Market Insight

Poland starts analogue switch-off without subsidies for low income homes

November 08, 2012

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On 7 November 2012 Poland commenced the first phase of analogue switch-off (ASO) beginning with the Lubuskie region in the West of the country, with large cities: Zielona Gora and Zagan. By the end of November 2012 ASO will also take place in three other regions including cities: Poznan, Gdansk and Ilawa. The areas of the first phase represent about 10 per cent of total households.

According to the transition plan, ASO process will take the second step in March 2013 in five other areas, including capital city, Warsaw. Then ASO will gradually continue in various regions of the country. The ASO completion is set for July 2013.

Until now three multiplexes have launched in Poland, two of which (1 and 2) have currently a national coverage, providing 15 channels in total, including one in HD. The third multiplex, dedicated to public broadcaster, TVP, will extend its coverage after completion of ASO. At the moment TVP's main three channels broadcast on multiplex 1, but will move to multiplex 3 after ASO. The broadcasting council, KRRiT, is working on a tender for the three places on multiplex 1 and it should be called in the beginning of December 2012. All multiplexes are operated by the country's transmission company, Montagu-owned Emitel.

By the end of June 2012 the Ministry of Administration and Digitization spent PLN2m (about €0.5m) on information campaign. The campaign in the second half of 2012 and in 2013 will cost another PLN3m.

No plan for more DTT multiplexes has been yet prepared; no decision has been yet taken with regards to digital dividend. Moreover, although the ASO has already started, the government hasn't yet decided on subsidies and in so far no re-funds for low-budget households have been prepared. Recently Post Office has commenced the sale of set top boxes via mail. A set top box costs in its offer PLN115 (about €30).

In addition to DVB-T service, there is also a DVB-H multiplex operated by Info-TV-FM owned by Poland's largest satellite TV player, Cyfrowy Polsat. The company offers eight pay mobile TV channels for PLN14.9 (about €3) monthly, or PLN9.9 monthly for CP's satellite TV subscribers. The DVB-H channels are offered on top of free to air DTT channels which has been made available for mobile devices thanks to a mobile decoder provided by CP.

DTT launched in Poland with a considerable delay. Even the launch of four commercial channels on multiplex 1 at the end of 2009 had to be considered a test, as the public broadcaster failed to fulfil the conditions for choosing the DTT operator (and so the public channels launched on DTT in 2010). After multiplex 2 launched in September 2010 digital roll-out slightly accelerated, still, DTT didn't get a national coverage before July 2011, when the multiplex reached 87 per cent of the population. Multiplex 1 started broadcasting nationwide even later - in May 2012.

As of November 2012, multichannel penetration in Poland reaches about 95 per cent of homes. As a result of the slow roll-out only about five per cent of total households are now with a DTT service on their primary TV sets.

Lack of DTT was a big advantage for satellite platforms, which in 2006-10 have been growing very fast, in rural areas facing no competition from other platforms. Currently, it is a predominant platform in Poland with the penetration exceeding 55 per cent of total homes. Pay satellite TV is a primary TV service for short of a half of Polish households.

Upgrading to DVB-T2 standard for the moment doesn't seem necessary for Poland. The country applied MPEG-4 compression format, enabling both a sufficient number of channels to create an attractive offer, as well as an HD broadcast. Many countries, primarily in Western Europe, which started digitization with MPEG-2 compression, are now upgrading their networks. Some want to apply a mixed model with 'old' multiplexes broadcasting in MPEG-2 and the newly launched once - in MPEG-4, possibly also in DVB-T2. Such a model, however, means that homes willing to receive the MPEG-4 channels anyway need to buy a new, MPEG-4-enabled STB.

Poland is one of a very few countries which launched DVB-H. Most countries decided to use DVB-H multiplex for DVB-T due to low demand on mobile TV.  With making DVB-T channels available on mobile devices CP managed to create an interesting DVB-H offer at affordable monthly subscription. The price of the equipment, PLN325 (about €80), may be, however, too high for the service to take up fast. 

Because of the late launch, Poland's DTT is unlikely to reach a high penetration on primary TV sets. Nevertheless, the DTT penetration on secondary TVs will likey grow high as not only the equipment retailers offer DTT receivers, but also satellite operators (CP, Cyfra Plus and platform N); similarly, many cable TV companies in Poland make DTT channels available to their subscribers.

Relatively low number of homes depending on analogue terrestrial TV at the end of 2012 (about five per cent of total households) shouldn't have any impact on ensuring subsidies for low income households. It looks highly surprising that in spite of the ASO start, no subsidies are yet available in Poland. As the homes remaining still on analogue terrestrial are mostly those which couldn't afford pay TV, lack of funds may be felt badly by many of them.

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