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Satellite vs. fiber

For the near future, the TV industry will continue to look to the skies 7/30/2000 08:00:00 PM Eastern

Much has been said about the massive deployment of fiber-optic cable throughout North America. One would think that high anxiety would be the order of the day for satellite operators. Well, that's not the case-at least not yet.

"Economics do not change overnight. Even as we approach the upcoming satellite-replacement cycle in 2003 to 2006, I would be surprised if satellite-based multipoint distribution did not make sense," says Senior Vice President Jim Chiddix, chief technical officer of Time Warner Cable. "Besides, by that time, most of the major cable programmers will be locked in to new multiyear satellite contracts."

Chiddix stresses that, even with the new and more sophisticated cable architectures that have emerged in recent years, featuring a mix of super-headends and server-intensive distributed headends, the role of satellite technology has become even more vital to the cable industry. Chiddix says that satellite is well-suited for video-on-demand (VOD) servers in headends nationwide.

An excellent example of the point Chiddix makes in terms of satellite-based distribution of programming involves a request for proposal (RFP), which New York City-based pay-per-view service provider iNDemand circulated earlier this year to two dozen companies. According to Rob Jacobson, iNDemand's senior vice president for distribution and product development, the search is on for someone to supply a hybrid VOD/satellite distribution platform.

"We see the VOD platform as being quite different from our PPV services. It creates huge efficiencies for us, while it allows us to provide broad and diverse offerings. It also will help us to amortize our encoding costs, while we continue to mine new areas of PPV," says Jacobson.

INDemand has eight transponders that reach 1,800 headends around the country. The National Digital Television Center (NDTC) in Denver serves as iNDemand's uplink.

"A headend can receive up to 70 channels of our digital PPV content. Satellite gives us enormous range and flexibility," says Jacobson.

"You have this major investment in a satellite infrastructure and this huge bed of resources built around satellite distribution, which nobody is prepared to abandon. Some dynamic change has to occur to make it worth the cost to move to a terrestrial network," says Dick Tauber, CNN's vice president for satellites and circuits in Atlanta.

"Every time I get ready to buy satellite capacity, I compare the cost of fiber. While fiber is becoming more attractive, we cannot do the job that HBO requires only with fiber today," says Bob Zitter, senior vice president of technology operations at HBO Time Warner Entertainment.

Zitter says that, despite the fact that cable operators are continuing to tie their headends together with fiber at a brisk pace, local fiber connections remain too expensive, and, in many instances, adequate local fiber facilities simply do not exist.

Broadcasters face a similar set of circumstances. "Inter-city bandwidth is prolific. It is becoming a commodity," says Andrew G. Setos, FOX Television's senior vice president for broadcast operations and engineering in Los Angeles, who adds that making a fiber connection over the last mile remains a significant obstacle. "Terrestrial systems are beginning to show promise that they might be practical, but they are not there yet. Inbound is virtually all on the ground. This year, we are passing 50,000 TV hours inbound." Setos predicts that, three to five years out, "the economics on the ground will change dramatically for the better."

"Maybe fiber is ubiquitous in the top 40 markets, but that is certainly not true when you look out at the top 200 markets," says Larry Thaler, NBC's director of distribution projects. "And in the smaller markets in particular, no fiber solution appears imminent."

Thaler says that fiber is fine for sporting-event backhauls and digital transfers between facilities. Ron Gnidziejko, NBC's director of distribution technologies, points out that NBC is using a mix of 45-Mb/s satellite and fiber hops from Intelsat and AT & T for its upcoming Olympics coverage in Australia. However, as file transfers are becoming more routine, some may be misinformed about the trend.

"Fiber is not more data-intensive than satellite, and you can achieve significant savings in complexity if you just use the file-transfer process, regardless of the medium in question," Thaler says. "Among other things, using file transfers eliminates the need for people to be present at both ends of the transmission."

Along with Atlanta-based Video Networks Inc., NBC Newschannel in Charlotte, N.C., is routinely flowing a half-transponder's worth of data as files out to its affiliates.

And what about all the consolidation taking place in the cable industry?

"While the emergence of hybrid fiber-satellite networks constitutes an evolutionary shift," says Chiddix, "the consolidation of headends has been going on for years, and it has had no real impact on the satellite side whatsoever."

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