PrimeStar announced will be implementing a new national pricing structure beginning July 1.
Before PrimeStar's roll-up, each partner had a different pricing scheme for the service according to the customer's home address.
PrimeStar's new, universal pricing plan puts the cost of the Prime Value package at $22.99 per month. The company's new Value Lease program allows customers to pay a $99 deposit to reduce their monthly lease cost from $10 to $3.
Customers can combine the Value Lease and the Prime Value package for a monthly cost of $25.99.
Time Warner Chairman Gerald Levin said his company is willing to reduce its stake in PrimeStar to satisfy U.S. government antitrust concern about cable control over the satellite provider.
Time Warner will do what's "in the best interests of PrimeStar. If that takes bringing down our interest, we'll do that," Levin said after a speech at the Town Hall Los Angeles speakers forum. Time Warner, together with Newhouse Broad-casting, owns 30 percent of Prime-Star. Levin declined to say how much Time Warner would reduce its stake, though he said it would be "pretty small."
On April 1, PrimeStar restruc-tured its partnership into a new corporation. TCI Satellite Entertain-
ment, a spin-off of Tele-Commmun-ications Inc., holds a 37 percent stake. Comcast and US West Media
each own 10 percent, Cox Commun-ications owns 9 percent and General Electric's Americom unit has 4
percent.
A bill that would suspend a sharp increase in satellite copyright fees for superstation and distant network signals was passed by the House Telecommunications Subcommittee.
The legislation passed on a voice vote. Rep. Billy Tauzin, a Louisiana Republican and subcommittee chairman, said he intends to intro-duce an amendment that would extend a temporary freeze on copyright rates when the bill goes to the Commerce Committee. That extension would give federal regulators more time in assessing the impact of the copyright fees and take the current seven month stay on the rate increase to one year.
The copyright rate, approved in December by Librarian of Congress Craig Billington, would require
satellite carriers to pay 27 cents per subscriber, per month for each superstation and distant-network signal.
The old rate was 6 cents for distant networks and either 14 cents or 17.5 cents for superstations. Cable
operators pay about 2.5 cents for network signals and 9.8 cents for superstations.
Telesat Canada signed a contract with Arianespace for the launch of its new Anik F1 satellite.
The launch, set for sometime in the first quarter of 2000, will take place from the European Space Agency's spaceport in Kourou, French Guiana. Telesat plans to use the new Anik satellite to provide broadcasting and communications services throughout North America.
The Anik F1 satellite is being built by Hughes Space and Communications and will have 84
communications channels - 48 Ku-Band and 36 C-Band.
EchoStar believes an anomaly found aboard its fourth satellite may not be all that bad, saying the bird may be able to perform its functions despite a possible loss of power.
EchoStar IV had troubles with solar panel deployment soon after launch. The satellite, built by Lockheed Martin, was put into a geosynchronous transfer orbit on May 8 aboard a Proton launch vehicle.
EchoStar Director of Finance Rick Westerman said testing continues on the satellite, and maneuvers to release a stuck solar panel will continue. It may be several weeks before the company can determine how much of the satellite can be saved, he said.
Also working in EchoStar's favor is insurance coverage on the satellite. EchoStar IV was fully insured for $220 million, and the company could collect up to $70 million since a third of the satellite's functions may be impacted by the solar panel trouble.
Once the solar panel troubles surfaced, EchoStar considered locating the satellite at 148 degrees, an
orbital location covering the Western United States. If EchoStar IV remains at 119 degrees, EchoStar I,
now located at the full-CONUS slot along with EchoStar II, would be moved to the 148-degree position.
Any satellite at 148 degrees would deliver local and niche programming.
Ted Turner's TNT is reportedly using strong-arm tactics with cable operators facing hefty fee increases for carriage of the popular network, and part of the heavy-handed efforts include threats to promote home satellite providers over the wireline technology.
According to Variety, an operator approached by TNT was told that the network will abandon the system unless the operator adheres to a new fee structure. TNT further said it will take out ads urging TNT-deprived subscribers to cancel their cable subscriptions and buy a satellite system so they can get TNT on DirecTV, Primestar or Echostar.
