FREE ESSAY ON VIDEO TRANSMISSION VIA SATELLITE

VIDEO TRANSMISSION VIA SATELLITE

Video Transmission via Satellite
Abstract
Direct Broadcast satellite (DBS) delivers hundreds of TV channels to millions of people
around the world. Satellite owners buy slots in space and lease assigned transponder
frequencies to service providers. In this paper, I briefly introduce the history and
development of DBS, the major vendors of the products, and overall market situation. In
order to illustrate why DBS is such a popular technology, I also give out the comparison
between DBS and the traditional cable TV. Both of them have advantages and disadvantages.
But the competitive advantages of DBS will make it attract more subscribers thus gain
larger market share in the future.
1. The History About Satellite TV
The Beginning
Most network and cable programs are transmitted on a series of C-band satellites and some
Ku-band satellites. These two types of satellites use different frequencies much as VHF
and UHF broadcast TV use different frequencies.
Communications satellites were originally designed for commercial purposes for sending
telephone, radio, TV, and other signals across the country and around the world for
retransmission to businesses and homes by local telephone companies, TV stations, or
cable companies. Enterprising individuals soon learned to build satellite dish receivers
to pick up these signals at their own home, and begin making and selling these systems to
homeowners around the country, thus beginning the era of home satellite TV. During the
1980's and early 1990's, several million of these C-band systems were sold with dishes
generally around the 10' diameter size. One of the early pioneers in the C-band business
was Charlie Ergan who founded Echosphere Corporation.
Modern Times
As home satellite systems became more popular, programmers such as HBO and others
realized that they could not continue to give away their programs free to millions of
home dish owners. A scrambling system was then developed so their signals were no longer
broadcast in the clear for everyone with a dish to pick up without any payment to the
program developers. The subscribers were addressable, so that the programmer could turn
channels on and off by a code sent over the satellite signal, depending on what channel
was paid for by the owner. A few channels were broadcasted on the higher frequency
Ku-band satellites, and some hybrid C/Ku-band systems were sold, but Ku reception never
became very popular due to the difficulties in receiving the Ku channels and to the lack
of sufficient programming on these satellites.
In the early 1990's four large cable companies launched a Direct Broadcast Satellite, or
DBS system called Primestar using an existing medium power Ku-band satellite and a 36
dish. In 1994, the GM Hughes DirecTV system was launched using a newly designed high
power Ku-band satellite and an 18 dish. These systems provided great pictures and stereo
sound on 150-200 video and audio channels, and the small dish era began in a serious
way.
Two years later, the EchoStar Dish Network system was launched. A forth DBS system,
Alphastar, attempted to get started but eventually went out of business.
Since the beginning of the DirecTV satellite system in 1994, sales of these small dish
systems has exploded, making this the most successful introduction of new technology
ever. With the launch of a Direct Broadcast Satellite (DBS) system from EchoStar, and the
continuing success of the DirecTV system, as well as the cable-owned Primestar system
(now bought out by DirecTV), the choices can look bewildering.
Across America, more than one of every 20 homes has a satellite dish. Several states now
boast satellite television penetration figures exceeding 10% of all TV households, with
one state, Montana, having dishes in more than one out of every six homes. This explosion
in the popularity of direct-to-home (DTH) satellite technology may surprise many casual
observers since many Americans (and most of the media) have only learned about satellite
TV in the last two years. Indeed, DBS represents the most successful consumer product
introduction in history, easily outperforming CE stalwarts like the color TV, VCR and CD
player. The industry survived not only because it has a good product but also because
many of those early pioneers simply wouldn't let the dream slip away. Those pioneers,
carrying the scars of their battle, are now leading this industry into the digital
information age of the 21st century.
2. DBS Manufacturers and Satellite TV Service Providers
Manufacturers
Two service providers dominate the DBS industry in the United States. DirecTV, an El
Segundo, California-based subsidiary of GM Hughes Electronics, holds the top spot with
4.8 million subscribers. Littleton, Colorado-based EchoStar Communications comes in
second, with about 2 million subscribers.
