Freesat Faces Uncertain Future, Ofcom Report Reveals

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Freesat, the UK’s subscription-free satellite TV platform, is at a crossroads. As more viewers embrace streaming services and broadband-based content, the future of this popular platform, which serves approximately 1 million homes, hangs in the balance.

A new report by Ofcom, the UK’s communications regulator, highlights the challenges faced by traditional TV platforms like Freeview and Freesat in the face of the growing popularity of streaming services.

As we previously reported, most of the report, which was submitted to the UK Government, focuses on Digital Terrestrial Television (Freeview), outlining three potential paths for Freeview’s future, including one that means a total phaseout of the service.

But what about Freesat? The report suggests that Freesat’s future is closely tied to the decisions made by Sky, the UK’s largest pay-TV provider. Both Freesat and Sky rely on satellites operated by SES, a leading satellite operator, to broadcast their content.

As Sky shifts its focus to streaming platforms like Sky Glass and Sky Stream, it may decide to stop using satellite services altogether.

If this happens, the cost of maintaining the satellite infrastructure could become too high for Freesat (and the public service broadcasters) to bear alone, potentially forcing the platform to shut down.

This raises the question: Can Freesat survive in a world where streaming is the new king – as evident by the new Freely service, which is a broadband-based replacement for Freesat and Freeview?

Freesat has been around since 2008, aiming to ensure that the UK’s transition from analogue to digital television did not leave viewers without free access to TV content.

Unlike Freeview, which only requires an aerial, Freesat broadcasts via satellite, making it ideal for areas with poor terrestrial signal quality – but viewers need a satellite dish, and a Freesat receiver box.

In 2021, Freeview and Freesat merged to become one company (now known as Everyone TV), a move intended to consolidate their resources and development.

Freesat 4K remote

Over the years, channels have come and gone from Freesat (as they do on Freeview), with one notable mention being the removal of Channel 4 HD and the Channel 4 app from Freesat. Eventually, both have returned.

Recently, however, Freesat has been losing more channels – notably, 9 channels were removed overnight from the platform in February 2024.

Freesat’s Cost And Dependence on Sky

Freesat’s future is closely tied to the cost of maintaining the satellite infrastructure and its dependence on Sky, the UK’s largest pay-TV provider.

According to the BBC’s response to Ofcom’s Call for Evidence, the broadcaster spends significantly less on satellite distribution (DSat – which represents both Freesat and Sky users) than on Digital Terrestrial Television (DTT / Freeview) for a similar level of coverage.

TV Satellite dish engineer

The cost of DSat scales according to the volume of channels rather than the breadth of coverage, with 80% of the BBC’s cost attributed to carrying 16 regional variants of BBC One.

However, the BBC notes that, like Freeview, DSat (via Freesat and Sky) will represent poorer value for money over time (and the BBC also has to consider how it uses the TV Licence fee payer’s money).

Assuming linear viewing hours continue to decrease, the take-up of streaming platforms continues to increase, and the cost of DSat remains the same until 2030, the cost per Freesat / Sky viewer hour in the year 2030 will be around five times higher than it is expected to be in the financial year 2023/24.

This increasing cost per viewer hour raises questions about the long-term sustainability of the satellite platform, especially considering Sky’s shifting strategy towards streaming services.

Sky logo on a TV

Sky’s role in the satellite ecosystem is considerable, as its viewers make up the majority of the DSat audience.

Sky currently has a contract with SES, the satellite operators, until 2028. However, Sky is actively migrating its customers away from satellite to streaming platforms like Sky Glass and Sky Stream.

If Sky decides to exit the satellite market entirely, it could significantly reduce the audience for DSat broadcasts and challenge the viability of the Freesat platform.

At that point, commercial broadcasters may no longer find it financially worthwhile to remain on the platform, and the satellite operator, SES, may conclude that it’s no longer viable to provide a satellite service for just the public service broadcasters (PSBs) and Freesat.

Sky’s Experience and Insights

In its response to Ofcom, Sky highlighted its own experience transitioning from analogue to digital satellite broadcasting, which may be an indicator of what will happen when the switch is made to streaming.

Sky Q on screen
Photo: Sky

The company noted that a small but significant number of customers continued to use the analogue service despite its limitations and the availability of superior digital alternatives – even when those were offered to customers at no extra cost.

This experience suggests that there can be a high degree of inertia among some households in adopting new technologies, even when there are clear benefits.

Sky agrees with Ofcom’s analysis that those who remain on DTT (and possibly Freesat) are likely to be disproportionately older or vulnerable households.

Freesat’s Possible Future

In its response to Ofcom, the BBC suggests that Freesat could serve as a basic “nightlight” service during the transition from broadcast to internet distribution.

Because the cost of satellite distribution scales according to the volume of channels rather than the breadth of coverage, Freesat could temporarily fill gaps in coverage to help maintain universal access to BBC content.

