United Video Satellite Group, through its Superstar/Netlink unit, and TurnerVision will combine their respective CBand satellite businesses.
Under the agreement, TurnerVision will join the Superstar/Netlink Group. The resulting joint venture will be the nation's largest provider of programming to CBand DTH satellite customers with approximately 1.3 million subscribers.
"I am very excited about TurnerVision's addition to our joint venture as we continue to work on improving the venture's economics," said Peter C. Boylan III, president and chief operating officer of United Video. "TurnerVision has an excellent reputation in the industry and will be a great addition to our product line in the joint venture. Both companies share similar values regarding programming, customer service and employees."
TurnerVision, a privately held company headquartered in Bluefield, WV, will continue to operate its call center in its current facility. Cindy Sheets, TurnerVision vice president and general manager, will continue to oversee the TurnerVision operations from the West Virginia location and will report to Mike McKee, president and chief operating officer of Superstar/Netlink Group.
Champion Holding completed its purchase of assets once belonging to bankrupt Alphastar for $4.6 million, and announced it will unveil a new start date for the service early next year.
Champion President and CEO Mahmoud Wahba said the service will retain the Alphastar name and has reemployed "the excellent technical and operational staff" from the former company.
"We believe that the subscription management system we have, the conditional access capabilities and the ability to generate original programs will give us the edge to become formidable competitors in this field," Wahba said. "Also, our earth station has the capacity to transmit over 200 channels, which distinguishes it as one of a handful of (such) facilities in the world."
Wahba said the company was "strongly leaning" in the direction of restoring Caribbean service next year. Champion's plans call for restoring service in Puerto Rico, the U.S. Virgin Islands and Hawaii and eventually working towards the continental United States.
Old customers won't need new equipment, but future subscribers would get a system.
The DTH business is being divided into three sections: AlphaStar Broadcasting will revive the old Alphastar operation; Alphastar PC Webcasting will provide video, audio, text and data transmission to computers via satellite and the Champion Private Network and Teleport will provide transmission capability for private networks, businesstobusiness communication, distance teaching and special events coverage.
Alphastar went bankrupt last August.
The European Commission said it may take action with the World Trade Organization if the United States does not change a plan for implementing a global telecommunications trade pact.
The European Union is reportedly unhappy about provisions, approved last week by the Federal Communications Commission, that allow federal regulators to restrict foreign operators from entering the U.S. market.
The FCC adopted the rules, which ease access of foreign operators to the U.S. market, to carry out a WTO pact that takes effect Jan. 1. The accord was signed last February by 69 nations.
Under its plan adopted last week, the FCC will replace existing entry rules for foreign operators with an easier and more streamlined process and will no longer require them to prove that their home market is open to U.S. communications companies.
However, the FCC, the U.S. Trade Representative's office, the State Department or the Defense Depart ment could block entry if they feared a company could hurt competition in the United States or pose a national security threat. European carriers argued that the "public interest test" is vague and leaves U.S. authorities with too much room to block deals.
In December, more DirecTV subscribers got a further warning in their monthly billing statement regarding a possible rate increase scheduled to take place Jan. 1.
DirecTV notified subscribers who receive distant network signals from Prime Time 24 that rates will increase in their monthly bills for those channels. The jump is blamed on the 27cent fee proposed for distant network signals and superstations approved by Librarian of Congress James Billington. Here is the letter DirecTV subscribers received: November 25, 1997 Dear PrimeTime 24 Subscriber:
Does it make sense that DIRECTV subscribers will now have to pay more than cable subscribers for the very same broadcast signals? Of course not! But that's exactly what has happened. Let me explain.
The Librarian of Congress has the authority to impose copyright fees. And on October 27, 1997, the Librarian approved an increase in the copyright fees charged for providing network signals to satellite TV subscribers.
