EchoStar, DirecTV Ready MPEG-4-Based Satellite Receivers

DirecTV, which has developed a prototype receiver using Broadcom’s MPEG-4 chip, will start shipments mid- year as it launches all-HD delivery of local channels in 10 markets including N.Y. and Chicago, CTO Ramulo Pontual told us following a news conference at CES in Las Vegas Thurs. DirecTV hasn’t selected a manufacturer for MPEG-4 receivers, but it currently sources MPEG-2-equipped models from Thomson, Philips and Samsung. And while Broadcom’s MPEG-4 chipset is used in the prototype receiver being demonstrated at CES, Conextant and STMicroelectronics also are IC suppliers for DirecTV.

The first of MPEG-4 receivers will be the PVR- equipped Home Media Center that also supports HD and employs technology from 4 suppliers including Uccentric, which is providing home networking software. At the heart of DirecTV’s HD push will be the launch this year of Spaceway-1 and Spaceway-2 satellites to 99 degrees and 103 degrees W., respectively. Those will be followed by the DirecTV-11 and 12 birds in 2007. The latter 2 satellites will be capable of transmitting 150 national and 500 local HD channels, Pontual said.

EchoStar will deliver the first of its MPEG-4 receivers by the 4th quarter and it also is testing Broadcom chips, Senior Vp Mark Jackson said. Neither company has set pricing and both maintain it will be a multi-year transition to MPEG-4 compression from MPEG-2. EchoStar expects to be fully MPEG-4 within 5 years, although the switch for HD programming will be done in 2 years, CEO Charles Ergen said.

The transition raises several issues including that current DirecTV and EchoStar subscribers will increasingly be required to trade out their existing receivers for an MPEG-4 model to take full advantage of HD, company officials. The satellite service may provide some incentives for current HD subscribers to make the switch and EchoStar may make the receivers available to existing customers at a lower price, Ergen said.

The MPEG-4 receivers also will be equipped with hard drives starting at a minimum of 250 GB in order to accommodate HD programming, Jackson and Pontual said. “We may start at 250 GB, but the issue will be, would it be cleaner at 350 GB,” Jackson said.

Meanwhile, EchoStar will launch a video-on-demand (VoD) service starting in Feb. with about 30 movies and eventually expanding to 100, Jackson said. EchoStar, which will charge $4.99 per movie, will deliver the service from satellites at 110 degrees and 119 degrees W, he said. Dish On Demand will be built around the Dish Player DVR 625, which will have a 160 GB hard drive, a portion of which will be partitioned for use in storing nonfilm content including long-form 5-10 min. ads, company officials said. EchoStar is securing content agreements for VoD service to go with a earlier pact signed with Vivendi-Universal, Jackson said. The PVR-625 ($749) will be capable of storing up to 100 hours of SD content, while the PVR-942 ($999) will have 2 tuners and a 250 GB drive with room for 180 and 25 hours of SD and HD, respectively, Jackson said.

EchoStar also will introduce 3 portable media players containing 20, 30 and 40 GB hard drives that are capable of storing programming transferred via a USB 2.0 connection from a satellite receiver, Jackson said. Pricing hasn’t been set, but the players, which use a Linux operating system, are being sourced from Archos, a French company in which EchoStar purchased a $9.3 million equity stake in the last week. The players also will contain 7”, 4” and 2.2” LCD screens.

DirecTV also demonstrated a dual tuner DVR that’s its first to employ software developed by News Corp. affiliate NDS. Among other things, the satellite receiver allows one-touch recording, “viewmarks” that let users mark favorite places within a recording, and the ability to record an entire TV series. The receiver also uses NDS security software.

Despite adding NDS, DirecTV Pres.-CEO Mitch Stern denied the move signaled a move away from TiVo, which has been its sole PVR provider for several years. But Stern declined to comment on whether DirecTV will support TiVo’s new Tahiti platform unveiled at CES (see separate report in this issue). It features, among other things, a CableCARD-equipped HD PVR that’s expected to be available by early 2006. “We have a contractual relationship with TiVo,” said Stern, adding that he was scheduled to meet with TiVo CEO Michael Ramsay on Thurs. “But we will distribute other PVRs with different features. We are going to work with as many companies as we can to support our service.”