BBC TRUST FREESAT CONCLUSION.

AS REPORTED BY THE BBC TRUST IN APRIL 2007.

choice and introducing competition in the subscription-free satellite TV
market?
Of the 588 responses to question 7, 92% consider that the proposal will have a beneficial
effect for consumers by increasing choice and introducing competition, while 8% disagree.

Will "Freesat" be beneficial to consumers?
No8%
Yes92%
YesNo
The regional differences can again be observed in the responses to this question. In
Northern Ireland, Scotland, and Wales all respondents believe that ‘Freesat’ will be beneficial
to consumers.

"Freesat" will be beneficial for consumers0%
20%
40%
60%
80%
100%
120%
NorthernIrelandScotlandWalesEnglandOverallNolocationPercentages of respondent by location who agfrred that "Freesat" will be beneficial to consumers was: Northern Ireland: 100%; Scotland: 100%; Wales: 100%; England: 92%; Overall: 92%; No location: 82%.
Organisations responding to the consultation also recognise the benefits of the proposal,
with 93% of those who responded answering ‘yes’ to question 7.

"Freesat" will be beneficial for consumers50%
60%
70%
80%
90%
100%
OrganisationSelfOverallOther
Sample of comments from respondents who believe the proposals will be
beneficial to consumers
“Yes. It will help also to drive down the cost of equipment”
“Yes as Sky is the only company offering such a service at present. Equipment can be costly
purchased through them. Some competition will help bring prices down.”
“It will definitely make the market known and accessible.”
“Indeed. If the market were left simply to consumer forces there would be far less choice
than we now have, and the "minority" programming we have would be non-existent.”
“Yes. Therefore the Consumer Expert Group has supported BBC involvement in a Freesat
proposition since our 2004 report "persuasion or compulsion? Consumers and analogue
switch-off"”
“Yes. I think that providing competition - and an alternative - to the present satellite TV
suppliers is a very important point. Otherwise we are all, to varying extents, at their
mercy.”
“Yes. The only other options are commercial and the service is at the whim of the
companies. Sky freesat is good but could be withdrawn or the number of stations restricted
further for commercial reasons. Cable has only a subscription service.”
“Most certainly. The UK is in an almost unique situation compared with other European
countries being almost totally dependent upon Sky. In Germany and UK although there is a

Answering "yes" to the following proposition, "Freesat will be beneficial to consumers, were 93% of organisations, 93% of individuals, 92% overall and 83% categorised as "other".
sky service PVRs without subscription are readily available at a price around half those of UK
equivalents due in part to lack of competition.”
“Yes, increasing choice is something that really does need addressing.”
Sample of comments from respondents who believe the proposals will not be
beneficial to consumers
“Increasing choice is not part of the BBC’s remit as I see it. Wherever 'increased choice' has
been used, one eventually wins out, & not necessarily the best product (e.g. Betamax/VHS
video).”
Question 8 – Do you agree with the Trust's conclusion that whilst launching
“Freesat” will affect other participants in the market, it is not likely to lead to
exit from the market of existing participants or to create a barrier to future
innovation? (Any figures for the likely effect on other participants' revenues
would be particularly welcomed).
Of the 526 responses to question 8, 90% consider that the proposal is unlikely to lead to
market exit, while just 10% believe that it could.

Unlikely to lead to market exit?
Yes90%
No10%
YesNo
This is also true for responses from organisations, with 90% considering market exit unlikely.

"Freesat is unlikely to lead to market exit." 90% agreed and 10% disagreed.
The proposal is unlikely to lead to market exit. 92% of individuals agreed, overall 90% agreed, 90% of organisations agreed and 83% categorised as "other" agreed.Sample of comments from respondents who believe the proposal is unlikely to
lead to market exit
“Absolutely true. I think it may well work the other way given the BBC's commitment to
public access and its own innovative leads in the past. I think it is more likely to encourage
innovation. The BBC Micro computer model is pertinent here.”
“I agree entirely that the launch will affect the market marginally but I do think it will not be
hugely disruptive, any player in the market that doesn’t foresee the involvement of the BBC
as a part of or wholly as a competitor doesn’t deserve to survive in the market.”
“I hope it would have an effect on others services, otherwise it would not be the success
that we all want it to be”
“If other broadcasters do welcome competition, they should have no problems with this.”
“Yes because the service will not have the same sports and movie content that create
revenue for Sky and cable.”
“Yes. Introduction of this service (given suitable HD content) will act to further develop the
HD receiver market for STBs, PVRs and iDTVs. Assuming an open platform approach for
Freesat this can only act in the interest of future innovation. It is very unlikely that BSkyB will
exit from the market for FreeSat from Sky. There will alwaysbe a market for consumers to
have an easy potential upgrade to pay TV services using an initial free-only offer.”
“Yes. I don't imagine it would impact on any other participant's subscription services, and it
wouldn't directly compete with Freeview (havingdifferent features) so wouldn't force it out
the market.”

