PanAmSats big week
Satellite operator garners streaming, television deals
By Glen Dickson -- Broadcasting & Cable, 10/22/2000 8:00:00 PM
Satellite giant PanAmSat was busy last week, announcing major deals for both its new streaming-media division and its established program-distribution business.
Broadband service provider Excite@ Home has agreed to use PanAmSat's NET-36 satellite streaming network to deliver high-quality Internet audio and video to Excite@Home's more than 2 million broadband subscribers. NET-36 is designed to bypass Internet bottlenecks by using PanAmSat's satellite capacity to distribute multimedia traffic to servers at local points of presence (POPs), which will then feed subscribers through broadband connections, such as cable modems or DSL. PanAmSat is investing $250 million in the NET-36 venture, primarily to install local servers at telcos and cable headends.
Excite@Home, which is controlled by cable operator AT&T, plans to start using the NET-36 service by the end of the year. "We want to provide the highest-quality content, and PanAmSat has very strong content relationships," says Excite@Home Vice President of Business Development Denise McGuire. "And they can access our high-speed network."
NET-36, which launched on Sept. 26, also counts Real Networks and Qwest Communications' US West unit as customers. NET-36 serves more than 100,000 households in seven Qwest cities, according to NET-36 President and PanAmSat Senior Vice President Bill Moses, and will soon be reaching close to 200,000 homes. With the addition of Excite@Home's 2 million subscribers, NET-36 already has access to a third of all broadband households in the U.S., he points out.
While NET-36 pursues new revenues in the streaming market, PanAmSat's traditional television business got a big boost last week with a sweeping space-segment deal with Disney. The 15-year agreement makes PanAmSat the preferred space-capacity provider for the ABC Cable Networks group, the ESPN Networks and the ABC Television Network.
Under the multisatellite deal, Disney is expanding PanAmSat's existing domestic and international distribution of Disney Channel, ESPN, SoapNet and Toon Disney; switching the distribution of ABC and syndicator Buena Vista Television from Loral to PanAmSat; and tapping PanAmSat for satellite news gathering (SNG) and other occasional-use services for ABC and ESPN.
"We can provide the kind of global satellite coverage that few others in the industry can do," says PanAmSat President and CEO Doug Kahn.
PanAmSat will begin handling Buena Vista's programming next year and ABC's SNG feeds in the next two years, according to Kahn. ABC won't switch its primary program distribution to PanAmSat until 2006, however, when its contract with Loral expires.
ABC's switch to PanAmSat was simply cost-driven and not due to any service problems, says Preston Davis, ABC president of broadcast operations and engineering. In the meantime, ABC will enjoy preferred occasional-use pricing from the Greenwich, Conn.-based company.
Disney's cable networks will also benefit from new "multibeam feed" antenna-upgrade kits from PanAmSat that will allow a single satellite dish at a cable headend to simultaneously receive feeds from three satellites: Galaxy Xr at 123 degrees west longitude, Galaxy V at 125 degrees and Galaxy IX at 127 degrees.
"It creates for us the ability to have one antenna," explains Vince Roberts, senior vice president of broadcast operations, engineering and technology, for ABC Cable Networks Group. "At a cable downlink, real estate is pretty precious stuff."
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