Many operators are not confident that TNT will come down off its aggressive rate-card demands. According to Variety, the new TNT rate card calls for increases that average 7 percent a year over the five-year life of the contract. Most new contracts start Jan. 1.
A TNT spokesman declined to comment. But a source familiar with TNT said the company thinks the
increases are "fair and modest" since the network brings in consistently strong prime time ratings. The
network lost cable carriage of the NFL to ESPN last year, but Turner paid $890 million so sister network
TBS can have national-cable rights to NBA games for the next four years.
C-Band industry leaders have come together in a marketing plan that will get the message out that "C-Band is the preeminent consumer satellite system."
The C-Band Partnership will focus on helping C-Band customers to find service and sales support, and create a marketing platform for all of the C-Band focused businesses and organizations.
The partnership is led by Dorian Simpson, national sales manager for consumer products in the Satellite Data Network Systems unit of General Instrument. "C-Band programmers and packagers are all very committed to C-Band," Simpson said. "Through this program, we're combining activities and resources for an extensive marketing effort in support of the industry."
The C-Band Partnership will set up an industry-wide service network and toll-free consumer call center
at 1-877-CbandTV. Through this center, C-Band customers can be connected to the nearest authorized
C-Band dealer in their area.
The leaders of America's four DBS providers offered a hint of when they each expect to reach cash flow break-even and pledged not to raise prices while cable companies continue to charge higher rates.
USSB President Stan E. Hubbard and EchoStar/DISH Network President John Reardon said their respective companies should reach that point sometime next year. DirecTV President Eddy Hartenstein said his company could achieve the same goal when the service signs up a little more than 4 million subscribers.
PrimeStar President Dan O'Brien wouldn't comment on when his beleaguered company would reach break-even, but said the service would consider diluting its cable ownership mix to satisfy federal regulators.
The company faces an anti-trust suit filed by the Department of Justice, which is concerned PrimeStar's
cable backing could hinder competition in the DBS market. O'Brien said the service is considering bringing
in new partners, both strategic and financial, to satisfy anti-competitive concerns.
The new man in charge at PrimeStar, former EchoStar and Star Choice executive Carl Vogel, knows the company needs to change its ownership mix in order to satisfy federal regulators.
But he wouldn't speculate what PrimeStar would do, and whether a new company joining the ownership mix and a further dilution of its cable interest will do the job. "We are committed to do what we think is necessary," Vogel said.
"We are more than willing to compete. Our goal is to make PrimeStar a competitor" in the DBS service.
Vogel is CEO and member of the board of directors for Star Choice Communications, a Canadian DBS firm headquartered in Calgary. He also was at EchoStar Commun-ications until his resig-nation in March 1997.
Meanwhile, PrimeStar revealed it added only 5,000 net subscribers in May. The company signed up
70,000 gross, O'Brien said, but deactivated 65,000
EchoStar and one of its subsidiaries face fines from the Satellite and Radiocommunication Division at the FCC for having two DBS satellites just outside of their designated orbital slots.
According to the FCC, both EchoStar I and EchoStar II, co-located at 119 degrees, aren't in their proper orbit. EchoStar and its DirectSat Corp. each face a levy of $20,000 for the apparent violation, a relatively small fee assessed by the satellite division and International Bureau.
FCC rules state that high-power satellites are expected to stay within .05 degrees of their designated orbit. EchoStar I is licensed for 119.2 degrees while EchoStar II is designated for 118.8 degrees. The FCC alleged in its order that both birds were .2 degrees outside of their designated slots.
EchoStar said both high-power satellites are still within the 119 degree area, and are only slightly out of position. Service was never impacted by the shifting birds. The company also filed documents with the FCC concerning the satellite's changed location.
Tempo Satellite, owner of a satellite that shares the 119-degree orbital location with EchoStar, told the
FCC in March that the two birds weren't in their proper orbit. The Tempo bird, launched by PrimeStar
part-owner TCI Satellite, hasn't been used since it was parked in space in March 1997.
