George Thompson: Abc Subsidizes Dtv
Television Digest
Mon, Jun 09 1997
In what he called "goodwill gesture" to ABC affiliates week after he was named pres. of ABC TV Network, and in bid to boost DTV launch, Preston Padden said company will reimburse each station for cost of satellite electronics needed to receive network DTV signal. At affiliates convention in Orlando last week, Padden said he didn't know how much move would cost ABC, but indications are that total expense could be about $30 million. ABC affiliates have been told to budget about $150,000 each for satellite electronics to receive network DTV signal, Preston Davis, ABC pres.-Network Operations & Engineering, told us, but he said cost may be less. Network plans to reimburse stations over 5 years beginning when they start passing through to public network DTV signal. Figure includes only electronics, Davis said, since existing satellite dishes probably will be able to receive DTV signal. Stations also will remain on their own for other DTV equipment, including transmitters, antennas and converters, he said. ABC plans to remain flexible on whether DTV signal will be used for true high-definition signals or multichannel standard-definition DTV, Davis said: "Anyone deploying new technology would want as much flexibility as possible, since nobody knows what the consumer ultimately will want." ABC also remains somewhat undecided on whether DTV signal it provides will be progressive-scanned or interlaced, Davis said. "We have always leaned toward progressive as a technology," he said, "but whether it will be possible is still somewhat unclear." He acknowledged that network would have preferred to make scanning decision "yesterday" and that it must be made soon, but "we also don't want to make the wrong decision. We'll take the time we need." Network needs to see entire array of progressive-scan equipment in full production before it commits to progressive, Davis said. He said major pieces of progressive equipment such as cameras, switchers and converters will be available in time and said "the problem is all the little bits and pieces," including test equipment and infrastructure. Some progressive-scan equipment may have been delayed because there have been "a lot of broadcasters championing interlaced," Davis said, "so that is what the manufacturers have been building." In addition to having full suite of equipment available, Davis said ABC needs assurance that it won't be only broadcaster using progressive-scan. Padden acknowledged that skeptical stations might consider DTV something dreamed up in Washington "designed to wreck your bottom line," but he told affiliates that DTV represents "enormous competitive potential. It represents nothing less than an opportunity to completely reinvent our business and permanently and materially enhance the value of our broadcast assets." He said Steven Spielberg has been able to "dominate" movie industry through digital special effects, and by "digitizing our dinosaurs, we have the chance to do much the same in the television business." Network hasn't fully decided how it will use DTV, Padden told affiliates. He said network will "take a few months" to investigate possibilities fully, then develop ABC consensus, share its views with affiliates and try to "find common ground" with stations. ABC plans to complete internal review of DTV by end of summer, affiliates were told in closed-door meeting. Disney Chmn. Michael Eisner said DTV means it's "time {for broadcasters} to take back the field" from cable. In response to question, ABC officials said they won't address specifics of DTV planning until overall DTV business strategy is in place. They told affiliates that network expects to begin DTV talks with affiliates by end of summer. Disney/ABC Cable Pres. Geraldine Laybourne, meanwhile, is taking longer term look at ABC's future in digital world. She told us that she has spent last 9 months "in the field, talking to consumers" about what they would like to see on TV: "We have to take what we have, and what the consumer wants, and come up with some new stuff. Right now, we're in a laboratory situation." It's "way too early" to discuss plans publicly, Laybourne said, in part because there's "no imperative in the market to make a decision." For example, she said, digital TV will generate demand for programming to air on standard-definition multiplexed channels, but even start of that is more than year away, and even then it will be long time before there are enough DTV households to create viable market. "It's a really interesting exercise, but it all depends on how quickly people can actually receive digital TV," Laybourne said. ABC may move more quickly on launching new cable channels that target capacity made available by arrival of digital cable compression, Laybourne told us. She said network is likely to announce new projects targeting that market within next few months: "We are in a great position for that because we have library product that can be used without great expense."
(Copyright 1997 by Warren Publishing, Inc.)
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