Product Analysis
Hughes
DirecTV became the fifth-largest pay television provider in the United States in its
first five years of operation. In an effort to expand its subscriber base, the DBS giant
signed marketing agreements with Bell Atlantic, GTE, and SBC Communications that allowed
DirecTV to offer its satellite services to the companies' customers. To gain greater
channel capacity and further seal its lead in the market, the company bought United
States Satellite Broadcasting for $1.3 billion in 1998 and Primestar for $1.8 billion in
early 1999. Immediately after its buying spree, DirecTV carried all three brand name DBS
services under its umbrella.
The DIRECTV service provides 175 channels from a cluster of three High Power DBS
satellites. Its partner, United States Satellite Broadcasting (USSB) of Minneapolis, uses
the same satellite cluster to transmit a complementary 25-channel premium movie option.
About 2 million DirecTV subscribers have already signed on for the optional USSB movie
package. DirecTV/USSB is the fastest-growing DBS service, adding some 50,000 subscribers
each month. In addition to movies, the service's programming includes extensive
professional and collegiate sports coverage, cable channels, and CD-quality audio and
pay-per-view (PPV) events. DirecTV plans to phase out Primestar service by 2002, adding 2
million mostly rural converts to the DirecTV subscriber list. The company had $1.8
billion of sales in 1998, a 42% increase over 1997.
Market Player Owner StartupDate Satellites DishSize No. Of Channels Households
DirecTV GM Hughes 1994 GM HughesDBS1, DBS2, DBS3 18 200 4.80 million
EchoStarDish Network Echosphere Corp. 1996 Echo 1, Echo 2 18 150 2.04 million
Primestar DirecTV 1990 GE-2 27 120 2.32 million
EchoStar
EchoStar Communications started its Digital Information Sky Highway (DISH) Network in
March 1996. Like DirecTV/USSB, it is a High Power DBS provider. EchoStar's market share
rose from 20% to 24% from 1998 to 1999. More indicative of the company's progress was its
increase in subscribers, rising from 1 million in 1998 to 2.4 million in 1999, a 96%
increase. EchoStar transmits more than 120 channels from a Full-CONUS orbital slot, and
also owns rights to East Coast and West Coast transponders from which it plans to deliver
local data services, foreign language programming and other channels via an additional
antenna dish. EchoStar competes by offering lower hardware prices and monthly fees.
Unlike DirecTV, EchoStar can deliver local broadcast channels in major markets. It also
has the most superstation programming. A 6 ~ 10 channels Christian religious service from
the East Coast satellite, SkyAngel, is partnered with EchoStar. Echostar had $983 million
of sales in 1998, a 106% increase over the previous year.
3. Competitiveness for Choosing DBS
Reasons
1. Cannot get cable service
If cable is not available and your off-air local reception is poor, or you want to get
some of the cable type channels like CNN, ESPN, A&E, etc. DirecTV is the answer.
2. Hate the cable company
Many cable subscribers are reasonably well satisfied with their service, but many are
unhappy with poor reception, frequent outages, limited channel selection, and high
monthly fees for premium channels. DBS is now an excellent alternative. 
3. Got to have those SPORTS!
Most cable systems just don't have the channel capacity to compete with the huge
selection of sports on DSS right now, and those scheduled to be on other DBS systems in
the near future.
4. Looking for Specialty Channels
The Dish Network system is carrying many foreign language, religious, and other niche
channels that are not available from cable providers.
5. Pay-per-View and Music Channels
There is a great selection of movies, sports, and concerts on DSS, and coming to other
DBS systems. All DBS systems have many channels of stereo music that can be plugged into
a home music system. 
6. Quality of Picture and Sound
All DBS systems have excellent picture and sound via digital transmissions versus the
snow or shadows frequently experienced with cable or antenna reception. 
7. Technological Leadership
DirecTV is on the cutting edge of Home Theater technology. Some pay-per-view movies
already been broadcast in wide screen format. Dolby digital sound output is available on
some satellite receivers, and it can be sure that satellite will be the first to bring
High Definition TV to the home.
