One problem that the folks at Dish Network and DirecTV have is that there is increasing pressure on their customers to buy a “bundle” from their local cable company that includes cable television, broadband, and sometimes telephone via cable (like VoIP, except it doesn’t use the public Internet). Many folks like their home satellite service for TV, but have discovered or have heard that satellite delivered broadband just doesn’t work well, due both to latency (the time it takes the signal to reach the satellite and bounce back to earth, which is quite noticeable on interactive games and VoIP calls) and to limited capacity, which causes satellite providers to impose usage caps that are very unpopular with customers. So if customers want decent-quality broadband service, they still have to deal with the local cable or telephone utility, which then tries to sell them a bundled service package (and often penalizes them with higher broadband prices if they reject the “bundle”).
The new threat is that the phone companies are starting to offer their own video services, in effect creating a second cable company in some areas. Their broadband service is often cheaper than the cable company’s, and in some states they’ve managed to get legislation passed that exempts them from having to get a separate franchise in each city where they offer video, giving them a leg up on the cable company and also (in some cases) exempting them from paying local franchise fees.
Even though they are direct competitors, it now appears that DirecTV and EchoStar (the latter is the parent company of Dish Network) are going to join together to counter these threats by building a nationwide wireless broadband network, according to an article at TheStreet.com, which also states,
Seeking to keep pace with peers in the telecom and cable TV industries, DirecTV is building a network to offer its own wireless broadband services to consumers, according to two people familiar with the deal. These people say that DirecTV is working with EchoStar and seeking final bids from tower companies in a push to put the network together.
Wireless broadband would give home satellite operators the ability to deliver low-latency broadband and VoIP service to customers, but in addition, depending on the available bandwidth, it could allow these companies to offer localized channels to their customers (local access and educational channels that are now carried, often as requirement of a franchise agreement, by cable TV systems). Of course they may want to be careful about what they initially choose to offer because once theory prove they can offer something like that, it won’t be long before cities would be trying to force them to add those channels AND collect additional taxes and fees to fund the production of those programs. Many people switch to home satellite in the first place in order to avoid paying those local taxes and fees.
If anybody can pull this off, these are the companies that can do it, and the obvious advantage to customers is that they’d probably offer a nationwide wireless broadband and VoIP service that customers could access from anywhere that they’ve built out their system, at far less than what the cell companies are charging. If they do this right, this could literally change the face of communications in the United States – imagine being able to take your laptop computer or portable VoIP handset and use it almost everywhere, at a reasonable price.
I also expect the phone and cable companies to try and throw up roadblocks, but DirecTV and EchoStar are no strangers to dealing with legislators and regulators. These companies are, in fact, big enough that they could scare the daylights out of people like Ed Whitacre (who still keeps spouting off about how “content providers should be paying for the use of the network“) and the other “baby Bell” executives and big cable executives who love their respective monopolies and duopolies.
And now I’m going to make a suggestion to these companies – feel free to pass it on to them if you know any of the executives at DirecTV or EchoStar. The suggestion is, learn all you can about “mesh networks” and consider using them. Think about it, in most urban and semi-rural areas you have small-dish customers all over, and each one has a dish mounted on their roof or on a pole in their yard. Imagine if on the back side of each dish, there was a small box attached that contained the transceiver to make it a node in the local mesh network. Power it from the customer’s receiver (the same way the LNB is powered) or a “booster” power supply, and leave a small vertical antenna peeking out above the dish to seek out and connect to other customers in the neighborhood. If these companies did this, they could cut their requirements for high-powered equipment dramatically AND provide better coverage, except in places so rural that customers are miles apart.
I truly hope these companies can pull this off; the competition can only make things better for customers.
