The 6th International Conference on Telecommunication Systems, Services, and Applications 2011

Digital Broadcasting Techno-Economic Efficiency Simulation Model between DVB-T and DVB-T2 in Indonesia
Denny Setiawan
Departemen Elektro FT UI Universitas Indonesia Jakarta, Indonesia denysetia@gmail.com

Umar Said Habibulloh

Program Studi Teknik Telekomunikasi Institut Teknologi Bandung Bandung, Indonesia umarsaidh@students.itb.ac.id

Abstract this paper shows a model used to calculate the efficiency of migration from analog TV technology to digital TV technology in Indonesia. Analogue television broadcasting in Indonesia uses 470-806 MHz or channel 22-62 and will migrate to digital television terrestrial (DTT) standard in a few years. Two standard had made for the migration, those are DVB-T and DVB-T2. This migration will provide frequency spectrum called digital dividend as DTT allows the television broadcaster to use only about 1/6 spectrum than the analogue [1]. The digital dividend propagation characteristic is very high valuable it has to used optimally in order to generate more benefit to the people, business stakeholders and government. That is why it is very important for us to create a model in order to provide best scenario with best scenario between DVB-T or DVB-T2 which provide greater profit for Indonesias government. Keywords- digital dividend; analog TV; digital TV; DVB-T; DVB-T2; MPEG-4; cost; revenue; profit

To solve this problem, this paper develops a method of estimating the benefits of advanced digital dividend gained by migration from analog TV to digital TV in Indonesia. II. BASIC THEORY

A. DVB-T One of the televisions broadcasting service standard which is quite popular in Europe and other countries are the DVB (Digital Video Broadcasting). Digital data used in the DVB standard is a compressed data in MPEG-2 format. Selection is based on consideration of the compression format for compression of good quality and from a commercial standpoint is also profitable. Besides MPEG-2 format also has become the standard in digital video systems in the world like the DVD format [3]. B. DVB-T2 DVB-T2 is a newest broadcast transmission standard. First, the DVB Project created commercial guidelines for evaluating how to implement the latest technology developments into new DVB-T specification. The DVB-T2 standard uses the experience from the current DVB-T, which was implemented first in the UK twelve years ago. DVB-T2 is capable to increase by at least a 30% the transmission capacity over the current standard while keeping the same TV coverage including transport of Internet Protocol (IP) data. The resulting standard exceeds the target for capacity increase and achieves 40-50% and in some scenarios over 65% increase [4].

I. INTRODUCTION Digital television (TV) is the first major change to the terrestrial broadcast of TV. Digital terrestrial television (DTT) system can deliver television even to mobile devices [1]. Beside of television, DTT allow us to deliver high definition (HD) and data casting services content. But until now, terrestrial users have not received data and HD content because its transmission requires wider data channel than standard definition (SD) TV Digital Video Broadcasting Terrestrial (DVB-T) with Moving Picture Expert Group 4 (MPEG-4) coding and standard compression. Instead of maintain the technology used recently, Indonesian government plans to do technology migration from analog TV to digital TV. Its because digital TV provide better capacity (how much it can transmit data), better performance (how consistent data stays over distance) and what type of data the signal can carry. For the same amount of bandwidth, digital signal can carry more data than analog signal [2]. New technology like DVB T2 provides increased capacity and ruggedness in terrestrial environment. But in order to increasing capacity, it coverage area got smaller. It impacts to increasing number of transmitter which has to be built.

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Table 1. DVB-T vs DVB-T2 Capacity Comparison

DVB-T Modulation FFT Size Guard Interval Code Rate Carrier Rate Capacity Number of Programs (MPEG-4) Emin (500 MHz; 10 m) 64-QAM 8K 2/3 Normal 19.9 Mbps 9 SD 2 HD 52.5 dBuV/m

