Video Transmission Via Satellite

Video Transmission Via Satellite Video Transmission via Satellite Abstract Direct Broadcast satellite (DBS) delivers hundreds of TV channels to millions of people around the world. Satellite owners buy slots in space and lease assigned transponder frequencies to service providers. In this paper, I briefly introduce the history and development of DBS, the major vendors of the products, and overall market situation. In order to illustrate why DBS is such a popular technology, I also give out the comparison between DBS and the traditional cable TV. Both of them have advantages and disadvantages.

But the competitive advantages of DBS will make it attract more subscribers thus gain larger market share in the future.1. The History About Satellite TV The Beginning Most network and cable programs are transmitted on a series of C-band satellites and some Ku-band satellites. These two types of satellites use different frequencies much as VHF and UHF broadcast TV use different frequencies. Communications satellites were originally designed for commercial purposes for sending telephone, radio, TV, and other signals across the country and around the world for retransmission to businesses and homes by local telephone companies, TV stations, or cable companies. Enterprising individuals soon learned to build satellite dish receivers to pick up these signals at their own home, and begin making and selling these systems to homeowners around the country, thus beginning the era of home satellite TV. During the 1980’s and early 1990’s, several million of these C-band systems were sold with dishes generally around the 10′ diameter size.

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One of the early pioneers in the C-band business was Charlie Ergan who founded Echosphere Corporation. Modern Times As home satellite systems became more popular, programmers such as HBO and others realized that they could not continue to give away their programs free to millions of home dish owners. A scrambling system was then developed so their signals were no longer broadcast in the clear for everyone with a dish to pick up without any payment to the program developers. The subscribers were addressable, so that the programmer could turn channels on and off by a code sent over the satellite signal, depending on what channel was paid for by the owner. A few channels were broadcasted on the higher frequency Ku-band satellites, and some hybrid C/Ku-band systems were sold, but Ku reception never became very popular due to the difficulties in receiving the Ku channels and to the lack of sufficient programming on these satellites.In the early 1990’s four large cable companies launched a Direct Broadcast Satellite, or DBS system called Primestar using an existing medium power Ku-band satellite and a 36 dish. In 1994, the GM Hughes DirecTV system was launched using a newly designed high power Ku-band satellite and an 18 dish.

These systems provided great pictures and stereo sound on 150-200 video and audio channels, and the small dish era began in a serious way. Two years later, the EchoStar Dish Network system was launched. A forth DBS system, Alphastar, attempted to get started but eventually went out of business.Since the beginning of the DirecTV satellite system in 1994, sales of these small dish systems has exploded, making this the most successful introduction of new technology ever. With the launch of a Direct Broadcast Satellite (DBS) system from EchoStar, and the continuing success of the DirecTV system, as well as the cable-owned Primestar system (now bought out by DirecTV), the choices can look bewildering. Across America, more than one of every 20 homes has a satellite dish. Several states now boast satellite television penetration figures exceeding 10% of all TV households, with one state, Montana, having dishes in more than one out of every six homes. This explosion in the popularity of direct-to-home (DTH) satellite technology may surprise many casual observers since many Americans (and most of the media) have only learned about satellite TV in the last two years.

Indeed, DBS represents the most successful consumer product introduction in history, easily outperforming CE stalwarts like the color TV, VCR and CD player. The industry survived not only because it has a good product but also because many of those early pioneers simply wouldn’t let the dream slip away. Those pioneers, carrying the scars of their battle, are now leading this industry into the digital information age of the 21st century. 2. DBS Manufacturers and Satellite TV Service Providers Manufacturers Two service providers dominate the DBS industry in the United States.

DirecTV, an El Segundo, California-based subsidiary of GM Hughes Electronics, holds the top spot with 4.8 million subscribers. Littleton, Colorado-based EchoStar Communications comes in second, with about 2 million subscribers. Product Analysis Hughes DirecTV became the fifth-largest pay television provider in the United States in its first five years of operation. In an effort to expand its subscriber base, the DBS giant signed marketing agreements with Bell Atlantic, GTE, and SBC Communications that allowed DirecTV to offer its satellite services to the companies’ customers. To gain greater channel capacity and further seal its lead in the market, the company bought United States Satellite Broadcasting for $1.

3 billion in 1998 and Primestar for $1.8 billion in early 1999.Immediately after its buying spree, DirecTV carried all three brand name DBS services under its umbrella.

The DIRECTV service provides 175 channels from a cluster of three High Power DBS satellites. Its partner, United States Satellite Broadcasting (USSB) of Minneapolis, uses the same satellite cluster to transmit a complementary 25-channel premium movie option. About 2 million DirecTV subscribers have already signed on for the optional USSB movie package. DirecTV/USSB is the fastest-growing DBS service, adding some 50,000 subscribers each month.In addition to movies, the service’s programming includes extensive professional and collegiate sports coverage, cable channels, and CD-quality audio and pay-per-view (PPV) events. DirecTV plans to phase out Primestar service by 2002, adding 2 million mostly rural converts to the DirecTV subscriber list. The company had $1.8 billion of sales in 1998, a 42% increase over 1997.

Market Player Owner StartupDate Satellites DishSize No. Of Channels Households DirecTV GM Hughes 1994 GM HughesDBS1, DBS2, DBS3 18 200 4.80 million EchoStarDish Network Echosphere Corp. 1996 Echo 1, Echo 2 18 150 2.

04 million Primestar DirecTV 1990 GE-2 27 120 2.32 million EchoStar EchoStar Communications started its Digital Information Sky Highway (DISH) Network in March 1996.Like DirecTV/USSB, it is a High Power DBS provider. EchoStar’s market share rose from 20% to 24% from 1998 to 1999. More indicative of the company’s progress was its increase in subscribers, rising from 1 million in 1998 to 2.

