Neil Gaydon, CEO, Pace Micro Technology - Page 1 of 3

Pace Micro Technology is one of the main suppliers of set-top boxes and new technologies to satellite pay-TV operators around the globe, working with a number of the most successful direct-to-home (DTH) operators such as BSkyB, DirecTV and Sky Italia.

As these operators face more competition from terrestrial TV providers, Pace now aims to help the satellite operators stay ahead of the terrestrial TV providers by bringing advanced offerings such as high-definition (HD) and personal video recorder (PVR) services to customers as well as aid the DTH players in entering the Internet protocol (IP) world.

Neil Gaydon, named CEO of Pace in April, lays out the roadmap for the company and its satellite operator customers for Via Satellite.

Via Satellite: What major challenges are satellite pay-TV operators facing?

Neil Gaydon: There are four main challenges facing satellite operators in 2007. The first is ongoing basic subscriber acquisition — increasing their subscriber base as well as retaining existing subscribers and growing ARPU (average revenue per unit). This remains essential for future business plans and growth. The second is getting HD and PVR services rolled out to a wider audience.

The third is better utilization of the hard drive in PVR products with push VOD (video-on-demand) services to compete against VOD services from cable, telcos and broadband services. And lastly, they must plan for a return path and backend infrastructure to support triple-play services for future ARPU growth, which will also fend off telco, cable and other broadband services advances.

Via Satellite: Do you think satellite pay-TV operators will be able to maintain their leadership over other providers in terms of introducing new services?

Gaydon: At the moment, they are more nimble than other operators, as they have a relatively simple system compared to cable, for instance, which can be a two-way system. Although as satellite operators also move to two-way systems, things will get more complicated, especially as they move to triple play, which could then slow innovation. But the benefits will be worth it for subscriber retention and increased ARPU.

Another benefit for satellite operators, especially the most successful, is that they have built up very large and strong subscriber bases and also strong consumer brands, often more powerful than some of the largest CE brands, which in turn they can build on. Satellite also has the advantage of ubiquitous coverage not requiring huge infrastructure costs that comes with other transmission methods.