BBC TRUST DECIDES FREESAT.

AS REPORTED BY THE BBC TRUST IN APRIL 2007.

“Yes this is unlikely to affect cable/ satellite by a degree to closure, but would stimulate
innovation.”
“There is room in the TV market for both Free and Pay-tv alike.”
Sample of comments from respondents who believe the proposal is likely to
lead to market exit
“As the BBC will be effectively duplicating the "Freesat from Sky" service it will lead to lessinnovation. The money spent on BBC "Freesat" would be better spent developing
innovations!”
Question 9 – Does the proposal to establish a joint venture and to limit its
activity to marketing and technical co-ordination, leaving set top box
manufacture, retailing and installation to the market go far enough to minimise
the impact of the proposition on the market?
Of the 449 responses to question 9, 89% consider that the proposals go far enough to
minimise the impact of the proposition on the market, while 11% do not.

This conclusion also holds true when looking at responses from organisations, coming in just
1% lower at 88%.

"Do the proposals go far enough to minimise market impact?" 89% said "Yes" and 11% said "No".Do the proposals go far enough tominimise marketimpact?
Yes89%
No11%
YesNo
"The proposal will minimise market impact". Those agreeing were 90% of those categorised as "other", 89% of organisations, 89% of individuals and 88% of organisations. Sample of comments from respondents who believe the proposal will minimise
impact on the market
“Absolutely. You only have to look at Freeview's amazing success to back that statement
up.”
“Yes. But it must encourage other broadcasters, be it national or niche to get involved.”
“Yes and distances the BBC somewhat which is more suitable for a public service body.”
“Generally yes although some consideration will need to be given to influencing manufacture
and installation in the interests of consumers”
“Yes, plus in time it could be incorporated direct into new methods of viewing, like PC
media centres etc.”
“It's the most obvious way - it’s the same model as Freeview and the only sensible way
forward.”
“Yes. Many companies existing and future will benefit from the supply of the equipment
necessary.”
“Absolutely - the trust should not underestimate the market need for this development”
“Yes - it will also mean boxes will be cheaper as companies will be in competition with each
other.” 

BBC TRUST FREESAT CONCLUSION.

AS REPORTED BY THE BBC TRUST IN APRIL 2007.

Sample of comments from respondents who believe the proposal will notminimise impact on the market
“No it does not; the whole marketing and installation etc should be undertaken and
controlled by the BBC”
Question 10 – Is it appropriate for the Trust to impose conditions to prevent
licence fee money benefiting other participants in the proposed joint venture
and to ensure appropriate separation between Freeview and "Freesat"?
Of the 516 responses to question 10, 79% consider it appropriate for the Trust to impose
conditions to prevent licence fee money benefiting other participants in the proposed joint
venture and to ensure appropriate separation between Freeview and ‘Freesat’, while 21% do
not.

Should there be separation between "Freesat" and
Freeview?
Yes79%
No21%
YesNo
This view is less prevalent among responses from organisations, where only 69% of
respondents believe that the Trust should impose such conditions.

Should there be separation between "Freesat" and Freeview?. 79% said "Yes" and 21% said "No".
"The Trust should impose conditions to separate Freeview from "Fresat"". Those agrreing were 79% of individuals, 79% categorised as "other", 79% overall and 69% of organisations. Sample of comments from respondents who believe the Trust should impose
these conditions
“Yes, other participants should pay their fair share of any costs in the joint venture.”
“Yes. Licence fee money should go to providing programming and digital services. It should
be accountable for. It should not be used to help other partners develop technology and
services which will not be available to the freesat viewer. Also some services may be
available on freesat but not on freeview and vice versa. Therefore these should be kept
separate too.”
“Yes, the licence fee should not be used as a profit vehicle for allied companies involved inthe JV.”
“License fee money should only be used for the betterment of this service. Other
participants will see the obvious benefits without needing license fee money.”
“Yes - whilst the government and the BBC insisted on taxing television the licence fee
money should not profit other organisations. The licence fee money should be used purely
for distribution and channel content”
“It is, taxpayers/licence fees should not be used or available to private companies.”
“This is appropriate; there would be ample opportunity for the third-parties to make the
venture into a profitable one themselves.”
“Yes absolutely. The license fee money should only benefit the BBC not any joint venture
partners.”

