CME’s Mainusch: DTT has no future

Christoph Mainusch

Digital-terrestrial TV has no future and governments should not invest in DVB-T2 to the disadvantage of other platforms, according to CME’s Christophe Mainusch.

The co-CEO of CEE broadcaster Central European Media Enterprises (CME) said governments should deregulate broadcasting and in particular remove restrictions on advertising minutes as viewers now have the choice of turning to the internet for content.

Speaking at the NEM event in Dubrovnik, Croatia, this morning, Mainusch said that, in addition to advertising, subscription and carriage fees are crucial to linear broadcasters like CME.

“While we rightfully receive carriage fees from cable and satellite, free DTT is obsolete,” he said. “It is uneconomic. We pay a significant amount to the DTT operators. It is not justified. Now this technology is to be expanded with the development of DVB-T2. The introduction of DVB-T2 is the wrong step because it is outdated and it is not fair towards other operators to be confronted with a subsidy on that front.”

He said the state aid for the DVB-T2 transition in particular is problematic because it discriminates against cable and satellite. It would be better for governments to allocate the funds to high speed internet, he said.

He claimed that DTT also carries the risk of piracy and should be encrypted.

Mainusch said that if operators paid a fair amount to broadcasters and the latter invested in introducing catch up and other offerings on cable, satellite and IPTV, people will switch to these other platforms.

“In the US, VoD-for-free in basic packages is standard. It is a slow transition and it is different from market to market. We simply believe that DTT is an outdated uneconomic model that shouldn’t be invested in further.”

Mainusch said that CME has a strong investment in DTT in Croatia and the Czech Republic where it has over 50% audience share. In Romania, on the other hand, CME has a strategy of ignoring DTT.

“We are not DTT supporters but when you have a 50% share it is not easy to say goodbye to that because we would leave our leading position and it is difficult to see how people would transfer to other services.”

He also said that there is an urgent need for the deregulation of broadcasting and the removal of advertising restrictions. He said that while video content on YouTube is not subject to regulation, there is detailed regulation in place for TV and “the trend is for further expansion of regulation rather than adapting it to other platforms”.

“I would argue for complete deregulation. It should be left to commercial broadcasters to decide how much advertising should be permitted in the programming.”

Mainusch said that consumers now had choices and could access content from multiple providers, including internet providers. While noting that the EU is ready to deregulate advertising rules, he appealed to CEE governments to follow this lead.

Despite his scepticism about DTT, Mainusch said that linear broadcasting still has a strong future and internet players are likely to have to adapt their model to become more like TV, rather than broadcasters being out-manoeuvred by internet companies.

He said that there had been many prophecies of the death of the medium and its replacement by the internet over the last 10 years. However, TV is “actually stronger than ever” – it just needs to adjust its strategy and change to manage the challenge and “make TV future proof”.