DirecTV Inc. signed retransmission-consent agreements with
ABC Inc. and NBC last week, giving the direct-broadcast satellite provider rights to send
local signals from the broadcasters' owned-and-operated stations into their respective
DMAs.
DirecTV and EchoStar Communications Corp. have similar
agreements with Fox Television Stations Inc.
By the end of May, DBS providers must have retransmission
consent for any local broadcast feeds they send to subscribers. Recent legislation gave
DBS a one-time, six-month grace period for negotiating retransmission consent.
As part of a deal with ABC, announced last week, DirecTV
agreed to carry cable spinoff SoapNet, which will reair ABC's four daytime soap operas on
weekday nights.
Disney/ABC Cable Networks plans to launch the new channel
Jan. 24, but DirecTV isn't likely to add it until sometime in the second quarter, once it
starts marketing a new, yet-to-be-named programming package, DirecTV vice president of
programming acquisitions Michael Thornton said.
DirecTV has no plans to add SoapNet to its PrimeStar by
DirecTV medium-power service. By late November, PrimeStar customers accounted for 1.5
million of DirecTV's 7.8 million-subscriber base.
DirecTV converted 77,000 PrimeStar customers to its
high-power service last month. The company also added 150,000 net new high-power
subscribers, a record November.
Charlie Nooney, executive vice president of sales and
affiliate marketing for Disney/ABC, declined to discuss whether SoapNet was paying a
launch fee for DirecTV carriage. He also declined to say if ABC is charging a
per-subscriber fee for its local network feeds.
NBC treated DirecTV "similarly with how we treat the
rest of the [multichannel] industry," NBC Cable president David Zaslav said.
In return for retransmission consent, DirecTV agreed to
carry the network-station group's signals in any market where it launches local-to-local,
"and they'll support our cable networks with subscriber fees," he added.
DirecTV's retransmission talks with NBC were influenced by
an Olympic Games carriage deal with CNBC and MSNBC that DirecTV signed this past summer,
Thornton said.
He added that he expects DirecTV to announce a
retransmission deal with CBS Corp. "in the near future." DirecTV is negotiating
with all station groups and station owners for network affiliates in each market where it
plans to launch local service.
CBS spokesman Dana McClintock said the network was
"making great progress" with DirecTV.
DirecTV also said last week that it will launch a spot-beam
satellite in late 2001 that will allow the company to reuse spectrum by focusing satellite
beams only on individual markets. The same spectrum could be reused to send different
broadcast signals to New York and San Francisco, for example.
The satellite, DirecTV 4S, will launch to 101 degrees west
longitude, with DirecTV's core satellites.
DirecTV president Eddy Hartenstein told analysts at last
week's PaineWebber Media Conference in New York that the new satellite would let DirecTV
expand local-to-local service to 40-plus markets. The additional channel capacity will
help the company to comply with must-carry requirements, which are mandated to start in
2002.
A spokesman for EchoStar said the company could not discuss
whether it had spot-beam plans, citing a securities-related quiet period.
EchoStar already sends local signals in 11 of 13 markets
from its new satellite at 110 degrees west. New York and Los Angeles are served from its
core service at 119 degrees. Chairman Charlie Ergen told Dish Network subscribers last
Monday that he plans to add 20 more local-to-local markets by March, all from 110 degrees.
Current Dish subscribers would need hardware upgrades to
see the satellite at 110. Ergen said a free-upgrade program would be available starting
today (Dec. 13) to current subscribers who want to use new "Dish 500" hardware
if they commit to a certain level of programming for one year. Those who don't commit can
get discounted hardware and free installation for a limited time.
Since legislation allowing local-to-local passed two weeks
ago, EchoStar has been promoting its availability in 13 markets through local newspaper
ads.
In addition to the "Big Four" networks, EchoStar
also promotes at least one independent station in many markets, including KJZZ in Salt
Lake City, KTLA in Los Angeles, KWGN in Denver, WSBK in Boston, WGN in Chicago, TBS in
Atlanta and WPIX and WOR in New York.
DirecTV has made no determination on whether it will add
independent stations to any of its local packages, Thornton said.
DirecTV plans to use spectrum at its 110 and 119 orbital
locations for additional local-channel markets. DirecTV already serves five markets using
core spectrum: New York; Washington, D.C.; Los Angeles; Denver; and San Francisco. It was
looking to add another five this past weekend.
Other markets DirecTV has slated for 101 degrees are:
Atlanta; Boston; Chicago; Cleveland; Dallas; Detroit; Houston; Miami; Minneapolis;
Orlando, Fla.; Philadelphia; Phoenix; Sacramento, Calif.; St. Louis; Seattle; and Tampa,
Fla.
Zaslav declined to categorize retransmission-consent
discussions with EchoStar. Nooney said Disney/ABC is talking with EchoStar, but he could
not say when an agreement would be announced.
As for network affiliates, Zaslav said, "They're on
their own" when it comes to negotiations with DirecTV and EchoStar, just as they make
their own decisions when it comes to carriage on local cable systems.
