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Ofcom may charge Freeview for TV frequencies in 2014

Broadcasters in the UK may be forced to pay Ofcom up to £240 million a year to transmit their TV channels.

According to a new consultation document published by the watchdog, it wants TV stations to pay for using the frequencies on a yearly basis.

Ofcom aims to get at least £10 million a year from each Freeview multiplex. Currently the BBC has two multiplexes, while ITV, Channel Four and Channel Five share one. Overall, there are six multiplexes in the UK. Fees are expected to be split up between broadcasters.

Credit: Man of Yorkshire

The document proposes that an annual charge could rise to as much as £40 million a year, or £240 million for all six multiplexes. This is if these multiplexes can’t be moved to make way for 4G services.

The Administered Incentive Pricing (AIP) system will apply to radio spectrum allocated (in the case of Freeview channels) as opposed to auctioned spectrum (for 3G and 4G services).

The AIP assumes that companies allocated free spectrum have no incentives to use it efficiently, while auctioned spectrum isused efficiently because they’ve paid highly for it.

The Ministry of Defence has had the AIP scheme forced onto it, and as such has now released large amounts of spectrum for sale to other users.

Ofcom wants to start charging for spectrum by 2014, before ramping up fees to £40 million per year per multiplex over the next five years.

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