Sky Cable makes major expansion move

Sky Cable, the country’s biggest cable television brand, is set to embark anytime now on its most ambitious undertaking so far, with the introduction of digital addressable set-top boxes among its subscribers, beginning with those in the high-end residential and commercial areas of Pasig, The STAR learned.

The full implementation of the move to install digital set-top boxes among all its subscribers, however, may take a while because of the huge funding requirement involved. Sky Cable, which now includes Home Cable, have a combined subscriber base of 200,000 which means that just to put one box per home will already cost the company P600 million for the cost of the boxes alone. Each box costs around P2,500 to P3,000 ($52 to $55 per box).

An official disclosed earlier that the full implementation may take around five years. "We first have to convince our stakeholders and creditors that investing in this move will generate favorable results for the company," the official said. Sky Cable is under debt restructuring.

Earlier, Sky Cable president Eugenio Lopez III told The STAR that in the past, most of the churn (subscribers who stop their cable TV subscriptions) is attributed to a shift to illegal connection. "But over the last three months, Sky Cable has been experiencing net subscriber additions (meaning gross sales less churn is still positive)," he said.

Sky Cable officials told The STAR that the cable TV operator chose certain subdivisions in Pasig as its pilot area for the introduction of digital set-top boxes because this locality more or less represents the kind of subscribers who will use the boxes to subscribe to pay-per-view programs. Since all the cable TV channels will be encrypted in the box, a shift to addressable set-top boxes means "no box, no signal."

"These are areas where we can expect to generate additional revenues, primarily from pay per view, even if we give the first box for free," the official explained.

Central CATV, which operates the Sky Cable and Home Cable brands under their new names Sky Cable Gold and Silver, is also set to launch its prepaid service, initially in Pasig.

Subscription to the Sky Cable prepaid service means that the subscriber may have to lease the set-top boxes wherein certain basic cable programs will be encrypted.

Company officials hope that with the prepaid service, they will be able to put a stop to illegal connections, numbering around 70,000 or even more. "We estimate that there is a two to one ratio between legitimate and illegal cable TV connections," an official told The STAR.

Sky Cable will also be launching soon its Sky Cable Platinum. Under this new offering, existing subscribers of Sky Cable Gold or Silver can lease a set-top box and pay an additional monthly service fee of P350, in exchange for which they will get 25 new premium channels which includes three more HBO movie channels.

Those in Pasig however have no choice but to use digital set-top boxes, without which they will not get any cable TV signal.

Officials said the plan for Pasig, and eventually for all Sky Cable subscribers, is to distribute the first box for free iwhile the other boxes will have to be purchased or leased from Central CATV. Each television will require one box.

The installation of digital addressable set-up boxes is a move being resorted to by the local cable tv industry in order to minimize if not altogether put a stop to signal piracy. While there are between one to 1.5 million paying cable tv subscribers nationwide, it is estimated that there‚s another one million that is illegally connected.