Digital dilemma in Spain.

January 31 was a big day for Canal Satelite, Spain's first digital TV service. It was the day that the service - owned by publishing group Prisa, Canal+ and TV network Antena 3 - began broadcasting. It was also the day that the Spanish government passed a law limiting Canal Satelite's activities.

Rafael Arias Salgado, Spain's transportation and telecommunications minister, passed a decree that increased the value-added tax on digital TV services from six percent to 16 percent. More importantly, the decree requires that all digital decoders be standardized so that they can receive signals from Plataforma Digital, a rival digital service due to begin broadcasting by this summer. Canal Satelite's decoders, which do not meet this requirement, are suddenly obsolete. And the government is serious about enforcing the decree: on February 3, transportation and telecommunications ministry inspectors arrived at a Canal Satelite distributor and demanded to know whether the decoders sold there met the requirement.

Salgado claims that he was trying to protect consumers and prevent Canal Satelite from becoming a monopoly; the government also contends that the decree complies with European Union technical requirements for decoders. Canal Satelite says that its decoders are already compatible and legal in Europe; its owners also maintain that the Spanish government is just trying to stall until Plataforma Digital - a government-connected enterprise owned by telephone utility Telefonica, state broadcaster RTVE, regional Spanish TV channels, Spanish publishers and Mexico's Televisa - can get off the ground.

Since February, the Spanish government and Canal Satelite have been engaging in legal battles. The digital service has accused the ministry of coercion and maintains that under European Union rules the ministry should have given three months' warning before enforcing the decree.