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PanAmSats big week

Satellite operator garners streaming, television deals 10/22/2000 08:00:00 PM Eastern

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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