There’s an old saying that all politics is local. For satellite TV companies, it seems like all problems are local.
In the mid to late 1990s cable TV had a big advantage over satellite because the latter did not have the bandwidth to deliver local TV signals. Dish owners had to either subscribe to cable or put an off-air antenna on the roof to watch the broadcast networks. Talk about back to the future.
However, a few years ago, DirecTV and EchoStar launched several new satellites that could beam local signals to most of their subscribers. Not without coincidence, satellite TV’s subscriber growth has soared ever since.
However, here we go again.
Cable TV operators are now offering local hgh-definition TV (HDTV) signals. Unlike satellite TV, which still requires an off-air antenna to receive local high-def feeds, cable subscribers simply have to connect their set-tops to their televisions. For the growing audience of HDTV owners, which now stands at 6 million, cable’s convenience and cost savings could be the difference.
Satellite TV operators say that advancing technology will eventually eliminate the problem. In fact, News Corp. Chairman Rupert Murdoch, whose company just bought a controlling interest in DirecTV, hinted at a recent Senate Commerce Committee hearing that a breakthrough may come soon.
However, the high-def signal takes up more space than Shaquille O’Neal. It may be years before DirecTV and EchoStar can beam down HDTV feeds for hundreds of local channels.
So is the satellite TV industry doomed? Will it lose the HDTV audience to cable?
No! Because I have a solution. There’s one catch, though. It’s currently illegal.
Out of Market
In 1999, Congress passed a law that allows satellite TV operators to carry “out-of-market” local broadcast signals if a customer cannot receive the local affiliate over the air. For instance, let’s say that you lived in the mountainous areas of Wyoming and-because of the hilly terrain-your antenna could not pick up local TV signals. DirecTV or EchoStar could offer you a network feed from New York or Los Angeles.
The law is designed to protect the community. For a variety of reasons, including the need to broadcast weather alerts and other local emergencies, public officials prefer that we watch local stations.
`out of market’ protection
The National Association of Broadcasters, the trade group for local stations, has lobbied Congress for protection against “out-of-market” broadcasts. NAB fears that many viewers would opt for the national broadcasts, which would hurt local ratings. In fact, NAB recently won a lawsuit against EchoStar for providing distant signals to viewers who could actually receive local feeds.
So what does this have to do with HDTV?
I propose that Congress amend the 1999 law to permit satellite TV operators to provide distant HDTV feeds for the four major networks-and UPN and The WB. The dish operators have the bandwidth today to deliver those signals.
The feeds could only be seen if you have a high-def set. But the amendment would level the playing field, giving HDTV owners more options in choosing a TV provider. To appease the NAB, Congress could even put a time limit on the amendment, giving satellite TV operators a deadline to produce local HD feeds.
With more consumers buying high-def sets, Congress needs to act soon to ensure that the cable TV industry has real competition.
Phillip Swann is president and publisher of TVPredictions.com. He can be reached at Swann@ TVPredictions.com.