RAW FILE

ITU‑R
JUNE 7, 2019
9:00 A.M
ITU WORKSHOP ON "FUTURE OF TV FOR EUROPE"

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>> Europe is a very large sector.  I saw a statistic that said 84 billion turnover per year and over 1 million people involved in Europe, and of course televisions ubiquitous and tell us about 800 million have television and ITU has been involved in developing the standards for television right from the very beginning.
In fact, ITU first standard on television was 70 years ago almost exactly to the day, in 1949, and we continue to be very active across and in the development of the technology for broadcasting but also for content production.
And now that we have artificial intelligence coming along, we're also looking at how to make the best of that opportunity for the future of television, and of course, address the challenges that that brings both for businesses and policymakers.
Of course, last week, you know we had the AI for Good Global Summit here as the main UN Platform for discussing artificial intelligence with the implementation of the Sustainable Development Goals, and we did publish a report to coincide with that produced in the sector on looking at how AI could do this for processing and distributing television and radio content.
So there is a lot of work to be done on the use of AI programming and distribution and making sure that audiences benefit from it, and in particular in the ITU, we always stress the importance of accessibility.
When we start work on the new standard, we have an accessibility checklist to make sure that the standard will provide for persons with disabilities making use of the service or product.
We had a session during for accessibility.  And , also we have the radio conference coming up. ‑‑ (audio cutting out) ‑‑ we need to see the impact of those decisions, but of course we need to prepare well in advance for these conferences and the sector is already preparing for the following WRC which will be in 2023, and in particular looking at the possible impact of decisions on the UHF band and use of that band for our television broadcasting in Europe.
Then turning to the standards sector in ITU ‑‑ (audio cutting out) ‑‑ the study group is really being reactivated and is forming partnerships with many other world leaders to enforce its work in that area and we're seeing new membership coming back to new members joining the Study Group now but also some companies that were ‑‑ and organizations that were participating some years ago, for example, U.S. Cable Maps is back.
And then the development sector is also looking at this issue and produced a report on the new trends in broadcasting, produced by Study Group 1.
So, as we look ahead, we have a number of questions that we've identified that can be discussed here.  Let me read them out.  How to ensure the WRC 23 results will not compromise the future development of broadcasting TV, what can policymakers to continuously adopt effective regulations and take strategic decisions to maintain and further enhance a inclusive enabling environment for television, and so that's particularly the accessibility issue.
What are the new transform services that providers are pursuing, how can we ensure television accessibility, regardless of the technology used for content, is insured; finally, what are the updated technical standards needed to enable service delivery?
So these are all issues that are being addressed in ITU, and we hope to understand the discussion of in workshop will help the work progress in the three sectors of the ITU, and of course Study Group 9 is currently meeting and will be able to act straight away on these deliberations.
So, very pleased to gain cooperation between the three sectors of ITU, as always something which ITU membership is concerned about and we always make every effort to ensure we have well coordinated.  We have a number of internal groups to ensure the coordination and I think this is a good example of it working well, and also of course, linking with the ITU's regional office for Europe because the development conference did adopt a number of regional initiatives for Europe that there isn't an initiative specifically on the future of television in Europe on broadband.
So this is a very important region for ITU, almost 50 countries, as I said with huge turnover, a million people working in the sector, and an opportunity for Europe to really take a lead.
This is the third such event on the Future of Television in Europe, so it's a series that we want to see continuing.  We started it also in the Americas, and we hope to do a similar event in the other regions, and in particular Africa, hopefully will be the next one.
So, thank you all very much for participating.  Thanks very much to all the panel, experts contributing, and the moderators.  We hope that you'll have a very interesting and informative exchange and really identify some issues that we can really pick up in the study groups in the three sectors.  Thank you very much and I wish you a very enjoyable workshop.  Thank you.
(Applause).
>> Thank you very much for the introductory mark terms of remarks in the opening speech which covered all sectors and all of the dimensions of our work.  Let me with this, thank you very much and also to thank our other presenter of the three sectors for being with us.
The program of this workshop has been prepared by the Program Committee directed by Stefano Polidori whom you know very well.
Just a few short announcements as we know that this workshop will be held in English and we'll have the accessibility feature, the captioning feed is available on the website, and you can use this for the reference point after this.
The outcome of this meeting will be go to the work of the study groups of the three sectors, starting from the Study Group 9 which is just deliberating currently.  Outside of the room, you will find the fresh highlights of the market trends from one of our implementing partners, so we encourage you to take a look at the fresh data and relevant to the TV.
Also, outside of the room you will find a excellent display of the newest technologies brought to the ITU for your reference, and you will have the nine displays of the TV‑related technologies, so please use this opportunity of the free time to go one by one and investigate what is there for you and for the development of the global standards and advancing the discussion on the future of television.
In addition to this, as we wanted to thank the sponsor for making our networking so vibrant, and so we hope to see you all during the coffee breaks and during the reception in the evening and to continue our discussions which will kick off just in seconds during the first session focusing on the policy.
Having said that, I would like to thank very much our Deputy Secretary General for being here with us.  We know that your time is very busy but you found the time to be with us to underline the importance of this undertaking for the future and work of the ITU and the whole community involved in the television business, and for this I would like to thank you as well for this, and thanks to all colleagues for being with us.
I would like to call for a round of applause.
(Applause).
And invite the speakers to the first session to approach the podium.  Thank you.
>> Ladies and gentlemen, I hope that all of you have had a chance to open the website of the workshop and to refer to the program.  We have all presentations and material to be used during this session available already for your reference.
This session is not only about one‑way communication but this session consists of the introductory remarks and the panel discussion.  This is the reason why right from the beginning, we are making the call for making sure that once the key messages are conveyed that we can start with the proper discussion and finding conclusions of this session to be ‑‑ to be captured in the report of this meeting.
Therefore, it's my great pleasure to welcome this session, the representatives of the regional European intergovernmental organizations, and it's my great pleasure, so European Commission, European Broadcasting Union, and also we're having the pleasure of welcoming the Deputy Director of the Regulatory Authority of Hungry and so Peter Vari and also great session to welcome on the session the voice of the private sector, so therefore we're very grateful for Jean to be the voice of Europe and make this discussion very much hands on and looking toward the outcomes of the European debate.
So not to prolong, it's my great pleasure first to invite the speakers to provide their messages up to the 10 minutes using some PowerPoints and the first whom I have on my list is the Representative of the European Commission, Mr. Audrius Perkauskas who is the Deputy Head of the Unit of Audio visual and European Policy from European Commission, the floor is yours and we request for the slides to be displayed.
   >> AUDRIUS PERKAUSKAS:  Thank you very much, and thank you also for reminding me in this workshop.  TV is definitely a very fascinating subject and it's in constant evolution and in the last 10 years or so we have seen so many transformations of TV that sometimes we struggle to keep pace with this changing environment.
The communication we manage and our main instrument for that is the Audio Visual Media Services Directive, some of you might know the directive, television ‑‑ now it's called Audio Visual Services Directive and the directive, those of you less familiar with the content regulation, it's really about free circulation of audio visual media services in Europe and offsetting key is values associated to audio/visual sector and so really the core of it is two principles, but now we'll go a bit more into the detail of our recent work in this field because we realized the world of TV has changed again and in those days it was very ‑‑ the popular talk in the area of TV was connected TV, and so we looked into this realm of connected TV and thought it's time to adapt the directive again.
Of course, the process of adaptation is inevitably quite long, and as we were working on adaptations, other interesting developments reach the market like emergence of all of the top TV and more recently the more prominent role of video‑sharing platforms in the field of TV, so as we were going along with it trying to adapt our rulebook also to this new development.
