Articles

Cablecasters Capturing Digital Signage:  Giving Consumers Relevance

February 15, 2008

Filed under:
Chaotic change -- to the tune of billions of dollars -- is rapidly churning the troubled waters of advertising, retail marketing, cablecasting and broadcasting. It is also churning the traditional relationships between the ad side and the operational/telecast side of these industries. Yet, as the rather trite (but true) old adage “where one door closes, another opens” conveys, these players must begin wedding their businesses to digital signage in order to better survive in the Brave New World of Giving Consumers Relevance.

The 2-Buck-Chuck Test

January 22, 2008

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In another take on the pending merger between XM and Sirius, Jimmy Schaeffler of the Carmel Group offers this commentary, titled “The 2-Buck Chuck Test.”

Broadcasters and Digital Signage: A New Business Model

January 02, 2008

Filed under:
Since the advent and mass deployment of flat-panel plasma and LCD monitors just a few years ago, the new application and technology called digital signage has developed great new legs. Estimates of these types of screens being used for the many forms of digital signage in the U.S. as of early 2008 are at almost 500,000. Industry researcher, The Carmel Group, estimates revenues of more than $2.5 billion by year-end 2010. Yet, there is a good chance that the real stride in those legs will develop only if North America’s broadcasters join the small band of local operators that are today making digital signage a part of their overall business model. These would include broadcasters such as Capitol Broadcasting’s Jim Goodmon, whose company, Microspace, began focusing on digital signage in 1994, in the form of digital signage kiosks.

Getting a “Free” Bird

July 22, 2007

Filed under: Blog, Satellite, Press
In the more than three years since April 2004, when Rupert Murdoch shut down the more than two mil. pirates attacking his newly-acquired DirecTV, the DirecTV system has remained “hack free” (which is another way of saying no one has yet found a way to break into the system that secures the DirecTV boxes and signals). Yet, like water that flows into and eventually around a dam, that most-effective 2Q 2004 DirecTV shut down was the bane of rival EchoStar, because it meant pirate resources were consequently shifted from DirecTV to the now more vulnerable DISH Network. Since 2004, there has been a large expansion in the number of pirates that target the Digital Broadcast Video (DVB) set-top box standard that supports the DISH Network programming. These pirates use the so-called Free-To-Air (FTA) set-top boxes to view, for free, subscription TV services for which the overwhelming majority of normal, legal DISH Network subscribers pay monthly. FTA pirates tapping into the 13 mil. legal subscriber DISH Network, as well as into the 2.3 mil. legal subscriber Bell ExpressVu (BEV) system (which is the Canadian satellite operator that uses the conditional access system supplied by the EchoStar and Nagra joint venture company, called NagraStar), have now distributed their illegal services and products to an estimated two million illegal TV Households (TVHHs) in the U.S. and Canada, at an average hardware unit price of around $200, accounting for almost $350 mil. in total cumulative revenues. (See chart, below). The top three distributors of FTA devices for the EchoStar and BEV systems are, in order, Sun Valley, CA-based PanSat; South San Francisco, CA-based Coolsat; and Mississauga, ON, Canada-based Fortec. Among just these top three FTA providers, they have already distributed an estimated 1.385 mil. units, representing sales of well over $200 mil. in estimated cumulative revenues since 2004. The Carmel Group believes that the top eight FTA manufacturer/distributors listed in the chart below account for three-quarters of the FTA business in North America. In short, FTA today in North America is big business. Take the NFL Sunday Ticket that is carried on BEV in Canada, and the level of hacking is even more disturbing.

Reject their request

February 23, 2007

Filed under: Satellite
When the Federal Communications Commission approved the creation of satellite radio in 1997, it had an option: Provide an exclusive license to one company, or authorize competing licenses that ensured consumer choice and lower marketplace prices. It wisely opted for the latter, saying: "One licensee will not be permitted to acquire control of the other remaining satellite licensee. This prohibition on transfer of control will help assure continuing competition."

