Free-to-air digital television decoders expected to halve in price within a year

The cost of decoders for the Freeview digital terrestrial service is expected to halve within a year with the launch of a new cut-price set-top box.

The first of the new adaptors is due to appear in shops in July - cutting the lowest price from £99 to £60. The manufacturer, Lidcom, hopes that prices will fall to £50 within a year.

Freeview, which was launched last year following the collapse of ITV Digital, offers free access to 25 BBC and commercial television channels and 16 radio stations. It is a partnership between the BBC, BSkyB and Crown Castle, which operates the adaptors.

Analysts have predicted that there will be a huge rise in demand when the cost falls to £50. Digital decoders are expected to become the most popular consumer electronic gadget in the country.

A rapid expansion in the switchover to digital is vital if the Government is to achieve its target of turning off analogue transmissions by 2010. The Department of Culture, Media and Sport said at least 95 per cent of viewers must have access to digital services before analogue can be switched off.

Industry analysts estimate that 600,000 Freeview boxes have already been sold and a further 900,000 former subscribers to ITV Digital are now watching the service using their old equipment.

The Independent Television Commission said recently that free-to-air digital television was now growing faster than pay-TV services.

Roger Guerand, the managing director of Lidcom, said the Surrey-based company was close to signing licensing deals for its basic adapter with a number of high-street brands. He said Lidcom had been able to slash the manufacturing cost of the box by using only 100 components - a third of the number found in most other digital decoders.