Pace Micro Technology has warned the digital television licence bidders to pay attention to consumer expectations.

Research by the firm reveals more than a third of consumers would switch to digital if there was more choice of free-to-air channels.

The findings reveal 36 per cent believe broadcasters should be responsible for encouraging the switch to digital. Bidders, including the BBC and ITV/Channel 4, will find out tomorrow if they have been successful in gaining a licence to become digital broadcasters following the collapse of ITV Digital.

Malcolm Miller, chief executive officer for the Saltaire-based Pace, said: "The outcome of the Independent Television Comm-ission bids, combined with a stronger digital signal, public awareness and the availability of low-cost digital technology will be critical success factors in ensuring we achieve the Government's switch-off date of 2006-2010.

"The cost to Britain of a second digital terrestrial failure would be incalculable and could severely jeopardise the digital switch."

The survey results show consumers are clear about what would make them switch and the type of content that they want to see.

Nearly half of those questioned, 44 per cent, said they would be encouraged to switch to digital because of the availability of latest release movies such as Star Wars.

A further 36 per cent said they would be tempted to move to digital because of big sporting events. While 36 per cent said they would switch if offered a free-to-view package with a possible pay TV upgrade.

The survey did find that the awareness of the digital switch is growing.

Former culture secretary Chris Smith has urged the ITC to shun the BBC-led consortium's application for the former ITV Digital licences.

Mr Smith, who as culture secretary set the target for analogue switch-off between 2006 and 2010, says digital terrestrial TV needs to include a pay element.

Pace was the largest European supplier of digital set-top boxes in 2000. Its analogue and digital technology has been installed in over 13 million homes world-wide since it was founded in 1982.

The firm, which recently launched digital set-top boxes for less than £100, say the product is selling faster than DVDs or personal CD stereos.