Rocky Mountain News, October 22, 2001 business section
Television dilemma
High-definition TV offers clarity but its programming is limited
By Steve Caulk, News Staff Writer
The person who invented the wheel faced an immediate problem.
No wagons.
What good was a wheel -- or even four wheels -- when no one had a wagon to roll?
So it goes with technological developments, and high-definition television is no exception. People come up with great ideas, but obstacles prevent popular acceptance. Who's going to buy a telephone, for instance, if there's nobody to call?
High-definition TV has been struggling with this chicken-egg dilemma for 20 years. Dick Green, president of Cable Television Laboratories Inc. in Louisville, remembers working on the new technology in 1981 during a broadcast of a National Football League game. He thought the quality would prompt explosive acceptance.
"I did a game between the Rams and Redskins," he said. "I was convinced after doing it, this was a great new medium. I'm still convinced."
High-definition TV is wider than standard TV, with greater clarity, due to its increased number of horizontal scan lines. It works like the dots-per-inch measurement on a printer. Standard TV, which operates on an analog signal, has 480 lines; HDTV, which is digital, has 720 or 1,080. The high definition eliminates the ghost of images that people complain about on standard TV. The extreme detail allows viewers to see blades of grass on a football field.
Mark Cuban, entrepreneurial owner of the Dallas Mavericks basketball team, is so enamored of the technology he recently formed his own high-definition sports network called HDNet. Almost single-handedly, he said he hopes to eliminate the programming issue that has, at least partly, stunted HDTV's growth. Acknowledging the chicken-egg dilemma, Cuban said, "Yeah, and we're grooming the chicken.
"No one says, 'This sucks, I don't understand it,' " he said. "It's just a question of, 'Where can I get it?' The important question is, where can I watch and where can I get it? I look at the hard parts -- it's not creating content and providing content. The harder part is where the rubber meets the road, encouraging people to sell it to people."
He has personally visited retail outlets to talk to sales people about hyping those $2,000 high-definition sets. The price has come down from the $15,000 tag that was common upon the technology's introduction. But media experts still believe consumers are turned off by the price.
The other big barrier to the acceptance of HDTV is lack of capacity -- or perhaps more precisely, lack of capacity dedicated toward HDTV. In the satellite industry, for instance, one high-definition program takes up the bandwidth normally required for six to eight of the satellite's normal digital programs. Over-the-air networks such as ABC, NBC, CBS and Fox are under mandate by the Federal Communications Commission to broadcast entirely in digital signals (necessary for high-definition reception) by 2006. The FCC has set aside extra bandwidth for the networks to handle it.
But the networks have projected other uses for that bandwidth, such as two-way, high-speed Internet access -- not to mention the possibility of additional programming. And the FCC recently appointed a task force to review the transition to digital, with the understanding that the 2006 deadline might be unrealistic.
The cable industry downplays the importance of high definition because the technology takes up three times the "pipe" space as a digital signal. That means less programming, which means less advertising.
These obstacles -- price and capacity -- conspire to keep high-definition sets and other related equipment sitting idle on stores' shelves.
"HDTV is on the horizon, and we're looking at ways to best make this programming available when our customers demand it," said AT&T Broadband spokeswoman Tracy Baumgartner. "For now, there aren't that many HDTV sets in customers' homes and phones aren't ringing with request for the service, but we know that will change with time."
EchoStar has 4 HD channels
EchoStar Communications Corp. of Littleton offers four high-definition channels on its satellite TV Dish Network: one of its eight HBO channels, one Showtime channel, one pay-per-view channel and a CBS channel in limited markets (including Denver).
"We offer the most high definition in the nation right now," said EchoStar spokesman Marc Lumpkin.
But it's not for the faint-hearted. After purchasing the high-definition set, an EchoStar customer has to buy additional equipment, partly because the standard satellite dish isn't sufficient. A package including the high-definition receiver and two dishes costs $699.
For good measure, EchoStar adds a $2 premium to the high definition signal on its pay-per-view movie.
And somebody will have to absorb the high cost of high-definition production. Phil Garvin, whose Colorado Studios in Denver specializes in high-definition sports broadcasts, said Cuban's HDNet would not have worked if they hadn't found a way to reduce production costs significantly.
