Blogging Nick Piggott

Freeview is getting a pasting in the press at the moment, because a small number of set-top boxes have died after a change to the multiplex configurations. It highlights a problem faced by all digital platform operators, and challenges the notion that market forces can regulate the quality of receiver products.

The four digital TV platforms in the UK all use variants of the DVB (Digital Video Broadcasting) standard. Sky and Freesat use DVB-S* (Satellite), Virgin Media uses DVB-C (Cable) and Freeview uses DVB-T (Terrestrial). DVB-T is widely rolled out across Europe, and is the basis for Digital Television in many countries globally. DVB is to digital TV as GSM is to mobile telephony.

Both DVB and DAB are standardised in detailed standards documents published by ETSI, but like all standards, there are options and alternate configurations. All these possibilities are laid out in the standards, and both broadcasters and receiver manufacturers work from the same document to ensure that the end-to-end chain works.

Or at least, that’s the theory.

In practise, commercial pressures trump technical diligence more than manufacturers would like to admit. The standards are written in technical English, but it’s a major committment to read and really understand all the detail in the documents, and that takes time, and it’s expensive. Then the testing phase is complex, because there are so many permutations to work through to be sure that your receiver is going to work in all permissible conditions, or at least behave gracefully when it can’t support something.

Unfortunately, there is another way to develop a receiver. A scant skim-read of the spec, combined with periods of time with prototype receivers in hotel rooms, hacking away at code until the signal is correctly decoded. I know of a number of receivers that have been developed in this way – simply bashing away at code based on what’s being transmitted. As soon as the required signal comes out, the code is committed.

It’s faster and cheaper than doing it meticulously against the spec, and it allows a manufacturer to race a box out potentially earlier than rivals, and without having invested much time in tracking the development of the technology. The manufacturer just wants to shift the box, get the cash, and move the engineers onto the next consumer electronic device.

Interestingly, DAB suffered from exactly the same problem that Freeview has now, but about 9 years ago. A well-known (and at the time, best-selling) brand of DAB receiver appeared to be working perfectly until DigitalOne came on air. At the time, the BBC multiplex was broadcasting 8 services, but DigitalOne had 10. The additional number of services crashed the receiver, because the engineers at the time had assumed that 8 services would be the maximum on a multiplex. Thankfully, this was a reputable manufacturer who organised and paid for the recall and firmware upgrading of all receivers free of charge. Other receivers have been had similar limitations which have only become obvious when used in other countries, where the multiplexes are configured differently to the UK, but still entirely legitimately within the published specification.

Sky and Virgin avoid the problems that Freeview have had by supplying the receivers themselves, and testing every box themselves for compliance. It’s more costly for them, but dramatically reduces the customer-service problems that crap products create.

Because crap products tarnish the platform more than the manufacturer.

The headlines in the papers run along the lines of “FREEVIEW FIASCO“. That’s unfair. Why isn’t is saying “DAEWOO BOXES DIE” or “BUSH RECEIVERS BITE THE DUST“? Why does the Freeview platform bear the brunt of the criticism when they’re working within the spec? The Daewoo spokesman is quoted as saying “We certainly had no intention of selling boxes that would not work witin a few years”, which is hardly a robust defence. Why no unequovical statement of “Our receivers were developed according to the DVB-T specification, and tested accordingly”? What’s your view of the Daewoo, Bush, Labgear and Triax brands?

The argument from manufacturers about receiver compliance is “let the market decide”. In other words, those reputable brands who develop compliant receivers will benenfit, and people who put out rubbish will get crucified by the consumer and their brands will be trashed. Unfortunately, the Freeview problem is showing that consumers don’t react like that. They’ve already forked out their money, and their motivation was to receive the Freeview service, not necessarily to buy a cherished Daewoo product. It’s Freeview that they’re raging against.

DAB suffers from this problem. Consumers appear to assume that no matter how cheap and obviously nasty a DAB radio is, it should work perfectly, and maybe that’s a legitimate assumption. In the same way that a supermarket can’t sell you dangerously unfit food, surely they won’t sell you a digital radio that’s functionally useless. Unfortunately, it’s not the case, and there are DAB radios out there (cheap and nasty ones) which simply don’t meet the requirements of the spec, particularly in terms of sensitivity (the ability to pick up weaker signals).

Doing receiver compliance properly is a high-risk issue. Broadcasters and transmission providers are wary of running compliance programmes in case they get sued by a manufacturer if a receiver stops working. Manufacturers find it difficult to get hold of sufficient test signals to check all permutations (and that’s even the digilent ones). The risk falls disproportionately on the consumer.

