Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: SATURDAY, January 18, 1992 TAG: 9201180403
SECTION: SPECTATOR PAGE: S-1 EDITION: METRO
SOURCE: DANIEL CERONE
DATELINE: LENGTH: Long
ECONOMY HOLDING BACK NEW TECHNOLOGIES
The new year marks a dramatic pause in the history of television. On one hand, the industry is bursting with promising new technologies ranging from fiber-optic cable systems offering 150 channels to wide-screen, high-definition TV sets to the ultimate marriage of the television, computer and telephone.On the other hand, the economy is in such a slump that the marketplace is resisting the introduction of these vastly superior products and television delivery systems, each of which would require an expensive overhaul by cable companies, TV stations or product manufacturers.
Meanwhile, the whole concept of broadcasting television programs for free over the airwaves appears to be heading the way of the railroads. The percentage of TV viewers watching the Big Three networks has dropped to an all-time low of 62 percent, compared to 90 percent a dozen years ago before cable.
"The networks are sinking because of the weight of their history," said George Spitzer, a telecommunications marketing consultant. "I would not be surprised if within a few years - less than five - one of the networks disappears. It will become irrelevant as to how people get their signal, via broadcast or cable or fiber-optics."
Congress is caught in the middle of all this, assaulted by lobbying groups from all sides. New bills are piling up on Capitol Hill in an attempt to create legislation that will satisfy the struggling networks while making room for the new technologies. Something has to give.
No matter what happens, though, most TV analysts agree that by the turn of the century television as we know it today will no longer exist. And 1992 promises some early indications of what that future might look like.
The 150-channel cable system:
Time Warner Cable in Queens, New York, is testing the nation's first 150-channel, fiber-optic cable system. Fiber-optic cables are strands of glass that carry bits of information in the form of human conversations, television pictures or computer data. Roughly the diameter of a human hair, the tiny glass filaments have 30,000 times the capacity of the traditional copper wire used by telephone companies.
In time, all cable television will be carried by fiber-optics, though not before a competitive shakedown occurs. The Federal Communications Commission in October cleared the way for phone companies, which have already replaced the major parts of their cross-country networks with fiber-optics, to carry video signals. In effect, the move put big phone companies into direct competition with the cable TV industry.
These two giants, however, are battling in Washington for a future that may be decades away. The complete nationwide installation of fiber-optics could take up to 20 years and cost anywhere from $100 billion to $1 trillion, according to Henry Geller, a former FCC general counsel now teaching telecommunications policy at Duke University.
But that doesn't mean you won't see 150 channels on your cable system soon.
"Video compression" is an immediate technology that the cable industry will test across the country through 1992 and roll out as early as 1993. Video compression, in essence, turns the analog TV signal into digital information represented by binary numbers, requiring less space to transmit. Unlike conventional TV signals that can grow weak and fuzzy traveling over distance, digital signals result in a "perfect" transmission of information.
Multiplexing and the rise of pay per view:
With increased channel capacity, there will be an immediate demand for programming. Already, the sister pay-cable networks HBO and Cinemax are test-marketing a plan to multiplex - stagger their movies on several channels to give viewers more opportunities to see them.
Basic cable networks, meanwhile, are looking at splitting off into niches. MTV, for example, has announced intentions to break up into different musical genres, and the Family Channel hopes to launch a separate Cowboy Channel. Even broadcasting companies are turning to cable. The Fox network recently raised eyebrows with its test plans to time-shift the network's over-the-air programming in 1992 so viewers who missed their favorite Fox show at night could watch it on cable the next day.
But, according to industry sources, the real gold mine in this new multichannel universe will be pay-per-view movies and super sporting events. Seismic rumblings could be felt throughout Hollywood in October when Fox Inc. chairman Barry Diller publicly contemplated releasing Fox movies for a one-time showing before their theatrical release on pay per view - for a huge price. He further advised all studios to jump onto the pay-per-view bandwagon and experiment with the medium.
Right now pay-per-view movie channels - where cable viewers dial a phone number to order a movie that shows up later on their cable bill - offer one or two top movie titles a night. "With 20 extra channels devoted just to pay-per-view, you can see repeat showings of the hit movies," said president Jeffrey C. Reiss of Reiss Media Enterprises, which owns the pay-per-view channels Request TV and Request 2. "So instead of waiting to see a movie every other day, you'll have a start time every hour, like in the big multiplex cinemas."
The continued erosion of network television audiences:
ABC Network Entertainment President Bob Iger may have been laying a foundation for the inevitable before last fall's TV season, when he told reporters at the semi-annual TV press tour that the networks will eventually have to give up some of their programming hours to the affiliate stations because between one-third and one-half of all network shows lose money in this economy.
"You will probably, in a short time, see fewer hours of network programming," he predicted.
Since then, because of low ratings, ABC temporarily gave up an hour in late-night to its affiliates to program on their own. NBC ceded a morning hour, and there are rumors that CBS will soon follow suit in the morning. So far, prime-time has not been affected, but with weekend viewing levels as low as they are, sources say the time is not far away.