for HDTV transmission, no consensus has been reached on the audio standard for SDTV transmission.
In addition, since the announcement discussions have been held between officials and industry players including commercial and national broadcasters, the Australian Consumers Association, aspirant datacasters, service providers, the Australian Electrical and Electronic Manufacturers Association, and Australian Subscription Television and Radio Association. There is disagreement on the standard to be adopted.
Several submissions to the Senate Environment, Communications, Information Technology and the Arts Committee inquiry into the Broadcasting Services Amendment (Digital Television and Datacasting) Bill 2000 raised the issue of mandating the provision of an audio stream in MPEG format.
Some FTA broadcasters support the option of transferring the existing arrangements for HDTV to SDTV as well (ie choice between MPEG and AC-3). They consider this approach will maximise their capacity to deliver good quality HDTV. However, other broadcasters support mandating MPEG on the basis of maximising consumer take-up.
Support for mandating the MPEG signal has been received from the Australian Consumers Association; the Australian Subscription Television and Radio Association and aspirant datacasters. The arguments supporting mandating MPEG include: the expected lower cost of consumer equipment with consequent increase in take up of digital television and datacasting; and that all current digital satellite services in Australia transmit in SDTV with MPEG. If a free to air broadcaster transmits AC-3 only, any pay TV operator wishing to relay digital terrestrial signals over satellite would need to reconvert the audio stream from AC-3 to MPEG before retransmission. This would mean increased costs for the pay TV sector and consumers of pay TV and free to air terrestrial services delivered via satellite in rural and remote Australia and a degree of degradation in the quality of sound.
Equipment manufacturers have expressed a range of views on the appropriate standard - but mostly appear to want certainty to enable decisions to be taken in relation to consumer equipment provision.
The Department of Communications, Information Technology and the Arts also wrote to industry to ensure that the technical description of the audio standard to be adopted in the regulations is accurate and consistent with the relevant international standards. Although not all supporting mandating MPEG, comments received on the technical description were on the whole supportive of the approach proposed.
G. CONCLUSION AND RECOMMENDATION
Option 1 and Option 3 would not meet the Government's objective of providing a low cost SDTV entry point for consumers consistent with other government decisions relating to the introduction of digital television.
Option 1 is not viable because consensus can not be reached within the industry on the minimum audio standard to be adopted despite the government's encouragement to reach an agreed standard through appropriate channels.
Without industry consensus on the audio standard to be used, there is a risk that different sound standards will be used, leaving some consumers with equipment using a standard which is not compatible with some transmission standards and possibly unable to receive some digital television transmissions or, more likely, requiring dualformat receivers which will be more costly (both for manufacturers and consumers).
Also uncertainty about digital audio standards could result in later availability of consumer receivers having an adverse impact on the introduction of digital television in Australia.
Option 3 would provide certainty but would introduce arrangements which are uncommon elsewhere in the world, thereby potentially increasing costs of consumer equipment and thereby slowing take-up of digital television and datacasting in Australia.
Under Option 2, implementation of regulations that set a minimum audio standard will more closely meet the government's objective of ensuring the timely provision of digital television receivers in Australia which take advantage of the global economies of scale associated with the adoption of the dominant digital television audio transmission standard while providing a low cost SDTV entry point for consumers. Option 2 does not preclude other signals being transmitted and received should broadcasters, consumers and equipment manufacturers so wish.
No option would restrict competition in relation to provision of different types of sound. Option 2 would, however, mean that all broadcasters would need to provide consumers with a base level of service.
It is expected that, particularly given the high penetration rate of television sets in Australian households, the potential benefits of savings from reduced costs to consumers flowing from Option 2 are likely to outweigh the potential costs to those broadcasters who choose to provide additional sound signals. In addition, potential benefits from earlier take-up of digital television and compatibility with existing equipment may accrue to other sectors of the economy such as the pay television and datacasting sectors.
The Minister therefore proposes to implement the audio standard through regulation using powers under clauses 37 and 37B of Schedule 4 in the BSA.
H. IMPLEMENTATION AND REVIEW
The arrangements will be implemented at the same time as the commencement of Clauses 37 and 37B of the BSA. These provisions will commence on a date to be set by Proclamation, subject to automatic commencement 6 months after Royal Assent to the Broadcasting Services Amendment (Digital Television and Datacasting) Act 2000.