Watching BBC News on tv

In other words – if and when Freeview disappears, Freesat may find itself as the unexpected transition service, for those who can’t yet switch to streaming and broadband-based services like Freely (because of insufficient broadband speed in their area, for example).

However, for audiences, the equipment required to receive satellite signals (a satellite dish and set-top box) means that switching to Freesat is not necessarily straightforward.

Yet some viewers currently consuming content via satellite do so because they are not covered by DTT and/or broadband, and Freesat could continue to be a relatively convenient option for these audience groups.

The BBC acknowledges that further work would need to be undertaken with the wider industry to understand whether a Freesat “nightlight” service is both feasible and desirable from a technical, commercial, and audience perspective.

It’s also interesting to note that Freely, the new broadband-based free TV platform from Everyone TV, currently only supports DTT (aerial-based) as a “boost” for its channels list (so viewers can connect an aerial to a Freely TV and get additional channels over the air).

Freely TV guide

However, Everyone TV assured us that there are plans to launch DSat-compatible Freely TVs in the future, which means a satellite dish could be used to top top the channels list (for those channels that don’t yet have a streaming version).

This would, in theory at least, prolong the use of satellite-based channels in homes that already have a dish.

The Need for a Long-Term Vision

Ofcom’s report emphasizes the importance of having a clear, long-term vision for the future of free TV distribution, including both Freeview and Freesat.

Ofcom suggests that a decision on the future approach to Freesat would ideally be made by 2025/26 to allow adequate time for preparation and implementation.

Watching Freesat living room 1200
Photo: Freesat

This timeline aligns with the expected discussions between the BBC and SES, the satellite operator, regarding future capacity requirements.

As Freesat’s future hangs in the balance, a coordinated approach among industry stakeholders is important.

The BBC, Sky, and other broadcasters must work together to develop a plan for a potential exit from satellite distribution, taking into account the technical dependencies between Freesat and Sky.

Ofcom’s report also stresses the importance of collaboration between the government, industry stakeholders, and consumer groups in shaping the future of TV distribution in the UK.

A coordinated effort will be necessary to ensure that any transition from satellite to streaming-based services is smooth, equitable, and serves the interests of all audiences.

Whether Freesat continues to serve as a basic service (with a short list of core channels) or is eventually phased out completely in favour of streaming alternatives, major changes will be coming to the service in the not-so-distant future.

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7 thoughts on “Freesat Faces Uncertain Future, Ofcom Report Reveals”

  1. This might be a problem for a big market that people do not know about .. Those living in other countries that receive Freesat for many reasons.. They want to learn English.. they like the type of programs on UK tv .. or the biggest audience.. ExPats ..
    When Sky started closing the door to people who had second homes .. or had moved to countries like France .. Freesat was and is a “godsend” .. especially those who cannot afford internet subscription channels.. plus as said.. those who are not technologically minded ..
    Hopefully Ofcom will realize people who are paying for licences also use UK tv channels more out of the UK as well inside the UK ..
    Granted .. there will be a faction who say they should not.. but not all people can afford another way .. especially the old and those alone .. who rely on tv as comfort and company ..

  2. I can see absolutely no benefits to the consumer by moving existing free channels to streaming. Conversely big benefits to the industry by forcing us to watch adverts, spying on our channel and program preferences, and boosting profits by reducing cost of transmission.
    For those of us happy to pay the TV licence fee and no more, I see a creeping move into a world where we will have to pay increasing amounts for streaming services. Once there is a technology to charge us for the individual channels, I am sure the broadcasters will not be able to resist the temptation to extract more money from us. OFCOM and the government are being outwitted by the streaming lobby.

  3. Firstly, now that freesat is under threat, they must stop selling 4k recorders that will not outlive the service. Secondly, this smacks of the BT debacle, switching off landlines, only to ‘discover’ some people end up completely isolated. We don’t all have broadband. Once again, the view is that older people are probably going to die soon, so they don’t matter.

  4. I continue to use Freesat because I can record and keep programmes that aren’t always available on catch-up or streaming, particularly older films. It’s invaluable for fast-forwarding the never ending, constantly repeated adverts which is my biggest bugbear with all streaming channel. Even iPlayer now advertises its other programmes incessantly. I’m also able to watch Talking Pictures TV which isn’t available as a channel anywhere else apart from Sky and Freeview. I take exception to the inference that Satellite is now mainly used by older or less confident people!

    • I don’t think anyone is saying Freesat users aren’t technically competent. Freesat provides a service mainly for those who live in areas where the terrestrial signal is weak,limited or non existent. Some of course prefer the slightly higher PQ of satellite TV. That said Freesat is 100% reliant on broadcaster’s and sky who pay the bulk of the cost of the actual satellites. A service that has never really made mass market penetration,never getting much past a million homes compared with Freeviews 16 million homes is unlikely to survive in this changing streaming environment we live in. As freely grows both Terrestrial and satellite will be allowed to shrink the number of channels they carry into the next decade as streaming takes its place. Like it or not,personal preferences aside,this will definitely happen whether we like it or not.


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