But in any case, to recall, let's say our guiding principles for the rules and adaptation is what we wanted was similar obligations for services that are comparable from the user perspective and also in view of quite important role played by platforms in the field of video and in the field of TV, we put a special emphasis on new requirements for platforms.
So first of all, so what's about entering kind of a big field which is the key feature of this recent revision of the awd Audio Visual Media Services Directive, so this playing field went in two directions, and so first of all, the revised Directive contains more obligations or more specific obligations, let's call them, for new players in the TV domain.
And so this is first of all, on‑demand services, so on‑demand services is not a new phenomena as such, but in view of growing importance, the Directive now puts slightly stricter obligations on on‑demand services against protection of children and also slightly strict obligations for promotion of European Works so while before demand services had greater flexibility to decide how to promote European Works and now ways with clear rule that they have to have 30% of their catalogs dedicated to European Works.
Then the second part of this strengthening of rules for new players in the TV domain is to have some rules for platforms.  So for those players which do not create the TV content themselves but who mediate between creation of TV content and users and so we'll come back to that in a minute.
And then the second leg of creating a level playing field was to relax a bit the rules for traditional players in the TV market, so for broadcasters, because the television for the Directive and then visual media directive they were big in reporting what broadcast can and cannot do so when we realized when accessing the opportunity for revision of the Directive, that occasionally the Directive happens to go too far and perhaps constrains broadcasters in their ability to compete with new TV players.
So, perhaps the main example of this more flexible approach is that while before broadcasters had to comply within the limit of 20% per hour for advertising, now this limit has a timeframe so let's say two timeframes in the day then you have to comply with 20% limit, so no longer per hour, but in a much wider timeframe.
I will, knowing who is next to me I will leave a couple of points on signal integrity and vulnerability because it's a lot of protecting the economic interest of broadcast and it's another goal directed to another topic which is often addressed to this workshop of accessibility, so you will have a dedicated session on accessibility, and what the Directive does in this field and is that it contains a clear obligation of objective, which is to progressively put in place measures to ensure accessibility of audio/visual media services and accompanies, let's say, accompanying instruments to facilitate this progress towards better accessibility of TV content such as regular reporting by media providing services and then corresponding regular reporting by Member States to the Commission and encouragement for the audio visual media service providers to come up with accessibility action plans, so encouragement for explain clearly how audio/visual service providers will improve accessibility and some other things like online points of contact and an obligation to distribute emergency information in accessible formats.
So in other words, we could look at these provisions as a foundation for ‑‑ also for the work that you're doing in the field of standardization, for example.
Then coming to platforms, which was quite an important highlight of the recent revision of Audio Visual Media Services Directive and perhaps those things should be stressed and we realize that it's important to have platforms regulated as important players on TV markets; at the same time, we of course also realized that the role is a bit different.  As things stand now, they do not necessarily or do not often have editorial control of TV content they distribute.  Often they just mediate between content creators and viewers of the content, so we had to address obligations where platforms have to comply with.
So obligations are in several areas, so first of all, protection of children from harmful content, and then another area is protection from illegal content and risk violence in violence or hatered or finally like terrorism.
And another concern of audio/visual communication rules and again this was done to take into account how platforms act in their TV domain, so if they control that advertisement themselves, they have, of course, to make sure that this advertisement complies with the rules in the directives.
So for example, advertisements cannot be hidden from the public, and also tobacco advertising is prohibited, for example, so we have platforms that also have to comply to the rules.
Now, if a user uploads a video that contains advertising, of course this station is a bit more tricky because the platform has no direct control over that video, so their obligations on platforms is a slightly different need, which is to make sure that the rules of the directive are reflected in the terms of service of the platform, and then to take also some other measures like provide the possibility for content creators to disclose if their videos contain advertising, and then correspondingly, to inform users about that.
And so we talked about the commercial communications already, and just to recall what measures are, for example, in the areas of protection of children and protection of users from illegal content, it's mostly about reporting mechanisms to ‑‑ for users to indicate to a platform that certain video does not comply with the law or with terms of the platform itself, the control systems possibility for users to rate content, so to signal to the platform that certain content, for example, is not appropriate to children.
And finally, the mechanisms attached, so the platform does not react, for example, to the users signal that certain content isn't appropriate when the user should be able to complain to a platform and after ultimately to state of artist as well.
And then a few words about the self‑coordination because in this dynamic TV environment, it's important that the rules themselves are not too detailed and leave some space for stakeholders to address the objectives of Directive to stations and different Member States and different sectors of the market, so this is why this revision of Audio Visual Services Media Directive strengthens self and regulation and different levels and message of the self and co‑regulate, it's first of all at the national level and so Member States should encourage the use of co‑regulation and facilitate self‑regulation and it's also at the ITU level and so stakeholders might want to come up with union‑wide codes of conduct of the.
Of course, the advantage of union‑wide codes of conduct that certain agreements on standards would be relevant no all the Member States or it would create some scales for those providers who are interested in it providing their services more than one Member State.  And, of course, there are some basic criteria for good codes of conduct like broad acceptance by stakeholders, clear objectives, monitoring the mechanism and more effective enforcement.
So just to conclude this presentation, so we have a revised, significantly updated rulebook in the European Union for the audio/visual content, so you know we should look at it in a way that if accompanying in whatever sector telecoms device manufacturing gets interested in TV and says oh, it's interesting to do TV, so then Audio Visual Media Services Director and laws of others are very much relevant to this kind of company.
And then we have to wait a bit before the rules are actually in place because now as discussing they will be adopting laws based on the Directive and this process has to be over by September of next year, and so perhaps in relation to this workshop, my main conclusion would be that the Directive has always been about accompanying the development of TV markets, and this recent revision is yet another episode of this accompanying activity, and we'll all continue keeping a close eye on the TV market and see how things go forward.  Thank you very much.
(Applause).
   >> CHAIR:  Thank you very much, Audrius.  You added quite a lot and September 2020 is not very far away so there is much to do on the national level on this context so let me turn now to our colleagues from the EU, not only focusing on the 28 countries but taking into perspective also the interest of the countries and going beyond the boundaries of the European Union, so it's my great pleasure to introduce Ms. Sarah Turnbull Senior Legal Counselor of the EU.  The floor is yours.
   >> SARAH TURNBULL:  Thank you very much and thank you to inviting me to this very interesting workshop on my role of the regulatory environment for broadcasting television.  Who are we the broadcasting union for the world public alliance of public service media, and in numbers this is worldwide, obviously, 117 member organizations, 56 countries, 162 languages.  I won't go through all of those.
>> (Speaking off mic).
   >> SARAH TURNBULL:  Okay.  Can you hear me now?
So turning to what our members do in terms of providing television and radio content, we're a driving force in the European creative sector, 18.6 billion of which 84% allocated to original content, 88% of public service media TV output of domestic EU origin.
So, we do advocacy on a number of issues, so on Free to TV, net contracting, digital freedom.  Turning to the digital age, everything is developing very quickly at the moment and what are our concerns, our concerns are for our members that we can safeguard national culture, social cohesion and democracy through public service media content.
Is that better?
So when we change the European media ecosystem where more and more content is online, media is increasingly digitized and facing the challenges of globalization, consolidation, personalization, and digitalization, and users increasingly access content through global platforms, popular social media video sharing platforms and search engines.
So it's important that PSM in Europe have the right trusted online spaces and can enable citizens to access high‑quality content in a diverse range of programming.
So turning to what is the regulatory policy background at the moment, so as my fellow panelist went through the recent audio/visual media services directive, that's the most important thing we're looking at at the moment and firstly we're very ‑‑ we're very pleased with the modernization of that directive, which the most recent version before that was in 2010, so it was quite outdated with the current online environment.
The outcome that is now applying rules to digital online, so it's not just ‑‑ not just broadcasters and it's leveling the playing field.