Any Shot of XM-Sirius Merger?

January 30, 2007

Filed under: Cable, Satellite
After compiling data and developing arguments for the government review of EchoStar’s effort to purchase DirecTV during the 2002-03 time frame, I see many similarities -- and some notable differences -- comparing a possible merger between the satellite-radio duopolists, Sirius and XM. That said, it’s a good time to vent some ideas and analysis. This comes especially in light of recent company and government dialogues suggesting that the satellite-radio rivals want to combine to create a single U.S. satellite-radio monopoly.

The Telcos’ Better Mousetrap?

December 18, 2006

Filed under: Blog
Twelve years ago, the satellite guys needed a better mouse trap in order to lure cable subscribers to their nascent, all-digital video services. The same holds true for today’s telephone companies, namely, AT&T and Verizon, as they venture into a television jungle heretofore controlled solely by those satellite guys (with their 29 million video subscribers), and by the cable guys (with their 63 million video and “bundle” subs, when you count voice, audio-video and telephony services).

Distant Network Signals: 800,000 TV Homes At Risk From Legal and Political Moves

August 23, 2006

Filed under: Cable, Satellite, Advanced Services
Years ago, at an analyst event in Vail, CO, EchoStar chairman Charlie Ergen stated that he measured his legal department as he did other company divisions, by the profit it produces. Measured by that standard, the 2006 EchoStar legal department’s income statement might well experience something of a profit shortfall, perhaps taking the division well into the red.

IPTV Faces Uphill Struggle Against Satellite and Cable, with Retail Models and ‘A La Carte’ Key

August 01, 2006

Filed under: Cable, Satellite, Telephony, Advanced Services
"It’s taken satellite more than 13 years to attain 27 per cent of the U.S. multichannel video market"
Perhaps the best measurement of the true short- to midterm prospects for Telco-delivered IPTV is how quickly it will gain significant share of the multichannel video (MCV) market. Influencers in the U.S. include the power of a potentially merged EchoStar/DIRECTV direct broadcast satellite (DBS) service provider, ease of content acquisition and government regulation. After that? It depends on how well the Telcos do their IPTV job.

A Call For Perestrioka At Komkast

July 26, 2006

Filed under: Cable
Comcast and other lesser cable and satellite operators need to give up their totalitarian, take-it-or-leave-it approach to marketing and give subs more choice in picking channels. Here's one idea.

Telecom competition

July 02, 2006

Filed under: Cable, Satellite, Advanced Services
Editor -- Telecom companies will compete head-to-head with cable and satellite companies in California. Unfortunately, in his recent opinion piece in your paper, the Foundation for Taxpayer and Consumer Rights' Jamie Court quotes me to support his view that video competition will not lead to lower consumer prices ("Bad deal for cable customers," Insight, June 26). I did not say that. To make his point that "industry analysts say prices will be high," Court quotes me as saying "none of these players wants to enter into a price war." That's true. No business likes a price war.

Set-top Boxes, HDTV and Bandwidth: A Conundrum Coming?

March 14, 2006

Filed under: Cable, Satellite
Sales of satellite hardware and software services and products have for over a decade been a strong staple of U.S. consumer electronics businesses. It is so strong, in fact, that just the DirecTV side of retail U.S. set-top box (STB) sales represents an estimated $2 bil. in annual income as of the last measurement in 2004, according to the Consumer Electronics Assn.

