PPV may be cable's goose with golden egg

May 19, 1991|By Barry Cooper | Barry Cooper,Orlando Sentinel

ORLANDO, Fla. -- At a hotel in Orlando this week, executives in the cable television industry have nearly been salivating over these three initials: PPV.

That's an abbreviation for pay-per-view, a technology whose time has come, especially for sports, cable experts say.

The cable honchos, in Orlando for an industry convention, maintain they have reason to be wringing their hands in anticipation of uncovering a golden goose. They feel they will be able to take in millions of dollars from charging viewers for events that in many cases previously were shown on free TV.

Only time will tell, because PPV technology still is too new to judge. Though some cable executives are predicting PPV will be a bonanza, others are not so sure.

Pay-per-view allows many cable TV customers and home satellite-dish owners to order special events -- such as a heavyweight fight or a first-run movie -- for a fee. But of all the homes in the country wired for cable television, only about 10 percent have access to PPV, according to industry estimates. That figure is expected to grow over the next several years.

There is heightened interest in PPV because of the recent Foreman-Holyfield championship fight, which reportedly grossed more than $50 million through PPV and closed-circuit fees. Boxing promoters such as Don King are predicting that other sports soon will turn to PPV.

"Let's take the Super Bowl as an example," said Steve Desjardin, PPV marketing manager for the World Wrestling Federation. "Let's say there are 50 million homes wired for pay-per-view. Let's say half of those homes buy the Super Bowl for $10 apiece. That's a quarter of a billion dollars. No one can afford to ignore those kind of economics."

The Super Bowl long has been rumored to be headed for pay-per-view. Would fans pay, say, $45 to receive all seven games of the National Basketball Association Finals? How much could the World Series command?

NBC, which has PPV rights to the 1992 Summer Olympics, is planning to charge $125 for two weeks of PPV access. Customers who buy the extra programming will receive around-the-clock coverage -- 12 hours live, 12 taped. In addition to the PPV package, there will be Olympics coverage available on free TV. But Jim Rozier, vice president of marketing for CableVision of Central Florida, said, "People who buy the pay-per-view package would miss nothing."

Rozier said he feels only special events such as the Olympics and heavyweight fights can be a huge success on PPV.

Dave Almstead, vice president and general manager of the Sunshine Network, has the same opinion.

"Pay-per-view will be event-driven," he said.

The key to PPV will be acceptance by consumers, and that test has not been met.

"Yes, there initially could be some consumer backlash," Desjardin said. "But there was consumer backlash when sporting events started shifting to cable. I think the hand-up will be Congress, whether they will permit the big events to go to pay-per-view."

The NBA, Major League Baseball and the National Football League haven't announced whether they will shift large numbers of games to pay-per-view. For now, they are locked into rich, long-ter, deals with NBC, CBS, ABC, ESPN and TNT, among others. But as those contracts expire, owners may look to pay-per-view.

Steve Saril, vice president/marketing for Graff Pay Per View in New York City, said he is skeptical that there will be widespread marriages of sports to pay-per-view.

"Yes, it has worked in boxing, but I don't sense that it will work in baseball," he said. "Maybe in football it will work because you have a finite number of games. I don't think this will be a matter of taking games off free TV, but rather it will be adding to the number of choices viewers have."

Saril said he can envision fans being able to dial up some games of their choice as opposed to being restricted to watching what the over-the-air networks offer.

There is already some widespread use of pay-per-view. For the last few years, homeowners with satellite-dish systems have been able to purchase any number of sporting events. For example, a dish owner living in, say, Montana could have tuned in to most of the Orlando Magic's games by subscribing to the Sunshine Network.

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