Video services

EchoStar to Shut Down ViP-TV

Some rural U.S. telcos and cable operators are scrambling to find a new source of video programming upon receiving word that EchoStar Corp. LLC (Nasdaq: SATS) has decided to shut down its MPEG-4-based ViP-TV satellite distribution service.

EchoStar has already notified customers of the decision, and the company is targeting a shut-down by late September.

"But we're being flexible with [the deadline] as we work through it with our customers," EchoStar VP of Sales and Marketing Michael Hawkey tells Light Reading Cable. "We looked at satellite usage and the economics, and [decided] it's not the right time for this type of program," he added.

ViP-TV's primary target was Tier 2/3 telcos, cable operators and some hotel/hospitality customers. Dish Network LLC (Nasdaq: DISH), EchoStar's corporate cousin, uses its own service to distribute video programming.

Hawkey says the decision to shut down ViP-TV has no effect on Aria, EchoStar's new video platform that's being targeted to smaller video service providers, because it adds TV Everywhere services and other features that ride on top of an operator's underlying QAM video service. (See EchoStar's Cable Target: 1 Million Subs and EchoStar Boxes Target Indy MSOs .)

EchoStar hasn't announced any new ViP-TV customers for a while, but some announced customers include Duncan Cable TV of Vermont, TCT West Inc. of Wyoming, CT Communications of Ohio, and North Penn Telephone Company of Prattsburgh, N.Y. EchoStar had also signed on a handful of ViP-TV resellers. (See EchoStar Scores IPTV Wins, EchoStar Picks Up ViP-TV Reseller Pace, Fidelity to Resell EchoStar's ViP-TV Service and Mega Hertz Resells EchoStar's IPTV Service.)

Jon Romm, the COO of Avail-TVN , which is jumping in to help EchoStar's customers make the switch (more on this below), believes there are about 26 service providers currently using the ViP-TV service.

EchoStar is helping customers with the transition on a "case-by-case basis ... and making recommendations to each one of them," Hawkey said.

Bernie Arnason, managing partner for Pivot Group , says the decision has "riled up" some ViP-TV customers because they could be faced with finding an alternative rather quickly. "It's a pretty significant process," he says of the coming change-outs. "To get it done in 45 days is creating some challenges to say the least." Telecompetitor, a division of Arnason's Pivot Media, cites letters to EchoStar customers noting that ViP-TV is expected to shut down on Aug. 24, with service ending on Sept. 30.

Avail-TVN steps in
Arnason says Avail-TVN, which also relies on MPEG-4 distribution, could offers ViP-TV customers a "natural fill-in." The Comcast Media Center (CMC) , which also offers video distribution services tailored for rural operators, represents another possible alternative, but it's primarily an MPEG-2 shop and hasn't been focused on IP-based video services.

Romm says his company is prepared to help ViP-TV subs switch over to Avail-TVN's platform in time for the shutdown, noting that Avail-TVN helped several IP Prime affiliates flip over when SES Americom decided to phase it out in late 2008 and complete it by June 2009.

Romm acknowledges that Avail-TVN has to get ViP-TV affiliates switched out in a tighter time frame, but is confident that they can make it if they get on the stick now. He says Avail-TVN has already transitioned three ViP-TV customers, with another two on board to do the same.

Avail-TVN plans to conduct a webinar on its ViP-TV transition program on Monday, Aug. 14 at 2 p.m. ET.

— Jeff Baumgartner, Site Editor, Light Reading Cable

Jeff Baumgartner 12/5/2012 | 4:56:27 PM
re: EchoStar to Shut Down ViP-TV

How confident are you that you will be able to make the switch in time? Sounds like Avail-TVN is putting together a program to get you from A to Z, but a seamless transition on paper and in practice can differ. JB

cnwedit 12/5/2012 | 4:56:26 PM
re: EchoStar to Shut Down ViP-TV

This is the just the latest example of companies that got into the rural video business and then bailed. Besides SES Americom, which is cited here, there are multiple middleware vendors who have come and gone, stranding their customers. 

This is proving to be a much harder space in which to find profits than most people expected.

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