We welcome that it accepts and reinforces important values such as media freedom and plural.Ism cultural diversity and welcoming minors.
The video sharing platforms that this has gone through, it's not exactly the same, it's not leveling the playing field, it's not exactly the same requirements and it's flexible as to what different people do and what different providers do so it accepts that different providers have a different role in the ecosystem and it's flexible and maybe it's quite about transparency, so it's about people posting content and therefore what, so it's easy in terms of content for minors, for parents to be able to identify that they need to take some action to not allow accessibility to that kind of content, to protect, and the requirements are harder on proportion to the element, so the most harmful gratuitous violence and pornography will have stricter measures that might include encryption and effective parent controls and Member States can adopt stricter rules.
There is a new obligation for all media service providers to give additional information about harmful content.
Also, for the first time the Directive recognizes the material and functional independence of AVMS regulators from national governments and we particularly welcome the integrity of media service providers programs and services with new content and rules, so again aid yus Audrius mentioned there will be rules not changing and not putting new messages in content, for example the public service media is broadcasting or putting up online.  It shouldn't, or anybody's content should be provided as is without interfering with that.
Also, the Directive notices Member State's freedom to provide for appropriate interferenceses of general interest services, so where there is general interest services for which we would say the public service media are very important general interest and that their services should be given appropriate prominence in when these media services are provided.
Secondly, the European Union Code of Practice on this information, and so a big problem on online dysinformation which is a broader problem of information disorder and we are obviously about freedom of expression and we don't want people to be prevented from putting their message out there, but it may be that certain information in particular with types of political advertising, needs to be sign posted where it's provided by particular people and needs to be fact checked, so there is a voluntary industry late last year that the European Commission is following and reporting on to see how that is working, so again in line with self and co‑regulation, this one is self‑regulation at the moment that's, Google, Facebook and Twitter committed to take rule measures and so it's more transparent particularly on the advertising front in the context of the recent European elections and ongoing, and the Commission will continue to monitor that and at the end of this year we'll see whether more regulatory measures are needed.
We don't know at the moment, we equally encourage self‑regulation.
Finally, very briefly, the platform to business regulation, and that's to do with platform's conduct with businesses, and it's mainly introduces transparency obligations and requirements to full fairness and to make it clear when they're changing certain conditions or taking content down, and all the platforms will have to do more transparency and there are certain practices they won't be able to do, and again that will be to watch this space and that's regulation rather than ‑‑ or will be followed up again by the Commission as that progresses, so my message is we welcome the progress, we welcome that there are moves by the Commission to keep this monitored, but not to legislate everything because we all know this is changing on a daily basis, so who knows what the thing will be tomorrow.  Thank you.
(Applause).
   >> JAROSLAW PONDER:  Thank you very much, Sarah, for this feedback and from the perspective from the EU on changes proposed on the Directive and now let me turn to our Representative of another European intergovernmental organization, the European regular teleCommunication satellite organization, the voice of the satellite industry and so Mr. Dmochowski‑Lipski, the floor is yours.
   >> PIOTR DMOCHOWSKI-LIPSKI:  Thank you very much.  Thank you very much for inviting me, and well I'm not sure if I will be talking much about satellites since I don't have ‑‑ oh, thank you.  This is great.  I always prefer that.  Yeah.
I guess we'll be switching gears a little bit in this sequence of presentations after two very interesting presentations regarding regulations and before the next one, which also deals with those issues.
I will talk ‑‑ I will take kind of the micromic approach of business content from the management standpoint and from the inventer's standpoint, and so a few words about it, it's a international organization and it's not European.  It has 49 Member States and interlinked with the satellite operator by that name, and I probably bet that 100% of the people in the room have heard and the percentage of people that have heard about the organization is much lower.  They're interlinked and as satellite, rights of orbital we give to the operator to use for free in exchange for them fulfilling certain principles of public service and our role is to supervise that they do, and the principle mechanism for me as the elected organization is my presence on the Board of Directors.
And now, but mostly today, I wear the hat of somewhat experienced executive in the broadcast business, and also cable TV and telecom and my objective is to share with you kind of an overview as to how this issues pertaining to television, to the business of television are viewed from the content level, from the investor's level.
This is my ‑‑ so in this vein ‑‑ let me share with you my usual disclaimer.  This is not to present any official position of the organization that I lead nor for states, it's basically a discussion of certain issues relevant to the business of broadcasting.
And those who are mostly into marketing and strategy management and broadcasting, apologize, this will be kind of basic so I apologize for that and maybe for other colleagues that deal with more intrinsic regulations and so on, that might be more interested precisely because it's a kind of general discussion of the business of broadcasting.
First, I will speak most about commercial TV, publicly funded TVs and other ‑‑ there is it has another set of issues and problems, and I'm sure that colleagues are better equipped to deal with those.
First of all shows and this is something that should be clearly understood is that, you know, businesses are basically divided by revenue‑driven and by cost‑driven and a good example of a cost‑driven business would be any mass production, or say supersupermarkets, you make money and profits by saving off the profit of your cost game.
The television is a revenue side of business, meaning that any change on the revenues of how the product is received, how well the product is received, has an impact ‑‑ a significant impact on your profit line, more really than saving the cost, it's a basic question of popularity or lack of popularity.
So I was ‑‑ later on I will be talking about mostly the revenue side of the business.  And then there are issues of delivery, connected to the telecom industry, terrestrial satellite cable and also Internet, and the parameters are reached, speed and quality.  And programming, it's a major cost item, especially sports right now.
Then the next element of the business is investment technology and, again, convergence with telecommunications and here the issue is competition and also the access to investment and access to investments is also a function ‑‑ it's a function of attractiveness of the business as such.
Then there is the regulatory environment, goes without saying and talk has already been a little bit about that, and all of that goes into relative attractiveness or lack of it with investors in competition with other possibilities or investment, and then normal business metrics such as growth cashflows, and so on, and also value of programming as an asset, as assets, nontangible asset.
I'm not sure if you can see that it's not so much about the numbers, but this is actually good overview of the overall TV market if you take the types of revenues, we have revenues from advertising, from subscriptions or kind of paid services from public funds, yes, and online revenues and so on and some other key metrics at the bottom of the table.  The columns are countries, nations, and you can see the column from the left, the United States of America is the biggest market in the world, which also I don't know if this comes as surprise, but we as Europeans always take this into account, basically lots of trends, lots of solutions and programming comes from that part of the world, which is obviously with lots of connotations and implications, including regulations and including Audio Media Service Directives and copyrights and freedom of speech and all of that.
So as I said broadcast something revenue‑driven business, value added noncommodity type of business in management textbook terms, and you have five ‑‑ basically you have five sources of revenue, sometimes they overlap.  You have advertising, you have subscriptions, which is kind of reoccurring revenue, and then we have subscribers to programs or to channels and can you count on the revenues that they'll be coming into your market count, and a subset of that is paper item things, one of programming licenses for boxing match or pay per view showings of ballet or something like that.
And then you have public financing in some countries.  In Europe, yes, obviously and well that's something related, but it has all a separate set of challenges, business challenges and also public policy challenges.
And then I also mentioned merchandising, you know, coffee mugs with desserts and all of that.  It's not the biggest part of the revenue pie, but just to be complete I mention it.
And again the largest country is the United States of America, and in terms of the mix there are different percentages and different markets, let's say public finance something more important in Europe than in the United States, for example.
So let's focus on advertising.  This is like a standard pie chart of the overall advertising ‑‑ the advertising industry and you can see that TV is not that, just basically 50% of the whole advertising pie.
It changes, those trends shift, they go more into the Internet and so on, and but it's still very important.  Why?  Because it's a very effective way of advertising.