DVB-T2 256-QAM 32K 1/16 2/3 Extended 37.0 Mbps 20 SD 4 HD 51.8 dBuV/m

A. Determining Scenario The first step is to pick the scenario which will be used in calculation. This paper presented estimated cost and benefit of the broadcasting system which uses the last technologies in two variances, MPEG-4/DVB-T and MPEG-4/DVB-T2. To restrain the problem in Indonesia, this paper will only focus on migration in Jakarta and Bandung. B. Technology Coverage Planning The scenario which is used in this paper is MPEG-4/DVBT or MPEG-4/DVB-T2. In Indonesia, there are term service zone, and service area. Service zone consist of several service area. Therefore, in order to do the coverage planning, the observation has to be done in service area basis. The software used for simulation is LS Telecom Chirplus BC. After the simulation, the amount of total transmitter required in Jakarta and Bandung will be obtained. C. Cost Estimation Broadcast system cost estimation is based on the assumption that a distribution network is already in place and the calculation is performed for the case of broadcasting one TV package-multiplex. Distribution network is excluded from the model as its configuration can take numerous different topologies and technologies, and including all of them could lower the simplicity and flexibility of the universal model. The model treat only the TV broadcasting subsystem of the whole network assuming that the multiplex is transported from payout/headed center to transmitter location by existing infrastructure. As the distribution infrastructure in most cases really already exist and because distribution network dont affect directly the new broadcasting technology issues, the exclusion of this infrastructure doesnt lower the generality of the model. In this paper is also implemented research if digital TV new technology for 1 million people is subsidized by government. Variable cost as expenses that change in proportion to the activity of a business, are included in TC because those expenses are typically dependent on type of technology used. The model starts from the idea that TC can be estimated by using annual pricing data from sales records of most influential broadcast technology vendors. This is the way when a general estimation is required. If the estimation is needed for a particular project and in the case of known vendor, than concrete data from the project could be applied to the model for estimating system cost, generated revenue and profit/loss timing. According to the explanation above, can be explained that the formula for calculating total cost for each scenario is

C. MPEG-4 The improved video and audio coding compression standard. Its usage will result in more efficient compression of video and audio content. MPEG-4 is based on the MPEG-2 standard but it is not backward compatible with MPEG-2 receivers. A TV program package-multiplex can carry twice as many data using MPEG-4 as can currently be achieved using MPEG-2, while keeping a similar service quality. Important feature is the option for mixing MPEG-4 and MPEG-2 streams on a single multiplex. MPEG-4 compression system is applied on the satellite and cable networks and is increasingly being used on DTT worldwide [4]. D. Digital Devidend The digital dividend refers to the spectrum which is released in the process of digital television transition. When television broadcasters switch from analog platforms to digital only platforms, part of the electromagnetic spectrum that has been used for broadcasting will be freed up because digital television needs less spectrum than analog television. The reason is that new digital compression technology can transmit eight digital TV channels by using the same amount of spectrum used to transmit one analogue TV channel. The digital dividend usually locates at frequency bands from 174 to 230 MHz (VHF) and from 470 to 862 MHz (UHF). However, the location and size of digital dividend vary among countries due to the factors including geographical position and penetration of satellite/cable services [8]. III. MODEL OF TECHNOLOGY EVALUATION To calculate cost and benefit in migration from analog to digital TV, it is important to create a representative model to approach the calculation accurately. The model consists of several steps such as determining scenario, technology coverage planning, cost estimating, revenue estimating, and calculating total profit of each scenario.

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Case 1: migration from analog TV to MPEG-4/DVB-T technology Total Cost = m x (Cost of Transmitter DVBT + Cost of Decoder MPEG4) + n x Cost of Encoder MPEG4 + Cost of MUX MPEG4 + 1,000,000 x Cost of set top box DVB-T

Case 1 = n x (Useful Bit Rate DVBT Bit Rate MPEG4) Case 2 (3)

(1)

= n x (Useful Bit Rate DVBT2 Bit Rate MPEG4)

(4)

Case 2: migration from analog TV to MPEG-4/DVB-T2 technology Total Cost = m x (Cost of Transmitter DVBT2 + Cost of Decoder MPEG4) + n x Encoder MPEG4 + Cost of MUX MPEG4+ 1,000,000 x Cost of set top box DVB-T2

Total Revenue Per Year = x lease line fee per month per Mbps x 12

(5)

(2)

