The reason that Primestar won't succeed is to be found in your last post: "this is a political backlash on a legal monopoly." Regardless of the trappings of a public company, Primestar's ownership is still dominated by cable TV interests.
If they avoid cable areas and confuse the marketplace in non-cable areas, they can be semi-successful in DBS while denying their choice slot to an agressive competitor who could provide much more competition to cable: DISH.
DISH is the only competitor who has been directly anti-cable in their positioning. Even DIRECTV, with its lead in subs, is not really positioned well against cable. It is more of an upscale niche product, like an imported beer. Great if cost is no barrier, but to the masses price IS important and DISH is the low cost provider. Think of it as the Budweiser of cable programming.
Besides, as things sit right now, the whole arguement could be mmot. Why? Because:
1) DISH is suing Murdoch for $5 billion for breach of contract;
2) DISH would like to have another high-powered slot to best utilize its satellite fleet and max out its programming offerings;
3) Murdoch knows he has at least $1 billion of exposure in that lawsuit;
4) Murdoch has a slot he paid $682 million for that is unproductive;
5) Murdoch knows he is too late to market to be a viable competitor;
6) Murdoch got the carriage for his Fox Sports channels he needed;
So, don't be surprised if DISH and News settle, with News handing over the 110 slot to DISH in exchange for DISH dropping all claims. In this way, Murdoch gets a return on an unproductive asset - and limits his exposure. DISH gets the high-p[owered slot they wanted from Murdoch in the first place, and competition is served because DISH will use that slot to "make cable call Dr. Kevorkian."
In the end, government is all about politics. Politically, everybody knows the general public hates the cable companies. And, as you pointed out, cable can use Digital set top boxes to further fend off competition - albeit while charging the public top dollar for the privilage of using them. DISH has a proven track record as a competitor - and with another high-powered slot, they will be positioned to provide the first real competition in the marketplace.
This is the intent of the current government position. The happy circumstance for DISH is that they are in the right place at the right time. And it is not realistic to expect the public to choose from 4 or 5 providers. After all, it is a high cost of entry business. The choice between GM, Ford and Chrysler worked for automobiles. Why not a choice between GM, DISH and traditional cable TV for cable programming?
Just a thought.
Go DISH.
Noel |