What does this mean to you? Because of the increase in fees, we have been forced to increase our price for the PrimeTime24 service by 21 cents per network signal. This change will go into effect January 1, 1998. Thus, for example, if your PrimeTime 24 service currently includes 8 network signals, your monthly bill for this service will increase from $4.99 to $6.67.* Cable subscribers, however, will not be hit with the same increase. Their cost to receive the same signals will remain exactly the same.
Now, cable operators will pay 900% less for network signals than satellite carriers will pay under the new fee structure!
Congress' original intent was to make network programming available to consumers who live in areas where they are unable to receive overtheair signals from their local network affiliates.
Unfortunately, this consumerfriendly objective has been compromised by the Librarian's decision to significantly and unjustifiably raise the cost of broadcast signals included in the PrimeTime 24 service. The new fee increases place a substantially higher financial burden on satellite carriers as compared to the fees paid by cable systems for the exact same signals. And unfortunately, this increase will be passed on to you.
Can we stop this discriminatory rate increase? Yes, we can! There is absolutely no reason why you, the satellite TV consumer, should be burdened with higher fees than cable subscribers. We must put an end to this inequity! Congress has the power to overrule the Librarian's decision to impose this increase in fees.
If the decision to increase copyright fees is overturned, DIRECTV will cancel the price increase as of the effective date of the change. We will credit accounts for amounts paid to DIRECTV as a result of the fee increase to the extent that the bill overturning the increase applies to fees already collected.
Please join us in letting Congress know that you expect fairness from your government. Bills have been introduced in Congress which would halt the implementation of these fee increases. Contact your U.S. Senators and Representative today and request that they cosponsor these bills. Let them know that satellite TV viewers expect a level playing field. Sincerely., Eddy W. Hartenstein, President *The price increase reflects only the actual additional amount DIRECTV will pay for these network signals. Although the librarian's decision does not directly apply to the FOX signal, PrimeTime 24s contract with FOX requires a price increase linked to the copyright fees for other network signals.(End of letter)
In November, the National Rural Telecommunications Cooperative warned its DirecTV customers of the Jan. 1 increase. Canada Approves New Satellites, More Competition
Canadian Industry Minister John Manley approved Telesat Canada's application to replace its Anik E satellites with two Anik F satellites.
And consistent with Canada's commitment to foster an open market for fixed satellite services after March 1, 2000, two of the four Canadian orbital positions will be available to outside parties, the minister's office said.
"This is another example of how we are moving to implement the international commitments Canada made in the General Agreement on Trade in Services (GATS) Agreement on Basic Telecommunications and to ensure that our industry is poised for global competition," Manley said in a statement.
European Union Trade Commissioner Leon Brittan warned the U.S. government against imposing special costs on ICO Global Communications and its $4.3 billion satellitephone system.
Brittan, in a letter to U.S. Trade Representative Charlene Barshefsky, said that any attempt to hinder ICO's services could prompt similar charges and protectionism from other nations. The letter follows a heated response from EU ministers regarding plans from the Federal Communications Commission to allow foreign competitors into the U.S. telecommunications market.
Once launched, ICO will become the only foreign challenger to two big systems led by Motorola and Loral Space & Communications.
EchoStar Communications filed another program access complaint with the Federal Communications Commission, this time against FX, a basic cable/satellite channel from News Corp. and Fox Television.
In its complaint, EchoStar claims FX violated program access rules by making exclusive deals with cable networks. The company also has filed similar complaints against FoxSports Net and Cablevision's Rainbow Programming.
Iridium unveiled a major expansion of its corporate headquarters in Northern Virginia, a plan that calls for a $34 million investment in capital and personnel over the next year.
The Iridium Business Systems Center, located in Reston, Va., will serve as the business software development center and financial clearinghouse for the global telecommunications network.
"The Reston center will be the heartbeat of our business," said Iridium Chairman Bob Kinzie. "The sophisticated software designed and run by our engineers here will collect, process, and distribute the crucial information that will allow us to offer the highest satisfaction to our customers around the world."
