Take One (Mar 15, 1979)

fit of new subscribers. Showtime is a full-time (approximately 8 hours daily) service, like HBO. Both services share major film titles, but Showtime's schedule does not yet include many nonmovie types of programing. As of January 1, 1979, Showtime is the only pay-television service offered on the cable systems owned by its parent cor‘porations. This will deprive HBO of approximately 13% of its present audience. Showtime has plans to produce original pay-television programing (including the first “made-for-pay” movie). Its subscribers number approximately 600,000 and, like HBO, is satellite delivered. Unlike HBO, it so far carries no sporting events. The newest of the full-time pay services is Star Channel, a subsidiary of Warner Communications. Its fare consists of motion pictures and “Flash Specials,” (their original programing). though there are presently only 80,000 subscribing homes, Star Channel is expected to grow rapidly due to Warner's resources and commitment to cable television. Warner is also the operator of QUBE, the two-way, interactive cable system in Columbus, Ohio. QUBE's computer-controlled and monitored system allows community polling, shopping via television and “narrow casting” to selected portions of its system. And there are several pay channels which offer everything from family films to exploitation pictures. Unike the Star Channel service, and the majority of other pay-TV operations, the QUBE subscribers are billed each month for the number of films they have viewed. Prism and Fanfare are two regional, rather than national pay services, both of which rely heavily on local sports to entice prospective subscribers. Prism is distributed to cable systems via microwave in the Philadelphia area; and features sporting and_ entertainment events from the Spectrum, the city’s popular entertainment and sports arena. Prism shows fewer films than any other full-time service. Fanfare, which is allied with Prism, is a similar service, tailored to the tastes of its southwestern U.S. audience. In cable systems where Prism is offered, as well as HBO, it has been successful in luring a substantial percentage of subscribers from the national service. But, in these situations, there is a small but surprising number of subscribers who take both services—bringing their monthly television bills past the $30 mark. Clearly, Prism and Fanfare indicate that a portion of the pay-TV market is more interested in local and regional sports than in motion pictures. National satellite systems will have difficulty reaching these viewers. Films on Prism and Fanfare are booked and programed by another pay service, Hollywood Home 44 TAKE ONE/MARCH 1979 Even. Theater (HHT). Operating about as far from Hollywood as you can get, HHT feeds its films to leased space on Satcom I from its New York offices. The Extra Channel, as the service is known, is what the industry now calls a “mini-service,” which premiers one new film title weekly, then fills the remainder of the week with “Encore” showings of previously run titles, and occasional specials. Operating only a few hours per day, Monday through Friday, HHT offers little, but its prices are low. Showtime and HBO charge $8 to $10 per month, while HHT and other minis usually retail for $4 to $5 monthly. HHT also claims to show “only the best,” but it restricts programing to G or PG-rated titles. Mini-services are becoming increasingly popular in the cable industry. They are both safe and cheap, making them cable television's closest equivalent to impulse buying. Some services, like Bestvision and Guest Pay, are “standalone” systems, meaning that the individual cable operators originate the programing, usually by playing videocassettes. The present quality of signals from stand-alone systems is far inferior to the satellite networks, but these operators are placing high hopes on future technology like the MCA/Philips videodisc, which will both increase quality and reduce costs.. HBO and Showtime will also offer mini-services during 1979. All of the systems discussed have been pay services distributed by cable television and, in rare cases, via microwave to high-rise and other large apartment complexes. The remaining pay-television operations in the U.S. are over-the-air subscription services, including American Subscription Television and National Subscription Television, both serving the Los Angeles market. Over-the-air systems may be the answer to providing pay-television to major urban markets where cable television either doesn’t yet exist, or has failed to have an impact. But, if American Subscription Television (ASTV) is setting a trend, it may be a costly one. ASTV, which began broadcasting July 23 on KWHY-TV, channel 22, charges customers $40 for installation of its system, $60 annually for rental of its terminal/signal decoder and invidually (50¢ to $3) for each film watched. ASTV’s computer “sweeps” the decoder network periodically to determine each subscriber’s monthly charges. Other over-the-air systems include one in the Newark / New York area, Universal Subscription Television in Boston, and a system identified as Radio Broadcasting, proposed for the Philadelphia area. Paul Kagan says pay-per-view systems, like ASTV, “still have not proven themselves.” HBO, it seems, is continuing to lead the pay-TV industry. As of January, 1979, it is offering subscribers five originally produced new programs per month, in addition to the usual package of films and sporting events. It continues to showcase comedy, which, says company spokesman Robin Ahrold, “has no place to go on network television,” and often finds and features new talent before anyone else does. HBO’s film selection is broad and often includes low-budget films, seldom-seen “sleepers” and “B” films. But there are rumblings of an anti-trust investigation. Not only does HBO control about two-thirds of the pay-TV marketplace, but it is also investing in new films, speculating in their eventual success in return for pay-television rights to the films. Among the films which HBO has invested in are Magic, The Wild Geese, Who's Killing the Great Chefs of Europe? and Watership Down. HBO's competition also has their axe .o grind, since HBO's contracts for nonmotion picture programing excludes producers from selling the same product to another pay-television service. Lastly, HBO has been involved in a labor dispute with the Directors Guild of America, which has prohibited its members from working for HBO. But even though HBO may have its problems, they are still regarded as the biggest with the best, and will continue to lead the pay-TV industry for years to come. What if pay-television continues its present growth and becomes the major economic force it is expected to be? Will it have an impact on the three commercial networks? “No,” says Paul Kagan, “paytelevision will never be big enough. to affect network revenues,” explaining that as the pay-TV market increases the network coffers grow, as well. There are other scenarios for pay-TV which could also be worrisome. Will payTV's popularity grow to the point that the companies will try to introduce some forms of advertising? HBO’s Robin Ahrold insists that it won't happen, citing the abscence of commercials as pay-television’s major selling point. But a representative of the National Cable Television Association isn’t as definite, saying that commercials may have a place on pay-television, but adding that it probably won't happen ‘within the next two years.” The major question, though, might be the original one raised by theater owners. What happens if audiences begin to prefer pay-television over theatergoing? Right now, theaters are supported, in large part, by concession sales, and the film industry as a whole has been bouyed by inflating ticket prices and producing “event” entertainment. If pay-TV robs the theaters of its audiences, it could kill the goose that lays its golden eggs. Tim Onosko is the author of Funland USA, a book on amusement parks.