The Satellite Home Viewer Improvement Act: Price and Quality Impact of Direct Broadcast Satellite Companies’ Provision of Local Broadcast Networks

21 Pages Posted: 10 May 2012

See all articles by Michael E. Clements

Michael E. Clements

Government Accountability Office (GAO)

Stephen M. Brown

affiliation not provided to SSRN

Date Written: September 20, 2003

Abstract

In the subscription video industry, cable-based companies – the dominant firms – face competition from a competitive fringe – satellite-based companies. Prior to 1999, satellite-based companies operated under a government-created competitive disadvantage. These companies were generally not permitted to deliver local broadcast networks (such as affiliates of ABC or CBS) to their subscribers; cable-based companies did not face this constraint. With passage of the Satellite Home Viewer Improvement Act of 1999, the Congress removed this asymmetry and created a more level competitive environment. We estimate a three-equation structural model to test the impact of direct broadcast satellite (DBS) companies’ – the primary satellite-based companies – provision of local broadcast networks. We find that when both DBS companies provide local broadcast networks, cable-based companies improve the quality of service they provide to their subscribers, although we find no impact on the price for cable service.

Suggested Citation

Clements, Michael E. and Brown, Stephen M., The Satellite Home Viewer Improvement Act: Price and Quality Impact of Direct Broadcast Satellite Companies’ Provision of Local Broadcast Networks (September 20, 2003). TPRC 2003, Available at SSRN: https://ssrn.com/abstract=2053811

Michael E. Clements (Contact Author)

Government Accountability Office (GAO) ( email )

441 G St., NW
Washington, DC 20548
United States

Stephen M. Brown

affiliation not provided to SSRN ( email )

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