Wink Communications Inc. is battling for cable carriage, but it has found a savior in satellite distribution.
Wink announced a deal last week with EchoStar Communications Corp. which guaranteed that it will be in 4 million EchoStar households by summer 2003.
The three-way deal between Wink, EchoStar and middleware vendor OpenTV Inc. will see Wink launch on Echo-Star by mid-2001, when the software-integration work between Wink, OpenTV and the EchoStar "DISHPlayer" set-top is expected to be completed, Wink CEO Maggie Wilderotter said.
EchoStar, Wink and OpenTV said they will share the revenue generated from the service, but didn't disclose the terms of the revenue split.
The deal follows a similar agreement Wink cut with DirecTV Inc., which commits the top direct-broadcast satellite player to deliver Wink to 4 million subscribers by the end of next year.
Wink recently began a beta-test of the DirecTV product, and it will launch to between 500,000 and 1 million of the DBS provider's subscribers in August, Wilderotter said.
The satellite deals make 2000 the biggest year for Wink in terms of distribution agreements. The company counts just 200,000 cable subscribers, yet it still has more than any other interactive-television player.
Now that Wink has the U.S. DBS duopoly locked into distribution contracts, the company hopes the satellite deals will motivate cable operators to sign with it, Wilderotter said.
"We're hoping that's the case. I do think the cable operators are very aware of the fierce competition that satellite is bringing to the video marketplace," she added.
Charter Communications Inc., which has agreed to distribute Wink to 30 markets by the end of July, is Wink's largest cable distributor. Wink is also available on Time Warner Cable's New York system, Cox Communications Inc.'s Los Angeles system and Comcast Corp. systems in Connecticut.
Wilderotter said Wink is in talks with all of the major MSOs about deploying the service "in a more material way in their markets."
Shares in Wink jumped about $3 each June 26, the day the EchoStar deal was announced, closing at $29.50.
Wink shares this year closed at a high of $70.88 Feb. 14, the day the company announced a deal with Sony Electronics Corp. to integrate Wink's technology into the DirecTV receivers it produces.
Several Wink insiders sold a combined 460,000 shares the following day, when Wink's stock dropped $11 to close at $59.88.
Big winners that day included Wilderotter, who made $7.1 million in proceeds, including shares sold by her family trust. Other Wink executives who cashed in that day were senior vice president Katie Sullivan ($6.3 million) and executive vice president Allan Thygesen ($5.6 million).
Wink shares closed as low as $15.06 apiece in April, when it and other interactive-television players were hit by the NASDAQ slide, but they have increased steadily since then. Last Thursday, Wink closed at $28.