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DirecTv, Dish See 1st-Qtr. Growth

The recent SkyFORUM hosted by the Satellite Broadcasting & Communications Association (SBCA) in New York, marked a significant period of transition for the direct-to-home satellite industry.

Leaders of the two most powerful DBS platforms – DirecTv and EchoStar – used the event to boast of significant subscriber gains, and to issue predictions of victory in the wars raging now on Capitol Hill over network TV carriage by DTH satellites.

At the same time, USSB president Stanley Hubbard said goodbye to the industry in his role as head of the pioneering satellite movie service that is to be absorbed shortly by partner DirecTv. However, he vowed to be around in a variety of future capacities.

DirecTv president Eddy Hartenstein told attendees his company added 120,000 subscribers in March, to register a 60% increase from the same period last year. The monthly total pushed DirecTv’s first-quarter numbers to 304,000 subs, up 34% from first-quarter 1998. The company’s total now stands at 4.76 million.

DirecTv’s monthly per subscriber revenue average is now $47, and Hartenstein said that should grow after the pending $1.3 billion acquisition of USSB is completed. That time is moving closer as is the DBS-provider’s proposed acquisition of former rival Primestar, which is expected by June 30.

Hartenstein said DirecTv should be able to convert at least 1.7 million of Primestar’s 2.2 million subscribers to the DirecTv service.

Also, he said the added capacity afforded by Primestar’s satellites could make possible a DirecTv solution for delivering local-network TV stations into local markets. However, if any strict must-carry conditions are imposed by Congress that option might be thwarted.

Currently, Congress is considering four different bills related to network TV carriage by satellite operators. Issues in the various bills include the length of lead-in time before DBS providers would face must-carry conditions and rates for retransmission rights of broadcast stations.

EchoStar chairman Charlie Ergen reported his Dish Network made enormous strides in adding new subscribers over the first quarter.

Shortly after the event, Dish reported taking more than 50% of total new DBS subscribers over the first three months of the year. March totals alone hit 122,000, giving the system 325,000 total new subscribers in the first quarter, up 101% from the 162,000 added in the same period of 1998. Dish Network now reports 2,265,000 total subscribers.

Ergen said EchoStar will have HDTV demonstration equipment for retail in June or July, and a sell-through Dish HDTV solution will be ready by early next year. One product under development is a combination ATSC DTV set-top decoder/Dish IRD with standard and HD program capability.

Ergen said one hangup is the prolonged standard-setting battle over a copy-protection system, which is needed to allow for inclusion of an IEEE-1394 digital interface. He vowed to have a final product that will be competitively priced with Thomson’s similarly featured DTC-100 set-top decoder, which is slated to sell for $649 when it arrives later this year.