Digital Media Manifesto
Use case No. 04: Satellite pay TV
Purpose of this contribution is to use the methodology proposed in 030701chiariglione01 for the specific use case of subscription-based distribution of television programs (Pay TV) by satellite.
2. Description of traditional pay TV
2.1 Functions of traditional Pay TV
2.2 Value chain players
The technology that is specific of analogue pay TV is analogue scrambling of audio and video and the technology used in the subscriber card. The rest is well-established technology.
2.4 Legislative framework
The legislative framework has evolved to allow paidsubscription services to be offered ion UHF bands and satellite. National legislation based on the WIPO Copyright Treaty is making it a crime to tamper with decoder security.
2.5 Business model
The business model of traditional (analogue) pay TV is based on the relative scarcity (for terrestrial) and cost (for satellite) of television program broadcasting. The pay TV operator (service provider) aggregates programs whose rights he acquires and broadcasts them to his paying subscribers.
3. Description of the Digital Satellite Pay TV use case
The functions of a digital pay TV service by satellite are basically the same as those of its analogue predecessor, with notable extensions such as
3.2 Value chain players
They are partly the same as for traditional pay TV, with some conspicuous additions in the service provider back office, security technology" and software. The list becomes
Pay TV may be a rather well established business model but its digital form over satellite requires very sophisticated technologies. In particular
3.4 Cost/benefits for value chain players
|Value chain player||Cost||Benefits|
|PAs||Establishment of monopolies|
|Satellite operators||Increase use of satellite capacity|
|Program producers||Controlled distribution outlets|
|Pay TV operator||Most are in the red||Hope to achieve dominant/monopoly position|
|Security technology providers||Important client for their technology|
|Providers of back-office solutions||Important client for their solutions|
|Providers of OS/MW||Important client for their solutions|
|Providers of sw applications||OS dependency|
|Decoder manufacturers||OEM manufacturing||Important client|
|Smart card manufacturers||Important client for their solutions|
|End users (subscribers)||Stack decoders for each provider||Improved range of choice|
3.5 Difficulties of current deployments
Eight years after the first deployment started, the conclusion is clear: unless there is only one pay TV operator, cash flow remains negative.
The following can be considered as hurdles of primary importance:
5. Relationship with other use cases