Free satellite TV?

[Gregg Lengling]

by Michael Hopkins mhopkins@mediabiz.com

This isn't a scheme to get small-dish television via illegitimate means. Nor is this a deal with an asterisk pointing to the fine print at the bottom of the page. It's going to become the real deal on the other side of the pond.

On Wednesday, British Sky Broadcasting Chief Executive James Murdoch revealed that the company, with more than 7 million satellite TV customers in the United Kingdom and Ireland, will offer a slate of nearly 200 channels and interactive services for no charge. The package will debut later this year.

The move follows tough competition being delivered by FreeView, a U.K. terrestrial service offering a package of digital TV channels at no charge. BSkyB and the BBC control FreeView. But the free TV service has been something U.K. consumers can't ignore (so far 3.5 million have signed up for the service). And the satellite TV giant, which has relished its role as the big kahuna of British pay-TV for years, had to answer with some sort of offering.

Could free satellite TV come to the United States any time soon?

At the moment, there is some satellite TV programming viewers can get for no charge (after they buy the equipment). C-Band still has some channels in the clear. And GlobeCast's WorldTV has a number of its foreign channels free to air.

The BSkyB strategy is hard to ignore for those in the U.S. pay-TV business.

BSkyB hopes the absence of a subscription fee will lure new customers who may eventually switch to a pay-TV package. That could happen, given the sports coverage (such as the Premier League soccer coverage) delivered by Sky.

Given the rough and tumble business between cable and satellite in the states, luring a potential customer with some sort of free programming could be an answer. Once they have someone hooked, could they make that viewer a paying customer with such things as out-of-market sports packages or premium movie services?

Cable and satellite TV customers have experimented with offering free programming, but the offering is usually only temporary. Satellite TV companies, for example, have been known for getting customers signed up with three free months of TV, or free equipment.

Nonetheless, the free satellite TV announcement was among the first real strategic moves for Murdoch, son of News Corp. Chairman Rupert Murdoch. (News Corp., as you probably know, controls DirecTV.) James took the reigns of BSkyB late last year, and the free TV announcement was a bold move for the young executive.