EchoStar has that it will lower the price of its model 5000 advanced DISH Network reception system.
The 5000 model will be available for $399 and will sell to dealers for $359. The company also announced
that it has extended its "Unbeatable Deal" promotion through July 13.
Canadian satellite provider Star Choice has announced that it will offer the country's first bilingual programming package and an all-French programming package.
Star Choice's new offerings include five new programming packages which include a variety of French and English channels. An all-French language package, Choix Total Nickel, will be available for $29.99 per month.
"We recognize that Canadians have different needs and viewing preferences, including the language in which they are entertained," said Brian Neill, chairman of Star Choice Communications.
The company also plans on adding four new pay-per-view channels by the end of June, including three
English language channels and one French language channel, Canal Indigo.
Primestar/TCI Satellite's Tempo unit and DirecTV gave back DBS orbital spectrum to the FCC after failing to develop a business with the frequencies located on the Western fringes.
The companies had been licensed to use the slots since the early 1990s. Both opted to follow the standard FCC policy of giving spectrum back so it can be be reallocated to another provider.
DirecTV voluntarily surrendered its assigned channels at the 157-degree location, while Tempo
Satellite gave up odd-numbered channels 1 through 21 at 166 degrees.
What should companies do with DBS orbital slots that don't offer full coverage of the United States? Go international with them.
That was the suggestion of Tom Boasberg, chief counsel of the International Bureau at the FCC.
Most DBS slots assigned to U.S. providers today are outside of the full-CONUS designation, spectrum that offers complete coverage of the country. And with the exception of EchoStar's space assignments, all of the orbital parking spaces aren't expected to see satellites in the near future.
Boasberg says the slots are best suited to deliver DBS offerings to other countries.
So far, EchoStar is the only company to utilize the limited spectrum, delivering niche pro-gramming and local channels from 61.5 degrees and soon at 148 degrees. Outside of two EchoStar satellites at those two locations, all non full-CONUS slots are empty.
Boasberg says the best non-full CONUS slots are located in the west, at 157 degrees, 166 degrees and 175 degrees. The spectrum could be used to deliver services to Asia, thus opening up markets in countries which had been leary of satellite-delivered services from the United States.
Using U.S. spectrum for services outside of the country may lead to foreign companies beaming in their own domestic DBS offerings.
That, he said, would enhance competition among DBS providers in the United States.
He also said the FCC supports DBS efforts for delivering local channels. He said that policy-makers,
competitors and others should "get beyond the rhetoric" and determine what rules are fair and make
"economical" sense for digital satellite.
The NBA and the WNBA have signed agreements with DirecTV and PrimeStar to distribute the NBA League Pass and the WNBA Season Pass.
Both DBS companies have renewed their contracts with the NBA and are offering the WNBA Season Pass for the first time. The NBA League Pass offers up to 40 games per week, a total of about 1,000 regular season games.
The WNBA Season Pass offers around 45 games per season.
The 1998-99 NBA League Pass is available on both DirecTV and PrimeStar for $139 until Sept. 30. After this date, the price will increase to $159.
The WNBA Season Pass is also available on both DBS services at no cost to subscribers of the 1998-99 NBA League Pass or can be purchased a la carte for $39.
The House Commerce Committee's unanimous vote to pass H.R. 2921, the Multichannel Video Competition and Consumer Protection Act of 1997, was commended by the SBCA.
The passage of H.R. 2921 by the House would suspend the recent increase in copyright fees paid by satellite carriers retroactively to Jan. 1, and stay the increase for close to a year after the bill's enactment.
The bill will now move to the Judiciary Committee for review and consideration.
Starting on July 1, Encore will be adding first-run movies to its lineup. According to the company, this is the first step in upgrading the channel to "a full premium movie service." Initially, Encore will air two first-run exclusive movies each month, often in a package of movies highlighting a specific actor. July will feature The Rock, along with vintage Sean Connery films such as The Man Who Would Be King, Wrong is Right and Family Business.