Satellite TV has endured and expanded despite disadvantages

Raymond Snoddy on cable television and its ability to fulfil its potential but is yet to serve a “knock-out” blow to satellite and the latest piracy allegations from the UK and Australia levelled at News Corp.

Do you remember the time when satellites were expected to turn into the second or even third best option for the future of television delivery in Europe? When cable was expected to gobble everything up. Fine for covering the vast distances on continents like Africa, Australia and maybe even the Americas but for Europe at least cable was clearly the coming communications system.

You didn’t have to go to the trouble, expense and risk of launching expensive satellites into geostationary orbit 22,236 miles above the equator. Cable could offer as much capacity, speed and interactivity as the consumer was prepared to pay for.

Then when you combine that capacity with television over the internet (IPTV) using telecommunication networks and with it potentially limitless choice in viewing, then you really are starting to motor. If things go wrong with cable communications you just send a man in a van to the street corner rather than having to launch another satellite and you certainly don’t need a satellite dish.

Modern cable and IPTV are of course fulfilling much of that promise and may do even more so in future. It’s just that there hasn’t been any sign of the expected “knock-out” blow that would have left satellites as a secondary part of the communications infrastructure, merely feeding channels to cable networks and serving rural areas.

Direct-to-the home (DTH) from satellite to individual subscribers not only has not started to fade away but is actually expanding across Europe. With a flourish of triumphalism, satellite operator SES this week announced that satellite had become the leading TV infrastructure in Europe, ahead not just of cable but also terrestrial. Around 84 million European households now have satellite DTH as their primary source of television reception and this represents a rise of 22% over the past four years.

In the same period, according to the new research, terrestrial TV “lost” 16 million homes and cable is down by two million. IPTV has grown from a very low level to 16 million homes, increasing by 33% from 2010 to 2011.

The annual Satellite Monitor research has of course been paid for by SES, although the 62,000 interviews conducted in 35 countries in Europe and North Africa has been under the care of TNS Infratest Germany. Assuming that the research methods have not changed over the years then at the very least we ought to be able to rely on the trends.

Rather surprisingly the move to digital has also been a huge boon for satellite – not just for SES but also rivals Eutelsat – with satellite’s digitisation rate running at 97% compared to 70% in terrestrial reception and 48% in cable.

The growth of High Definition has given a further boost to satellite and SES says that worldwide it is broadcasting 1,200 HD channels from 50 satellites reaching 258 million TV households.

How to account for the endurance and even expansion of satellite despite its obvious disadvantages?

It is yet another clear example of consumers effortlessly gravitating to something that simply works – a technology that many thought should be in second place by now.

The success of satellite also depends on the public’s abiding interest in the quality of the television channels delivered and the fact that, so far at least, only minorities are interested in extreme levels of interactivity or speed.

Just as the latest Satellite Monitor figures were announced there came two powerful and controversial echoes from the history of the development of digital television in the UK and Australia.

They involve allegations of pay TV piracy designed to damage ONdigital, which became ITV Digital before crashing in flames and piracy attacks that hit News Corporation satellite television rivals in Australia.

The Australian Financial Review has just published 14,000 emails claiming a “secret unit” in News Corp has been involved in high-tech satellite piracy in Australia. On Monday night Panorama alleged that a News Corp subsidiary NDS, the smart-card manufacturer, had been involved in getting pirate ONdigital cards onto the market.

In the programme ONdigital’s former chief technical officer Simon Dore said the piracy had been a “killer blow” for the business.

In fact ITV Digital would almost certainly have collapsed for other more pressing reasons – poor channel line-up, little premium content and inadequate frequencies. It was probably doomed from the moment Rupert Murdoch was excluded from the ONdigital consortium by the then regulator the Independent Television Commission.

News Corp and NDS have both vigorously denied any wrongdoing. In the past NDS has successfully defended itself in court against similar allegations, arguing that the company only got involved with hackers as part of the battle against piracy.

Whatever the truth of the matter Rupert Murdoch, still reeling from the scandals over phone-hacking and bribing police, will not exactly welcome the opening up of new potential fronts in his battles in the UK and Australia.

Opponents – in and out of the House of Commons – will inevitably renew their search for patterns in corporate behaviour and pile pressure on Ofcom to extend their current inquiry into whether News Corp is “fit and proper” to effectively control the BSkyB broadcasting licence.

This will all be very irritating for Sky executives who throughout have had nothing to do with any of the controversies raging in other parts of the Murdoch empire.

It would be more than a little ironic if Rupert Murdoch, who more than anyone else helped to create the successful surge towards satellite revealed this week, should be pushed a little further into the mire because of echoes from the satellite past.

Your Comments