Video Transmission Via Satellite

.. ide a complete software platform for the new service through the company’s TV Navigator software. Strategic Partnership Example AOL TV/DirecTV plan to market the AOL TV/DirecTV service to a combined base of 24 million subscribers.

The service will provide AOL content in addition to satellite TV programming in one platform. The deal also boosts the broadband ambitions of both companies.Hughes’ planned $1.4 billion Spaceway geostationary broadband satellite system will benefit by being able to tap into this customer base well before the satellites built.

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AOL also said to be considering additional investment in Spaceway. Interactivity EchoStar appeared to have the jump on DirecTV when it came to interactive services. EchoStar still will be first to market with an interactive offering. High-speed, interactive Web-like channels are much more alluring than semi-high-speed cable modems. Brad Beale, DirecTV’s vice president of advanced products, says interactive services fit his company’s strategic aims: With the introduction of our interactive services, we’re taking television entertainment to the next level by bringing varying levels of interactivity to a consumer’s television viewing experience. Similarity Example EchoStar plans for DirecTV’s Internet product, EchoStar’s offerings are similar enough so that many subscribers will not really decide based upon any differences.

The money and the marketing clout behind the DirecTV-AOL partnership will put EchoStar at a disadvantage once AOL TV/DirecTV gets rolling, unless EchoStar can find a similar partnership.Sell out AOL’s DirecTV investment in the form of $1.5 billion placed in an interest-bearing GM security that is convertible into GM Class H common stock in three years will be used for marketing, public relations and to subsidize entry into the new services. These services will be sold under several brand names: DirecTV, DirecPC, AOL TV and AOL-Plus high-speed Internet service. The marketing expenditures planned for the venture are in the neighborhood of $1.6 billion.

This amount includes $500 million to market AOL-Plus through DirecPC; up to $500 million for DirecTV marketing, including $100 million to market to AOL members; $400 million for combined AOL TV/DirecTV services, and $100 million for DirectDuo, a single dish for both TV and Internet access. 6.Market Share and Growth The tremendous growth of DBS as a video provider was a reason to consider that industry a threat to the dominance of cable broadband. In the last year, the number of DBS subscribers grew to 13 million homes from 10.1 million, vs. 67.7 million cable homes.

More than 15% of all multi-channel video subscribers are DBS customers, and DirecTV and EchoStar are among the top 10 video providers in the United States, joining the ranks of AT Broadband, Time Warner Cable and Comcast Communications. Cable operators spent billions of dollars on preparing to offer glitzy interactive services.However, a lot has changed over the past year. The number of satellite players has shrunk from four to two: DirecTV and EchoStar. They are doing surprisingly well in rounding up new subscribers and revenue since the federal government gave them the right to retransmit local stations, which they do for an extra fee. Moreover, over the next few months, satellites will take the lead in offering interactive digital TV services, as well as two-way high-speed Internet connections, coast to coast.

That has made Hughes Electronics, parent of DirecTV deals with power players including America Online, Microsoft and Blockbuster, and programmers from the National Football League to Walt Disney. They are attracted to DirecTV because its 8.7 million subscribers account for about two-thirds of the satellite market.It expects to end this year with nearly 10 million customers, up 20% over last year.

As a result, it reaches more homes than anyone except AT and Time Warner, and it is on pace to pass the cable giants around 2005. About 70% of DirecTV’s new customers come from areas served by cable. No wonder investment bankers are so tantalized by the possibility that General Motors, which owns Hughes, is ready to fundamentally change the media landscape with an outright sale of the property.

Analysts say it would cost a buyer about $50 billion.7. America and the World Satellite communications is an international business, with satellites orbiting the globe and programming transmitted from space heedless of national borders. Multinational media companies such as Rupert Murdoch’s Australia-based News Corp. seek to expand into new markets. Among U.

S.DBS providers, DirecTV has been most active in pursuing joint ventures and other opportunities abroad. American Canada, Mexico, and some South American countries hold some of the orbital slots over the Western Hemisphere that could service the United States. If any of these choose to auction off transponder rights, U.S. companies can bid for them. Likewise, U.

