Nustar TV Network Forced to Lower Its Sights

The Nustar Television Network, a shoestring outfit in Tujunga that started broadcasting on Friday the 13th of June, appears likely to provide the superstitious with ammunition.

Nustar once vowed to become the nation’s fourth network, with round-the-clock satellite broadcasting aimed at UHF stations and homeowners with dish antennas. It said it would broadcast continuously, with more and more original programming as time went by.

But Nustar is now broadcasting just four hours a day, from 5 p.m. to 9 p.m., Monday through Friday. And there is no original programming, the company says. It just airs old movies.

Nustar also is short of cash. A former public relations director for the company, Eliot Hoffman, says he and many other employees have worked long periods without pay.

“Short-term, we have a crisis situation,” acknowledged Nustar President Peter O’Neil, who would not discuss specifics.

Shift in Management

O’Neil also was chairman until the board took that job away earlier this month and gave it to Don G. Hildebrand, a Canadian broadcasting executive. Hildebrand’s appointment capped a series of management changes that included the departure of the company’s chief financial officer and its vice president for programming.

The network also had some technical problems that interrupted programming, and it ran afoul of the Federal Communications Commission. Dan Rittenberry, an FCC licensing official in Washington, said his agency slapped a $6,000 fine on Nustar for broadcasting without a license.

The company, which insists that the fine is actually $5,000, is appealing. Both sides say the penalty was issued because Nustar’s rented “uplink,” a transmitter that fires its signal at a satellite, was unlicensed. Nustar says it wasn’t to blame.

On the positive side, Nustar agreed to sell almost 5,000 15-second ad spots to Andromeda Inc., an Edgewater, Fla., advertising concern, in exchange for $2 million in IOUs for debts owed to Andromeda by other businesses.

Andromeda’s sales director, Robert Isles, said his company plans to resell the spots. He said the notes that his company assigned to Nustar are not bad debts, adding that Andromeda has had a 95% collection rate in the past.

Nustar executives said the company is working on a private placement investment to raise more capital. O’Neil said that, to help the planned fund raising, he recently surrendered most of his majority stake to the company for free.

Nustar, founded by O’Neil and Hoffman a year ago, has disclosed little about its present finances. It went public in May by merging with Boston Investments, a Utah shell corporation that, because of its small number of shareholders, is not required to make regular disclosures to the Securities and Exchange Commission.

“There are many people concerned about their credibility,” said Thomas Haller, the former chief financial officer, who said he left last month because he and O’Neil have different management philosophies. But, he added, “My guess is that the concept is so sound, any moderate influx of capital will make it a success.”

Home satellite dish owners can tune in to Nustar on American Satellites ASC 1, Transponder number 6, at 128 degrees west.