Digital Satellite System (DSS) Dishes Set to Reach Mainstream, Threatening Cable Operators

Strategic Insights -

Attendees of the Western Cable Show in Anaheim, Calif. were left with a sense of unease as industry experts cautioned that the rise of Digital Satellite System (DSS) dishes could redefine the cable television landscape. Vice President of the National Cable TV Cooperative, Frank Hughes, predicted that DSS dishes would become increasingly affordable, potentially cutting costs in half once major retailers like Sony enter the market. Hughes warned that cable operators are underestimating the threat posed by DBS providers, particularly DirecTv and PrimeStar, which are logging 750-1,000 authorizations per day.

Key Takeaways:

  • Hughes predicted that DSS dishes will cost between $400-450 by next year, a significant reduction from current prices.
  • Cable operators are facing a threat from DBS providers, who are logging a high number of authorizations per day, with some providers like PrimeStar offering "no money down" deals.
  • The industry's growth is expected to be fueled by mass production of DSS equipment, with Hughes predicting the industry will hit the 3-5 million subscriber mark by decade's end.
  • Viacom Entertainment Group Chairman John Dolgen acknowledged that cable's approach may not be as consumer-friendly as DBS providers.
  • Tele-Communications Inc. CEO John Malone noted that DBS is both good and bad news for cable, bringing competition while also providing valuable and expensive market research.
  • TBS' Ted Turner has a DSS dish and subscribes to DirecTv at his Montana ranch, noting that it is "quite good" despite the lack of local stations, but much more expensive.

Statistics:

  • Hughes predicted that DSS dishes will cost between $400-450 by next year.
  • DBS providers are logging 750-1,000 authorizations per day.
  • The industry expected to hit the 3-5 million subscriber mark by decade's end.
  • PrimeStar is offering "no money down" deals.
  • Ted Turner has a DSS dish and subscribes to DirecTv at his Montana ranch.

Sources:

  • National Cable TV Cooperative (no specific date mentioned)
  • Variety (no specific date mentioned)
  • Reuters (no specific date mentioned)