On July 8th 2009 the Norwegian government decided new terms for the Norwegian digital terrestrial tv (DTT) network hereby altering former competitive requirements
QVARTZ advised NTV on this issue. Based on thorough fact-based market analysis of the TV-distribution market in Norway and the Nordic markets as well as analysis of RiksTV competitiveness, various scenarios for development of competition on the DTT platform were developed and economically modeled. The findings showed that competition on the digital terrestrial network would bring serious risks to NTV, the pay-tv operator RiksTV and the terrestrial network as a platform as such.
The terrestrial network ensures important social considerations. It provides the entire Norwegian population with a television offer and for many households it is the only alternative. Moreover, it constitutes public service broadcaster NRK’s main distribution network for television.
Hence, when the parliament agreed on the development of a digital terrestrial network for television it was essential that it would ensure the existence of a national Norwegian public service offer. Competitive considerations were emphasized as one of more subordinate considerations just like free public service broadcasting through NRK, access to local television and reasonable priced decoders.
Developments so far proved that fewer than expected have opted to subscribe to pay-TV in the digital terrestrial network. Hence, competition on the platform would make it unprofitable to operate pay-TV in the digital terrestrial network. Furthermore, the establishment of the terrestrial network has already contributed to the competition between the different platforms for pay-TV (cable, satellite and IP-TV). If one weakens the basis for pay-TV in the terrestrial network, it could have negative consequences for competition between platforms.