A bit of background: I'm in a rural area of Michigan where broadband
is how wide the high school marching band marches down the street.
Over-the-air TV comes from 60 miles away, kids walk to school uphill
both ways, etc.
Telecom infrastructure is laughable, so I subscribe to Dish Network
for television and Starband, a Dish-related two-way satellite Internet
provider. Dish & Hughes Electronics (DirecTV), present competitors
in the direct broadcast satellite market, have agreed to merge.
Obviously this will be heavily scrutinized, but a nugget that will be
highly examined is systems compatibility. Dish is a software based
system while DirecTV is hardware based. What follows is a post (not by
me) to alt.dbs.echostar commenting on remarks made by Charlie Ergen,
CEO of Dish, to the Dish subscribers on 12/10:
After watching the 2001-12-10 Charlie Chat, I have some observations.
Charlie said that neither DISH Network nor DirecTV subscribers will
require new equipment immediately after the proposed merger. He also
said that the two systems use different technology. Obviously, DISH and
Direct customers won't be using each others' satellites any time soon
after a merger, so there is no reason to expect immediate improve DISH
or Direct picture quality.
Later in the Chat he mentioned that one standard platform will be
developed and at that time we (DISH and Direct customers) will receive
new equipment if necessary. The magnitude of that undertaking and the
time required to complete it shouldn't be underestimated. By the time
any such changeover occurs, we can probably expect the total number of
satellite subscribers to be greater than 20 million. Only DISH and
DirecTV know how many receivers are active, but it's clearly well above
that number due to houses with multiple receivers. In any event, lots
of receivers, antennas, and switches are involved.
The easiest change would involve simply adopting one of the existing
platforms as the "new" one. All subscribers to the other platform would
be given new equipment over a period of time, and the old standard
would be abandoned, making its bandwidth available to the new DISH
Network. Both platforms would continue to broadcast until the
conversion is complete, meaning no bandwidth improvement until that
process is done.
If, on the other hand, a completely new platform is implemented,
things get a bit more complicated. Designing, engineering, testing,
debugging, manufacturing and distributing that number of new devices
will take time and loads of money. I wouldn't expect to see an
improvement in service due to a new platform any time soon; Charlie
mentioned that the new platform would be available a year after the
merger.
The changeover from one platform to a completely new one would not
be a trivial matter. Try to imagine how it might be done. During the
change, the old and new platforms would have to coexist for a
transition period to allow re-aiming of antennas, installation of new
customer equipment, etc. Those things don't occur overnight when 20+
million customers are involved. Where will all the additional satellite
bandwidth come from to maintain multiple platforms during the
transition? At some point DISH, DirecTV, and the new platform standards
would all have to be transmitted simultaneously. Only after we receive
the new hardware would we see the bandwidth benefits.
The topics of Internet via satellite and interactive services were
prominent in the presentation. Making those services more generally
available will also cost bandwidth that many have assumed would be used
to improve picture quality.
I think Charlie is doing what must be done to make satellite service
more appealing and competitive with cable in the long run, but those
who expect to see an improvement in quality any time soon may be
disappointed. The cost involved in making the changes will undoubtedly
fall on users, too.
Events are rarely as good as the optimists or as bad as the
pessimist expect. Time will tell how this goes, if and when a merger
occurs.
Here are the bullet points:
- 20 million subscribers and growing
- Multiple set top boxes in each household
- Personal video recording (pretty much standard now on Dish)
- Duplex satellite delivered Internet access (no phone line)
- Platform standardization
The complexity of this screams for a partner who can develop a
solution quickly on proven hardware and a bulletproof codebase. Does
this also have "digital hub" written all over it?
Here's my thought - an Apple home hub/server (a Cube-like box) that
runs Darwin (stability) and handles all the decoding of the A/V digital
stream as well as serve Internet clients. Connectivity could be
ethernet, FireWire, AirPort, or all of the above to either a similarly
equipped TV or a small transceiver connected to the digital port. The
hub would have a sufficiently large hard drive for PVR and 10-day
program guide (fully searchable, of course). This is just off the top
of my head.
Look at this as a combination satellite TV reciever, Internet hub,
TiVo, and network server.
Anyway, Microsoft wants in this market badly; they are already
investors in Starband (a PC-only service thus far) and they provide PVR
software, so the next step would be to control the gateway. Apple must
not let this opportunity slip by. If Steve Jobs really is hooked on the
digital hub, here's the opening.
Are you ready to hit the home run - or just come up with interesting
but not terribly groundbreaking toys with little real imagination or
lasting value?
Share your perspective on the Mac by emailing with "My Turn" as your subject.