DVRs: “A Can’t Live Without Device”

February 20, 2006

Filed under: Cable, Satellite, Telephony, Advanced Services
The study conducted by The Carmel Group, in early 2006, projects that subscribers of digital video recording services will increase to 20 million by 2008. Satellite, cable and standalone service providers, such as TiVo are poised to benefit from this trend. Titled “DVRs: Time In A Magical Box,” the study is scheduled for release on Monday, February 20, 2006, and combines projections of future DVR deployment in the U.S., a survey consisting of 1,800 consumers, and in-depth analysis of the DVR landscape and the device’s impact on advertising industry. The findings indicate that DVRs are poised to leap into a fifth of all U. S. households during the next four years. Moreover, since 75% of DVR users only possess one device, service providers are likely to find growth opportunities through the deployment of additional devices to these households. Since 1999, total revenues generated by the sale of DVR related hardware, software, and services, are estimated to have topped $1.1 billion.

TiVo Makes Me (and My Family) Smarter

January 05, 2006

Filed under: Cable, Satellite
Digital Video Recorders (DVRs) make me and my family smarter. They do this by allowing us to maximize the value of our TV and video experience. Yet, as more and more Americans discover this unique, new “smart” box, a lack of proper consumer education and traditional market economics suggest the creation of a new, “DVR Digital Divide.” Put shortly, for a service this valuable, it should not allow for those with the wherewithal to get smarter and yet those without the means to be left behind.

Growing Another Telecom Pie

October 05, 2005

Filed under: Cable, Satellite, Wireless
Decades ago, with the advent of TV, pessimists said there was no place for the new service, because “Why would anyone need more than a radio to get their news and entertainment?” Jump forward sixty years, and similar naysayers call DBS an acronym for “don’t be stupid.” Their 1980s and early 1990s logic: cable and broadcast TV were more than enough for just about everybody, so how could there be a place in people’s lives for another telecom service that did the same thing (even if it did it quite a bit better)? Ultimately, as everyone knows, TV, and later DBS, both became a critical part of the telecom landscape. What is interesting, though, is to note that even as much an improvement as each was, neither eliminated its predecessor, each did well despite the competition, and all grew to become a vital part of the telecom landscape. In fact, the overall pie – and the choices they represented -- grew significantly.

The State of U.S. DBS + MDUs (Circa 3d Q 2005)

September 30, 2005

Filed under: Cable, Satellite
One of the key reasons why DBS operators have had difficulty delivering their services to those in America’s MDUs is because DBS margins tend to be rather slim, and typically in the MDU world, there are more players looking for a part of the pie than there are in the single family unit (SFU) side of the DBS business. Thus, it becomes harder for DBS providers to make the profits necessary for the investments in MDU subscribers. By comparison, when a DirecTV or an EchoStar spends $600+ in Subscriber Acquisition Costs (SAC) to garner a SFU subscriber, the majority of the typical Average Revenue Per Unit (ARPU) of $60+/month goes to either EchoStar or DirecTV (and nobody else). In the MDU world, DirecTV and EchoStar must traditionally share ARPU with the building owner and/or the building manager, meaning it takes sometimes twice or more as long to recoup their SAC investment. Thus, SFU business models just can’t be applied to MDU scenarios.

DVR vs VOD From Riot to Reckoning

January 05, 2005

Filed under: Cable, Satellite
Beginning with DVRs, key attributes today include 1) intense consumer loyalty and attraction, 2) clear consumer choice, control and customization, 3) the ability to pause, record and rewind live (and future) TV (including multipart series), and 4) the availability of lifetime subscriptions.

Satellite Radio: It Will Succeed. Period.

November 15, 2002

Filed under: Satellite, Wireless, Advanced Services
The last quote above, i.e., “How could you question whether people would adapt to and want to make this part of their lives? It just works so damned well,” best reflects the future for the U.S. satellite radio, and it does so for the following reasons.

Will New Set-Top Boxes Make Dealers’ Lives Heaven Or Hell?

November 06, 2000

Filed under: Cable, Satellite, Advanced Services
There's probably going to be a lot of new money on the consumer electronics table soon, and it resides in the form of new CE hardware called set-top boxes (STBs) and handheld devices. There's probably going to be a lot of new money on the consumer electronics table soon, and it resides in the form of new CE hardware called set-top boxes (STBs) and handheld devices.