BBC FREESAT FUTURE DECIDED BY THE BBC TRUST.

AS REPORTED BY THE BBC TRUST IN APRIL 2007.

Sample of comments from respondents who believe the Trust should notimpose these conditions
“No, as all users of TV equipment have to pay the licence and any benefit to other
participants will ultimately benefit the users.”
“No it is a partnership and therefore funds should be shared to ensure the very best in
programming and service.”
Question 11 – Should the Trust impose any other conditions if it approves the
proposals in its final decision?
Of the 390 responses to question 11, 47% consider that the Trust should impose further
conditions if it approves the proposals, while 53% do not.

Should the Trust impose any conditions?
Yes47%No53%
YesNo
Sample of comments from people who believe the Trust should impose other
conditions
“It should set limits on the price paid to other commercial channels (such as Sky one) to air
on Freesat”
“Keep costs to a minimum for subscribers”
“Perhaps limiting cost of this”
“Quality of the boxes!”
“To protect "Freesat" from Pay Per View and subscription-based companies (such as BSkyB)
that may wish to buy-into and erode the service by turning into a subscription-based service(as seems to be happening now to Freeview).”

"Should the Trust impose any conditions?". 47% said "Yes" and 53% said "No".
“Freesat should not at any stage be 'watered down' to include subscription services just toincrease the appeal of the overall service”
“That HD would be free to all, and not additional cost for either subscription or purchase of
equipment.”
“That the service should be subject to review after 5 years, with the intention of adjustment
for any licenses”
“Broadcast technology is advancing so fast currently. It is important to ensure that 'Freesat'
will be allowed to accommodate any technological advances which come along even after the
service has been launched. To this end, the technical specification of the service should be
sufficiently sophisticated and pliable to be able to accept major changes in the future in a way
which won't present problems of incompatibility between consumer equipment and new
transmission formats”
“It should limit the amount of licence money that can spent on this project, with a maximum
spend if the project is unsuccessful”
“Set top boxes should only be sold to people with UK addresses - the satellite footprint
covers most of Europe therefore the freesat box must be restricted to the UK population”
“Do not limit the BBC's ability to sell the Freesat service overseas. The BBC could easily
sell the service (by subscription or for free) to users across Europe (assuming you'd use
Astra) or further afield providing an extra revenue stream that could be used to provide
subsidies for hardware/installation back home (e.g. for pensioners, schools, hospitals).”
“A restriction on 'game' channels that are invading late night television”
“Every effort should be made to ensure that, in addition to the PSBs, only quality channels
are easily available through Freesat. Effort should be made to reduce shopping and quiz
channel content and to ban any pornographic content”
“Many people already have independent (non-Sky) satellite equipment. There must be no
bar (viewing cards, etc) that would prevent them from receiving Freesat on their existing
equipment”
Question 12 – What other comments would you like to make about these
proposals?
Due to the diverse and individual nature of responses generated by question 12 it is not
appropriate to give a quantitative breakdown.
A sample of responses to question 12

BBC TRUST DECIDES.

AS DESCRIBED AND REPORTED BY THE BBC TRUST IN APRIL 2007.

“There is no justifiable reason why people who don't use a service should be forced to help
pay for it”
“Sounds great”
“Much needed especially for those of us who do not currently have a choice”
“I think they are very positive, and are a good solution to the problem of limited freeview
coverage”
“I believe I am one of a very small minority - the ariel cable in my house is broken between
the aerial and the socket - however to repair it involves channelling out the cable which has
been plastered inside the wall by the previous owner! So it’s either satellite or fuzz!
We have been considering changing to thefreesat service offered by sky. However we
would prefer to use a service offered by the BBC, were one available”
“Anything which stops HD broadcasts being only available via pay-per-view is a good thing”
“The trust should be seeking only to ensure a free (and as soon as possible, HD) service is
available to all licence fee payers.”
“It is not clear what the real benefit from this proposition would be. If it meant TV / Radio
masts could be removed from the landscape as aresult then that would be a real benefit”
“Free Sat from Sky was hidden away by Sky as they wanted monthly payments. BBC's Freesat should
be advertised properly and openly”
“Far too late it would have been a much better use of licence fee payers’ money to get thisimportant service correct in the first instance”
“I am concerned about the effect bad weather will have on the signal as the UK is not known
for its good weather. I also stress that I would prefer one system that works rather than
several that may work depending on the circumstances. I'd also prefer my license money tobe spent on upkeeping one working system rather than several”
“Whilst I am broadly in favour of the *way* the Trust is planning the venture, I am not in
favour of the venture itself. I consider it (and this consultation) to be a waste of licence-
payers' money.”

