'Private' cable TV delivers at a saving

May 16, 1993|By Frank D. Roylance | Frank D. Roylance,Staff Writer

When you pay anywhere from $165,000 to $1 million for a ne condominium at one of Baltimore's most prestigious high-rise addresses, you expect more than rabbit-ears on your television.

But the television system the first buyers at Harbor Court, a high-rise west of the Inner Harbor, discovered when they moved seven years ago was only a little better than that.

Wired to conventional antennas on the roof, it offered only broadcast stations from Baltimore and Washington, plus a single premium movie channel furnished free by the Harbor Court Hotel next door.

"This isn't atypical," said owners' association President Robert F. Schoenhofer.

"A developer trying to get rich will only do a good job while sales are in progress. They do everything people can see, and really skimp on the rest."

And buyers don't often lug their sets along to check out the TV before they sign on the dotted line.

So, confronted by TV fare more meager than that they left behind in the cabled suburbs, Harbor Court owners looked for an alternative. And, like a growing number of condominium and apartment building owners, they soon discovered "private" cable television.

Private cable systems are nothing more than heavy-duty satellite dish systems wired in to every residence in the 175-unit complex.

The systems are usually sold or furnished by private vendors, who then custom-design and deliver whatever programming the owners request -- at rates well below those of the local franchise cable company.

After rejecting a proposal from United Artists Cable, Baltimore City's cable franchise holder, Harbor Court residents bought a four-dish cable TV system for a little more than $100,000.

For less than $23 a month per condo, it delivers 11 Baltimore and Washington broadcast channels; 13 "basic" cable channels such CNN, ESPN, CNBC and Arts & Entertainment; three movie channels; Home Team Sports; four radio stations; a video bulletin board; and all maintenance.

A similar package with United Artists would cost at least $50 a month.

The building-wide savings paid for the hardware in 2 1/2 years. Monthly rate increases have totaled just 18 cents in the past three years, according to Walt Frazier, president of Stansbury Satellite Systems in Baltimore, which built the system and services it.

Interest has 'skyrocketed'

As franchise cable TV systems have raised their rates and extra charges in recent years, more and more multi-family property owners have inquired about private cable systems as a cheaper and more flexible alternative.

"Certainly the interest in private cable has just skyrocketed," said Carolyn S. Cross, a programming consultant for Heifner Communications Inc., a satellite TV brokerage in Columbia, Mo.

Heifner is one of three brokers that sell programming to local satellite TV vendors, who in turn sell it to properties like Harbor Court.

"I doubt if there is anywhere in the U.S. now that a property owner would not say to a [franchise] cable company, 'Give me your bid, and I'm going to go to a private cable company' " for a competitive proposal, Ms. Cross said.

And many are buying. Condominiums at Henderson's Wharf, the Anchorage, Canton Cove and Scarlett Place have gone with private cable systems. So have the Glen Meadows and Charlestown retirement communities in Baltimore County.

They deal with vendors who sell the hardware and, for a monthly TTC fee, arrange for the satellite signals that activate the customer's decoder box and deliver the programming -- much like a telephone number rings a single phone.

"I sell the programs just like the cable company sells it," said Stansbury's Walt Frazier. "But I don't make the profit that cable makes from it." As a result, customers save money on their monthly rates -- often enough to pay for their hardware within three to four years.

Comcast, which has 250,000 subscribers in Baltimore, Harford and Howard counties, is not panicked by the relative handful of customers lost to private cable.

"We don't at this point consider it a significant competitive factor," said Comcast spokesman David Nevins. "Needless to say, we'd like all the business we can get, and we are aggressively pursuing it. [But] our position is that we have far more of that business than we don't have."

"If we lose it, we lose it on price," he said. But he argues that most private cable companies cannot provide the 24-hour repair service, the number of channels or the community-access channels the franchises offer.

Private cable TV systems may one day compete with franchise cable systems in neighborhoods of town houses or single-family homes. Mr. Frazier said growing numbers of residential developers are inquiring about designs for private cable TV. Some neighborhood associations, particularly in areas where the original developers signed exclusive contracts with the local franchise cable company, are asking about switching to private systems as those contracts expire.

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