Interactive digital television will only become a sustainable product if it's fully entrenched into broadcasting practices and deregulated by the government, according to veteran telecommunications analyst Paul Budde.
Budde's 2004 report on Australia Broadcasting and Digital TV claims that the global digital free-to-air (FTA) market has failed to get off the ground due to restricting government policy over multi-channelling and data-casting.
"I think there will need to be a major overhaul within the next 12 to 18 months of the industry. It will have to open up to let the technology evolve," said Budde. "Take the example of data-casting, its heavily restricted by the government so no one wants to use it."
Budde said that the lack of support from free-to-air (FTA) broadcasters in embracing the new medium has also restricted the proliferation of digital television, as he said they are trying to maintain their oligopoly.
"FTA broadcasters never wanted it [digital TV] they felt that if digital TV arrived then it's just more competition," he said.
According to Budde, international campaign efforts and frequent price drops have failed to increase the saturation of digital TV Australia.
"By mid-2003, prices had dropped to AU$299 for standard boxes and AU$799 for high-definition boxes," stated the 2004 report. Budde said according to Digital Broadcasting Australia there have been 125,000 digital TV receivers sold in Australia and a "mere" 250,000 widescreen television sets since the launch digital TV in 2001.
However, Budde says the sale of digital TV products thus far is attributed more to the products accessories than the product itself.
"The key factor for growth in digital TV sets however is not digital TV itself, but the increasing popularity of DVDs and widescreen TVs," he said.
Budde predicts that Australia is far from ready for the proposed departure of analogue television.
"By 2008 the government wants to switch off the analogue system, at that stage only five or 10 percent of the population will be using digital," he said.
Budde's remedy to kick-start the flagging technology is to wholly integrate the digital TV into the broadcasting industry.
"We believe that interactive TV [digital TV] will only become a sustainable business when it has been fully embedded in broadcasting, telecoms and Internet technologies," he said. "Once it is based on an open network infrastructure, companies (marketers, advertisers, etc) can then add iTV [digital TV] to their own Internet, broadband and broadcasting services."