BBC TRUST FREESAT CONCLUSION.

AS DESCRIBED BY THE BBC TRUST IN APRIL 2007.

Conclusions

Public Value
Questions 1 – 4 broadly covered the public value aspect of the proposal, examining issues
such as access, choice and future-proofing.
Question 1 asked whether or not respondents believe current access to the BBC’s digital
services is adequate and whether the BBC should be seeking to improve this. The majority
of respondents considered current access to be unacceptable, and also considered that the
BBC should be taking action to improve this in the lead up to digital switchover.
Question 2 looked at the principle of choice,asking whether Licence Fee payers should have
a choice of subscription-free means of access to digital services, with the majority of
respondents firmly in favour of a choice.
Question 3 tested whether the current “Freesat” proposals offer value to all Licence Fee
payers, or just those currently without access to Freeview. The majority of respondents
considered that the “Freesat” proposal will bevaluable and attractive to all Licence Fee
payers, not just those currently without access to Freeview, though they did consider it
particularly valuable to this subset of Licence Fee payers.
Finally, Question 4 looked at the issue of whether the “Freesat” proposition should be
future-proof, for instance by including HD capability. Respondents demonstrated strong
support for incorporating future-proof capabilities.
The results of Questions 1 – 3 strongly support the idea that the “Freesat” proposal will
deliver significant public value by giving viewers a choice of means of access to the BBC’s
digital services. A further benefit identified by respondents was the stability offered by
“Freesat” as a free-to-air offering, in perpetuity, from a public service broadcaster.
Although the proposal will deliver public value without future-proof capacity, it is clear that
the level of public value delivered would be enhanced by offering features such as HD, which
have strong support among respondents.
The BBC’s Public service remit
Question 5 looks at the public service remit of the BBC, specifically focusing on the BBC’sPublic Purpose to help deliver emerging technologies and take a lead in digital switchover.
An overwhelming majority of respondents consider “Freesat” to be consistent with this
public purpose, citing improved access and technological advancement in their reasons.
Competitive impact
The Trust has a duty to have regard to the competitive impact of the BBC’s activities on thewider market, so Questions 6 – 9look at this in some detail.
Responses to Question 6 demonstrate that most people consider that the proposal has
identified those markets that may be affected by “Freesat”.

BBC TRUST FREESAT CONCLUSION.

AS REPORTED BY THE BBC TRUST IN APRIL 2007.

They also strongly believe that increased competition will be beneficial to consumers,
offering a choice of service and introducing competition in the subscription-free satellite TV
market, as shown by answers to Question 7.
Question 8 asked whether the launch of “Freesat” would lead to the market exit of
alternatives from commercial suppliers, and while recognising that the proposal does
increase competition, respondents did not consider it likely to do so.
Finally, Question 9 asked if the proposition went far enough in limiting the impact of the
proposition on the market. Again, responses here were resoundingly in agreement that theproposal did go far enough.
Respondents clearly believe that the proposal will not have a detrimental effect on the
market, that it is fair to current and any future competitors, and that the introduction of
competition in the market is desirable.
Conditions
Questions 10 and 11 look at the conditions the Trust could impose if it approves the
proposal.
The response to Question 10 is still strongly in favour of imposing conditions to prevent
other participants in the JV benefiting from Licence Fee money, and to ensure appropriate
separation between Freeview and “Freesat”.
Question 11 presented an opportunity to suggest any other conditions the Trust should
consider imposing if it approves the proposals. Key themes here were limiting the cost to
viewers, not allowing pay-per-view TV to beincluded, and that a future-proof capabilities
should remain free for all.
Other responses
Finally, Question 12 invited any other commentsrespondents might have on the proposals.
The majority of these were a summary of the respondents overall view, either supportive or
critical. Many of these responses reiterated a certain element of the consultation, such as
improving access, incorporating HD and introducing competition. This question was also
used to give a more personal element with, for instance, respondents citing personal
experience of poor reception and other issues. 

BBC TRUST FREESAT CONCLUSION.

AS REPORTED BY THE BBC TRUST IN APRIL 2007.

