MHEG Advocates Claim MHP Set-Top Boxes Too Expensive

The International MHEG Promotion Alliance (IMPALA), an organization that was set up last year by Strategy & Technology, Cabot Communications and EchoStar Europe to promote use of the MHEG-5 standard outside the UK (note: MHEG-5 is the middleware standard upon which the UK's free-to-air digital terrestrial service, Freeview, is based; it was developed and standardized in the mid-90's as part of the DAVIC standardization effort to support interactivity and navigation for VOD services; over 14 million Freeview receivers that employ the UK MHEG-5 profile have been deployed to date), has issued a press release contrasting the success of MHEG-5 in the UK with what it claims is the slow uptake of the MHP standard in Spain.

Freeview, the organization says, recently enjoyed its best receiver sales quarter yet, with over 2 million digital terrestrial receivers (including set-top boxes, integrated digital TV's and DVR's) purchased in the UK in Q4, 2006. "The success of Freeview," IMPALA says in its press release, "is in contrast to the situation in Spain" where "the latest figures for DTT receiver sales…show that Spanish viewers are not interested in paying a premium price for MHP-enabled devices." According to research (from the DTT association, Impulsa TDT) cited by the organization, in Q4, 2006, 437,000 DTT receivers (including set-tops, integrated TV's and PC DTT cards) were sold in Spain, but only 514 were MHP-enabled. The principal reason for this, IMPALA says, "seems to be that MHP set-top boxes are significantly more expensive, costing from €120 or more, compared to around €50 or less for standard receivers." The organization goes on to point out that a typical Freeview box, equipped with MHEG-5 middleware, also costs around €50, and that the low penetration of MHP-enabled receivers in Spain "and other countries" makes it "very difficult for broadcasters to build any viable commercial business models for interactive services." IMPALA's press release concludes by arguing that MHEG middleware would form a more practical basis for the roll-out of interactive TV services than MHP: "IMPALA believes that viable interactive TV services can be launched where the population of receivers contains MHEG interactive middleware by default," the press release concludes. "The cost of this is low compared to MHP implementation, especially since the high volume generated by Freeview in the UK is driving down cost. The incorporation of MHEG-5 capability into integrated TV's is also universal across the UK market and these receivers could be made widely available for DTT roll-outs in many countries."

Originally Published: April 16, 2007 in [itvt] Issue 7.26 Part 2

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