The DVB / DAB logos are only supposed to be applied to receivers reaching the spec, but clearly not many people trust the manufacturers’ thoroughness in testing for these logos to carry much value any more. The logos just go on the box if it appears to work. Freeview and Freesat now run a testing programme on receivers, which grants a UK specific “tick” logo to boxes proved to be compliant. I would prefer to see a crack-down on receivers falsely applying the DVB/DAB logos, rather than developing a safety net branding. But to do so would need a significant investment in compliance testing and enforcement by DVB Form/WorldDMB, customs, importers and retailers. Is it worth it for a £15 receiver box?

Photo – my own, entitled “World’s Stupidest Freeview TV #2″.

Radio Festival – the three days where the entire UK radio industry gathers to discuss the future of the radio industry, address the topics of the day, and indulge in the unprecedented transfer of value from wallets to bars. (Although this year’s free bars have been widely praised).

So where and how did Digital feature in this celebration of radio, and what did Lesley Douglas (Controller, BBC Radio 2) say that was the most insightful and valuable contribution of the whole event?

Twelve years ago, DAB warranted a token primer session in Techcon. (”Here is a picture of a mul-ti-plex. You can transmit many stations on one mul-ti-plex. It uses au-dio en-cod-ing called Emm-Peg Two”). I drove people around Birmingham in a Black Thunder demonstrating a DAB radio the size of a small beer fridge.

This year, ITIS and Fraunhofer presented useful and interesting applications for DAB. ITIS explained the many varied uses of TPEG, including the very topical FPI (Fuel Pricing Information) service (complete with early 2008 diagrams with references to sub £1/litre fuel – how we sniggered). If GPS mapping is the next big thing in terms of mobile technologies, then DAB allows those maps to be populated with large amounts of really useful real-time data. My hunch is that POI (Points of Interest) will itself become a Point of Significantly Valuable Commercial Interest to commercial radio stations (can I register the acronym POSVCI? No?). Fraunhofer demo’ed their Journaline applications, which is a lightweight browseable text service, something like a RSS Reader but delivered over DAB. Neat, but I wonder if it’s aiming at a class of radio (simple text display) that the radio industry is trying to get beyond now?

Festival proper started on Tuesday, with brilliantly produced an fabulously creative session on the Digital Radio Working Group (producer, Nick Piggott, GCap Media plc). Ahem. Look, it was never going to wow people when the report had already been out a week. The discussion (when it finally got going – the crowd took time to warm up this year) focused a lot on in-car receivers, and I felt that Peter Davies got away rather too easily with side-stepping the question about what to do about the punitively high transmission costs being suffered by commercial broadcasters at the moment. There also wasn’t enough discussion about coverage strengthening. But then, it was the first session, and the bar had been open the night before.

There was the obligatory session on music rights, where PPL and PRS/MCPS explain that they’re really only trying to help, but then get nailed (quite rightly) by everyone who asks a question from the crowd, and big kudos to Jay Crawford for exposing the levels of desperation to claw money from people to such an extent that they set up call centres to do mass enforcements of “workplace” music licences. A quick conversation with the landlord of the local hostelry confirmed that he’d been strong-armed into getting a licence because his chef occasionally has the radio on in the kitchen. Madness, from the people who brought you “let’s sue 12 year olds”.

But the really interesting thing about Festival now is that Digital crops up everywhere. It’s just part of life. (I don’t think it got mentioned in Matthew Bannister’s amusing session on compliance, made even more hysterical by Muff Murfin using at least three words from the seriously banned list unaware that two school kids had been ushered into the hall behind him for the next session).

On Wednesday, we had a session on visualising radio, which just served to highlight the commonality of the vision for radio in the future. I was on the panel next to Ben Chapman (Radio 1), and the fact is that we pretty much agree. Ben’s got different ideas on what his visuals will be, and in that respect it’s the very embodiment of “agree on technology, compete on content”. Radio is going to visualise, so the race is on to see who does it first, and who does it best (clearly, GCap will do both). There were some slightly random contributions from Westwood about his YouTube successes. (I wonder if he’s called that because of Westwood Hill, Sydenham, SE26). Chris North of Wise Buddah reminded us (as only an agent can) that artistes have finite time, so we need to bear that in mind when we come up with endless digital extensions to work on.

However, it was Lesley Douglas who really contributed significantly to the digital debate this year, in the dying moments of the festival. In a session where a panel of key industry people (Andrew Harrison, Tony Moretta, Lesley Douglas) take questions from the audience, one question prompted the discussion “has the UK picked an out of date digital technology?”. The conclusion, as usual, is no – when you properly consider all the elements that lead to success, there’s no better choice than DAB/Eureka 147. But Lesley closed the panel by saying something along the lines of:

I hope that this is the last year we have to discuss the technology, and that next year we’ll be talking much more about the content of digital radio, which is what matters far more to listeners.

