Chapter 2

History of Cable, Home Video, and the Internet

History of Cable, Home Video, and the InternetChapter 2Monthly cable service, 1950: $3.Monthly digital cable service, 2010: $75.First satellite TV broadcast: NBC, 1962.Cost of satellite dish, 1979:$36,000.Cost of direct TV satellite system, 2010: $0 (but you have to sign up for a year of service.)

Quick FactsIn 1998, ratings revealed that more Americans were watching cable than watching broadcast networks.At first broadcasters welcomed that their signals were reaching homes that otherwise couldn't receive them.UHF stations could not make a profit unless they were carried on the cable.The FCC was reluctant to get involved in 1958, because cable was not broadcasting and used no spectrum space. History of CableIn addition to carrying local stations, they began to import the signals of distant stations that were not available to the community.

Most communities had only 3 to 4 stations, new ones suddenly available in a market, the audience shares and ads revenues of the existing stations would decline.

They asked FCC for protection. Cable changing conceptCable systems had to carry all TV stations within 60 miles and could not carry shows from distant stations that duplicated those offered by local stations.FCC restrictive rules In 1968, the commission ruled that CATV systems in the top 100 markets had to get approval before importing the signals of distant stations.The major impact of these rules was to discourage the growth of cable in urban areas.Cable was insignificant to city residents, they received good reception from a number of local stations.Cable changing conceptCable system operators were not encouraged to bring service to urban areas because the stringing and installation of cable were expensive in densely populated areas and operators would have a big job making sure that no imported signal duplicated local programs.Cable changing conceptIn 1953, Paramount Pictures built a cable system and offered movies for $1.35 in California, and football game for $1.

Only about 75 homes signed up for this pay as you look service and it ended.Pay TVTwo basic reasons for the explosive growth of cable in 1970s; Technological:Home Box Office (Pay TV) rented a transponder on the communications satellite Satcom 1 and announced plans for a satellite-interconnected cable programming network.Cable systems could set up their own receiving dish and HBO would transmit to them first-run movies.HBO new arrangement meant wider coverage of cable systems at a lower cost (Showtime, CNN.)Cable growthRegulatory:FCC realized that its rules were stilling cables growth.It changed its philosophy: it would encourage competition between cable and traditional TV. Eventually FCC dropped most of its rules concerning cable.FCC was given definite but limited authority over cable. The local community was the major in cable regulation through the franchising process.Cable growthRegulatory:The spurt of cable growth attracted large media companies to invest in cable which caused cable to grow even faster.

By 1988, the cable industry had become dominated by large 10 multiple-system operators (MSOs.) it passed the magic number: more than 50% of all households in USA were cable subscribers. Cable growthRegulatory:The growth of cable continued through 2000s.

Annual revenue from these television services amounted to about $53 billion in 2009.

The cable boom was cooling off losing subscribers to sattelite broadcasters.Cable growthThe rise of cable led other innovators and entrepreneurs to the multichannel bandwagon.

Leading the way were satellite; multichannel, multipoint distribution service (MMDS.)Alternatives to cable In 1945 science fiction writer Arthur Clarke theorized that global communications could be possible by reflecting signals off three satellites parked in orbit at equal distance from one another.After 20 years, the dream became reality spurred by (space race) between the Soviet Union and the United States.

The Satellite SkyIn 1962 the first satellite TV transmission was made using Telstar1.In 1979 Neiman Marcus featured a home satellite dish and sold it for $36,000, than the price began to drop aided by FCC legalizing the private reception of satellite TV programming .Dishes began to proliferate rural areas unlikely to be served by cable TV due to low population density.The Satellite SkyBy the late 1980s direct-to-home satellite (DTH) became a growth industry.The backyard satellite dish was dubbed TVRO (TV receiver-only.)The dishes were too big and heavy to supplant cable TV in suburban homes.To take off, satellite TV would have to become physically smaller and cheaper.The big dishIn the 1990s, direct broadcast satellite (DBS) service provided for nationwide distribution of TV programming from a new generation of orbiting satellites to compact (18-inch) home dish receivers.

The dishes were aimed at one of three satellites.

Direct Broadcast SatelliteThese satellites could beam over 200 channels to subscribing households offering different packages by competing organizations.

In the 1990s the new dish mounted on a window ledge or near the chimney became a new TV status symbol, not unlike the rooftop antennas of the 1950s.Direct Broadcast SatelliteSubscribers to DBS grew from 2.2 million in 1995 to more than 32 million by 2009 for two factors:

1- DBS systems dropped in price.2- Congress softened regulation allowing DBS systems to include local channels in their offerings.Direct Broadcast SatelliteBecause of construction costs, utility problems, and franchise disagreements, cable service lagged in the inner cities.In major urban areas satellite dishes are available.Yet people in major urban areas also want cable services, one solution was wireless cable known as (MMDS) which makes use of short-range microwave transmissions to beam channels from a central transmitter location. Receiving households use a small microwave antenna to pick up the signals and a special decoder called a down converter to turn them into TV channels.