S.companies can potentially service other markets in the Americas from their own slots. Nations may attempt to control the industry by regulating the sale of decoders; in 1998 Argentina temporarily halted DirecTV from competing in its market while it tried to get its own system in place. Europe Europe has its own active DBS market. Luxembourg-based Socit Europenne des Satellites S.A. (SES) operates ASTRA, the leading satellite system, which served more than 74 million homes in Europe in 1999.More than 31 million European homes receive programming directly to a satellite dish via ASTRA.

British Sky Broadcasting (BSkyB), the first service provider to offer DBS in the United Kingdom (1989), relies on an ongoing contractual agreement with SES. In 10 years, the Isleworth, UK-based company has amassed 3.6 million DBS subscribers and 2.6 million cable subscribers in the United Kingdom and Ireland, where broadcast television consists of five channels. By holding broadcast rights to the leading soccer leagues in England and Scotland, the British satellite service has also become the largest pay-TV provider. Asia Japan Asia, home of 60% of the world’s population, is a tempting target for telecommunications companies, but DBS growth there been hampered by political and economic conditions.Japan, which can be completely covered from one orbital position and where cable television never really took off due to heavy regulation, has the most advanced satellite technology in Asia.

Challenges for Japanese DBS include the Asian financial troubles of the late 1990s, a conservative business environment, and a lack of demand for Japanese-language programming outside of the domestic market. As of May 1998, SkyPerfecTV had more than 700,000 subscribers in Japan, and DirecTV Japan had topped 100,000. China China is reluctant to allow direct broadcast to its population of 1.

2 billion because of political concerns about western influences. Murdoch, whose base in Australia makes his News Corp.a natural contender in Asia and the Pacific Rim, antagonized the Chinese government by declaring that satellite television would undermine totalitarian regimes, and was subsequently constrained to low-profile participation in partnership ventures with Hong Kong and others.

Reacting to the boom in home television sets throughout that region of the world, APT Satellite Holdings Limited stepped up its efforts to secure licenses to offer DBS to homes in China and Southeast Asia. The Hong Kong-based company provides satellite service to 100 countries, mainly serving television stations, local cable operators, and master antenna systems. India In 1997, India, which also feared excessive western influences on its population of almost 1 billion, banned direct-to-home satellite television broadcast services. Amid a furor, which included a lawsuit by News Corp., it declared that the ban would only be temporary, until the government could set up a broadcast authority.

A bill to establish the regulatory agency has since been introduced in India’s Parliament.Oceania In a short time, Sky Network Television Limited has signed up 260,000 subscribers in New Zealand for its five pay-TV channels and analog DBS programming. The Auckland-based company is partly controlled by Independent Newspapers, which is partly owned by Murdoch’s News Corp. 8.

Future Development Advanced compression schemes allow multiple streams of programming, along with the ability to control information per transponder frequency, made DBS feasible, and research and development continues in this area. Squeezing down the signal still further would be an advantage, but providers also want to eliminate the occasional blocky digital compression artifacts that some viewers find distracting.With High Definition Television (HDTV) on the horizon, three or four times more bandwidth (or three or four times better compression) will be required to provide the same number of channels. Currently, each DBS provider uses its own format for transmitting the signal. An emerging world standard, DVB, uses MPEG-2 and also attempts to standardize other elements of the system. Still, even DVB-compliant systems from different providers are not interchangeable.

In addition to HDTV, demand for local channels drives the push for more bandwidth.Besides improving compression, other areas of technological development include higher-power transponders, which allow more information to pass through existing bandwidth because less error-correcting coding is required. Signal polarization, controlling the orientation of the electromagnetic wave transmissions, is used to isolate adjacent transponder slots and allow more of them within a fixed-frequency spectrum.

Statistical multiplexing maximizes the use of existing bandwidth by assigning it upon demand, depending on the information density of a particular program being carried by a channel at a given time. Another approach to the bandwidth problem might be to expand it using spot-beam broadcasts to individual markets, although satellites capable of such transmissions in the DBS frequency spectrum did not yet exist as of mid-1998. Capital Broadcasting of Raleigh, North Carolina plans to provide local programming packages from a satellite with 61 beams by about 2001. Technological development is also addressing the problem of rain fade, when thunderstorms and other weather disturbances interfere with the DBS signal. Currently, satellite transmissions are focused to provide more power to wetter regions within the coverage area.Reference Consumer Guide to DBS, June 1998. Available from http://www.

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