Where n number of SD TV programs per multiplex and m number of transmitter. In the equations, cost of set top box multiplied by 1 million means that the government plans to give a subsidy for 1 million people who are planned to be pilot project for this migration. The entire variable used in the equation (1) and (2) are independent. The variable m can be obtained from step (B) when we made a coverage planning for each scenario. The variable n, which is number of SD TV programs per multiplex obtained from the data where this technology is implemented. D. Revenue Estimating The revenue collected in this migration obtained from leased line fee per month. If the network operator invest in broadcasting infrastructure, that operator can benefit from the spare capacity a gained by using new technologies. That benefit is the revenue from leasing capacity a from DVB system to other interested parties (for instance to service providers) using the pricing model of wholesale Internet access, which is the bandwidth sold to Internet service providers and content companies. It makes sense to apply the same pricing model because the subscription fee for today known DVB data services (DVB-H, mobile TV or data access) is similar like subscription fee for Internet access, so the wholesale pricing is similar as well. If the DTT operator using DVB system offers IP-datacasting-like service capacity within very attractive frequency band (VHF/UHF) with the introduction of mobility and interactivity (DVB-H, DVBNGH, return channel using GPRS/3G), that capacity price per Mbps can easily even overcome the current wholesale Internet access prices. The spare capacity can be calculated from the frequency which is left by common technology if we do migration from common technology to the scenario technology. And after we do the calculation to obtain , we can obtain the total revenue collected from the leased line fee per Mbps

E. Calculating Total Profit After we get the revenue per year from formula (5), we have to calculate the total revenue after several years. In this calculation, we are going to calculate the NPV of total revenue. The net present value (NPV) is defined as the sum of the present values (PVs) of the individual cash flows. In the case when all future cash flows are incoming (such as coupons and principal of a bond) and the only outflow of cash is the purchase price, the NPV is simply the PV of future cash flows minus the purchase price (which is its own PV). NPV is a central tool in discounted cash flow (DCF) analysis, and is a standard method for using the time value of money to appraise long-term projects. Used for capital budgeting, and widely throughout economics, finance, and accounting, it measures the excess or shortfall of cash flows, in present value terms, once financing charges are met. The NPV of a sequence of cash flows takes as input the cash flows and a discount rate or discount curve and outputs a price; the converse process in DCF analysis - taking a sequence of cash flows and a price as input and inferring as output a discount rate (the discount rate which would yield the given price as NPV) - is called the yield, and is more widely used in bond trading. Each cash inflow/outflow is discounted back to its present value (PV). Then they are summed. Therefore NPV is the sum of all terms, NPV = Rt / (1+i)t where t - The time of the cash flow i - the discount rate (the rate of return that could be earned on an investment in the financial markets with similar risk.) Rt - the net cash flow (the amount of cash, inflow minus outflow) at time t. For educational purposes, R0 is commonly placed to the left of the sum to emphasize its role as (minus) the investment

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The calculation result for each scenario will be compared, and the one with the most NPV will be the most optimum way to do the technology migration. IV. SIMULATION RESULT : AN APPLICATION FOR INDONESIAS CASE

of Rupiahs, green line is the capital expenditure cost needed, while the blue increeasing line is the profit projection of DVBT multiplexer. From the figure, we notice that the break even point of this case is about 2-3 years.

Indonesia is one of several countries which are still heavily using analog technology for its TV broadcast. In order to get more spectrum efficiency and take the most benefit of Digital Dividend, Indonesia need to proceed analog-to-digital-TV migration in a proper way. To optimize the result, there are two migration scenarios to be considered. First is the migration to MPEG-4/DVB-T and the second is the migration to MPEG-4/DVB-T2. In order to obtain variable m, the software LS Telecom Chirplus BC has been used and to calculate coverage of Bandung and Jakarta areas. In each city, it is assumed 2 transmitter required. Cost of the equipment is taken from information of vendor of equipment. Applying formula (1) and (2) to this study, those variables take the following values: m = 2, cost of transmitter DVBT=Cost of transmitter DVB-T2= IDR 3,000,000,000, Cost of Decoder MPEG-4 = IDR 110,000,000, Cost of Encoder MPEG-4 = IDR 150,000,000, Cost of Multiplexer = IDR 300,000,000, Cost Set Top Box DVB-T = IDR 278,000, Cost Set Top Box DVB-T2 = IDR 2,502,000. In this study, we analyze the current number of analog TV program in Bandung and Jakarta areas. So we also use n as a sum of number of TV program in Jakarta and number of TV program in Bandung. It is assumed in this study, that the model of DVB-T scenario using 64-QAM modulation so that each 8MHz bandwidth can have capacity up to 19.9 Mbps. In the other hand, DVB-T2 scenario will use 256-QAM modulation to produce capacity up-to 37.7Mbps In this study, we use interest rate of 6%, which is interest rate of Bank Indonesia.

