Tandberg Television secured a key deal with DirecTV, which will see the company play a key role in DirecTV’s High-Definition (HD) strategy going forward. The deal, which is worth more than $9 million, will enable DirecTV use Tandberg’s latest MPEG 4 technology and, according to Tandberg, marks the first time a North American satellite pay-TV operator has used advanced HD encoding technology.

Tandberg Television Business Director Roger Bolton, hailed the deal. He told Satellite News, “It is more than a validation of the technology. It is an acceptance that MPEG 4 is going to be used as the main HD delivery platform, certainly for satellite, but really for any restrictive bandwidth application. It has the benefit, certainly in the satellite world, of having no legacy set top boxes out at broadcasters. So, they are not tied to MPEG 2. They can actually go with any new form of technology.”

DirecTV is being very aggressive in the HD space. It is launching four new satellites throughout the next three years to vastly increase the number of local and national HD channels it carries. The first two of these satellites, Spaceway 1 and Spaceway 2, will launch in 2005 with the capacity for more than 500 local HD channels. The next two satellites, DirecTV 10 and DirecTV 11, will launch in 2007 with the capacity for an additional 1,000 local HD channels, more than 150 national HD channels and other new programming offerings.

Pressure On Others

Warren Hobson, director of corporate strategy at Tandberg Television, believes that DirecTV’s aggressive plans will put pressure on others. He told Satellite News, “A lot of cable operators have launched HD services. What DirecTV does ups the stakes. With the channel counts they are planning, they will significantly eclipse the offering on the cable networks. It will certainly put a lot more pressure on the cable networks to accelerate their rollout of HD programming. There is a strong competitive dynamic between cable and satellite in the United States.”

Bolton added, “Satellite is using HD and local HD in the United States as its differentiator, whereas cable is using Video-On-Demand (VOD). So, they are playing off each other. We are hoping then that it makes sense for cable to follow the HD path as well. I would think the cable players would want to deliver HD.”

DirecTV’s initiative could also provide some impetus for non-U.S. markets in terms of the move to HD. Hobson added, “We know that that three satellite pay-TV operators have announced their intentions in Europe–BSkyB (UK), Premiere (Germany) and TPS (France). I am sure these are just the tip of the iceberg. A lot will also depend on the availability of content and good local HD content.”

–Mark Holmes (Roger Bolton, Tandberg, [email protected]; Warren Hobson, Tandberg, [email protected])