Advertising revenues are driven by cost of reaching audience, and it's better if, let's say you take a batch of a thousand viewers or people who watch B boards and the less you pay to reach those thousand people, the better off you are and there is a piece called cost per thousand, CPT in English or CPM, it's M in Latin, like Roman M, and the formula for that you have the world cost of the campaign and in the denominator you have your audience and then it's per thousand.
Ratings influence, and that's driven by popularity of shows and also popularity of time slots.  In the traditional linear television business, obviously there is prime time and not prime time and so on, and the relevance to target audience is basically by advertisers.  This means more audience, lower CPT, more revenue, and again it's a revenue‑driven business, television.
Now, the challenges, the current situation going into the future, these are ‑‑ Generation Z, you know current students, youngsters, millennials and Generation X and my generation, Baby Boomers people born in the 50s and 60s perhaps and then you can see that other people watch more linear TV and this doesn't come as a surprise but it's a nice way of presenting this, and the viewing patterns generationally shift from linear TV to Internet.
And I don't have a slide, but if you focus only on linear TV, then they would see that young people mostly watch sports on TV, other stuff entertainment and others, they watch elsewhere, by and large.
And then in addition to traditional Free to Air television or that part of the bigs which is financed by advertising revenues, there is paid TV and this growth, grows, but it doesn't grow that quickly as you can see.
In other words, businesses have to fight for it ‑‑ for subscriptions for people who are actually willing to pay, and this goes both for traditional paid TV like HBO and so on and also TV streaming services such as Netflix and their competitors.
So it is growing, but it's not growing that much really, and people debate as to how to actually increase this.  Then the title of the slide, only 24 hours a day, yes, television broadcasters compete not only with itself not with anything else, and in the free time leisure area and you could compare it, for example, to a situation where marketers or heads of marketing for luxury cars, for example, there are all services, the class and so on, when they analyze the market situation they not only analyze BMW or Royals Royce, but also luxury boats, and they analyze the market for, I don't know, first‑class plane tickets and so on because you compete within certain segments and not only your own industry but others, and then you have those patterns and here, and again social media as you can see, is a lot for people.
The pay ‑‑ as I already said provides traditional pay television and also those streams services over the Internet and this is this yellow box, which is still smaller, but it's growing and actually I think the prediction is that there will be more and more relevant than just traditional pay channels.
And finally, on the advertising segment, the question is, is television for advertisers really establish that it's 50% of the overall advertising so it's significant, and it's not that.
This is a significant grab, actually.  I would like to ‑‑ turn your attention to it because you have on the left‑hand side, you have H groups from C24 all the way to people like me, and the question ‑‑ the question this is research done by Global Web Index and the question is in which of the following ways you're most likely to find out about new products or services, and as you can see, this is interesting, for all of them it's still, as seen on TV, and it's kind of ‑‑ you know I say, it's not really logical because of what I said before about the audiences, the younger audiences shifting more into the Internet, but the phenomenon is still there.
So it's very, very important to understand that there is a business for advertisers to advertise on TV and it's very important for television people to actually capture that and capture the audience with all their programming mostly.
This I repeated in the previous one of my introductory slides to put all of those in perspective, and I'm focusing this presentation on advertising around I don't have time to go through all of that, but this is the revenue, it's the most important thing in this business and that's ‑‑
A few words about convergence with telecom, telecom‑delivered platforms and this is a basic ‑‑ basic delivery platforms, free to air, mostly basic television packages, cable, television, pay as you go, and satellite direct to home and I will say a few words about satellite because I come from a satellite organization, but basically television media is very important for the satellite industry, and there are two types of services.
There is satellite direct to home, DTH, commercial platforms that people mostly living outside of the cities buy to watch TV, and also there is a B to B business serving broadcasters to relay the signal say between the studios and the for example, transmitters and so on, and then there is Internet, of course.
To continue on that because a few words about the links between satellite telecommunications and television.  The traditional geo‑‑ the TCS, Intel, traditional geo stational business still get a lot of some companies like SES are actually most revenues from television and the SES case is 67% and the rest being all segments of data transmission and so when I say to the Board of Directors, actually a discussion about trends in broadcast something very, very lively and more than because it's still a source of cash.
However, the business, meaning the revenues for satellite industry from that segment, it's flat or slightly falling.  There is really no growth because manufacturers, you know, television is shifting more to Internet and the increase in the presence of fiber optics with transmission and so on, and so the satellite business needs to find new sources of revenues such as broadband, mobile, or Internet of Things in the future.
I mentioned that there are two types of television transmission business from the satellite standpoint, one is DTH centered business, the dishes that you can see in the backyards of consumers., and this business is far better than B to B, meaning serving broadcasters, for example, to relay a signal between let's say transmitters in the studios because of the more and more presence of fibers optics, for example, so this business is falling.
Television for satellites is better in emerging markets than developed markets.  There is not that much ‑‑ there is not that much penetration of fiber optics in Africa, so they need satellites to watch their American shows.
And in order to also to understand the market, you have to see that there is a lot of competition from telecom and media, and there are multiple partnerships in the industries in telecoms and providers of video over the Internet, VOI pattern British telecom and analytics or British telecom and so on all of that influences broadcast TV business and also satellite as a way of distributing the signal.
So this is how it looks from the microperspective, that's how managers and investors see the current situation of television in Europe and elsewhere, I guess the conclusion is the business is still there, it's more of a kind of cash cow, meaning there is not much growth in the business and the patterns are shifting toward other media, but the sheer volume of the business and the sheer attractiveness from the advertising standpoint is such that it will be premature to say that it's in decline.  It's not in decline, but it needs to sort of reinvent itself in the advent of basically new technology.
I'm over 10 minutes I guess, but that we didn't have to rush ‑‑ so thank you very much.
(Applause).
   >> JAROSLAW PONDER:  Thank you very much, not a rush when the views are interesting and definitely you made a lot of good points of the interest of our discussion, so before we are going to the next presentation, just a short reminder, please make sure that we are putting your questions prepared and keeping your questions prepared because we want to also have a discussion.
So now it's my great pleasure to turn to our next speaker, Peter Vari, who is the Deputy Director General of the Hungarian Regulator, like paving the way of digital revolution in Hungry, including the television, and so Peter, the floor is yours.
   >> PETER VARI:  Thank you.  I come from Hungry and I work at the Hungarian Regulation which is in the (?) information sector and because we listen different presentation from the European Union, and our country is a member of this civilization and industry, what can I say for you now, and you know, Hungry, the provision and the general public is span in front of their television set and the question is what we can see in the future.
In general, the Hungarian television is used, or the cable television networks, and the 60 percentage of the households has cable TV connection and about 20% is using the digital television.
I would like to focus now in my presentation only on the broadcasting because if you see there are other platforms for the cable television and satellite platforms, they follow the business line work prepared in the market, but the terrestrial broadcasting ‑‑ but they use something which belongs to the state and recorded the fragments.
And sometimes we'll state necessary to find the spectrum usage for the future, and these things start to test your television broadcasting in every country.
I was lucky because I was participating and I go here when they planned the frequency for the digital terrestrial broadcasting in WHF and UHF band and I remember at that time, that more and more fragments, we were there before it's future of television broadcasting ‑‑ and that's what happened in our country, for example.
Now, I ‑‑ first of all, as I see all the European countries use, the UHF broadcasting band for broadcasting, and in this one in our country, the five terrestrial networks existing and these five are five of the 12 free and 47PT channels and the 4 public for the Hungarian inhabitants and to that, the operator has the right to use these frequency and the service for the viewers.
So, we listened about the new regulation which handled the communication sector and we listen about the new audio visual media regulation and adopt because it's important for us also and we see the market and we sometimes remember that ‑‑ (?) don't know where they are going.