The Business Support Systems Center will develop business solutions to manage customer problems, assign phone numbers, combat fraud and facilitate billing and financial clearing.
Hughes Space and Communications said it set a new company record with the nearsimultaneous launch of two satellites, one from Arianespace's facility in Kourou, French Guiana and one from the Baikonur Cosmodrome in Kazakhstan.
JCSAT5, the fifth satellite built for Japan Satellite Systems by Hughes, will relay voice, data and television signals to Japan, other nations in the AsiaPacific region and Hawaii.
Astra 1G, also the fifth Hughesbuilt satellite for Societe Europeenne des Satellites of Luxembourg, will expand television, radio and multimedia services throughout Europe.
Galaxy Latin America launched Galaxy VIIIi, a Hughes satellite that will support its DirecTV service throughout Latin America.
The satellite will provide the Latin American DirecTV service with 32 transponders that will broadcast to subscribers in Mexico, Central and South America and the Caribbean. The transponders are designed to function with another satellite, Galaxy IIIR, and the new satellite's footprint also will cover areas in the United States most heavily populated by Hispanics.
The new satellite is almost twice the power of Galaxy IIIR. The new HS 601 HP bodystabilized satellite was built by Hughes Space and Communications and will be operated by PanAmSat.
NextLevel Systems, Inc. announced that it will be closing its satellite receiver manufacturing plant in Barceloneta, Puerto Rico at the end of this year.
As the principal manufacturing facility for NextLevel's satellite business, the Barceloneta plant, which employs 1,100 people, manufactures receivers for the reception of analog and digital television signals that are transmitted via satellite. The receivers are used in the private network, commercial and consumer markets. Future satellite receiver production will be split between an American subcontractor and the company's facility in Nogales, Mexico.
The plant closing is part of the multifaceted plan, announced in October, to improve the company's financial performance by reducing the headcount by 1,100. Last month, NextLevel announced that its Chicago corporate headquarters will be consolidated with its principal operating unit in Horsham, PA during the first quarter of 1998.
AT&T and DirecTV, Inc. announced that they have ended their marketing agreement to distribute the DirecTV direct broadcast satellite television service and DSS equipment through AT&T.
AT&T and DirecTV entered into their original marketing agreement on March 25, 1996, to enable AT&T to provide its customers with special incentives on DSS equipment purchases. Under the agreement, AT&T invested $137.5 million for a 2.5 percent equity stake in DirecTV and options to purchase up to an additional 27.5 percent equity stake.
With the termination of the agreement, AT&T is selling back its 2.5 percent equity stake for $161.8 million. The remaining equity options and exclusivity provisions of the original agreement have been cancelled.
The new arrangement between the two companies will provide all DirecTV customers who are or become AT&T long distance customers with one free, specially designated payperview event each quarter in 1998.(Whoopdeedoo!)
The speculation is that telecom giant AT&T might have backed out of its nearly two year old deal with DirecTV in order to make an investment in cable company, TCI. According to several sources, the lure of the internet via TCI wires and @Home service may be the driving source.
A lawsuit was filed in the U.S. District Court, Northern District of Illinois, Monday seeking damages on behalf of all persons who acquired NextLevel Systems Inc common stock, either in connection with NextLevel's spinoff from General Instruments Corp or in the open market between July 28 and October 15, 1997, the plaintiff's attorney said Tuesday.
NextLevel officials were not immediately available to comment on the complaint, which alleges the prospectus issued in connection with NextLevel's spinoff misrepresented the company's true financial condition by failing to separately state the revenue and expenses of NextLevel's three separate and distinct lines of business.
In addition, the complaint alleges NextLevel concealed the fact that it was suffering from reduced orders by its largest customer, TeleCommunications Inc. SBCA Offers Satellite Dish Preemption Help
A service from the Satellite Broadcasting and Communications Association is assisting consumers across the country with issues concerning preemptions of local laws and homeowner association covenants affecting satellite dishes and other outdoor antennas.
