With over five million receivers in the UK market, Freeview is offering a real threat to Sky’s subscription satellite service.

Freeview has now broken into the top ten digital television operators worldwide, a list that is otherwise dominated by satellite and cable networks.

Sales of free-to-view digital terrestrial television receivers outstripped new satellite subscriptions by more than 10:1 in the last quarter.

Around a quarter of sales are going to homes that have already switched to digital for their main television set. As a result, the UK regulator Ofcom has restated earlier figures for the number of digital homes, knocking 400,000 off the estimate for the previous quarter. It now assumes that 1.1 million Freeview receivers are now in homes that already receive digital satellite or cable.

Taking into account the revised figures for second sets, the number of Freeview homes rose by over 12 per cent over the last quarter to 3.9 million, increasing its market share by 2 per cent to 28.2 per cent, while Sky’s share fell correspondingly to 53.6 per cent.

As estimated third of a million homes also receive free-to-view satellite services, including former Sky subscribers who continue to use their set-top boxes to view free channels. Sky is doing little to market its non-subscription service, but the BBC is still reserving the option to create its own Freesat offering. Much will no doubt depend on any decision by the independent television network to transmit its programmes without encryption.

With a total of over 13.8 million digital television homes, this now puts digital television penetration in the UK at over just under 56 per cent, up just over 2 per cent on the previous quarter.

Interactive implications
With further growth to be expected over the all important run-up to Christmas, the rise of Freeview has significant implications for interactive services in the UK.

While the BBC reserves several channels for interactivity, the overall bandwidth for such services remains more restricted than satellite or cable, the standards used are inherently more limited and there is currently no return path available to support two-way services.

If interactive services are to play a significant role in the future of digital television, regulators and broadcasters would be advised to focus more attention on the terrestrial platform.

Significantly, Sky recently announced the extension of its digital text service from satellite to terrestrial television.

However, with the sale of every new Freeview box, the technical limitations of current standards could be creating a legacy problem for the future.