4 million in 1999, a 96% increase. EchoStar transmits more than 120 channels from a Full-CONUS orbital slot, and also owns rights to East Coast and West Coast transponders from which it plans to deliver local data services, foreign language programming and other channels via an additional antenna dish. EchoStar competes by offering lower hardware prices and monthly fees.Unlike DirecTV, EchoStar can deliver local broadcast channels in major markets. It also has the most superstation programming. A 6 ~ 10 channels Christian religious service from the East Coast satellite, SkyAngel, is partnered with EchoStar. Echostar had $983 million of sales in 1998, a 106% increase over the previous year.

3.Competitiveness for Choosing DBS Reasons 1. Cannot get cable service If cable is not available and your off-air local reception is poor, or you want to get some of the cable type channels like CNN, ESPN, A, etc. DirecTV is the answer.

2. Hate the cable company Many cable subscribers are reasonably well satisfied with their service, but many are unhappy with poor reception, frequent outages, limited channel selection, and high monthly fees for premium channels.DBS is now an excellent alternative.

3. Got to have those SPORTS! Most cable systems just don’t have the channel capacity to compete with the huge selection of sports on DSS right now, and those scheduled to be on other DBS systems in the near future. 4. Looking for Specialty Channels The Dish Network system is carrying many foreign language, religious, and other niche channels that are not available from cable providers.

5. Pay-per-View and Music Channels There is a great selection of movies, sports, and concerts on DSS, and coming to other DBS systems.All DBS systems have many channels of stereo music that can be plugged into a home music system. 6. Quality of Picture and Sound All DBS systems have excellent picture and sound via digital transmissions versus the snow or shadows frequently experienced with cable or antenna reception. 7.

Technological Leadership DirecTV is on the cutting edge of Home Theater technology.Some pay-per-view movies already been broadcast in wide screen format. Dolby digital sound output is available on some satellite receivers, and it can be sure that satellite will be the first to bring High Definition TV to the home.

Some Facts of DBS In the process of signing up 4 million subscribers in less than 4 years as a national service, DirecTV has: 1. Registered more than 120 million pay-per-view movies and special event purchases. 2.

Broadcast approximately 200,000 hours of professional and collegiate sporting events. 3. Consistently earned a customer satisfaction rating exceeding 90% 4.Maintained a monthly churn rate (percentage of subscribers who disconnect) of just 1% the lowest in the multi-channel video industry. 4.

Comparison Analysis Satellite TV vs. Cable TV Satellite TV Cable TV Channel capacity More (225)Up to 55 pay-per-view Less (50 or so) Video quality Better Worse Audio quality Better Worse Service payment A bit less A bit more Multi TV watch Need additional receivers$90/each No further requirement Typical monthly cost $32Add $6 for ABC, CBS, NBC, Fox $30 Pros n Powerful signaln Crystal clear picture qualityn CD quality soundn No need to upgraden More channelsn Full sport packagesn Small 18-inch dish, no moving partsn Over 55 pay-per-view Channels n Most wide spreadn Extra outlets free except for installation cost $20n Low hook up fee, $20 ~ $30n Include the local channelsn Limited channels – 35 ~ 40n Reception is not as clear as satellite TV Cons n Need an antenna or cable TV to receive their local stationn Extra TV set required an extra satellite receivern Affected by rain fade, loose image when hard rain or snown Need to pay additional for local channels n $20 per month just for cable, not including programmingn The rates never go down..only upn Wire to deliver signal, may have interruptions Satellite TV vs.

Satellite TV DirecTV Dish Network Manufacturer Hughes Echosphere Channel capacity 200 channels31 CD quality music channelsUp to 55 pay-per-view 130 channels31 CD quality music channelsUp to 10 pay-per-view Dish 18-inch 18-inch Subscribers 8.7 million (2000/6) 4.3 million (2000/6) Multi TV watch Need additional receivers$90/each Need additional receivers Typical monthly cost $32Add $6 for ABC, CBS, NBC, Fox$5 for second satellite receive $5 for programming on second TV set receiver, $20 maintenance fee International programming Unavailable Available Sport packages More Less Pros n More channelsn Full sport packagesn More pay-per-view Channels n Provide international programming Cons u Do not provide international programming u Less channelsu No full sport packagesu Limited pay-per-view channels 5. Marketing Issues Still Unprofitable As of 1999, there were more than 10 million DBS subscribers in the United States, up from 8 million in 1998 and 6 million in 1997. Thousands of viewers sign on every day, and industry analysts predict more than 12 million by the year 2000.However, all the current providers are in heavy debt and operating at a loss.

The providers ‘policy of subsidizing the cost of the customers’ receiving equipment down to exacerbates the operating losses as low as $100 in order to attract market share. Since none of the receiving systems is compatible, if a provider goes out of business, as AlphaStar has already, customers are left with worthless equipment. Expand Services DBS firms are seeking to expand the business by serving new categories of customers.

Example Business Vision, partnered with EchoStar, and Member Direct Television, in cooperation with DirecTV, are providing business television to thousands of receiving sites.The programming includes tailored business news and information, training programs, industry-specific material, and proprietary packages for large firms. More Product Choices Example DBS companies venture into new business areas, America Online partnered with DirecTV, Hughes Network Systems, Philips Electronics, and Network Computer to work on developing AOL TV. DirecTV and AOL planned to work together on a service that would combine digital satellite television programming and AOL TV’s enhanced interactive TV Internet service. Hughes Network Services planned to design and build a dual-purpose set-top receiver, complete with an advanced set-top box for AOL TV provided by Philips.

Network Computer’s contribution was to prov …