October 19, 2007

Cable and Satellite Suit Up for HD Battle

Cable rapped for falling behind in HD arms race as In Demand steps up and DirecTV charges more for HD channels.

By Shirley Brady

The race between cable and satellite TV operators to roll out high-definition channels is heating up — and focusing on sports networks.

Case in point: DirecTV is offering hockey games in HD to its NHL Center Ice subscribers this season and is slated to launch the NHL Network this month, while (as of yesterday) Dish Network said it will launch NHL Network HD, which lets hockey fans follow the action (not to mention the puck) in all its high-def glory.

Cable operators, meanwhile, are also promising to offer the NHL Network in HD this hockey season, but so far it's the league's standard def channel that's starting to roll out this month on systems operated by Comcast, Time Warner Cable, Cox Communications and Cablevision.

Charter Communications today announced its deal with In Demand Networks to pick up the NHL Center Ice out-of-market games package — but not the NHL Network, in HD or SD. Charter is still negotiating with the NHL directly about picking up its channel, with a spokesperson today saying there's "More to come," so stay tuned.

In Demand, cable's programming buying consortium co-owned by Comcast, Time Warner Cable, Cox Communications and Advance/Newhouse (Bright House Networks), today announced a pair of high definition sports packages that cable operators can offer HD-hungry sports fans.

TeamHD is a high-definition sports offering that will feature all NBA-scheduled HD games offered through In Demand's NBA League Pass package.

That channel joins In Demand's GameHD channel offering MLB Extra Innings baseball games in HD, which quietly launched in April on select Comcast and Time Warner Cable systems, and smaller ops including Marco Island Cable in Florida.

GameHD will add HD NHL games from In Demand's NHL Center Ice package this season and resume HD MLB games when the MLB Extra Innings package returns in the spring.

"GameHD did launch 'soft' in April, but there was no need for compression then, as Baseball was the only sport running," commented an In Demand spokesperson today. "So far, about 40 (cable operators') head-ends are signed up for it (either authorized or already launched), with a number from both Comcast and Time Warner, plus some other MSOs."

GameHD and TeamHD are designed to get around a thorny problem for cable operators wanting to add more HD programming to their lineups — bandwidth constraints — by compressing these additional high-def sports feeds into In Demand's existing HD PPV channels.

In Demand is transmitting GameHD and TeamHD so their "signals are compressed along with (our) existing HD PPV channel into the bandwidth of one HD channel," in effect offering three HD networks in the space of one channel.

They will appear as two separate channels on "the traditional sports package area" of cable lineups, meaning those subscribers will now get one live sporting event each night of the week on three In Demand channels: GameHD, TeamHD and In Demand's existing HD PPV channel.

"This innovative approach will help cable to match the HD content offered by satellite," In Demand stated in its press release. "The technology, which is free to operators, is completely automated on a national basis for cable operators to implement easily at their individual headends. There is no additional cost for consumers who already subscribe to the out-of-market sports packages."

In Demand's latest HD offering to cable operators was announced on the same day that the industry was rapped on the knuckles for not doing enough on the HD front, particularly for sports fans.

Pali Research this morning lowered its estimates on Comcast and Time Warner Cable, as standard-bearers for other cable operators, for "poorly positioning their HD marketing message as they have been too focused on marketing low-cost telephony," Pali analyst Rich Greenfield writes.

"In addition, cable has not freed up enough bandwidth to deliver any and all HD channels as they become available (just as we saw with digital and DVRs, cable somehow always seems to fall behind the competition)."

Greenfield also knocks cable ops for "taking a hard line on new sports programming that they do not own or control" — including NFL Network (its biggest battleground: Time Warner Cable San Antonio) and Big Ten Network — because "the competition has used sports, especially HD sports, to its marketing advantage."

While DBS is quick to tout new HD channels, including high-def sports nets, and DirecTV has been making a lot of noise about its race to 100 HD channels by year-end and 150 next year, DirecTV is also increasing the cost to its HD fans for offering this additional content.

DirecTV this week emailed subscribers a notification that they will lose three longstanding high-def networks (HDNet, HDNet Movies and Universal HD) that for many years have been part of their basic $10/month HD package unless they pay an extra $4.99/month to upgrade to its new HD Extra Pack that launches on Dec. 15.

That new package will include those three chanels, plus Smithsonian HD, MGM HD and MTV Networks' MHD music net, for an additional $4.99 monthly on top of the $10 monthly base fee DirecTV charges for HD access.

DirecTV, which now offers 74 HD channels, is offering the HD Extra Pack as a "free preview" through Dec. 15 when it becomes subscription-only, and doesn't see the move as a form of rate hike to its HD subs.

"It's hard to see how this represents an increase when customers will continue to pay the $9.99 access fee that allows them to receive DirecTV's HD technology and all channels broadcast in HD that are tied to their respective base programming package," a DirecTV spokesman comments to TV Predictions.

"Once the HD Extra tier preview ends in mid-December, customers will have the option of taking the package, or not. That we moved three channels from our regular HD lineup into the Xtra tier hardly represents an 'HD price increase.' Arguably they pay a little extra if they want those three channels back, but that's their option."

For more on DirecTV's latest HD move, see today's Sky Report. And in the meantime, the race to win HDTV lovers' hearts, eyes and wallets continues.