Sometimes it's difficult to find the best way when we adopt, which is best for the market and how it can have the marketplace in the situation.
Now, every four years we publish our spectrum strategy and this strategy was created in 2016, and after WSC, we launched a new process and we would like to create a new spectrum study next to four years, of course, and in that time we have in 2016, we had 20 and in one of them the meeting documents of broadcasting and digitalization, we would like to ensure the spectrum for the test broadcasting which is connected the demand, of course.
And the other things which I mentioned that our country is a member of the European Union and the European Union has a decision that somehow (?) band will be used by MFCM or 5G network for the future and the band will be last but the terrestrial world broadcasting and we necessarily (?) the roadmap and we are the first country who was published our national roadmap and how we can handle the the broadcasting in our country after the last ‑‑ for the future.
And we heard that 2020 is very important year, and I sort of agree with this statement because certainly because we have the operator and the operator license we are banded to that until 2020 and we suggest a new process for how to continue the terrestrial broadcasting in our country.
Two things which is are important that are necessary to be in time for the new operator, and I say to give the time to the viewers because if something changed, for example let's say new ‑‑ necessarily the time for changing, of course.
And you know, our regulation the time period for the broadcasting, and in this way the next years will be the next period or, so and we don't forget the WSC 23 because we necessarily as to what we see in the terrestrial broadcasting and how to use the frequency at that time.
And we have the ‑‑ some requirements for the terrestrial broadcasting, and for example we never say to speak the public broadcasting, why the (?) mentioned the commercial side and I mentioned the public broadcasting and more so because it's available without new somebody description or fee and you would like to view the country of the broadcasting, of course, and change the quality because this ‑‑ this content providers would be commercial, of course, it could be the public broadcaster or for the HD content for the viewers.
And the requirements that we would like to ‑‑ the problem in 2020 that how changed the TV or in this way, we define, the present content, which including the public broadcaster's content necessary to offered the DB2 technology and impact for because to use this technology, but under that we would like to encourage the one operator that offer the new technology to and the new coding system because we prepared because maybe we lost the other frequency band, for example, we would like to ensure the capacity for the broadcasting while the frequency will be ‑‑ could be less for the future.
Yes, as I mentioned, that necessary to change the frequency because the 5G is coming and will be important for the 5G network operators.
Now, as I mentioned, we are now are banded for the future, but if we don't like to use the transmission capacity, and in this way we have the two technical solution.  One of them that we encourage the operators ‑‑ (?) if I want technology and that is to plan the larger efficient coverage, and in this way, necessary, the coordinated to the neighboring countries and it seems to be that (?) 6, but it's also a long period to replan the frequency, plan which comes from the G6 plan.
In this way, we settle to the DHT networks and see additional and that will discover which band, which will be the band for the future.
We would like to avoid the problem at the households, and we would like to we really would like to oppose any technical problem for the people or inhabitants when we change the technology, and in this way as I mentioned the DHT, the parameters will be more or less the same and the new technology will be flexible for the operators and could define more parameters which come from the business case.
And of course, we use the same polarization as in the past of what is also important, that nobody necessary to how is to change, for example.
And I mentioned the G6 plan, it's absolutely important for the other European countries because at that time we planned ‑‑ planned the frequency plan for the digital terrestrial television and the radio broadcasting.
And we planned this with plan and in this way we allocated the new frequency for our country and we coordinate together the 13 countries why we have the last neighboring countries, of course.
And we are in the middle of the procedure now because we published the documentation and we had the public consultation and we received some documents from the applicant and as I wait, we would like to decide about this and we have it's one here to be in the network or also save on more TV channels for our viewers.
And so, that's why I wanted to summarize that now that I know that all platforms are important but one of them is the special situation because we have the spectrum and the state decide the spectrum and it could cause problems for the terrestrial broadcasters, not only issue‑wide of the broadcasters because we have the 33 local television broadcasters and they also need to follow this change to give to the business for the next years.
Thank you very much.
(Applause).
   >> JAROSLAW PONDER:  Thank you very much.  Thank you very much and thank you for underlining the importance of the terrestrial television and with this we will turn now to the our colleagues representing the private sector, the voice of the private sector and we'll start from the presentation of the trends of the European Television Market and to be provided by the Tom Morrod as Markit UK.  The floor is yours.
   >> TOM MORROD:  Hi, everyone.  Can you hear me in the back?  Still awake?  Good.
Yes, I'm from the private sector, as they say here.  I work for a company called IHS Markit an list market out of London, one of the lead analysts and I've spoken as these kind of broadcast technology conferences for about 15 years so I have a little understanding of what we're talking about in compression and single‑frequency networks, et cetera, but I'm not going to talk about any technology on these slides, I'm going to try to do this in about 10 minutes, and I'm watching the clock at the back and going to try to provide a framework for what I think is happening in the overall European landscape and what that might mean from a regulatory perspective.
Back.
I'm going to pick up on three trends very briefly through this deck.  We'll talk about the rise of online video platforms, and this will be in terms of numbers what have been reflected with statistics, we make the statistics, so we have teams of people who collect information and forecast information about what's happening at a company level and market level so we'll talk about rise of online video in Europe, we'll talk about the consolidation trends for telecom and media companies, and the economics of platform companies, and I'm going to try to focus on the last point there there what happens and what does it mean when we talk about the platform companies coming into the market.
A lot of this is alluded to in the discussion about the AV MSD in the first presentations which is a very ‑‑ it's a lengthy document which I've read parts of, but what I'd like to provide here is kind of the context for what's happening in the industry that's led to those kind of regulatory decisions and what the risks in the industry still are.
So let's talk about the world five years ago.  This is European TV trends, and I'll just pick up on the three graphics here, so five years ago, linear viewing was growing and we've seen that already.  Connected devices or media‑capable devices connected to the Internet were about a parody with a say TV set that is not connected to the Internet, and online video was about 3% of whatever metric you looked at in terms of viewing or entertainment.
And over the past five years, that has gone through a radical shift.  We've seen online video, OTT, subscription VOD, whatever terminology you wish to use there, is growing about 20% of total viewing and growing an additional approximately 2% of viewing every year and that's accelerating.
So what we've actually seen is total linear viewing or total TV viewing, total video consumption has flattened out and in some countries that happened in 2012, 13, 14, but while linear viewing has gone down quite rapidly in the last 5 years, that has been replaced by very rapid uptake, exponential uptake in online video viewing, so that's the first key trend that's happened in the last five years.
The second is that all of you have smartphones and many of you ‑‑ many of you have tablets and some of you have laptops and can see them, and I'm sure you've all watched video on many of those devices in the past.
The reality is the landscape of devices that can consume video has completely changed in the last few years.  It's a recent phenomenon, it's really only in the last 5 years that happened and just to put out a big number, there are about 2 billion TVs in the world installed in the households, about 1 TV per house hold currently but more video‑capable connectible devices, cell phones, laptops, tablet, games consoles, in China than there are TVs in the world and so the landscape is very rapidly evolved and in different ways and different devices to consume and that has a major impact on the environment we're working on.
Last, the pay TV industry, I focus on pay TV, so commercial industry, it's in relatively good health overall.  Growth is all coming from the online industry, so it's not coming from the traditional pay TV, cable, satellite, and digital terrestrial and in general all of the money, all of the growth has moved to online platforms.
So if we look at that in terms of some numbers which were promised, this is European by platform net additions for last year, and so the number of new subscribers, the net new subscribers over the course of the year, and the story for Pay TV and traditional industry is relatively subdued, let's say.  Cable is in some ‑‑ it's either flat or in decline, depending what view you want to take.  Digital terrestrial, this is paid digital treses treel is a small market, tell co‑TV, IPT is growing a little bit.  Satellite is growing a little bit less, but online video services, so Netflix, Amazon Prime Video, Hulu those kind of things put on an additional 17 million subscribers in Europe alone last year and so that's a big number.  32% growth in one year, forecasts of over 10% average growth for the next five years and most of that is Netflix and Amazon and that's kind of giving you a clue as to how we will talk about platform companies in a little bit.
