There could be new players emerging in home satellite TV. For starters, BellSouth is ready to launch a DTH offering to compete - at least within the areas it serves - with DirecTV, EchoStar and cable. The move by the regional phone operator is in the March 27 issue of Business Week magazine. Under BellSouth's DTH plan, the company will lease transponders on Loral's medium-power satellites. Subscribers would need a dish that is larger than high-power dishes used by DirecTV or EchoStar. BellSouth could shrink the dish size by focusing on a specific region of the country - such as its territory - but that could lead to higher leasing costs for bandwidth. Wall Street observers said the plan from the Baby Bell will likely meet fierce competition from established satellite players. "We believe BellSouth's effort would lack critical ingredients and comes too little, too late to have a significant impact on the existing DBS players," Merrill Lynch's Tom Watts said. In six years, DBS has enrolled more than 11 million subscribers and is poised to grow even more with local channel offerings and interactive TV, among other services. "We believe BellSouth's decision to enter the market would be primarily a defensive move against cable to bundle with video and, presumably, high-speed DSL Internet access and potentially other services," Watts said. BellSouth has a video offering through Americast, a consortium that involves four other Baby Bells. The service is reportedly being discontinued after gaining only 350,000 subscribers in two years. Meanwhile, Alphastar has resurfaced, this time with the help of mPhase Technologies, a designer of broadcast digital television and high-speed data solutions. Alphastar, the former DTH platform revived by new investors after its bankruptcy in 1997, will work with mPhase Television to develop a network providing telephone companies with interactive television and video. The service will use satellites and standard copper telephone wire. The first client will be Hart Telephone, a local exchange carrier located in Hartwell, Ga. Several other installations are planned, the company said.

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House Panel Ponders Building Access

The House Subcommittee on the Constitution held a hearing Tuesday to examine the constitutionality of forced access on building owners for telecommunications providers. The subcommittee heard testimony from constitutional law professors as well as from representatives of the real estate and telecommunications industries. The conflict centers on the argument that if a building owner grants a telecommunications provider access to the building, the building owner should be forced to open the building to access from any telecom provider who wishes to be allowed access. The Federal Communications Commission is considering a rule that would require building owners to provide access to telecommunications service providers under rates, terms and conditions comparable to those they have provided in the past to other telecommunications providers, such as phone and cable companies. Satellite TV, and its effort to gain access to multiple-dwelling units and other properties, is part of the picture. The FCC is attempting to ascertain whether consumers in multi-tenant buildings have the ability to access the service provider of their choice, or whether discriminatory practices on the part of building owners exist for competitive carriers. Constitution Subcommittee Chairman Charles T. Canady (R-Fla.) said the subcommittee would have oversight of the applicability of the Fifth Amendment of the Constitution to any such rule. "Some of the proposals contained in the FCC's NPRM, if adopted in a final rule, would require real property owners to acquiesce to the physical presence of uninvited telecom service providers on their private property in order to further a public policy promoting the availability of telecom services," Canady said. "Such a rule would implicate the Fifth Amendment of the United States Constitution, which states, in part, that 'private property shall not be taken for public use without just compensation.'" Subcommittee member John Conyers (D-Mich.) said he would prefer market competition to be the determining factor in telecommunications access issues. However, "where monopolies exist and it is possible to enact legislation to help out where the market fails, such legislation must be constitutionally sound," Conyers said. Steven R. Rosenthal, a partner in Cooper, Carvin & Rosenthal law firm, testified that the Fifth Amendment "should protect building owners from having to open their property for use by any telecom service provider for the purpose of giving that provider an economic advantage by virtue of being on the owner's property."

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BSkyB/Kirch Deal Gets OK

The European Union cleared British Sky Broadcasting's deal to acquire a stake in KirchPayTV, giving the U.K. satellite provider a link into Germany's pay-television market. The European Commission said in a statement that the deal "will lower barriers to entry which would otherwise have been raised by the operation and therefore eliminate the serious doubts with regard to a creation or strengthening of a dominant position." Under the deal, BSkyB is getting 24 percent of Kirch. While BSkyB may not have a direct role in the German operation, the commission said Kirch's dominant position in the country could be strengthened by its access to BSkyB's marketing and distribution know-how.

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DISH Ratings Jump

Credit Suisse First Boston raised its 12-month price target on EchoStar from $125 to $162 a share. The jump in ratings didn't help the DISH stock, however. During trading Tuesday, EchoStar closed down 1/4 to $120. The drop may not necessarily be related to the rating. It could be attributed to the Federal Reserve's move to hike short-term interest rates, which created a mixed day on Wall Street. In other stock moves, British Sky Broadcasting fell more than $5 to $170, Hughes rose slightly to $120 while Pegasus jumped nearly $3 to $128.12.

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COMP WATCH: Cable Study Spotlights DBS