Freesat is looking to take advantage of Ofcom’s Wholesale Must Offer rules, offering a pay-TV package, even though many of its set-top boxes don’t feature the necessary conditional access smart card slot.
Managing director Emma Scott told The Guardian that the option of offering subscribers the ability to sign up for Sky Sports 1 and Sky Sports 2 was currently being discussed at board level. However, no final decision has been made, and there are concerns that any pay offer might run counter to the Freesat brand.
Any plan for a move into pay by the BBC-ITV operated platform would first need the approval of the BBC Trust, currently otherwise engaged in the defence of the BBC Licence Fee at current levels.
Already BT Vision has set out its offer for IPTV subscribers, and with the telco using DTT as a delivery mechanism the option is there to offer a pay-TV offer alongside Freeview, though no operator as so far made such an announcement.
Under the Freesat plans a third party would run the pay-TV offering, Freesat would then take charge of the conditional access. It already runs its own EPG from the 28.2 degrees East orbital slot it shares with BSkyB.
The challenge for Freesat would be the lack of a conditional access module in many of the 1.25 million receivers already in the marketplace. For example while the newer Humax Foxsat-HDR has a CAM slot, the earlier Foxsat-HD does not, so a new generation of CA-ready product would be required. An early 2011 launch for Canvas – the BBC iPlayer is already available through Freesat – might be perfect timing.
Launching a pay-TV offer may help Freesat around two potential problems. The first is that for all the promotion of HD – the majority of Freesat purchases are for HD receivers – only two HD channels are currently on the platform. In addition to BBC HD and ITV1 HD, the terrestrial Freeview HD can offer Channel 4, while Five HD is only available through Sky. The latter two channels broadcast an encrypted signal that is currently of little use to Freesat boxes and the introduction of CA may improve their carriage chances.
Secondly, there remains the possibility that ITV’s strategic review might bring forward additional pay channels from the commercial operator. Its own platform might be the perfect launch pad.