I couldn’t agree more.

It’s really great to meet radio people from around the world, and talk with them about their own plans for digital radio. But I’m often surprised about how much confusion surrounds DAB, particularly the (mis)information about DMB.

It’s important that radio people inform themselves properly and independently about the technology choices they are making. This isn’t as easy as it seems.

Follow the money

What isn’t widely understood is how money flows around the business of consumer electronics these days. You might think that a manufacturer makes money through retail margins – selling radios at a price higher than it cost to produce them. That’s certainly true, but the economics of the last decade or so have eroded retail margins to be incredibly slim. You don’t make much money simply by selling radios.

One of the issues that is new to radio people is IPR – Intellectual Property Rights. IPR represents some “cleverness” that a company (or group of companies) has thought up to make technology work better/cheaper or both. Legally, they “own” that idea or process, and they can choose to licence it to third parties. A modern consumer electronics device (like an MP3 player) may have IPR from twenty or thirty companies in it, and everyone of those companies is entitled to a licence fee. There has recently been a case where consignments of MP3 player have been seized because the manufacturers have not been paying the IPR for using the MP3 technology.

Here’s a specific example: To enable DAB+ or DMB requires an audio encoding technology called HE AAC, combined with a technology called SBR (Spectral Band Replication). These two technologies cost €1.60 and €0.15-€0.20 to licence per receiver respectively. So every DAB+ or DMB enabled receiver generates €1.80 to those companies who own the IPR rights. Multiply that across every radio sold in the world, and that’s a substantial amount of revenue. Put it another way, if you sell a DAB+ radio for €20, as a manufacturer you might get €0.50 from the retail margin, but as an IPR licensee you might make €1. Making radios is not as profitable as making the technology to go into radios.

But here’s an interesting thing. A DMB device also needs another technology called MPEG II Transport Stream. That adds another $0.50 per device. So a DMB device automatically has a higher cost, even if it only ever decodes audio. And there’s another $0.50 per device flowing to an IPR holder (or group) somewhere.

So who owns this IPR?

It’s not always clear who benefits from these extra licensing fees. But it does stand to reason that the companies who have IPR rights in a particular technology will be those companies most enthusiastic about promoting it and getting it widely adopted. And boy, there’s no wider adoption than radios. (100m radios in the UK alone – only 70m mobile phones). It’s a vast vast opportunity. If you’re an IPR holder, even if it’s only a total of €0.10 per device, you could be looking at millions and millions of Euro in licence revenues for decades to come – just by persuading someone to use your technology.

So now it makes sense why a technology company might fly people around the world, and make expensive “prototype” devices to encourage uptake of that technology in which they might have IPR rights -both declared and potentially hidden too. A few hundred thousand Euro in airfares, flights and prototypes might net millions of Euro return.

(It would be like the petro-rich countries encouraging the development and universal adoption of the internal combustion engine. Whatever the development and marketing costs were, they would quickly be dwarfed by the petro-dollars rolling in for decades and decades).

Take your technology advice carefully

Here’s a harsh statement – don’t trust technology suppliers to give you impartial advice. They might benefit substantially from your decision. They are selling you a solution, and your consumers will be paying for it with every device they buy, for ever.

So now you have an insight to the motivation of technology suppliers, who can give you impartial advice?

Well, the answer is that few people can give you genuinely impartial advice. But I would suggest that other broadcasters probably have objectives more similarly aligned to your own, and rarely have an IPR interest, so their advice might be far less prone to distortion. But of course, they don’t make any money from their advice, so sometimes it’s hard to justify spending a few hundred Euro one a flight and a hotel to discuss these things.

I’m disappointed that our colleagues in France have an expectation of Digital Radio that’s virtually identical to ours, but have been sold a completely different set of technologies to delivery it – technologies that will add about €0.75 in IPR to every single digital radio sold around the world. We can’t afford to make that mistake again.

DAB, DAB+ and DMB

Sometimes it appears that technology suppliers would prefer the simplicity of DAB to be obscured from broadcasters. It obviously helps them sell a solution if the solution looks hard.

DAB isn’t complicated, but you do have to know your options.

