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Analysis & Opinion
22.09.08 Russia’s Digital Conquest
By Sergei Balashov

Countries perceived as the pioneers of technological progress, namely the United States, Canada, Germany, Italy and the United Kingdom, have already launched digital television services. The Russian government plans to go fully digital only by 2015. Russia has already adopted the European DVB-T digital broadcasting standard, but so far only the regions of Mordovia and Yugra have official digital broadcasting. Meanwhile, broadcasters argue that trailing behind the global technological trends is by no means a setback for the country, but rather an advantage.

“The world has been switching to digital technologies for a long time, and during this time scores of mistakes have been made,” said Eduard Sagalaev, president of the National Association of Television and Radio Broadcasters. Russia is looking to avoid these mistakes by skipping all the stages that it has already missed, to jump into the digital world of tomorrow right away. “Many countries approached a dead end with mobile television when they focused on broadcasting sports events, particularly football games, while the technologies of that time didn’t even allow the ball to be visible,” Sagalaev added.

Today, the conditions seem to be set for making the switch. Russia will be falling into a well-established pattern. All of the necessary technology is there, with the availability of television sets capable of receiving both digital and analog signal, as well as the modernization of a satellite network necessary for transmitting the digital signal.

However, there will still be challenges--they won’t be purely technological, but rather social and economic. Television viewers will have to be provided with over 50 million set-top boxes (devices that connect a television set to a source of digital signal, converting it into content). According to preliminary estimates, 40 million of these will be needed for ordinary people, and about ten million more for various organizations. With the average price of $30 per device, the government is bound to introduce discounts to make them available for all social classes.

When it comes to producing set-top boxes, Russia is looking to develop its own technology, rather than to rely on imports. “The government has a defined take on this issue,” said Sagalaev. “We will not be buying anything abroad. However, we won’t be able to produce that many set-top boxes on our own.”

Russians will most likely solve the problem by setting up joint ventures with Western companies to locally produce set-top boxes. “These will have a ‘made in Russia’ label on them; the most advanced Western technologies will have to be employed,” Sagalaev noted.

The lengthy campaign will be worth the trouble. Digital technology will make television accessible for a country where just 33 percent of the population has access to more than five channels. Once digital television is in place, this number will grow tenfold due to the digital channels’ taking up less bandwidth, and will be available for all viewers—a crucial point in view of significant upcoming events such as the Sochi Olympics.

Content is also expected to improve in both quality and quantity. Today, only 35 percent of overall television expenses are spent on content. The bulk is eaten up by logistical and technological expenses, which are expected to be cut with the introduction of digital technology.

“Content production jumps by at least 25 percent after switching to digital television, like in the cases of Germany and Austria. In smaller countries it was as much as 50 percent,” said the General Director of the Ostankino television broadcasting centre Mikhail Shubin. There is more to it, as Russians plan to transform the set-top boxes into interactive devices that will not only allow the viewers to react to the content, but will also serve as an accurate measuring tool of any show’s or channel’s rating.

“If we fail to do it, we’ll lose the opportunity to know how our viewers react,” said Mark Krivosheev, chief researcher of the Radio Research Institute. “Today, broadcasting without interactivity isn’t broadcasting.” Getting accurate feedback and ratings is crucial to any broadcasting company’s strategy. “Our broadcasters will have all the data and Russia will hold the patent to the interactive set-top box,” added Krivosheev.

This and other advances will be made possible by coordinating efforts and merging potentials of all sides involved in the digital technology market. Plans to set up an organization, most likely to be dubbed the Russian Digital Alliance, are expected to be announced at the upcoming conference on digital technologies in Khanty-Mansiysk. The alliance will unite broadcasters, network and cable operators, as well as producers of content and equipment.

“We believe the time is right and [the Russian Digital Alliance] will facilitate the dialogue of all parties interested in digitalizing Russian television and radio, that’s where ideas like 3-D television could be discussed. We want our country to keep up and even go ahead of the time,” said Sagalaev. He then proceeded to give the date when Russia is expected to take the leap. “Russia will surprise the world by 2015, when the switch to digital technologies will be completed. There is no doubt that by skipping a few of the initial stages of development and experiments, we will surprise everybody by taking over the leading positions in this field globally,” he added.
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