The Federal Communications Commission issued the preemptions, which overrule local zoning restrictions and bans on satellite dishes. According to the SBCA, most of the calls it has received on preemptions are from homeowners who have been denied the right to install or keep antennas by the local homeowner association.
For information regarding preemptions, consumers can call the SBCA at 18005415981, extension 343.
Canadian DTH service Star Choice enhanced its offer to satellite viewers receiving unauthorized U.S. signals by decreasing the price on its 411 receiver to $549.
Canadians who trade in their U.S. equipment also can receive up to $800 in Star Choice programming credits. Once customers in the Canadian "gray Market" use the full programming credit, they are free to choose from any Star Choice package. Packages range in price from $8.99 to $44.99 per month.
"Improving our offer to Canadians subscribing to unauthorized U.S.based service providers, coupled with reducing the suggested retail price on our equipment, will not only greatly appeal to consumers, but will be enthusiastically supported by our extensive dealer network," said Carl Vogel, Star Choice chief executive.
EchoStar's DISH Network activated its one millionth customer December 16th, a major milestone for the 21monthold DBS service.
For the 12month period following EchoStar's first satellite launch in December 1995, the DISH Network added more subscribers than any of its DTH competitors added in their first year, according to the company. With the addition of 650,000 customers to date in 1997, DISH Network has doubled its market share from 17 percent of all subscribers added during 1996 to 35 percent in 1997, its first full year of service. Charlie Ergen, EchoStar chairman and CEO stated:
"Combined with the successful launch of EchoStar III, 1997 has truly been a memorable year for EchoStar," he added. "We look forward to 1998 when DISH Network becomes the first and only DBS service to offer local channels to its customers."
EchoStar said its fourth satellite is tentatively scheduled to launch in March 1998 into the company's westernoriented orbital location at 148 degrees.
EchoStar IV will support the company's DISH Network and further enhance other satellitedelivered services.
EchoStar III was launched Oct. 5 from Cape Canaveral Air Station in Florida. Once commercially operational, the bird will complement current programming offered by the DISH Network by expanding international, educational and business programming. The company also hopes to deliver data and local channels in certain U.S. television markets.
Teledesic chairman Craig McCaw, who along with Microsoft's Bill Gates formed the developing satellitebased communications company, will assume the additional role of company CEO.
"I'm committed to Teledesic's vision and to providing the leadership necessary to fulfill its promise. Because Bill Gates and I have so much personal interest in Teledesic, we've decided that it's best for me to play a more active role in the company's development," said McCaw, 48. "
Teledesic cleared its last significant regulatory hurdle in November when the International Telecommunications Union finalized designation of international radio spectrum for use by non geostationary satellite services, including those planned for Teledesic.
The company will use a constellation of 288 lowearthorbit satellites, providing broadband Internet access, videoconferencing and other communications needs. Teledesic plans to begin service in late 2002.
After its recent breakup with AT&T, observers said DirecTV is speaking with Baby Bells, including Bell Atlantic and SBC Communications, about the possibility of becoming agents for the DSS service within their respective territories.
Any partnerships will require the Baby Bells to charge for the service on regular phone bills, and use employees to install DirecTV's systems. DirecTV has a similar agreement in place with Cincinnati Bell.
Baby Bells have been rumored in the past regarding partnerships with DBS companies.
Norsat International settled legal action which Express Vu, TMN Networks, The Family Channel and WIC Premium Television initiated against the company in June 1996.
Under terms of the settlement, Norsat will discontinue importing and selling in Canada satellite systems that receive U.S. originated DSS signals.
Bruce Chapman, Norsat President and CEO. stated "The Federal Court of Appeal has ruled against the importation and sale in Canada of U.S. DTH systems and we have a duty to abide by its decision.
"We look forward to working with Canadian DTH service providers to assist Canadian consumers in
converting to a made in Canada solution."