KEY POINTS:
A digital free-to-air satellite TV service set to go live next month will be aimed at "middle New Zealand" but will add digital video recorders and high-definition set-top boxes within a year.
Government-backed Freeview is a consortium of TVNZ, CanWest, Maori Television Services and Radio New Zealand.
It will broadcast existing channels TV One, TV2, TV3, C4, Maori TV and Radio New Zealand's National and Concert stations from the Optus D1 satellite to viewers with its set-top box and satellite dish.
A digital terrestrial service operating much the same way as existing broadcast TV will begin early next year.
TVNZ will launch a new family-oriented channel dubbed TVNZ3 in the next few months while a 24-hour news channel is expected to appear by year's end.
Digital TV broadcasters around the world are already delivering programmes in high-definition for better quality, as well as interactive services.
But Freeview programming will be delivered in standard definition and the two set-top boxes it has so far accredited will not allow for interactive features or hard-drive recording.
Freeview general manager Steve Browning said it would appeal to the 25 per cent of New Zealand homes with poor TV reception and those who wanted more choice in viewing.
"Middle New Zealand just wants good-quality telly. That's where Freeview comes in," he said.
The set-top boxes, sold and supported by electronics retailers, cannot be used for sending text messages and email or e-commerce services.
"We studied it long and hard. It was a trade-off between usage and cost. You add cost if you add a modem," Browning said.
Freeview would support some interactivity - mainly in the form of the channels' electronic programming guide. The MHEG-5 standard the boxes support is used by Freeview in Britain and is popular for its low hardware requirements.
A high-definition set-top box will be available by next March when digital terrestrial broadcasts begin.
"I'd like to think we'll have a personal video recorder for the satellite platform within 12 months," Browning added.
Sky has limited sales of its MySky personal video recorder as it readies MySky 2, a newer model that will support high-definition TV feeds delivered from the same satellite the Freeview consortium is using.
Browning said the satellite was brand new and was unlikely to experience the outages on the ageing Optus B1 satellite that disrupted Sky's TV services last year.
"Satellite has a bad reputation in New Zealand because of what happened with B1," he said. "But it was in its 15th year, literally falling out of the sky."
Browning has moved from TVNZ to head Freeview, but he hasn't had to change offices. Freeview is based at TVNZ's Auckland headquarters and is funded by the collaborating broadcasters.
"We're structured as a cost centre, no revenue line. We're concerned with how many houses have [Freeview] boxes in them," said Browning.
An advertising campaign would greet the launch of Freeview in late April and Browning said uptake of the set-top boxes, which will cost about $200, would be closely linked to consumer confidence.
After a shaky start, digital TV has experienced rapid uptake across the Tasman in the past year, with two million of Australia's 7.8 million homes now able to access digital TV, according to Digital Broadcasting Australia. Three-quarters of the digital tuners are high-definition, though not all owners have high-definition TV screens.