So what does this mean?  It means that Netflix is now the biggest TV platform in Europe, which is something that many of us would not have guessed, let's say 10 years ago, so the regulatory environment from when the AVMS was initially discussed has completely changed already, and so that was discussed ‑‑ that was initially discussed in 2010 and 2012 and already we have this huge change before these kind of regulations have gone into effect where online platforms have grown very rapidly and overtaken all of the localized and Pay TV platforms and just picking up on another trend in here, you see sky, Liberty Global and Votaphone in the top five slots and you see all of the companies are national and none confined to a single market, looking down the list in general, you see a lot of companies with multiple operations across Europe, and that again is a trend that we want to pick up on, so Deuch similar, you have to be outside of a market in order to compete on the same scale in order to compete with companies like Amazon and Netflix.
What does it mean in terms of the environment of big companies?  We've seen a huge number of another round of consolidations, and if you think back 10 years or 20 years, we've seen these kinds of rounds of major company consolidation in the media and telecom industry before, but there are several different drivers here and they're all quite important.  These are companies trying to position against this new landscape of big companies that are Pan national.  AT&T and Time Warner are trying to put media within the footprint and trying to shift the revenue opportunities towards something that is revenue generating versus cost based as Peter talked approximate before.
Disney and Fox is trying to position as a global content company, much in the same way with Netflix with the upcoming Disney Plus launch.  Votaphone, liberty global, network operators trying to find communities of scale, and Comast Sky and regional programs and pan national and diversification of the content types still consumed by people like sports.
And what's interesting when you dig into the operating strategies and various company strategies is they've pretty much are trying a bit of everything, so there are some companies trying to bundle together video on top of other services, there are some companies trying to unbundle and go outside of their network and some companies focusing on mobile video as something distinct.  Premium content is still talked about as a major strategic opportunity, and aggregating new content owners or bringing in what looks like competitors into ‑‑ into a platform environment and putting Netflix on to your platform or working with channel networks like those that are producing content specifically for platforms like YouTube, and then innovating around technologies, user interface, accessibility, so all of these have been tried, but I wanted to kind of bring the conversation away from what's happening in the forefront, which is what's happening in the TV industry and start talking a little bit for the second four or five minutes on what's happening in the platform industry because I think this is actually the context that we should be referring to.
These are a handful of big companies.  If you don't recognize the logos, you really should.  These companies have started to do pretty much everything over the past few years, and what we've seen is companies that have a history elsewhere, so I'm not going to try to point out all of the different consumer services and brands that these companies actually operate, but I'll draw your attention to how they've diversified.
So companies like Ali Baba, alphabet, Google, Amazon, if you don't recognize some of those names it's because their enormous Chinese companies and again you should go and find out what those companies are doing, and they have all come from different histories, so none of these TV company, none of these are even necessarily what we would consider consumer service companies, they're retail companies, device companies, device manufacturing companies and so they have a interesting and distinct way of entering the market and diversified across a range of consumer services, but they don't rely on those services.
So if we talk about let's say Apple, they're a hardware business, and the service is part of Apple is a relatively small add‑on to a hardware business and I can have a discussion about how that's changing, but the reality is that Apple doesn't have the money in video.
Amazon also doesn't have to make money out of video and they have AWS, a retail empire that spans the world, and they don't need to make money directly out of Amazon Prime Video, and Google as an advertising business, some of you might have noticed, and again they don't need to make money directly out of video.
So these all operate in a very asymmetric way and they don't rely on making money, on having a economic approach to industries that they're entering, so all of the consumer services that we saw on the previous slide, the long list of brands and approaches to the industry that they have, they don't actually need any of those to come up and make money at this moment.  They're playing the platform approach, the disruptive approach, which is to get into a market, create quite a lot of change in that market, and try to take a dominant position in it.
And what's kind of terrifying is that if you look at where that's happened, and these are examples that are relatively close to us but we could talk about AirBnb or Uber and we have a very similar story.  Look at online video revenue in the U.S.  We have a couple of platforms, Facebook and YouTube, and let's look at smartphone install base, and so again Apple and Google, the two companies have won in this particular case and Android is making up the rest of it and Google operated out of Android.
If we look at mobile app store revenue we have a similar kind of story, Apple and Google are taking a dominant position, and if we look at again, a new industry, Global Smart Speaker install base, we have Alexa from Amazon and Google Assistant.
And so what's interesting about platform companies is firstly, they don't have the economics of needing to make money in a particular industry that they're getting into, but they also have a tendency to dominate an industry when they get ‑‑ when they get going.
And so bringing this back to the discussion today, let's look at what's happening in total video advertising over time and so we see that this is total video advertising and not online video advertising, and we see the pie pushing not only away from Legacy TV but YouTube and Facebook, only two companies, are taking all of that change.  So this is tending toward one of those that we've seen before.  We can see the growth rates of original acquired programming across multiple well‑known traditional media brands, Disney, universal, Discover yrks and HBO are relatively flat over the years and Netflix and Amazon are expanding on programming.
And I'll bring this back quite meaningfully to the European Online Video market, the growth part of the TV market in Europe, and this is a pie chart that I would argue looks quite a lot like the pie charts where we see market domination in other cases, and with Netflix and Amazon taking the vast majority of the current online video subscription market, and a range of localized and Legacy TV platforms taking relatively small shares, so this fragmentation of the rest and domination by a few is typical of this platform disruption and domination of a few companies, so I'm always using words that are potentially quite evocative in a regulatory discussion, but that's kind of purposeful.
What do we want the pie chart to hook like in five yoars and how do we help to generate that process?  So the key takeaways it, trying to keep to time, I think I've run over a little as well, it's TV industry sint driven by traditional economics and the companies coming in don't have the same economics to video provision and economic services when we think about broadcasters or paid TV operators, and I would say there is a much more fundamental and philosophical discussion which is addressed in a lot of the regulatory discussions already, about public access, local culture and localization and privacy, and if you think about how platform companies actually operate, they have very different ways of dealing with public access, localization, and privacy, than let's say a digital terrestrial broadcast, and so in some cases you could say the national broadcasters and broadcast in itself deal with a lot of potential concerns that come up with platform companies coming into the consumer industries, and so one thing that I would like to, you know, one thing that I would say in general is that we should be supporting the traditional industry in ways that help to enable it to compete with these new companies, and that whirlwind tour I hope will give you some idea of what we're thinking about for the TV industry in Europe.  Thanks, everyone.
(Applause).
   >> JAROSLAW PONDER:  Thank you very much, Tom.  After your presentation, immediately one of the questions which emerges by me is being directed to our colleague advocating for the traditional terrestrial TV, what is the future of the traditional business, but welcome to this after the presentations.
Now, it's my pleasure to turn to Pascal Chevallier representing today the Digital Europe being the platform of the all‑industry players from Europe, so please the floor is yours.
   >> PASCAL CHEVALLIER:  Thank you.  So just, yes, just to complete what is Digital Europe, so Digital Europe is a trade association which is representing broadband, 35,000 businesses across Europe, direct member of Digital Europe or member of Trade Association which are also members of Digital Europe and I am digital Europe but also working for of a AFNUM a French national trade association and also a national player of the digital industry but there I'm focusing on the audio/visual part of the Digital Europe because I'm also chairing from our modern ‑‑ it's audio visual parking group within Digital Europe which is following basically all the policy and technical aspects of the business, knowing that historically this group was named Broadcast Work Group and now we change to Audio/Visual Working Group reflecting the change that we're seeing in the values presentation while the audio/visual business is not only in the TV business now, and so Digital Europe is advocating for the digitalization of Europe and the benefit for all the cities and from these digitalization.
