A few days ago, I had pointed out that the biggest challenge for cable companies will be to find enough capacity on their system for HD video, something they have to offer if they want to stay competitive with satellite television providers.
Digital Broadcast Satellite (DBS) systems from DirecTV and Echostar have the HD advantage for now, and are benefiting from it. In fact, to press their advantage, the satellite companies are even resorting to legal shenanigans — a.k.a. lawsuits. It is comical yes, but it also reflects the high stakes poker going on between cable and satellite companies. While cable providers can compete by offering voice and data, DBS has one chip — Hi-Def.
The lawsuit cited the text in Comcast’s print ads, which said, “Comcast wins the HD Picture Challenge. Satellite customers agree: HD looks better with Comcast.” Comcast’s claims are based on a survey that it commissioned from Frank N. Magid Associates. That March poll found that in side-by-side comparisons, “Two-thirds of satellite customers expressing a preference between Comcast and DirecTV and between Comcast and Dish Network said Comcast delivered a better HD image.”
This lawsuit comes close on the heels of another frivolous lawsuit, this time Time Warner going after DirecTV for false advertising.
With HD as their only advantage DBS folks are doing their best to press that advantage. In his latest earnings conference call, DirecTV president and CEO Chase Carey pointed out that the company will launch a new bird in June called DirecTV-10.
“This satellite will greatly increase our HD capacity beginning in September,” he said. “With that satellite, we’ll move forward to later this year, towards the end of the year bringing 100 channels of HD to the marketplace.” The company will launch DirecTV-11, in the first half of next year. “Once we get that satellite up, DirecTV-11 with DirecTV-10 we will have the capacity for over 150 national channels and 1,500 plus local channels.”