Complicating matters is the need to integrate programming content with advertising, some of which is high definition, some of which isn't. HDNet devotes an entire screen to content only if it's in high definition, including advertising, Garvin said.
"When we're handed a commercial that's regular definition, we make it smaller," he said. "It tells the audience this is not the full-blown thing, and they don't expect it to look as good."
How dramatic is the improvement in picture quality?
"If you have seen a sports event or documentary or movie in high definition, you will not want to watch regular definition again," Garvin said.
The improvement goes beyond the elimination of "snow," said Dick Green.
"From the technical side, where high definition shines is in long shots, wide angle, with lots of detail in a picture," he said. "Sports has an advantage. You can see faces in the stands. You can see details you can't see on standard TV. On standard TV, you can get close, but then you miss the action."
Viewers like the look of HDTV
Customers who have gotten a taste of high definition want more, said Dave Kummer, senior vice president of engineering for EchoStar. The company beams the high definition from two satellites, and EchoStar would love to have more high-definition content to offer its subscribers.
"We have pay-per-view for high definition, and it costs us money to provide it, and we need enough critical mass so we can put up another high definition pay-per-view," he said. "But we have to balance it. At this moment, we're not really making money on the high definition pay-per-view because there aren't enough subscribers to support it."
EchoStar has 90 transponders available for high definition -- almost double the capacity of satellite TV rival DirecTV, Kummer said. EchoStar's capacity for high definition makes it a more likely vehicle for the technology, compared with cable, he said.
"We can cover the whole U.S.," he said. "So if I put up a pay-per-view, I have a fixed cost -- but I can offer it to the whole U.S. Whereas cable might put it on a tiny cable market."
Green of CableLabs argues to the contrary, saying cable has the technical advantage.
"On satellite, it requires a lot of transponder space," he said. "You can't add new transponders. You have to put a new satellite up. On cable, we can compress it down and squeeze more in. As high definition progresses, it gives us a huge advantage."
He added, "It's a law of physics. It's not cleverness at all. Transmitting digital signals through the air is more difficult (than land-based transmission)."
Exec: Picture not worth cost
But the cable industry has not shown a tremendous interest in the technology. David Beckwith, spokesman for the National Cable & Telecommunications Association, downplayed the degree of picture quality on high definition, saying the improvement doesn't justify the expense. And he said "well under 1 percent" of cable customers want high-definition TV.
"That makes it hard to justify dedicating the bandwidth to that particular service," he said. "If there were more sets sold, the cable companies would take a hard look at it. They would start experimenting, maybe do a couple of channels, and start supplying it on a limited basis. Most cable systems are at or near capacity, but they're upgrading and expanding the capacity all the time. It could probably be accommodated by many systems."
Also limiting the mass appeal of high definition is the size of the screen, Beckwith said. While high definition works best at 45 inches, many people don't want to dedicate more than 32 inches worth of TV space in their homes. And he said he doesn't foresee a time when consumers will clamor for high definition on a 13-inch set, because the small screen undermines the HD-effect.
Cuban chose satellite as the vehicle for HDNet because the market is less segregated, he said. One company, DirecTV, can cover the entire United States.
"I can say to anybody, go to a store, put up a dish and watch my network," he said. "I can't do that with cable."
And this is the right time to push high definition, he said, because "everybody else says it's the wrong time."
People who see HDNet at sports bars will want the technology for their homes, he said. About 250,000 homes have high-definition receivers, and Cuban sees that number growing to 3 million within three years. Networks offering high-definition content will benefit immensely, he predicts.
"For the high-definition user, the channel universe contracts dramatically," he said, explaining that people with high-definition equipment will concentrate on using it whenever possible. "You start with a three-channel universe -- CBS, HBO and HDNet. You'll look to them first. You'll watch stuff in high definition that you might not ordinarily watch."
October 22, 2001
. I am not sure what 90 more transponders mean (in terms of how many more HD channels they can add) so if someone could elaborate on that, I would appreciate that. Also, if Dish as so much more transponder space for HD, than why don't they show HDNet?
