ANAHEIM — Despite the assertion Wednesday by Tele-Communications Inc. prexy Leo Hindery that “the sun has set” on the direct broadcast satellite industry, a couple of satcast industry infiltrators at the Western Show declared Thursday morning that the business is pink-cheeked and prepared to smack the cable industry right where it hurts: in the wallet.
Sitting on a panel entitled “DBS Detente: A Summit Meeting With the Competition,” DirecTV senior VP of marketing Stephen B. Ste Marie and Dennis P. Wilkinson, senior VP of marketing and programming for PrimeStar Partners, told those in attendance that satellite TV is poised to steal customers away from cable after three years of establishing its own unique niche.
“Between 80% and 90% of all our new customers are coming from areas where cable is readily available,” Ste Marie said. “Our growth has slowed, so now we’re going up against cable directly.”
“We’re going to lose subscribers to DBS, we’re aware of that,” admitted fellow panelist Skip Harris, VP of marketing for Falcon Cable TV.
Just how many subscribers that will ultimately mean, however, remains a matter of considerable debate.
To this point, DBS has managed to carve out a market of more than 6 million satellite subscribers. Critics, however, have charged that DBS has mined its audience exclusively through customers in high-end financial brackets, given the once-prohibitive startup costs for the hardware (once nearly $1,000, including installation) and monthly fees that can approach $100.
However, what with dish hardware and installation packages now hovering around $300, DirecTV’s Ste Marie said operators are confident that satellite TV will soon be embraced by the typical cable consumer.
“It’s all a matter of convincing cable subs to give us a try,” Ste Marie said. “It’s hard for us to overpromise, given that our product delivers so much more than the cable TV customer is used to getting.”
But does that mean the median-income Americans will be inspired to take the satellite bite?
“You have people who are barely living above the poverty level paying us $50 and $55 a month,” Wilkinson said proudly. “These are people who simply make satellite television their primary entertainment option — not simply in the home but overall.”
And contrary to Hindery’s assertion, Wilkinson said that there is no discernible slowdown as yet in DBS growth. “If 55% annual growth is a slowdown, keep it coming.” he said.