In the frame of the new environment election, we have put on our website a white paper about our vision for Europe towards 2025 and we call for stronger Digital Europe which can be can be when we say digital for us, digital is a digital single market and I'm adding myself, world digital single market and which obviously inclusion and when you mean inclusion, we don't mean only accessibility but also inclusion of people which are digital naive and this is a problem because we've seen in the presentations that younger people are not exactly the same as older people, but you see we should also focus on radios, so what we do should be also profitable overall for the planet, and in relation obviously, which is giving a lot of impact on the industry and on the environment, mutual trust, and agile and mission‑base policy toward quarterbackly toward the evolution and we have seen in the previous presentation that where the world, we are discussing five years ago is changing very fast and the future, the problem is the future is that like you never reach the future, the future is always in front of us, and by the way, you have to be able to react on that and obviously we should give momentum to that by adding some leadership on that.
About the specific focus of today, what we want from Europe is to have a strong Europe by again, strengthening the single market result regulatory fragmentation and really to see the key point that Digital Europe all over Europe and stakeholders in the institution is really to have an active market with protections that we see globally in the world and maybe look at in some European country.
We need to simplify access, the market access and improve the market surveillance, and this is something not specific to audio visual world, but can be seen in this type of directive, like the red directive, the harmonized standout evolution, how this could be even better or fast are achieved.
As our services are concerned, we only ‑‑ effort for harmonization and we've seen in the presentation for Audio Visual Media Directive there was quite a lot of freedom from market states to go and to have stricter rules than what is the base value of the audio/visual digital services directive, and then we are monitoring what is happening at the national level to avoid that good practice, a very negative effect and at the end we may end up with 27 different favors, which is already a challenge in our business because most working with the audio visual working group, 20 manufacturer coming from in the past and now going to G, G2 and HVC, New Generation, HBTV, 1.1, 2.5, 2.0, so you see the future is moving very fast and the market is not so unified as we may want in order to respond and to have a real European market which is big enough to have a scaled economy and to counteract U.S. or China which have an internal market which is significantly better than any single national Member State market we have in Europe.
And for that we say to have some clearance in the values regulation because we discussed audio visual and media services and we have the European communication code which is also part of the (?) for TV and giving them some freedom to Member States to make specific law which can be also fragmenting the market and we have also some ‑‑ at the end of the product it's the same product, a directive, and feels like design of ‑‑ we may impacted some technical functionality that we may have in the product.
In January, in the past, the product and services has always been the result of a good cooperation between the product provider and service provider in order to be sure that services and products are working together and that services and products are available at the same time on the market and we see the trend now to have regulation and increasing some technology of the product without really a plan for the services, and this is something that really we are monitoring with a lot of care because we think again this could cause some real fragmentation of the market.
Basically, to achieve this nal market we really call for the implementation of the new directive at the multi‑step level and specifically focus on the impact this could have on product and services because, again, the provision is a good thing but if at the end of the provision is registered in 27 different constraints on the terminal, obviously the terminal will have some difficulty to fully address the values market in Europe.  The services ‑‑ or so far the services, they are ‑‑ we should have close cooperation between device stakeholder on that aspect and we should also be careful on the sum of the value's directive which may be sometimes competitive, or the same problem be addressed in different directive that you find it, the data privacy and which is why in the RGPD, in the i‑privacy which can be more to also as delegated at or act in the red directive or accessibility which we have discussed in the frame of the requirements, but we've also provision in the European Communication Club we have the European Access Act which is coming and which would also monitor the implementation.
And at the end, the target is the same end product, as said in that case, the satellite receiver or whatever, and services, and both will be at the values recommend and which are not always completely constitute or access the resources that they are not critical system.
I tried to catch up on the timing, but if you want to go on the subject then you will see in the presentation that you can access directly to begin to allow a policy paper which I have mentioned briefly at least for our 2025 and some more specific to the subject like the HBTV one because we have seen in the recent past, some G3 from valued countries trying to impose some technology in the product while we're witnessing that imposing a technology is probably less effective than walking together and having a positive communication on the product with lateral certification as this has been to know in the past in France, for example, or in the UK with Free View HD which was not monitoring any type of technology in the product, but just because you are a service and ecosystem, well if you are not (?) for the ecosystem, you will be simply be out of the market without imposing any specific regulation, which is basically something we still think is the best way to approach regulation, the regulation gives you a broader scope, but the product success is linked to mutual communication between services and products so that the consumer is really aware of what you can expect from both services and product.
(Applause).
   >> JAROSLAW PONDER:  Thank you very much for this presentation, and now let me turn also to the Representative of the French Forum of AudioVisual, Mr. Jean Mahe and leader of the performance group in terms of the reform and work on regulations, but today he's representing the French Forum and so we would like to hear more of how the additional operators are also taking this change as the opportunities for them to provide the new opportunities and broadcasting opportunities for the end customers.
   >> JEAN MAHE:  Thank you.  Good morning.  It's a pleasure to be here.  Again, thank you for inviting me to speak.  So you mentioned, and I'm also at the end of the Audio Visual on content at the headquarter in Paris in the Regulatory Office so it's not the end here to speak with this title, but to me with the other basket, as I would say, as I'm sharing the F (?) for four years and so I know this subject well.
So in two words concerning the GFEN this is a forum which has some common positions on the meeting organized by the French decision‑maker and it includes some TV channels, TV distributers, broadcasters, TV manufacturers, 25 members up to now, people are being asking for being members and it will be done in a few weeks, and actually an association is also participating on Pascal, is attending a lot of the meeting at FAVN so it's working in a classical way, the spectrum working group, and UHD working group, and we have created recently a working group with this UHD problem with some butt kissing at this stage from the tower on it's difficult to analyze exactly what depends on different treatment, of course.
So it's increase the forum called the SD forum was presenting on the formula and you can see understand very easily why we change the name of the reservation to S.  FAVN which is probably not well known outside of Paris but I'm sure that you will recognize as was before but in French is different.
So we're working now on the modernization of the French DT forum and I'll try to explain that a little bit to you, but I want to ‑‑ I liked some figure first, which is the tendency of the way how to receive the television influence.  You can see that IPT is the first platform now to deliver the signal to the French people, but it's not very far because this was achieved one or two years ago, it didn't come to make addition of the collective cable which are providing also the same services as those provided by DTT only and so also the figure on the tendencies going very slowly, because it depends of course, of the spreading of the fiber now network in the French territory.
So you also have some place it is holders because we are ‑‑ because before on this still keeping in the same line, we said they're going to be the same for the future in the coming years.
Now, I want to also to address a little history of the DTT in France.  You will see that this is a big adventure, and as it is a regulatory group here, it's important in this what happens is the first step is all of the elements concerning the French rules, so it's been a done deed a lot of time as you can see.  It seems the beginning of 8 6, no, something that AT elements introducing in the law, the law is very big ‑‑ it's not so big in the electronic communication code, but it's not so far, and so there will be a strong discussion coming in the next weeks because the government is ‑‑ will provide the new text concerning, so this is slow and this will be discussed I think for, a minimum of one year in order to have a final text so far for 2020 and I'm sure that will be also the case to introduce the text which should be before coming from the commissions that we have to introduce in the French Regulatory Framework.