Wireless CablePeter Goldmark was a visionary in telecommunications from his laboratory at CBS had come high-fidelity sound recording.He was talking about buying movies for home viewing and video rentals.Today broadcast, satellite, and cable and Internet TV are just part of a total home video environment.Home VideoIt was a film camera especially equipped to shoot an image from a TV screen.The quality was poor, fuzzy images and dark picture, the difference between the film frame and TV frame, it sometimes cut off parts of the picture.After a single replay, the kinescope was generally discarded.The Kinescope RecorderThe Videotape recorder (VTR)In 1956, the VTR made its debut.Kitchen debate: a debate between US vice president Richard Nixon and Soviet premier Nikita Kruschev was captured on videotape at an exhibition in Moscow in 1959 (a demonstration of a modern US kitchen)It was made for TV stations, networks and production facilities not for home viewers.The videocassette recorder (VCR)The VCR revolution began with the introduction of the Betamax VCR by Sony in 1975.The table model machine could record up to one hour of video.Sony was promoting the machines ability to tape broadcasts off the air.Betamax case: Piracy, Universal Pictures in 1984, US Supreme Court ruled that home taping did not violate copywright law.Another Japanese firm introduced a competing format VHS (video home system) in 1977.The two formats were incompatible.VHS had a longer recording capability Betamax produced better picture quality.They battled for marketplace superiority, eventually VHS won the battle.Home VCRs were table models, designed mainly to record TV shows off the air for later playback time shifting.A second growth industry was created: home video moviemaking (camcorders) which replaced 8-millimeter film as the medium of record.DVDs & DVRsOver the past 10 years, DVD has replaced videotape as home video medium. (more content, better picture and audio quality, doesnt wear out after repeated plays.)A new revenue stream for production companies emerged with the advent of DVD boxed sets of TV programs.As the new century opened, digital video records (DVR) record content on a hard disk drive.Possibility to record up to 300 hours of program and pause live TV and resume it at any point.Video store by mailTechnology has created opportunities to download video, and now the outlook for these stores is cloudy.Cable and satellite providers are experimenting with video on demand: allow subscribers to choose movies and view them at their convenience.Traditional video store now stock video games and movie tools on its shelves.In 1998, two entrepreneurs started a mail-order business to rent and sell DVDs over the Internet, then offered Netflix: allowed users to search for videos similar in taste to previous rentals.The Internet & The World Wide WebThe Internet refers to the global interconnection of computer networks made possible by using common communication protocols.The World Wide Web is just one service available on this global network.Other Internet services we use, like e-mail, video chat function within a Web browser, but they are separate network technologies.The birth of the InternetLike radio, the Internet was developed for military preparedness and assurance that it could communicate in time of emergency. The cause behind its development was the Cold War between the USA and the former Soviet Union, which marked the end of World War 2 in 1945 until the fall of Berlin Wall in 1989.In order to make a communication system less vulnerable to attack, that system need to take many paths to send messages. Similar to the way neural networks work inside the human brain.The birth of the InternetA distribution network of information could provide redundancy of information.Data should be broken up into small strings of bits that could be enclosed in electronic packets which would be able to move quickly within a communications network having many different connections packet switching.Pc-the new mass mediumPc contribution to the growth of networking cannot be overestimated.It made it affordable for businesses to provide their workers with individual computers.To meet the growing demand for interconnection, domain name servers such as .gov, .edu, and .mil were developed.The InternetThe Internet was officially born in 1986.

Private Internet service providers (ISPs), such as AOL, gave consumers access to the Internet, while large telecommunications corporations, such as AT&T, provided new backbone capability.The birth of the World Wide WebIn March 1989Tim Berners-Lee circulated a paper called for the creation of a program using a graphical interface for requesting information available on networked database.He called his concept the World Wide Web.Broadcasters and Web-centric companies developed a wide variety of services that run on todays computers, along with increased bandwidth capability of the Web. YouTube, Facebook, Flickr, and other media services have gained widespread acceptance as alternatives to TV & cable.Blackberries, iPhones, and AndroidsIn the 21st century, technology made it possible to develop portable devices called personal digital assistants.In 2002, Canadian company introduced the first smart phone called Blackberry. It combined e-mail, mobile telephone, text messaging, and Internet access.In 2007, the first iPhone was introduced to fans. It was audio/video player, Web browser, game unit, telephone, and personal digital device all in one. It used the iTunes Store interface to sell third-party application.Blackberries, iPhones, and AndroidsIn 2007, Google announced that it would develop an open-source smart phone system. These Android phones manufactured by a variety of companies went on sale on 2009 as direct competitors to Apples iPhone.In 2007, computer manufacturers introduced netbooks. Apple once again surprised the public by introducing the iPad.In the 21st CenturyThe cable TV industry continued to consolidate. In 2002 Comcast acquired the cable assets of AT&T Broadband.Cable continued to draw audiences away from the traditional TV networks. In 2005, about 60% of prime-time audience were watching cable.Cable companies began using its lines to provide other services to subscribers, including high-speed Internet access, video on demand, and local telephone service.By mid-decade, about 75%of all cable systems offered telephone service. In the 21st CenturyThe phone companies fought back by offering TV services.In 2010, 50 million households had broadband.The Internet allowed everyone a chance to be a mass communicator.