Some Facts of DBS
In the process of signing up 4 million subscribers in less than 4 years as a national
service, DirecTV has:
1. Registered more than 120 million pay-per-view movies and special event purchases.
2. Broadcast approximately 200,000 hours of professional and collegiate sporting events.
3. Consistently earned a customer satisfaction rating exceeding 90%
4. Maintained a monthly churn rate (percentage of subscribers who disconnect) of just 1%
- the lowest in the multi-channel video industry.
4. Comparison Analysis 
Satellite TV vs. Cable TV
Satellite TV Cable TV
Channel capacity More (225)Up to 55 pay-per-view Less (50 or so)
Video quality Better Worse
Audio quality Better Worse
Service payment A bit less A bit more
Multi TV watch Need additional receivers$90/each No further requirement
Typical monthly cost $32Add $6 for ABC, CBS, NBC, Fox $30
Pros n Powerful signaln Crystal clear picture qualityn CD quality soundn No need to
upgraden More channelsn Full sport packagesn Small 18-inch dish, no moving partsn Over 55
pay-per-view Channels n Most wide spreadn Extra outlets free except for installation cost
$20n Low hook up fee, $20 ~ $30n Include the local channelsn Limited channels - 35 ~ 40n
Reception is not as clear as satellite TV
Cons n Need an antenna or cable TV to receive their local stationn Extra TV set required
an extra satellite receivern Affected by rain fade, loose image when hard rain or snown
Need to pay additional for local channels n $20 per month just for cable, not including
programmingn The rates never go down...only upn Wire to deliver signal, may have
interruptions
Satellite TV vs. Satellite TV
DirecTV Dish Network
Manufacturer Hughes Echosphere
Channel capacity 200 channels31 CD quality music channelsUp to 55 pay-per-view 130
channels31 CD quality music channelsUp to 10 pay-per-view
Dish 18-inch 18-inch
Subscribers 8.7 million (2000/6) 4.3 million (2000/6)
Multi TV watch Need additional receivers$90/each Need additional receivers
Typical monthly cost $32Add $6 for ABC, CBS, NBC, Fox$5 for second satellite receive $5
for programming on second TV set receiver, $20 maintenance fee
International programming Unavailable Available
Sport packages More Less
Pros n More channelsn Full sport packagesn More pay-per-view Channels n Provide
international programming
Cons u Do not provide international programming u Less channelsu No full sport packagesu
Limited pay-per-view channels
5. Marketing Issues
Still Unprofitable
As of 1999, there were more than 10 million DBS subscribers in the United States, up from
8 million in 1998 and 6 million in 1997. Thousands of viewers sign on every day, and
industry analysts predict more than 12 million by the year 2000. However, all the current
providers are in heavy debt and operating at a loss. The providers 'policy of subsidizing
the cost of the customers' receiving equipment down to exacerbates the operating losses
as low as $100 in order to attract market share. Since none of the receiving systems is
compatible, if a provider goes out of business, as AlphaStar has already, customers are
left with worthless equipment.
Expand Services
DBS firms are seeking to expand the business by serving new categories of customers.
Example
Business Vision, partnered with EchoStar, and Member Direct Television, in cooperation
with DirecTV, are providing business television to thousands of receiving sites. The
programming includes tailored business news and information, training programs,
industry-specific material, and proprietary packages for large firms.
More Product Choices
Example
DBS companies venture into new business areas, America Online partnered with DirecTV,
Hughes Network Systems, Philips Electronics, and Network Computer to work on developing
AOL TV. DirecTV and AOL planned to work together on a service that would combine digital
satellite television programming and AOL TV's enhanced interactive TV Internet service.
Hughes Network Services planned to design and build a dual-purpose set-top receiver,
complete with an advanced set-top box for AOL TV provided by Philips. Network Computer's
contribution was to provide a complete software platform for the new service through the
company's TV Navigator software.
