Scrambling by HBO Fails to Daunt ‘Dish’ Salesmen

It might be bravado, but Paul Piscatelli, who sells and services the backyard “dishes” that San Diegans use to capture television programming beamed from satellites in space, said his business will be boosted by Home Box Office’s decision to scramble its television signal beginning Wednesday.

“They’ve been talking about scrambling for the past six years,” said Piscatelli, owner of Comm/Trak Satellite, a retail outlet, and president of the 65-member San Diego Satellite Dealers Assn. “That black cloud . . . has inhibited sales in some areas, but we can’t wait until they scramble. . . . It will prove that satellite TV viewers need never go back to the horse-and-buggy days of pre-cable television.”

Scrambling also will provide a boost for M/A-COM Linkabit, the San Diego subsidiary of Burlington, Mass.-based M/A-COM Inc., which has been building the decoders that home dish owners will need to unscramble signals from HBO and Cinemax, Home Box Office’s second movie channel.

The Linkabit technology, which prohibits unauthorized reception of HBO and Cinemax signals, “is evolving into the de facto industry standard,” said Alan Levy, HBO’s New York-based manager of corporate public relations.

The programming industry is “clearly avoiding a situation where dish owners will be forced to (add) a number of these descrambling units” each time a pay service scrambles its signals, said Levy.

There are more than 1 million satellite dishes operating in the United States, according to industry estimates.

In addition to winning the HBO and Cinemax contracts, Linkabit’s Videocipher II, which will unscramble both video and audio signals, was selected by The Movie Channel, MTV, Nickelodeon and Cable News Network.

Although M/A-COM Linkabit won those contracts, the technology still faces competition from a handful of other companies, including San Diego-based Oak Industries, which has marketed its decoder to a smaller group of programmers.

Despite that competition, M/A-COM Linkabit’s scrambling business seems likely to grow. “I would say that the majority if not all pay television services will scramble,” Levy said. “Many of the major ad-supported cable services will also scramble.”

However, simply hooking up a decoder won’t bring HBO and Cinemax back to a satellite dish owner’s television screen.

After spending $395 (the suggested retail price) for an M/A-COM Linkabit decoder, dish owners also will have to pay a programming fee to their local cable company or to HBO. HBO will charge $12.95 for either HBO or Cinemax and $19.95 for both services, Levy said. Local cable companies will set their own rates.

After that fee is paid, HBO or the cable company will “activate” the decoder via an electronic signal, Levy said.

Dishes have continued to grow in popularity despite the cable programming industry’s years of scrambling talk, especially where cable is not available, said Piscatelli, who added that there are at least 12,000 dishes in San Diego County alone. Mirroring a national pattern, most of those dishes are in areas that lack cable service, said Piscatelli.

Although Levy suggested that at least 20 channels, including the more popular pay channels and some of the commercial networks, will eventually scramble their signals, dish sellers remain optimistic because customers will still be able to receive more than 80 satellite channels.

And, later this year, “there will be 21 new, additional channels added, many of them the prime-time movie-type channel like HBO,” Piscatelli said.