Everything in DAB starts with the multiplex, and the multiplex can support a mix of technologies all co-existing in the same set of spectrum and on the same infrastructure. The most prominent DAB applications are:

• DAB – confusingly, the same name as the multiplex. DAB refers to the original method of broadcasting radio using the MPEG Layer II audio encoder, and this is now largely superseded by DAB+. You can add visuals to DAB using Slideshow at frame rates of up to 1fps.
• DAB+ – the way to transmit Digital Radio. DAB+ is a direct upgrade of DAB. The great thing about DAB+ is it supports exactly the same data services as DAB, so there is a clear migration path for countries using DAB now (like the UK) into DAB+ without starting from scratch again.
• DMB – the way to transmit mobile TV. DMB is substantially more complicated and expensive to transmit, and on the receiver, than DAB or DAB+. Unless you absolutely need to transmit TV (moving pictures with synchronous audio), you should not be considering DMB at all. The extra IPR load on the receiver of DMB is nasty, and makes the idea of a €50 radio with a colour screen virtually impossible.

I don’t think I can make it clearer than that. Don’t use DMB for radio, as it’s unnecessarily complex and expensive for radio, even radio with visuals. Use DAB+, as it was beautifully developed (largely by broadcasters with no IPR interests) to work brilliantly for radio. DMB was knocked up in a hurry to support mobile TV – it works, but it’s not elegant. But you can mix them all together in the same DAB multiplex just fine.

Radio companies of the world need to stick together

Together there is enough knowledge and understanding of the technology within broadcasters not to have to rely solely on technology suppliers for advice. The problem is that we appear to be really lousy at talking to each other about it. The WorldDMB Technical Committee helps a bit, but often decisions are being taken at higher levels than that, and there simply aren’t enough commercial radio broadcasters participating in WorldDMB.

That needs fixing before we fall into another IPR trap that will cost us all money.

Vodafone Germany appear to have thrown in the towel in the great battle to get mobile users to pay for mobile TV :

They’ve decided that a better plan is to enable reception of the existing Free-To-Air DVB-T service, and bolster their revenues from selling digital content linked to and around FTA TV. This sounds like a smart move to me, as someone else is paying for the network. Clearly it’s more “not good news” for the dedicated mobile technologies of DVB-H and DMB.

So, Vodafone Germany enables Free To Air TV reception via DVB-T, and at the same time Vodafone UK enables Free To Air Digital Radio reception via DAB by signing a network exclusive deal for the Samsung Steel.

(I’m tapping all the contacts I have to get the full info on the extent of DAB support in the Steel – does it do DLS Text, Slideshow, EPG?)

Maybe Vodafone Group is more joined up across Europe than we give them credit for?

Joi Ito is an influential guy in new media circles, and he’s fretting about Mobile Internet. In his post “Is mobile Internet really such a good thing?“, he draws attention to some of the fundamental differences in business models between wired Internet and mobile Internet. It may all be IP packets at a technology level, but the way money flows around is very very different, and that’s what Joi is concerned about.

To briefly summarise his thoughts:

• The mobile internet ecosystem is very regulated; either by government and law, or by the network operators and their own business plans
• The operators are driven to pursue revenues “above the wire” (from applications) because the cost of their spectrum and networks is very high
• A significant amount of money goes to vendors to make the network equipment – (infrastructure and, I guess, handsets)

It’s these issues which make Joi wonder if models that work on wired Internet will successfully transfer to mobile Internet.

I think that if we move over to mobile too quickly we’re risking moving our game to a platform where the DNA is not what we’re used to on the Internet and most importantly, putting money in the pockets of people who do not redistribute it to startups, but instead feed giant vendor ecologies instead.

To me, the obvious differences between wired and mobile Internet are:

• You pay for your computer and you probably expect to keep it for 3-4 years. You don’t pay (directly) for your mobile phone, and you probably want to change it every 1-2 years to keep “in fashion”.
• Your wired connection is probably pretty cheap for your ISP to maintain, and has a significant amount of capacity that can be dedicated just to you. The spectrum for your mobile connection probably cost your Telco a huge amount of money, has to be shared amongst everyone in your immediate vicinity, and probably isn’t that spacious.
• Because of the two reasons above, your wired ISP probably doesn’t see itself as a significant content provider and certainly wouldn’t try and take a cut of all the transactions processed across “the Internet”. Your Telco probably needs to create “above the wire” application based revenue to make their business plan stack up, and keep the money flowing to pay for new handsets and new network infrastructure.

It seems to me that the ideal mass-market mobile application would benefit from a network where:

• The users pay for their own devices, and expect them to last some time
• The network operator has low infrastructure and spectrum costs, and offers widespread coverage

Hmmmm… I wonder what technology could possibly fit that bill. Answers on a postcard please, copied to Joi Ito.

Seriously, it does serve to highlight again that a broadcast technology has unique strengths, even in a world apparently dominated by bi-directional IP. If you can come up with a set of applications that can be broadcast (or combined with a lightweight use of IP), then you’re going to have a massive advantage over the guys relying on the Telcos to enable their business plans.