HNS Unveils New Satellite Service

The company says that recent research shows 50 million U.S. households have no broadband options at all, but that satellite broadband could reach those homes. HNS' parent company is the owner of DirecTV, and the service is called Direcway.

by Roy Mark of www.internetnews.com [June 25, 2001]

On the premise that there is a significant high speed Internet market that's only available by satellite, Hughes Network Systems (HNS), is unveiling its next generation of satellite services, Direcway, that offers broadband-by-satellite services for enterprises, consumers, small businesses and telecommuters.

HNS is a subsidiary of Hughest Electronics Corp. (owner of DirecTV), which is, in turn, a wholly-owned subsidiary of General Motors Corporation. Hughes also owns Telocity, which has been renamed DirecTV DSL.

Hughes has been an early leader in building the satellite industry, inventing VSAT technology that today serves over 400,000 network terminals in 85 countries, as well as the satellite broadband business through DirecPC and its 116,000 subscribers.

"Our message to the marketplace is clear," said Pradman Kaul, chairman and chief executive officer of HNS. "Hughes Network Systems has extensive experience in inventing and building the satellite business; we have great retail and service partners to sell Direcway to end users; and we have high-speed broadband services that are available nationwide today."

HNS also has "Powered By" alliances with a number of service providers, with new ones to be announced soon. These partnerships link Direcway to more than 45 million users via highly targeted advertising and promotion.

"Satellite-by-broadband is available today and ready for installation in many of the more than 50 million U.S. households that only have dial-up Internet service, but who want the same faster Internet connection at home that they have become used to at work," said Paul Gaske, executive vice president and general manager for the North America division of HNS. "We see a tremendous market opportunity throughout the United States."

According to the recent studies of single-family households, the U.S. broadband market is divided into four groups:

• 21 percent that are "broadband rich" and currently have access to cable and DSL
• 18 percent that are "broadband limited" and currently can choose from cable or DSL, but not both
• 24 percent that are "broadband waiting" and will not have access to cable or DSL for 3 to 5 years
• 37 percent that are "broadband never" and include areas that don't have—and most likely will never have—DSL or cable

"There is a significant market out there that's only available to satellite," said Kaul. With all of the powerful business and marketing alliances we have secured in the last 12 months, we see an enormous potential for tapping underserved markets nationwide."

Direcway will be sold via consumer electronics retailers. In addition, the service will be available from independent dealers nationwide.

HNS will also be developing value-added services for Direcway, and new premium content services will be announced June 26 at Retail Systems 2001 in Chicago.

—End