Will Apartment-Dwellers Buy DBS Dishes?

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A new rule that forbids landlords from blockingapartment-dwellers and other renters from placing satellite dishes on their propertyshould help satellite services, but by how much is not certain.

The Federal Communications Commission's rule, whichwent into effect Jan. 22, allows multiple-dwelling-unit residents to put up their owndishes, as long as they're installed on areas of exclusive use, such as balconies.

Meanwhile, opponents of the federal ruling are acting outtheir version of a rent strike, fighting the ruling in the courts and at the FCC.

The ruling was an obvious boost to direct-broadcastsatellite companies, although no one could predict how many new customers they willattract.

Instead, the industry plans to push forward with attemptsto wire whole apartment buildings and rental communities so that each MDU will be equippedto receive DBS.

And in an indirect way, the ruling may actually help DBScompanies like DirecTV Inc. and EchoStar Communications Corp. to convince property-ownersto sign deals bringing DBS to all of their tenants.

Whether they sign them up individually or by the building,DBS companies can't afford to lose out on the MDU market.

"Apartment-building owners are beginning to realizethat because of demand, it makes sense to wire the entire building," if only topre-empt the aesthetic concerns that come with a multitude of individual dishes, said MikeMeltzer, vice president of multiaccess sales and emerging markets for DirecTV.

Still, the FCC ruling addresses the needs of tenants whoselandlords have already signed exclusive contracts with competing cable services. Ifrenters want to watch certain sports or ethnic programming that's only available onDBS, they can buy their own dishes, rather than waiting to see whether their landlordsplan to switch to DBS.

Ethnic American Broadcasting Co., for example, offersethnic programming via a special DirecTV hardware platform that requires a slightly largerdish than DirecTV's standard 18-inch antenna.

Murray Klippenstein, executive vice president ofEABC's parent, Sky View Networks, said dish size is not an issue among ethnicaudiences who might not be able to access the programming any other way. The FCC rulingallows MDU residents to install dishes of up to one meter (39.37 inches) in diameter -- orlarger, if they live in Alaska.

Dish size is not just a matter of aesthetics: The largerthe surface of the antenna, the bigger the wind-loading problems, according to Steve Blum,president of California-based Tellus Venture Associates. And larger dishes need morestructural support than standard DBS dishes.

The recent FCC endorsement clearly won't help allrenters. Building-owners still have the right to place certain restrictions on DBSinstallation. Tenants cannot use common areas such as roofs, courtyards or outside wallsfor dish placement, for example, without the permission of the landlord. Andbuilding-owners and their tenants must keep their fire escapes clear of obstructions.

The biggest obstacle for a large number of renterswon't come directly from the landlord, however; because DBS dishes require a clearline of sight to the southern sky, only MDUs with a clear southern exposure make goodcandidates for dish placement.

"One-half of the people in the building won't beable to put a dish on the balcony," said Mickey Alpert, president of Washington-basedAlpert & Associates. "For a retailer, it's tough, because you basically haveto advertise to people facing southwest. It's a niche market, at best."

The market for individual renters is so fragmented thatsome DBS providers don't plan to target it at all.

Bell Atlantic Video -- which resells DirecTV programming inNew York; Boston; Washington, D.C.; Baltimore; New Jersey; and, most recently,Philadelphia -- plans to target the MDU market only on a building-by-building basis,according to vice president of business and external affairs John Grosvenor.

"Our business is based upon offering acable-replacement product," including off-air reception, Grosvenor said, adding thatit's more difficult to install off-air antennae in an unobtrusive way.

In addition, he said, "It's hard to tell bytelephone whether these are customers that we'd be able to serve. We'd have toturn a lot of people away."

Wiley Reed, director of commercial services for EchoStar,said retailers and apartment-dwellers would need to be educated about line-of-sight issuesif there is to be a market in selling to individual MDUs. Like its competitors, EchoStarwill focus most of its MDU attention on wiring entire buildings.

"We want apartment-dwellers who pay their bills andwho don't churn," Reed said.

Grosvenor said subscriber turnover is more significant whendealing with individual apartment-dwellers. Renters typically move frequently, but if theentire building is wired for DBS, each new tenant becomes a prospective customer.

To fight the ruling, the National Multi-Housing Council andthe National Apartment Association filed a petition for review with the FCC, citing safetyconcerns, among other things, said Jim Arbury, vice president for the associations.

Meanwhile, the Community Association Institute hasrequested a reconsideration; comments on this request are due Thursday (Feb. 4).

"Renters are [television] viewers, and they shouldhave the same rights to satellite television as [home or apartment] owners," repliedAndy Wright, vice president of government and legal affairs for the Satellite Broadcasting& Communications Association.