Figure 2 Cost Benefit Analysis for Case 2 : MPEG-4/DVB-T2

If we apply the model with case 2 in this study, we will get the cost benefit analysis of implementation MPEG-4 DVB-T2 in figure 2. In this figure we will not have a breakeven point because the cost is too much higher so in 5 years we cannot reach the breakeven point. From the figure 1 and figure 2, we can conclude that in case 1, we will get smaller profit for the smaller cost. But the profit which is obtained is greater than the cost we spend. But in case 2, although the profit is so much greater than case 1, the total amount of profit cannot reach the cost to implement MPEG-4/DVB-T2 technology in Indonesia. If we do a little modification to the calculation, we can get several different results. First if we remove the cost of set-topbox subsidy 1 million people, we will get a result as follow

Figure 3 Cost Benefit Analysis for Both Case Without Set-Top-Box Subsidy

Figure 1 Cost Benefit Analysis for Case 1 : MPEG-4/DVB-T

From the figure 3, we can conclude that the profit for case 2 is bigger than profit for case 1. The cost for implement new technology will be same between case 1 and case 2. It means the cost from the first calculation just have a differences in settop box subsidys cost.

Figure 1 describes the cost benefit analysis of MPEG4/DVB-T with x axis show the year and y axis is the amount

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To optimalize the profit, we have done sensitivity analysis between number of population get set-top box subsidy to total profit in 5 year.

If the number of subsidized citizen is greater than 200,000 people, MPEG-4/DVB-T will provide better profit. But if the number of subsidized citizen less than 200,000 people, MPEG-4/DVB-T2 provides better benefit. For further analysis, this paper can be used as For example we can calculate demand forecast better revenue. Wider scope of observation is also calculate number of transmitter which is cover Indonesian area. ACKNOWLEDGMENT This work is partially supported by Telecommunication Engineering Department, Bandung Institute of Technology, and Directorate General of Resources and Standard, Ministry of Communications and IT, the Republic of Indonesia. REFERENCES
[1] Paulikas S., Sargautis P., Banevicius V. Impact of Wireless Channel Parameters on Quality of Video Streaming //Electronics and Electrical Engineering. Kaunas:Technologija, 2011. No. 2(108). P. 2730. http://www.pbs.org/opb/crashcourse/digital_v_analog/ __, "Digital Video Broadcasting (DVB), Framing, structure, channel coding and modulation for digital terrestrial television, European Standar, ETSI EN 300 744 Vol.1.4.1, pp. 11 27, French, 2001 A. Sugaris, I. Reljin. Digital Broadcasting Techno-Economic Efficiency Simulation Model // Electronics and Electrical Engineering. Serbia, 2011 Dadang Gunawan, Denny Setiawan, Andre Muslim Dubari. Optimization Digital Dividend Spectrum Utilization Scenario Analysis by Spectrum Valuation Parameters // Electronics and Electrical Engineering. -2011. No 3(109) __, Perencanaan Frekuensi TV Siaran UHF di Indonesia // Ditjen Postel. -2005 http://www.freeview.uk http://en.wikipedia.org/wiki/Digital_dividend_after_digital_television_tr ansition

references. to provide possible to all of the

Figure 4 Sensitivity Analysis Between Number of Subsidized Citizen vs Profit for Both Case

From the figure 4, we can see that if we plan to do 5 years investment to the new technology, it depends on how many people will get set-top box subsidy.. If the number of set-top box subsidy is under 200,000 people, MPEG-4/DVB-T2 will provide better benefit. As the opposite, if the number of subsidized citizen is bigger than 200,000, MPEG-4/DVB-T gives greater benefit. V. CONCLUSION

[2] [3]

[4]

[5]

This paper analyses the technical parameters for deploying MPEG-4/DVB-T and MPEG-4/DVB-T2. The proposed model is useful to calculate cost and benefit of implementation of new technology. This break-even analysis can be an initial calculation that preceeds more detailed cost-profit analysis. The model applied to Indonesian case shows that if we plan to do migration from analog to digital TV, its better for us to calculate the number of set-top box subsidized to citizen.

[6] [7] [8]

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