MPEG4 Chip Delays Europe HD Rollout

A new report from European research firm Screen Digest says that delays in the delivery of MPEG-4 chips to set-top box makers will slow down what was expected to be a European rush to HDTV.

The World Cup soccer tournament takes place in Germany this June and July and many European pay TV providers placed a bet that HD broadcasts would attract millions of subscribers. But with HD set-top box delivery delayed by six months the ability to get those set-tops into consumers hands becomes much more difficult.

Broadcasters including Britain's BSkyB, Germany's Premiere, TPS in France and Sky Italia in Italy will be showing games in HDTV, but without the right set-top boxes, not all the "HD-ready" households being touted before the tournament will be able to watch in the new format.

Senior Analyst Vincent Letang, who has just released a report on the subject, says only about 100,000 European households will be able to watch HD.

"TPS in France, the number two pay TV operator in France, just received its first shipment of 10,000 set-top boxes to pre-registered subscribers," he says. "And they expect to have 30,000 delivered by the beginning of the World Cup which isn’t bad but is below expectations."

The biggest loser appears to be Premier, the German pay TV service that invested millions in HD marketing around the World Cup. "Pay TV has always been difficult to market in Germany because there are so many free-to-air networks so they were betting big on HDTV," says Letang. The company also lost rights to the major German soccer league for next year so the double blow is extremely painful.

ST Microelectronics is the primary chip maker and the chips are available now for Thomson and Pace, the two top box makers. BSkyB in the UK could also be affected.

"Ultimately there will be enough boxes to put in pubs but it will be tough to get them to individual homes," says Letang.

Long term, however, Screen Digest doesn’t expect the shortage to hurt HD adoption. The company is forecasting that by 2010 about 50 million TV sets will be HD-ready and about 11 million European households will be watching TV in high-definition quality.