Government economists have revised their cost-benefit forecast for digital switchover in the UK and estimate it will have a positive benefit of at least a billion pounds.
The Department of Trade and Industry and the Department for Culture, Media and Sport estimate an overall benefit of analogue switch off by 2012 at between £1 billion and £2.9 billion in today’s money.
The report claims that this clearly demonstrates that switching off the analogue signal, rather than maintaining dual transmission systems, is in the economic interest of the UK. It does not suggest a preferred year for completing switchover, but indicates that sooner is better than later, with every year of delay adding to the overall cost.
When analogue transmission ceases, the equivalent of 14 television channels of frequency spectrum will be released. The model used assumes that the released spectrum will be used for digital television services, rather than mobile telecommunications.
The value of various consumer benefits, which are somewhat vaguely described, is set at around £6.2 billion, assuming switchover is completed by the end of 2012. This includes savings of around a billion pounds a year in transmission costs and a further billion pounds for the re-use of released spectrum.
Many of the figures used in the model remain confidential. The report does confirm that the cost to the consumer of reception equipment is likely to amount to around £2.3 billion and the additional consumer energy costs of set top boxes could be around £1.4 billion, including the social cost of increased carbon emissions.
The total cost, including investment by broadcasts and marketing costs, but excluding ‘targeted assistance’ or subsidised set-top boxes, is put at around £4.5 billion.