Cable and Satellite

1
Chapter 3

• Cable and Satellite

2

• First Mom and Pop System
• Astoria, Oregon, 1948 Seattle TV, antenna on
  top of hotel
• CATV Community Antenna TV
• Microwave relays allowed up to 12 channels
• Open Skies
• FCC open sky policy, 1972 domestic satellites
  (domsats)
• HBO, 1972 Thrilla in Manilla, first HBO
  satellite program, 75

3

• Superstations local TV station distributed by
  satellite, cable
• WTBS, Ted Turner 1976
• Cable Tiers
• Tiers of service
• Basic service, expanded basic
• Public access
• Premium channels, pay-per-view

4

• (Cable tiers, cont.)
• New choices
• Controversy over a la carte
• Digital cable makes DVRs, VOD possible
• High-speed Internet, telephone service

5

• Cables Costs and Benefits
• Cable channels have two sources of revenue
  subscriptions and advertising.
• Basic channels (VH1, CNN) carry advertising.
• Premium channels (HBO) rely on subscriber fees.

6

• Cable Franchises
• Cable systems must win local contracts
  (franchises).
• Usually protected from competition. Franchise fee
  to city.
• Penetration rate -- of potential subscribers
  who subscribe.
• Rate declined from 69 (2001) to 67 (2003).
• Churn rate of those who subscribe, then cancel.