Telstar 5 In Operation, But What About AlphaStar?

Loral Skynet said its Telstar 5 satellite is in full commercial operation a little more than a month after its launch.

Telstar 5 features a network broadcast/syndication distribution neighborhood anchored by the ABC and the Fox networks. The satellite also will be used by TelQuest, which will provide digital video services to wireless and traditional cable headends.

Other Telstar 5 customers include SPACECONNECTION, GlobeCast (formerly Keystone Communications) and Broadcast Satellite International.

No mention was made regarding AlphaStar's use of the new satellite. The service, which is going through bankruptcy proceedings in Delaware, was slated to switch from its present Telstar 402 satellite to the new bird this month, adding new channels and services once the transfer was complete.

Loral reportedly asked a bankruptcy judge to be released from its contract with AlphaStar, saying the service hasn't paid for using the satellite since it filed for bankruptcy protection. The company also filed a motion asking AlphaStar to "accept or reject" leases for transponders aboard the new Telstar 5 bird by Aug. 1.

Television service will be discontinued in September when signals are scheduled to be removed from the satellite AlphaStar is now using and if a resolution is not reached before then, said Jim Wilkinson of Tee-Comm Electronics, AlphaStar's parent.

Meanwhile, Satellite Week reported that Alphastar received bankruptcy court approval for $1.2 million in debtor-in-possession financing and has discussed possible sale of company to set-top box suppliers Samsung and Hyundai.

The approved financing came from Bank of Montreal, Satellite Week said, the same entity that took Tee-Comm into receivership in May. The money will fund Alphastar operations for another 90 days.

In addition to Telstar 5 and the orbiting Telstar 4, which provides C-band and Ku-band coverage for the continental United States, Hawaii, Alaska, Puerto Rico and the U.S. Virgin Islands, Loral Skynet has other pending launches. Future satellites include high-power Telstar 6 and 7 in 1998 and Telstar 8 and 9 in the following years.

DirecTV Eyes Another Telco Partner

DirecTV may score a distribution/sales deal with Bell Atlantic, which would make the East Coast Regional Bell operator another telephone company to join the Hughes-backed home satellite service, Multichannel News reported this week.

The Philadelphia-based company, currently completing a merger with NYNEX, would offer DirecTV to customers on a commission basis, similar to sales structures with other DirecTV retailers, a source told the weekly magazine.

AT&T bought a 2.5 percent stake in DirecTV for $137.5 million in January 1996. Analysts have said AT&T's effort has fallen short of expectations, which may give DirecTV leverage in bringing in another telco distributor. DirecTV also has a sales agreement with Cincinnati Bell.

DirecTV, AT&T and Bell Atlantic officials wouldn't comment on the Multichannel news story.

USSB Goes Dark Tuesday Evening

U.S. Satellite Broadcasting's service went dark for a brief period of time Tuesday evening, with only a blank screen and occasional intermittent service or a technical difficulties notice found on its channels.

USSB's DSS partner DirecTV was not affected. USSB appeared to have return to normal shortly before 10 p.m. eastern daylight time.

Other details were not available.

FCC Approves Two More LEO Satellite Systems

The Federal Communications Commission granted licenses to two companies for the construction and launch of satellite systems offering mobile two-way communications that include phone, paging and fax.

With FCC approval, Constellation Communications and Mobile Communications Holdings can now begin building their low-earth orbit, multi-billion dollar satellite-based systems. Constellation's system would use 46 satellites and Mobile Communications' would use 16. The licenses cover 10 years.

Investors in Mobile Communications include Harris Corp., Westinghouse and Israeli Aircraft Industries. Investors in Constellation include Bell Atlantic, E Systems Inc. and CTA Launch Services.

After granting the licenses, the FCC said other low-orbit satellite licenses will be available.

Europe Prepares For "TV Without Frontiers"

After more than two years in the making, the European Union's new "Television Without Frontiers" directive last week achieved its final step: Adoption by the body's ministers.

The mandate's long journey involved heated talks between the 15-nation bloc's different institutional actors. EU countries now have 18 months to apply the new law, which leaves unchallenged Hollywood's dominance of the continent's television screens.

Television stations will still be required to devote more than one half of broadcast time to European productions, but now only "where practicable."

It also guarantees that viewers can watch sporting events free, even if exclusive rights have been bought by pay television services. But the provision applies only when they appear in a member country's list of protected events.

Microsoft, CBS Deny Network Purchase

CBS and Microsoft officials on Tuesday denied Westinghouse Electric may sell the television network and related businesses to the software giant.

The New York Post reported that Microsoft was reviewing the finances of Westinghouse's CBS unit and was considering a purchase. The newspaper also reported that Seagram "is also said to be looking at CBS."

However, the Post story concluded Microsoft and Seagram interest in CBS is preliminary and it was not clear if offers would be made.

In its denial, Microsoft said it has no interest in buying CBS, and a purchase would jeopardize its deal with NBC. Microsoft invested $220 million in its MSNBC cable news venture with NBC.

Westinghouse is preparing to split its media and industrial businesses into two companies. That should be completed in late September or early October, according to company officials.