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Talk About Convergence

With digital technology it seems as if everyone is getting into everyone else’s business. Recent news from cable and satellite companies, and even one of the most visible studios in Hollywood, illustrates the trend.

Cablevision, the New York metro cable provider, is getting into the satellite business with the launch of its new HDTV service called VOOM this Wednesday. The service features a base of 39 HD channels, 21 of which are said to be exclusive from Rainbow Media. Cablevision says this package of HDTV channels is the key difference between VOOM and its established rivals DirecTV and EchoStar.

Not willing to let Cablevision and its new VOOM service hog all the headlines in the past couple of weeks, Hughes Network Systems (HNS) has introduced a broadband satellite terminal. When discussing broadband, conventional wisdom has always maintained that cable has a distinct advantage over satellite.

HNS is willing to challenge that position with the DIRECTWAY DW6000, a two-way high-speed satellite Internet system for home or office use that provides home networking and requires no phone line or additional software. The new system’s dish can also be configured to receive DirecTV television services, but no word yet on whether those services will include HDTV programming.

And finally, which Hollywood studio has become a hardware supplier and competitor of its own cable networks and video rental stores? The Walt Disney Company, through its Buena Vista Datacasting unit, in a very hush-hush announcement, has introduced MovieBeam in selected markets. The service will make available up to 100 movies at a time to a hard-drive-enabled set-top box that will be distributed on a monthly lease basis through CE retail chains. Movies are transmitted in digital MPEG 2 form and the equipment-leasing fee is $6.99 a month. New movies can be rented for $3.99, with older films getting $2.49.

So, let me get this straight. A cable company gets into the satellite business to offer HDTV programming. A satellite provider enters the broadband business via satellite. And a major Hollywood studio decides to compete against everyone, including itself. I guess that’s convergence, or some major companies hedging their bets as the digital revolution continues to play out.