Cable giants aim to rule HD

Companies increase their offerings in high definition as customers upgrade their TVs

Time Warner Cable and its rivals are in the early stages of a torrid campaign to win the latest battle for America's dens: high-definition programming.

With thousands of new sets installed in the past year, satellite and cable service providers are touting plans to multiply the number of HD channels they offer. Until recently, Time Warner had the edge in the Triangle. Now, armed with new satellites, DirecTV can claim the most high-definition programming.

But Time Warner, the nation's second- largest cable company, is spending $50 million in North Carolina and South Carolina to allow what it says will be an unlimited number of HD channels by the middle of this year. The company does have some ground to make up: Its offering of 26 channels trails DirecTV's lineup of 85.

For its part, DirecTV promises dozens of new HD channels this year. Even AT&T, the phone company, is planning to elbow its way into the fight by spending $350 million in North Carolina to introduce high-definition TV programming.

For consumers, the programming blitz is a win, at least in the short term.

"I don't expect to see much change in monthly fees, but I do expect to see more channels added to the plans," said Alfred Poor, a founder of HDTVProfessor.com.

Time Warner declined to predict how many HD channels it will offer after its new "switched digital" technology is completed. The system will free capacity in Time Warner's network by limiting the broadcast signal to the channel being viewed. The current technology sends all signals for all channels simultaneously, whether they are being viewed or not.

With the upgrade, Time Warner will be able to broadcast as many HD channels as it has agreements to distribute, said Brad Phillips, a spokesman for Time Warner Cable in North Carolina. The company will automatically upgrade all customers by mid-2008 without any change in prices, he said.

"Customers want more HD, and we're doing all we can to provide it," Phillips said.

Time Warner added 10 HD channels last year, including three last month: HGTV HD (Channel 277), Food Network HD (Channel 278) and National Geographic HD (Channel 279).

New satellites early last year allowed DirecTV to make capacity improvements that resulted in new high-definition channels. With another satellite scheduled to debut during the first half of this year, the company expects to offer 150 national HD channels by year's end.

The new satellites, however, mean DirecTV's current standard-definition customers will need new dish receivers that require a far broader view of the sky to pick up the signals.

AT&T's plans for HD

AT&T, which acquired BellSouth's local phone business last year, also is investing heavily.

The company resells video service through a partnership with DirecTV. But AT&T's $350 million "U-verse" investment will upgrade its fiber-optic network to transmit TV signals over phone lines using Internet protocol. The company wants to increase sales of bundled packages of phone, Internet, wireless and TV service.

AT&T officials declined to say when U-verse HD service will debut in North Carolina or how much it will cost. The service began this month in Atlanta, where subscribers get about 40 HD channels.

"This will be the most robust video service available, as far as capabilities and applications," said Della Bowling, spokeswoman for AT&T in the Carolinas. She declined to discuss a timeline for introducing the service or whether it would match the breadth of programming now available from satellite operators.

Despite the abundant opportunity, not all providers are diving in head first.

Telecom company Embarq began selling TV service in North Carolina last year to complement its high-speed Internet and wireless services.

But rather than build its own infrastructure, the company will resell TV signals from the satellite provider Dish Network.

Cable penetration fell about 1 point to 61.3 percent from a year ago to the lowest penetration since 1990, according to a recent analysis of Nielsen data by the Television Bureau of Advertising.

Satellite, meanwhile, increased to 27.6 percent from 24 percent.

Telecom companies, which are just getting into the TV business, are expected to claw out 8 percent of the market by 2011, mostly at the expense of cable, according to research firm Gartner.

True or not, one thing is for sure: Consumers will not return to standard-definition formats once exposed to HD. That means more investment to come. "We'll continue to see content move to HD," Poor said.

About 40 percent of U.S. households own a high-definition TV, up from 26 percent last year and 16 percent in 2005, according to the Consumer Electronics Association.

"We'll see content move to HD. The bottleneck is the investment in ... infrastructure," Poor said.