Strategic Partnership
Example
AOL TV/DirecTV plan to market the AOL TV/DirecTV service to a combined base of 24 million
subscribers. The service will provide AOL content in addition to satellite TV programming
in one platform. The deal also boosts the broadband ambitions of both companies. Hughes'
planned $1.4 billion Spaceway geostationary broadband satellite system will benefit by
being able to tap into this customer base well before the satellites built. AOL also said
to be considering additional investment in Spaceway.
Interactivity
EchoStar appeared to have the jump on DirecTV when it came to interactive services.
EchoStar still will be first to market with an interactive offering. High-speed,
interactive Web-like channels are much more alluring than semi-high-speed cable modems.
Brad Beale, DirecTV's vice president of advanced products, says interactive services fit
his company's strategic aims: With the introduction of our interactive services, we're
taking television entertainment to the next level by bringing varying levels of
interactivity to a consumer's television viewing experience.
Similarity
Example
EchoStar plans for DirecTV's Internet product, EchoStar's offerings are similar enough so
that many subscribers will not really decide based upon any differences. The money and
the marketing clout behind the DirecTV-AOL partnership will put EchoStar at a
disadvantage once AOL TV/DirecTV gets rolling, unless EchoStar can find a similar
partnership.
Sell out
AOL's DirecTV investment in the form of $1.5 billion placed in an interest-bearing GM
security that is convertible into GM Class H common stock in three years will be used for
marketing, public relations and to subsidize entry into the new services. These services
will be sold under several brand names: DirecTV, DirecPC, AOL TV and AOL-Plus high-speed
Internet service.
The marketing expenditures planned for the venture are in the neighborhood of $1.6
billion. This amount includes $500 million to market AOL-Plus through DirecPC; up to $500
million for DirecTV marketing, including $100 million to market to AOL members; $400
million for combined AOL TV/DirecTV services, and $100 million for DirectDuo, a single
dish for both TV and Internet access.
6. Market Share and Growth
The tremendous growth of DBS as a video provider was a reason to consider that industry a
threat to the dominance of cable broadband. In the last year, the number of DBS
subscribers grew to 13 million homes from 10.1 million, vs. 67.7 million cable homes.
More than 15% of all multi-channel video subscribers are DBS customers, and DirecTV and
EchoStar are among the top 10 video providers in the United States, joining the ranks of
AT&T Broadband, Time Warner Cable and Comcast Communications.
Cable operators spent billions of dollars on preparing to offer glitzy interactive
services. However, a lot has changed over the past year. The number of satellite players
has shrunk from four to two: DirecTV and EchoStar. They are doing surprisingly well in
rounding up new subscribers and revenue since the federal government gave them the right
to retransmit local stations, which they do for an extra fee. Moreover, over the next few
months, satellites will take the lead in offering interactive digital TV services, as
well as two-way high-speed Internet connections, coast to coast. That has made Hughes
Electronics, parent of DirecTV deals with power players including America Online,
Microsoft and Blockbuster, and programmers from the National Football League to Walt
Disney. They are attracted to DirecTV because its 8.7 million subscribers account for
about two-thirds of the satellite market. It expects to end this year with nearly 10
million customers, up 20% over last year. As a result, it reaches more homes than anyone
except AT&T and Time Warner, and it is on pace to pass the cable giants around 2005.
About 70% of DirecTV's new customers come from areas served by cable. No wonder
investment bankers are so tantalized by the possibility that General Motors, which owns
Hughes, is ready to fundamentally change the media landscape with an outright sale of the
property. Analysts say it would cost a buyer about $50 billion.
7. America and the World
Satellite communications is an international business, with satellites orbiting the globe
and programming transmitted from space heedless of national borders. Multinational media
companies such as Rupert Murdoch's Australia-based News Corp. seek to expand into new
markets. Among U.S. DBS providers, DirecTV has been most active in pursuing joint
ventures and other opportunities abroad.
