Hughes Network Systems last week laid out its long-range broadband satellite plan and introduced its new line of satellite products called DirecWay.
This fall Hughes will launch the DirecWay system initially through Circuit City, Best Buy, Office Depot and independent satellite retailers. The two-way broadband service will carry a $499 suggested retail price, with monthly service charges varying between $59.95 and $69.95 per month. Hughes’ ISP partners, AOL, Earthlink, Pegasus and Juno, will determine the final service charge pricing, said Paul Gaske, Hughes’ executive vice president and general manager.
Hughes expects 200,000 subscribers to sign up by the end of 2001 with the 4 million mark being hit by 2005.
Hughes will target the installed base of DirecTV users, but the primary customer is expected to be people living in areas where cable and DSL broadband service either cannot be installed or will not be installed for several years. About 61 percent of all U.S. households fall into this category, according to Hughes’ data. Hughes will also attack the small, medium and enterprise-level business markets.
“We feel we can nail down a significant niche in this market and we want to repeat the success of our DBS success story in the data area,” said Pradman Kaul, Hughes’ CEO and president.
Although upload and download speeds will vary depending upon which ISP is used, speeds should average 40Kb to 50Kb per second for uploads and 500Kb per second for downloads, Gaske said.
Unlike the current DirecPC and DirecTV services, DirecWay will require professional installation. Hughes intends to use the current crop of installers from satellite specialty stores and is promising consumers that their system will be fully installed within seven days of their purchase. The price for this has not been set, said Peter Gulla, vice president consumer sales and marketing for Hughes.
Gulla said additional retailers and ISP partners could be added prior to the launch. The basic customer experience should have the person going to a retailer and choosing one of the ISP services and leaving the store with a software package. The hardware would be brought to the customer’s home by the installer.
The DirecWay dish will bring in DirecTV service, and Hughes is creating a bundle in which customers can pay one price for both services, Gaske said.