Appendix A – Consultation Methodology
The Questions
The BBC Trust invited responses on the following questions:
1.Is current access to the BBC's digital services acceptable, and should the BBC be
taking action to improve access to its digital services in the lead up to digital
switchover?
2.Should licence fee payers have a choice of subscription-free means of access to digital
services?
3.Are the BBC's “Freesat” proposals likely to be valuable and attractive to licence fee
payers? (You may wish to comment on whether there is a value for all licence fee
payers or just those currently unable to receive Freeview).
4.Should the BBC seek to future-proof the “Freesat” proposition by offering a range of
set-top boxes so that users can choose either standard definition (the standard that
BBC channels are currently broadcast in) or a box that would be capable of receiving
high definition broadcasts in the future?
5.Do you agree with the Trust's conclusion that the BBC's “Freesat” proposals are
consistent with the BBC's Public Purposes because they will improve access to its
digital services?
6.Has the Trust correctly identified those markets that may be affected by the launch
of “Freesat”?
7.Do you agree with the Trust's conclusion that launching the “Freesat” proposition
will have a beneficial effect for consumers by increasing choice and introducing
competition in the subscription-free satellite TV market?
8.Do you agree with the Trust's conclusion that whilst launching “Freesat” will affect
other participants in the market, it is not likely to lead to exit from the market of
existing participants or to create a barrier to future innovation? (Any figures for the
likely effect on other participants' revenues would be particularly welcomed).
9.Does the proposal to establish a joint venture and to limit its activity to marketing
and technical co-ordination, leaving set top box manufacture, retailing and installation
to the market go far enough to minimise the impact of the proposition on the
market?
10.Is it appropriate for the Trust to impose conditions to prevent licence fee money
benefiting other participants in the proposed joint venture and to ensure appropriate
separation between Freeview and “Freesat”?
11.Should the Trust impose any other conditions if it approves the proposals in its final
decision?
12.What other comments would you like to make about these proposals?
Timing
The consultation on “Freesat” ran from 27 February 2007 to 5pm on 27 March 2007.
Methods of Response
The Trust offered a variety of methods in which people could respond. These were:
•An online form via the Trust website•Post
•Email 

BBC TRUST DECIDES.

AS REPORTED BY THE BBC TRUST IN APRIL 2007.

Data Collection and Analysis
Responses from the Trust website and via emailwere received into a central email folder.
Postal responses were directed to the Trust Unit team conducting the analysis. This data
was then manually extracted and analysed.
Questions 1 and 3 were split as follows to enable accurate conclusions to be drawn without
distorting the consultation.
1(a) – Is current access to the BBC's digital services acceptable?
1(b) – should the BBC be taking action to improve access to its digital services in the lead up
to digital switchover?
3(a) – Are the BBC's “Freesat” proposals likely to be valuable and attractive to all licence fee
payers?
3(b) – Are the BBC's “Freesat” proposals likely to be valuable and attractive to licence feepayers who are unable to receive Freeview?
The data was analysed in two ways. Firstly, responses were distilled to give basic yes/noanswers to each question. This data was used to generate the numbers for the quantitative
analyse. Secondly, a representative sample of the detailed comments from each question was
included to form the basis of the qualitative analysis.
Responses from key stakeholders were analysedcarefully as part of this process. Trustees
were given access in full to these responses.
In some instances the responses received were not relevant to the consultation. Some of
these were general enquiries which were referred to BBC Information. Others were
requests for printed copies. Finally, some responses did not answer any of the consultation
questions. These responses were not included in the final analysis.
Confidentiality
The consultation made clear the Trust’s intention to publish responses. Respondents were
given the option to submit a confidential response, in whole or in part. Where respondents
request confidentiality in whole no element of their response will be published. Where
respondents request confidentiality in part the relevant information will be withheld.
Publication
It is expected that the Trust will publish all responses made on behalf of organisations,
except as discussed above. The responses from individuals have been analysed as part of this
report.

BBC FREESAT TRUST DECIDES.

AS REPORTED BY THE BBC TRUST IN APRIL 2007.

Appendix B – Raw data
Overall
The following table gives the overall number responses to each question.
Question Yes No No response
351(a) 211 351 112
1(b) 432 34 208
2 594 34 46
3(a) 463 76 135
3(b) 502 36 136
4 537 50 87
5 576 41 57
6 432 31 211
7 540 48 86
8 475 51 148
9 400 49 225
10 408 108 158
11 184 206 284
Results by Nation
The following table gives a breakdown of responses to each question for respondents from
England only.
Question Yes No No response
1(a) 157 253 78
1(b) 316 23 149
2 431 24 33
3(a) 345 52 91
3(b) 368 23 97
4 389 34 65
5 420 26 42
6 327 23 138
7 393 34 61
8 355 37 96
9 298 39 151
10 289 84 115
11 140 154 194
The following table gives a breakdown of responses to each question for respondents from
Northern Ireland only.
Question Yes No No response
1(a) 1 4 1
1(b) 3 0 3
2 6 0 0
3(a) 4 1 1