American
Canada, Mexico, and some South American countries hold some of the orbital slots over the
Western Hemisphere that could service the United States. If any of these choose to
auction off transponder rights, U.S. companies can bid for them. Likewise, U.S. companies
can potentially service other markets in the Americas from their own slots. Nations may
attempt to control the industry by regulating the sale of decoders; in 1998 Argentina
temporarily halted DirecTV from competing in its market while it tried to get its own
system in place.
Europe
Europe has its own active DBS market. Luxembourg-based Societe Europeenne des Satellites
S.A. (SES) operates ASTRA, the leading satellite system, which served more than 74
million homes in Europe in 1999. More than 31 million European homes receive programming
directly to a satellite dish via ASTRA. British Sky Broadcasting (BSkyB), the first
service provider to offer DBS in the United Kingdom (1989), relies on an ongoing
contractual agreement with SES. In 10 years, the Isleworth, UK-based company has amassed
3.6 million DBS subscribers and 2.6 million cable subscribers in the United Kingdom and
Ireland, where broadcast television consists of five channels. By holding broadcast
rights to the leading soccer leagues in England and Scotland, the British satellite
service has also become the largest pay-TV provider.
Asia
Japan
Asia, home of 60% of the world's population, is a tempting target for telecommunications
companies, but DBS growth there been hampered by political and economic conditions.
Japan, which can be completely covered from one orbital position and where cable
television never really took off due to heavy regulation, has the most advanced satellite
technology in Asia. Challenges for Japanese DBS include the Asian financial troubles of
the late 1990s, a conservative business environment, and a lack of demand for
Japanese-language programming outside of the domestic market. As of May 1998, SkyPerfecTV
had more than 700,000 subscribers in Japan, and DirecTV Japan had topped 100,000.
China
China is reluctant to allow direct broadcast to its population of 1.2 billion because of
political concerns about western influences. Murdoch, whose base in Australia makes his
News Corp. a natural contender in Asia and the Pacific Rim, antagonized the Chinese
government by declaring that satellite television would undermine totalitarian regimes,
and was subsequently constrained to low-profile participation in partnership ventures
with Hong Kong and others.
Reacting to the boom in home television sets throughout that region of the world, APT
Satellite Holdings Limited stepped up its efforts to secure licenses to offer DBS to
homes in China and Southeast Asia. The Hong Kong-based company provides satellite service
to 100 countries, mainly serving television stations, local cable operators, and master
antenna systems.
India
In 1997, India, which also feared excessive western influences on its population of
almost 1 billion, banned direct-to-home satellite television broadcast services. Amid a
furor, which included a lawsuit by News Corp., it declared that the ban would only be
temporary, until the government could set up a broadcast authority. A bill to establish
the regulatory agency has since been introduced in India's Parliament.
Oceania
In a short time, Sky Network Television Limited has signed up 260,000 subscribers in New
Zealand for its five pay-TV channels and analog DBS programming. The Auckland-based
company is partly controlled by Independent Newspapers, which is partly owned by
Murdoch's News Corp.
8. Future Development
Advanced compression schemes allow multiple streams of programming, along with the
ability to control information per transponder frequency, made DBS feasible, and research
and development continues in this area. Squeezing down the signal still further would be
an advantage, but providers also want to eliminate the occasional blocky digital
compression artifacts that some viewers find distracting. With High Definition Television
(HDTV) on the horizon, three or four times more bandwidth (or three or four times better
compression) will be required to provide the same number of channels. Currently, each DBS
provider uses its own format for transmitting the signal. An emerging world standard,
DVB, uses MPEG-2 and also attempts to standardize other elements of the system. Still,
even DVB-compliant systems from different providers are not interchangeable. 
In addition to HDTV, demand for local channels drives the push for more bandwidth.
Besides improving compression, other areas of technological development include
higher-power transponders, which allow more information to pass through existing
bandwidth because less error-correcting coding is required. Signal polarization,
controlling the orientation of the electromagnetic wave transmissions, is used to isolate
adjacent transponder slots and allow more of them within a fixed-frequency spectrum.
Statistical multiplexing maximizes the use of existing bandwidth by assigning it upon
demand, depending on the information density of a particular program being carried by a
channel at a given time.
