Digital satellite television provider EchoStar today announced that by next year, 1.8 million of its U.S. customers will have access to interactive services as a result of a deal today with software provider OpenTV.
By the summer of 1999, EchoStar's DISH Direct Broadcast Satellite (DBS) network will offer an electronic programming guide, e-mail, Internet access, as well as some enhanced television services, the company said.
EchoStar offers a high-speed digital data stream into, but not out of the home, unlike set-top boxes from WebTV which purport to offer a more PC-like experience, albeit by using a dial-up modem to send and receive data from the Internet.
Email and other truly interactive services requiring two-way communications will be made possible in the EchoStar set-top receiver by sending data out via a modem connection, said Clay Conrad, vice president of global sales and business development for OpenTV.
OpenTV is "one of the two leading solutions in Europe," for providing interactive DBS services, according to Sean Kaldor, an analyst at IDC. The company was conceived as a joint alliance between Thomson and Sun Microsystems, developer of the Java programming language, and took its current name after a third party invested in the company.
"We provide an end-to-end solution in the digital television environment, a very thin client," Conrad said, referring to how the set-top box doesn't need a great deal of processor power to offer these functions--an important issues as more powerful chips cost more money.
"Most of the processing and transmission of applications happens in the broadcasting environment. This allows a multitude of different applications to be deployed in a cost-effective manner," he noted.
Through the alliance, EchoStar and OpenTV will be more competitive with upcoming digital set-top boxes from cable service providers, which are expected to begin deploying interactive digital services more widely in 1999. DBS providers have been slowly taking away customers from cable companies because of the added channels they offer, as well as better reception. Interactive services could provide another tool to lure customers away from cable operators.
EchoStar has an advantage over those cable service providers, analysts say, because most of its existing customers can easily upgrade to access the new OpenTV services, unlike cable companies who will have to deploy new hardware and revamp their delivery networks if they haven't already done so.
EchoStar is also in a good position to compete against other DBS providers such as DirecTV.
"There are 1.8 million homes that could accept it, which is not the case with DirecTV," said Doherty. "They have as many potential seats as there are potential cable modem seats."
"It's a good solution," Kaldor thinks. "This raises the bar--it's something that may put them ahead of the game, even if it's only for twelve months."