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Ukraine Chooses DTT Transmission Company

December 10, 2010

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Ukraine's National Broadcasting Council has awarded a licence to operate digital terrestrial services in the country. The winning bidder, Zeonbud, will build the DTT networks and launch services by October 2011, preparing the for analogue switch-off at the end of 2015. Total cost of the licence is UAH7.62m (about €725,000) and the licence is valid for ten years.

Zeonbud is backed by a company called Planbridge Ltd, registered in Cyprus. Local sources claim it is associated with Ukrainian businessman Rinat Akhmetov, whose interests include the TRK Ukrainia TV channel. Zeonbud has a UAH1bn (€100 million) credit from Ukreksimbank for the implementation of digital TV but believes the total investment needed should be 20 per cent lower. It is expected to co-operate with BRT Concern, currently providing analogue terrestrial transmission, in building the DTT network.

Zeonbud is now negotiating with technology providers including Motorola, Rhode & Schwarz, ABE Elettronica and others. According to the transition plan it will use MPEG4 compression format and will offer set-top boxes with an estimated minimum price of UAH360 (€35).

Currently multichannel penetration in Ukraine is lower than 30 per cent of homes - relatively low considering that there are four satellite TV players, and over 600 cable TV operators. In 2009, under very difficult economic conditions, Ukraine's pay TV struggled, with satellite making very modest progress overall, with only Viasat growing. Cable TV subscriptions actually fell.

Despite an improving economy in 2010, pay TV is, in general, still struggling (financial difficulties have forced one of the satellite operators, Poverkhnost, to suspend broadcasts). The conditions are ripe for DTT, although it will not launch before the end of the year. Low-cost satellite platforms similar to Russia's TriColor, or the Czech/Slovak Skylink) may also capture a share of the market.

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