HDTV rollout: The slow road

Exex say future of format is fuzzy

NEW YORK — The evangelists for the Second Coming of Television, featuring 500 digital channels and eye-popping high-definition pictures before the decade is out, have forsaken reality and taken up residence in a dream world.

That, in so many words, was the view of a group of media executives talking about pay TV and pay-per-view during a panel session here sponsored by the Intl. Radio & TV Society and the National Academy of TV Arts & Sciences.

“High-definition television will get rolled out in a judicious way, but it may take as long as 20 years before it approaches critical mass,” said Jim Rosenfield, managing director of Veronis, Suhler & Associates and former president of CBS TV.

Searching for a model

Tom Rogers, president of NBC Cable and executive VP of NBC, said that “digital television has not created a real business model.” Rogers said the most realistic estimates he’s seen — 1 million high-def TV sets and 10 million or so digital boxes in subscribers’ homes in the next four years — would not yield enough revenue to start changing the leisure habits of most TV viewers.

And the manufacturers who are trying to perfect an appliance combining a TV set and a personal computer are “wild cards,” Rogers said. These manufacturers, Rogers continued, are throwing off predictions of volume that “range anywhere from 2 million to 20 million sets.”

Penalty for dallying

Rogers said DirecTV and other direct-broadcast-satellite distributors could profit enormously from the slow rollout of cable boxes by continuing to induce people to cancel their cable subscriptions and buy satellite dishes to get Direct’s programming packages.

When Rogers predicts that the satellite dish subscriber count will grow dramatically over the next four years, it’s music to DirecTV’s ears.

But Terry Ferguson, VP of business development and strategic planning for DirecTV, disputes Rogers’ statement that “sports programming has become less crucial to DirecTV subscribers,” with out-of-market packages from the four professional sports leagues — football, basketball, baseball and hockey — now being purchased by only 15% of the subscriber base.

“Sports is still a driver of satellite dish purchases,” Ferguson said by telephone from DirecTV’s headquarters in El Segundo. “Sports hasn’t lost steam or slowed down.” She declined to reveal the percentage of Direct’s subscriber base that buys at least one of the out-of-market packages, but said, “It’s definitely greater than 15%.”

But she doesn’t contest Rogers’ assertion that the multiplexed HBO, Showtime and Encore/Starz pay networks, plus 50 channels of pay-per-view, are “the engines of DBS; the drivers of its circulation.”

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