Satellite TV provider Dish Network said Tuesday that AT&T will end its agreement to bundle its TV service with AT&T's broadband and phone service at the end of the year.
AT&T and Dish have had a joint marketing deal since July 2003, which allows AT&T to package the Dish TV service with AT&T's phone and Internet packages. But AT&T has decided not to renew the agreement, and as required by the contract between the two companies, AT&T is giving Dish six months notice that the deal will expire December 31, 2008.
The move is likely a way for AT&T to negotiate a better deal with either Dish or its competitor DirecTV. In April, AT&T expanded its partnership with Dish in the old BellSouth territory. (AT&T bought BellSouth in 2006.) And it stopped marketing a similar package with DirecTV.
At the time, it looked as if AT&T had dropped DirecTV for Dish. But AT&T has always maintained that it's discussing partnerships with both companies. And now it looks like the company is free to pit one company against the other to get the best possible price.
AT&T said in a statement that it will continue to discuss options with Dish even though it has terminated the current agreement.
Video is a key part of AT&T's strategy. The company has spent millions of dollars over the past few years to upgrade its network with fiber so that it can deliver TV over its IP network. The new U-Verse service is up and running in parts of AT&T's network. But the company isn't able to deploy U-Verse everywhere, so it has been relying on deals with satellite TV providers to deliver a so-called triple-play bundle that includes TV, phone, and broadband services in a single package.
Voom's channels are no longer available on Dish Network.
(Credit: Voom.tv)
Just two days after it launched 22 relatively high-interest HD channels, Dish Network has stopped broadcasting the 15 specialty Voom HD channels. The channels, which Dish has long been interested in dropping to make way for more popular channels, include names like GamePlay HD, Treasure HD, Kung Fu HD, and Monsters HD, and programming most viewers have never heard of.
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SciFi HD is among the 22 new HD channels launched by Dish Network.
(Credit: CNET)Ever since DirecTV launched a slew of national high-definition channels last October and November, it's been the only place most Americans can get their Cartoon Network, Sci-Fi, and Bravo networks in high-def. On Monday, Dish network caught up somewhat, announcing the activation of a total of 22 new high-def channels, including those three and many other national, high-interest channels--as well as a few lower-interest ones, including World Fishing Network HD. Twenty of the channels are supposed to go live Monday, and the last two, the regional sports networks (RSNs) Comcast Sports Network Bay Area HD and Comcast Sports Network New England HD, will be activated Wednesday, according to the company. Check out the full list of new channels on the official press release.
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There's a good piece by Saul Hansell over on The New York Times' "Bits" blog.
Hansell describes how Comcast is being criticized for low picture quality on certain broadcasts. That's interesting, especially in light of the contention between Comcast and DirecTV on this very issue, but it isn't the most important point in Hansell's post.
Hansell goes on to give a reasonable explanation of the basic issues involved, and mentions the likely future of cable TV: digital video distributed over Internet-like network switches. Instead of always sending every TV channel to every house, a switched system sends only the data for the channels that are being watched. (While it's fair to say that the capacity of such a system has no arbitrary limits, it isn't "infinite" as Hansell said.)
But there is a big practical difference between a system with hundreds of channels and one with, at least potentially, millions. With switched video, every channel is "on demand"--and anything that customers demand can be made available. Imagine YouTube in true HD, for example. That's impossible today, but with switched video, it's merely expensive. :-)
I wrote about switched-video technology back in 2001 in my column for Electronic Business magazine, and honestly I thought this technology would be in use by now, at least in test markets.
Verizon's Fios service has most of the necessary characteristics, but even Fios carries video in pretty much the same way copper-based cable systems do, except using an optical carrier over fiber. (Wikipedia has a decent explanation here.)
Well, there's no hurry. We'll get there eventually.
Updated 1:55 p.m. PDT with DirecTV's response.
DirecTV apparently had big trouble delivering ESPN2's coverage Tuesday morning of the season opener between the Boston Red Sox and Oakland A's, who are playing the game in Tokyo.
