ONdigital undone by box shortage

THE LAUNCH of digital terrestrial television has been attacked by high street retailers as a fiasco after they were left with a shortage of equipment.

They have complained that thousands of people wanting to sign up to the new service are unable to do so because not enough set-top boxes are on sale in the shops.

At the launch of ONdigital this weekend, there were only 5,000 boxes in shops throughout the United Kingdom, compared with 75,000 inquiries recorded on the ONdigital helpline.

ONdigital, a joint venture between Granada and Carlton, insisted that it had tens of thousands of boxes ready for the launch, but retailers such as Radio Rentals and the box manufacturers Philips disputed the figure.

Radio Rentals was reduced to offering customers vouchers to bring back to the stores when the boxes start to arrive. The company had only 500 boxes to distribute to its 488 shops. Given the shortage, it decided to put much of its stock into one shop in High Street Kensington in London - somewhat undermining the claim by an ONdigital spokesman that his visit to the same shop showed that, anecdotally, there were plenty of boxes around.

Dixons also confirmed that over the weekend demand had far exceeded supply. "We sold out of boxes by midday on Saturday in our Oxford Street store," a spokesperson said.

The delay was described by retailers as a classic management mistake by ONdigital - stoking up demand and then failing to supply product. It also reflects a number of technological difficulties in the development of the boxes, which are needed to decode the new digital channels.

Philips, the only manufacturer ready with the boxes, said it was producing as many is it could during the week, but could not guarantee that it would meet its target of 20,000 boxes in the shops by Friday. Pace, another manufacturer, is also expecting to start delivering boxes to the shops within weeks.

ONdigital is spending pounds 10m on its launch between now and Christmas, and is in fierce competition with BSkyB's digital satellite service. The failure to deliver set-top boxes is seen as only the first of a number of hiccups. The ONdigital service is available only in about 60 per cent of homes. ONdigital says that anyone who manages to secure a set-top box only to discover they are out of range will be able to get their money back.

Key ONdigital channels and services were also absent at launch. ITV2 will not go on air until next month, one of the main movie channels is still unavailable and digital Teletext services are not yet working.

BSkyB is also making much of the fact that it has nearly 10 times as many channels as ONdigital - but its customer service is also hitting obstacles. Retail store managers complained that while ONdigital customers will have to wait several weeks before their set- top boxes arrive, Sky customers are experiencing similar delays in getting satellite dishes installed by the company.