The part which is below is the ‑‑ there is a time it's just to the main specific evidence which we can see of the green ‑‑ not supposed to change a lot in the following years, and so the two‑step in April 2016 which was a swech to the new standard, it was the ‑‑ France was one of the first countries to already have maintaining and transmitting in HD so it's not so far from now and so we are now getting and I won't go into details in this roadmap, which has been produced by CSA which is the French Regulatory Body for audio visual, and I suppose you know it, and it has produced a roadmap which was produced last year if February.  And so you have here some constraints.  I'm not sure if it's very easy to read from the part of the room, but the first part is to define the technical standards in order to put, of course, on the French market new recruitment that will replace naturally the old equipment, in order to be sure, because in France we have of big importance is the olympic games in Paris in 2024 which is like this so we are preparing all of this I would say for being ‑‑ for the access mode.
The evolution as we saw them are focusing on source points as I have on this slide, and income we will switch the ‑‑ and return to ‑‑ the main stake in technical points for the transmission on something which could be seen by the viewer, but we know that there is some new sound, and the sound was not the things that were very well worked from this platform, but since the beginning so we will have some NGA as we go through them.  We will improve, of course, the resolution which will be the capacity to go to 4K and not for whole of the channel.  We see classical, I could say now, HDR, there may be also some far from which would be very important for the evidence, and then also so I want to highlight at what point in this new TV that for specificity for the French market, I'm sure Pascal is not maybe a lot of happy because it is a specificity of the market but it is a way due to the scares resource of the spectrum to use some dynamic way for TV channel, one channel TF1, for example, could transmit in one moment in HG, HGR can go at a later stage, and can go to 4 and which are not and ability to switch in a dynamic way, the video part of the television, which is not an easy way to be seamless for the work.
And I will analyze the state of this work, (?) is a big unit of work and so where we are and so for in 10 months, the FAVN was able to write technical specification for the modernization of DTT.  It was reached after some difficult compromises because you can imagine that strong discussion, the 26 Working Group meeting, it's not a number of yeerks but working group meeting, you can imagine some meetings that were very strong and the conclusion concerning the NGA was to use the DB SE4 and this is mandatory and this would be mandatory for these kind of TVs, but could be reintroduced before the end of this year if necessary, but the discussion has not started on this topic.
HBVTV is included on this part of elements mentioned, and Pascal before, concerning the mandatory part of the TV which are connected.  The specification was introduced last February.  We are continuing our work inside the user forum discussing the profile because we will have to kind of TV receiver on the market at the same time, so we need to manage all those things.
The FAVN has launched, as I mention before, the group on the interoperability which is a good thing, and I think to technology problem before in real loich and the problem of the calendar on some will be still discussed in the coming weeks, and I think that in conclusion, I don't want to ‑‑ I don't want to go beyond this time because I think we are far, and perhaps showing in Europe that DTT will have a future in Europe.  Thank you.
(Applause).
   >> JAROSLAW PONDER:  Ladies and gentlemen, with this concludes the status of the presentations, but we planned also a discussion and unfortunately the time is running very fast, all the provided content was so exciting that it would be a pity to interrupt, in fact.
So, I would propose that ‑‑ I would ask only one question and I would like to ask you, all the contributors for the very short 30‑second answer.  Your spontaneous reaction, of course this part of the table will be advantages because they have more time to think, but let's start from the left side we have heard about a lot of trends and what we are experiencing in the television and about the arriving and conquering the markets and challenging the traditional television economics, and we've heard a lot of the new regulatory challenges, but also we started our discussion with the new proposal or revision of the directives, which will also set the tone for more open market for the television expansion.
And so in this sense, would you agree that this proposal and this way forward is providing enough freedom for the European television business to grow and expand and provide new services with innovative solutions for the end users?  Status from the ‑‑
>> So I think the new directive deliberately gives freedom and deliberately doesn't ‑‑ it's not strict on what it's asking to do.  It gives opportunities for Member States to be more strict but will allow all TV audio/visual to comply with the minimum standards in there so I don't think it is restrictive and it's deliberately permissive and moved towards co‑regulatory and codes of practice.
   >> JAROSLAW PONDER:  Thank you very much.  European Commission?
>> The answer is, of course, yes, but more seriously, you know, it's true that sometimes we might have a tendency to say if the world is without rules it will provide the maximum scope for growth, but I would challenge with you, because for example what we saw in the social media space, at a certain point where we're functioning largely without content rules and ultimately we've gotten to disinformation issues, we got into a situation where very few people trust actually the news which appears on social media, so I would say reasonable rules is the way forward and I think this is what we have.  Thank you.
   >> JAROSLAW PONDER:  Thank you very much.  What is the perspective of Hungry?
   >> PETER VARI:  We have things which is important that the state will have things which is necessary for all information for people dependent of their social or other background and in this way, I believe it will go in the future but not to handle the other part of the social inhabitants to investigative information and in this way, the public broadcasters has a right to handle this information to the people everywhere.
   >> JAROSLAW PONDER:  Thank you very much.
>> Two things.  First, dynamics and changing business models or business models, one presentation between Tom and myself, and while the dynamics is strictly, that's obvious the numbers show that it goes into DTT and goes online and however the absolute numbers still prove that the source of passwordless media, the traditional media is safe or higher bit and I know that, and so the challenge, the challenge for them is to actually bridge the two in the way of think of it being maybe more technologically driven and also finding some sort of, I don't know how, you know, if I knew I would be a billionaire, and as far as the directives and vierp, with the European Union, you see Europe's interest in all of this and I believe that Europe can compete on the program and on other things in technology as well.  It's more kind of difficult with the kind of distribution patterns, but I think that any regulation, current or future, should basically give freedom to the players in the marketplace by protecting our core values, and that's ‑‑ there's what I think.
   >> JAROSLAW PONDER:  Thank you very much.
>> I've got a lot of the same things as Peter said.  I agree with the objectives, it does level the playing field in a lot of important ways and it's many ways overdo, and we're actually seeing a lot of discussion about using many of the things they've done in the AVMSD in other places like Brazil and the risk is the same as in the presentation, leveling the playing field in terms of localization and things like that doesn't necessarily deal with some of the overarching international economics, so yes, we might get content created in Europe, but it might not necessarily be created by the same companies that currently create it.  So that's ‑‑ that kind of is an open question, is that what we want or not?
   >> JAROSLAW PONDER:  Thank you very much.  Let me turn to the colleagues from the private sector voice.
>> Yeah, from the private sector, again, if the fragmentation, there is still a clearer future for audio/visual because there will be production of audio/visual contents which will be on the other side viewers which are interested, and but this is where we also have a question, the delivery modes may change very quickly and we should be ready and assured that the directive, or any piece of legislation is not matching what we see today and what we see that change from today, but technology and we know delivery and consumption of audio/visual contents may change very rapidly.
   >> JAROSLAW PONDER:  Thank you very much.
>> Thank you.  So the forum to explain this of all different members coming from different parts of the industries, different to on this question, but we want to, of course, as a lot of people have stated already, a regulatory landscape for being able to develop towards a return of investment of what we invest in.  Thank you.
   >> JAROSLAW PONDER:  Dear, ladies and gentlemen, with this we will conclude this session.  There are a lot of questions more, which we would like to ask, the time is pressing, and also the other proposition of this workshop is awaiting our presence, so let me call for round of applause for our speakers.
(Applause).
And also for you being great audience.
(Applause).
Thank you for this, and now dear, ladies and gentlemen, more announcements.  We have programs for a group photograph which will take place in front of this building, so our colleague in front of the doors is there awaiting us to guide us downstairs.  You have to leave your affairs here, your item, the room is safe.  After the photo, we are welcome in here at the coffee break provided by our sponsor as well as accompanied by the excellent expedition by the eight entities which made the efforts to showcase the innovation in the television field.
So with this, I would like to thank you very much for this session, and we'll meet downstairs.  The next session will take place and start at the 11:45 a.m., so please we'll start sharp, so that's why please don't go too much so that we can start on time.  Thank you very much.
(session completed at 4:19 a.m. CST)

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