The number of reader comments to a 6:29 a.m. blog post about the outage by Amalie Benjamin, who covers the Red Sox for The Boston Globe, soared past 120 within a couple hours after the transmission failure began. The fans, naturally, are calling for congressional hearings on the matter.
While the problem seemed to have been remedied by 10 a.m. East Coast time, we were still waiting to hear from DirecTV about what exactly might have been the problem. It's probably no small comfort to Sox fans, though, that the team won 6-5 on a Manny Ramirez two-run double in the 10th.
DirecTV's response
In an e-mail, DirecTV's director of public relations, Robert Mercer, offered the company's apologies for the inconvenience, saying it was the result of "temporary technical difficulties" that did not affect the majority of channels and that have since been corrected.
In the case of the Red Sox game, any customers who have NESN or ESPN2 in HD were able to see the entire game. For customers who watch NESN in Standard Definition (SD), we were able to bring the channel back at the top of the seventh inning. For customers who watch ESPN2 in SD the channel came back on later, after the game was over.
Replays on both ESPN2 and NESN were planned for Tuesday afternoon Eastern time.
Constrained by the technical limitations of its satellite television service, DirecTV has watched from the sidelines as cable operators and phone companies' high-end TV services have rolled out increasingly popular video-on-demand features.
The company is now preparing to launch its own VOD service this spring, according to a report in The Wall Street Journal.
Called DirecTV On Demand, the service, now offered in beta, is designed to deliver VOD content to customers in two ways: via automatic transmission of selected movie titles, which will be stored on subscribers' digital video recorders and then ordered up for viewing whenever the subscriber wants; and via Internet downloads of additional content, including TV shows, streamed to the subscriber's set-top box.
DirecTV also can track customer activity on its Internet-connected set-top boxes, the Journal report noted, and use the data to help it sell targeted ads.
DirecTV is expected to offer about 3,000 shows and movies, most of which will be delivered over the Net; the company will use the automatic transmission for exceptionally popular programs and movies. Comcast, meanwhile, says it offers about 10,000 pieces of VOD content, much of it for free; movies are available for about $5.
Whether DirecTV On Demand will measure up to alternatives offered by cable and Verizon Communications' Fios service is up for debate. Pricing will certainly be a factor, but so will the timeliness of DirecTV's VOD deliveries. If customers who order a movie or TV program for Net-based delivery to the set-top box have to wait too long for the content to download--and video does eat up a lot of bandwidth--they might be disinclined to use that option. Fios, a fiber-optic-to-the-home system, can deliver large video files in seconds.
Satellite television providers can't stand still, in any case, because cable and phone companies continue to ramp up their TV offerings.
DirecTV itself has been getting flack from subscribers unhappy with the company's drift away from the TiVo digital video recorders it once endorsed and its push toward sales of its own DVR, the HR21-700, which, some users say isn't as versatile as its TiVo counterpart.
Note, though, that use of DirecTV On Demand in beta (and, presumably, in the service's fully launched form) requires a DirecTV-brand high-definition DVR receiver--the HR20 or the HR21--and, of course, some form of broadband Internet service (minimum 750Kbps connection speed), which, of course, is available only through a cable provider or phone carrier. So you want DirecTV On Demand? Buy DirecTV's DVR receiver, and pay your cable/phone broadband bill.
In this environment, DirecTV has to do whatever it can to avoid losing market share.
The studio that brought Scarlett O'Hara, Dorothy and James Bond to the big screen is thinking smaller these days. Metro-Goldwyn-Mayer (MGM) is set to debut a high-definition channel on DirecTV beginning this fall, according to Reuters.
Though the TV channel is a first for MGM in the U.S., the studio currently has several European channels. The content lineup will be a combination of films and original programming. Rival Hollywood studio Universal has had its own HD cable channel programmed with TV and movie content from parent company NBC Universal since 2003.
The MGM channel will be one of many HD-only channels for DirecTV. The satellite provider will apparently be adding 100 new high-def channels by the end of the year.
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