July 24, 2009 10:59 pm

Freeview with internet video moves closer

Efforts to create a successor to Freeview allowing viewers to watch internet videos on demand through their TVs took a significant step towards launch on Friday.

Project Canvas – as the joint venture between the BBC, ITV and BT is codenamed – has moved to allay concerns among electronics manufacturers and rival broadcasters that it would exert too tight a control over the set-top box technology, thereby excluding fair competition.

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The BBC Trust, the broadcaster’s governing body, gave the green light on Friday for the BBC to press on with technological development of Canvas while it continues investigating whether the venture is a suitable use of the licence fee. That will bolster Canvas’s plans to launch next year, if approved.

“Canvas will set a new benchmark in UK media,” the BBC said in its response to the Trust’s request for further information, “democratising access to the television set”.

Canvas will be a free-to- air service like Freeview but its backers want to make it easier for anyone to use the box to deliver content over the internet.

However, consumer electronics companies, represented by Intellect, a trade association, complained in May that Canvas could have a “negative impact” on the digital TV market.

Canvas’ partners were seeking too much control over the project and had failed to collaborate with them, Intellect said.

Canvas said on Friday that it would allow technology companies to use the set-top technology without forcing them to use its own electronic programme guide.

Some broadcasters had suggested the Canvas partners might design the interface to prioritise the BBC or ITV’s content. On Friday, Canvas said that any broadcaster or content owner would be free to design its own channel.

“From the consumer electronics industry’s perspective, it’s an enormous step in the right direction,” said Richard Lindsay-Davies, director general of the Digital TV Group, the industry association which developed the technical specifications for Freeview.

The BBC also tried to address concerns that, because it was partly operated by the advertising-free broadcaster, it would provide insufficient commercial opportunities.

Canvas will allow channel developers to charge subscriptions or one-off, pay-per-view fees for their content. They will also be able to do deals with broadband providers to target advertising based on viewing habits or other online behaviour.

But more regulatory challenges remain for Canvas. BSkyB has questioned whether the Trust is the right body to judge the market impact of Canvas, while Ofcom has also urged the venture to be open to all .

One analyst, who asked not to be named, said: “Looking at it as a consumer, it looks like a pretty good product. It’s well designed and does all the things you would want it to do as a broadcaster or content owner.”

Anybody can develop an “application” for Canvas, but the document did not set out what the approval process would be.

But the venture looks better placed to survive the regulatory process than Project Kangaroo, the BBC’s last joint venture in online television, the analyst said.

Kangaroo was blocked by the Competition Commission earlier this year for potentially harming competition in the nascent video-on-demand market.

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