Another approach to the bandwidth problem might be to expand it using spot-beam
broadcasts to individual markets, although satellites capable of such transmissions in
the DBS frequency spectrum did not yet exist as of mid-1998. Capital Broadcasting of
Raleigh, North Carolina plans to provide local programming packages from a satellite with
61 beams by about 2001.
Technological development is also addressing the problem of rain fade, when thunderstorms
and other weather disturbances interfere with the DBS signal. Currently, satellite
transmissions are focused to provide more power to wetter regions within the coverage
area.
Reference
Consumer Guide to DBS, June 1998. Available from
http://www.dbsdish.com/reviews/c_report.html 
Davis, Neil W. Asia's Communications Market Booms. Aerospace America, January 1995.
Gifford, James M. The 18-Inch Business School. Satellite Communications, November 1996.
Hoover's Company Capsules. Austin, TX: The Reference Press, 1999. Available from
http://www.hoovers.com 
India Backtracks on TV Ban. Wall Street Journal, 24 July 1997.
Kiernan, Vincent. Making Satellites More Local. Satellite Communications, April 1998.
La Franco, Robert. The Unlikely Mogul. Forbes, November 1998.
Murphy, Beth. Rural Americans Want Their DIRECTV. Satellite Communications, March 1995.
Peterson, Richard R. Direct Broadcast Satellite: A New Generation of Television in
America. 14 January 1998. Available from http://www.dbsdish.com/dbs/a0.html 
Silverstein, Sam. U.S. Lawsuit May Trigger More Upheavals for DBS. Space News, 18 May
1998.
Ullman, Lawrence E. Bent Pipes in Space. Stereophile Guide to Home Theater, Fall 1996.
DSS: The Sky's the Limit. Stereophile Guide to Home Theater, Fall 1996.
Warner, Fara. Murdoch Builds a Beachhead in China. Wall Street Journal, 12 December 1997.

Activate the Money Star: Satellite Operators. The Economist, 3 May 1997, P56-P64.
Adamson, Steven, David Roberts, et al. Advanced Satellite Communications: Potential
Markets. Park Ridge, NJ: Noyes Data Corporation, 1995.
Agres, Ted. Companies Vie for a Slice of High-Stakes Space-Launch Pie. R & D, January
1997.
Behr, Peter. Firms Vie to Operate NASA's Spacecraft. The Washington Post, 26 June 1998.
Cole, Jeff. New Satellite Era Looms Just over the Horizon. Wall Street Journal, 18 March
1997, B1.
Cook, William J. 1997: A New Space Odyssey. U.S. News & World Report, 3 March 1997, 44.
Direct-to-Home Satellites. Television Digest, 7 April 1997.
Dunn, Ashley. Satellite Fantasies: 'Scuse Me While I Kiss the Sky. New York Times, 12
June 1996.
Edelson, Burton I., et al. Satellite Communications Systems and Technology: Europe,
Japan, and Russia. Park Ridge, NJ: Noyes Data Corporation, 1995.
Elstrom, Peter. The Internet Space Race. Business Week, 1 June 1998.
Furniss, Tim. Launch Odyssey: The First Geostationary Satellite Launch from an Offshore
Platform Is Scheduled to Take Place in 1998. Flight International, 19 March 1997, 32.
Gordon, Gary D., and Walter L. Morgan. Principles of Communications Satellites. New York:
John Wiley & Sons, Inc., 1993.
Leopold, George. Will August Rollover of Critical Devices Disrupt Satellites?--Lawmakers
Probe GPS Timer. Electronic Engineering Times, 17 May 1999.
McGraw-Hill Companies and U.S. Department of Commerce. U.S. Industry and Trade Outlook.
New York: McGraw-Hill, 1999.
Rapaport, Richard. Satellite Mapping. Forbes, 24 February 1997, 107.
Richtel, Matt. Start-Ups Pin Hopes on an Internet Route Through the Sky. New York Times,
30 November 1998.