Home Shopping Network Inc. announced Tuesday it plans to move ahead in a joint venture with fledgling SkyPix Corp., which promises windowsill satellite dishes as a serious technology for the future. "After conducting a thorough review of this major new technology with our own experts, we are satisfied with its performance and excited by its potential," said Roy M. Speer, Home Shopping's chairman and chief executive.
In March, the St. Petersburg-based television retail network said it had a preliminary agreement with SkyPix of Kent, Wash., a pioneer in the direct broadcast satellite (DBS) field.
But SkyPix has been the subject of some scrutiny in recent weeks, both for its technological viability and for its management's ability to attract enough capital.
A final agreement between the two companies is expected to be completed Aug. 31, the St. Petersburg-based television retailer said Tuesday. SkyPix plans to start beaming its signals later this year.
Home Shopping will provide $30-million in capital and services to SkyPix, including order-taking, billing and customer relations from its Gateway area facility. Home Shopping has already made available several million dollars to SkyPix to help launch the service.
Television signals now are delivered to the home in three main ways _ through the airwaves from local broadcasters, over wires from cable operators and to satellite earth stations on dishes usually 10 feet in diameter. Home Shopping reaches viewers with all three methods, primarily cable.
In a direct challenge to the cable and videocassette rental industries, SkyPix plans to run 40 to 50 movies in a pay-per-view format, with top titles starting every 30 minutes. SkyPix also hopes to offer sports, news, music and the Home Shopping Club.
SkyPix's 80 channels of programing will be receivable by a satellite dish with a modest diameter of 2 to 3 feet. The cost of the dish will be about $699.
However, the Wall Street Journal reported last month that SkyPix is behind schedule in its development and is far from reaching its goal of selling $200-million in stock to private investors.
And Satellite Business News, a trade magazine, wrote in an analysis that "after almost a year of hype and hoopla, SkyPix is rapidly approaching the proverbial "put up or shut up' point. ..."
But Gary Arlen, a Bethesda, Md., communications consultant, said much of the negative publicity surrounding SkyPix can be traced to the cable industry, which he said is leading a smear campaign for fear of losing its lock on TV viewers.
SkyPix "will find a niche because cable is messing up both in the ways it's packaging services and in pricing," Arlen said.