Luddites struggle to hold back the tide of digital evangelism

It’s television, Jim, but not as we know it.”

“In 1950, about 600,000 adults had access to a television set. By 1960, it was 25 million. I think we’re now looking at a change in this industry at least as dramatic as that which happened in the Fifties.”

“By July, 3.1 million people in the UK were connected to the Internet, a growth rate of 94 per cent a year. It’s forecast that by the year 2000, 40 per cent of the population will be online.”

“In the United States, Internet users are spending 12.8 hours a week online, and that is time when they are not watching television.”

“What’s the difference between digital television and the Internet? None.”

A selection of quotes from last weekend’s Royal Television Society Convention at Cambridge, where the evangelists of the TV and telecoms revolution were in full cry. The speakers were, in order, Adam Singer, the chairman of Flextech, Don Cruickshank, director-general of Oftel, Edward Briffa, controller of BBC Online and Briffa and Singer again.

The media world is dividing into two camps: those, like these, who believe television “will never be the same again”, because of its convergence with telecommunications and the computer, and those who think the mainstream terrestrial channels will continue to dominate the medium for the foreseeable future.

In Cambridge, both groups put their case. What seemed to give the evangelists the edge were the demonstrations of new technology, showing just how far the boffins have got in merging the TV and the PC into a single, all-powerful box. Microsoft and British Interactive Broadcasting showed how convergence will be harnessed to provide news and information and home shopping through the TV set, while the latest version of BSkyB’s Electronic Programme Guide got its first – and highly impressive – public airing.

But the most dramatic demo came from former Tomorrow’s World presenter Howard Stableford, who showed a digital TV system – the Interpolator – from Snell & Wilcox, that allows seemingly perfect interaction between the PC and the TV set. Until now, TV pictures seen on a PC screen have been jerky and fuzzy, while computer data projected on a TV screen has been equally inadequate.

Yet on a screen 40 feet wide, Stableford showed digitally-generated clips from Four Weddings and A Funeral and The Madness of King George in cinema-style, widescreen, pin-sharp clarity, punctuating them with e-mail messages, pages from the Cinemania CD-Rom, spreadsheets, mortgage calculations, programme guides and other Internet material conjured up from the computer.

The system will allow film producers to distribute their films to local cinemas electronically over cheap telecom lines, instead of having to make expensive celluloid prints that can get scratched or degrade over time.

At the moment, the Interpolator box costs $30,000 and is aimed at the US home-movie market for very rich people – but soon the critical technology will be available to be fitted into a top of the range TV or PC for an incremental cost of only $100.

That would make it into a mass market product – providing that people want to combine their TV and PC in the same box.

Not everyone believes they do. Beating the drum for the Luddites (relatively speaking) was Carlton’s Nigel Walmsley – perhaps oddly, since he is leading Britain’s move into digital terrestrial television, as chairman of British Digital Broadcasting.

“Watching television is a passive activity,” he said. “Operating a PC is an active one, which sets the mind racing. Do they really go together? The idea that home shopping will replace the high street and out-of-town centres is wrong.”

He pointed out that three-quarters of UK homes still only have four or five terrestrial TV channels, which gives DTT a huge virgin market to open up: “I think free-to-air television will have a beating heart for years to come.”

This view, that things will move more slowly than the evangelists believe and the mainstream channels will remain the creative powerhouse of British TV, was supported by the BBC’s head of policy and planning Patricia Hodgson, the chief executive of the Independent Television Commission Peter Rogers and, perhaps surprisingly, by David Youlton, the chief executive of Snell & Wilcox. He believes digital TV will succeed because of the quality of its pictures and the new channels it offers, not because of the Internet: “When people go home they want to watch TV, not work at it, scrolling through pages of information.”

Yet Adam Singer insists: “It is coming very fast. We are no longer in the television business. We are in the content and distribution business and soon you’ll be able to download everything you want – including real television – over the Internet.”

But won’t people still need the major channels to package all this material for them? “This generation does,” said Singer. “The next – my children – won’t.”

Oftel’s Don Cruickshank, who is vying with the ITC to become the single regulator in this brave new world read a headline from the Financial Times: “US group to make ‘super-chip’ a hundred times the power of today’s.”

He says: “I believe that anyone thinking about the future of their company should assume there will be virtually infinite storage and processing activity and it will be almost costless. The ramifications of that are huge.”

Luddites point out that the launch of digital satellite and cable is overdue, delayed from this autumn to some time next year. But that may be small comfort in the long run.

News Analysis, page 22