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About Satellite-TV
December 2, 1986: The First Signs of Unity

On December 2, 1986 the Satellite Broadcasting and Communications Association (SBCA) was founded in Anaheim, CA. The SBCA was the result of a merger of two trade organizations - the society of Private and Commercial Earth Stations (SPACE) and the Direct Broadcast Satellite Association (DBSA). SPACE had represented primarily the manufacturers, distributors and retailers of DTH systems. DBSA comprised of companies such as RCA Americom, AT&T, Hughes, Comsat and USSB - all of which were interested in high power DBS. The new organization, which was led in its first year by SPACE co-chairman Taylor Howard and Dr. John Clark of RCA Americom, faced the immediate challenge of how to restore unity to a fractured industry. For the first time ever, satellite programmers had an opportunity to participate in the decision making. As the new satellite trade association took shape during the early part of 1987, sparks of optimism returned to the satellite business. Little did the SBCA leaders know that perhaps the industry's biggest challenge would soon surface.

1987 - 1993: Piracy Dominates DTH

Shipments of DTH hardware quickly rebounded in 1987. This upswing in sales was driven by the advent of integrated receiver/decoders which combined the decoder module with the receiver unit, and perhaps even more importantly, the arrival of "program packages." The grouping of encrypted services (all of which had chosen to use the VideoCipher II (VCII) scrambling system) into attractively priced packages was a major step forward in the sale of programming to the consumer. Just as stability was returning to the industry, the VCII system came under attack from "hackers" - computer experts dedicated to defeating the complex digital codes. Within months of the first rumors of a "break' in the system, the industry's worst fear was realized when signal piracy exploded across the nation. Many dealers chose to offer illegal devices. It became apparent that not only were new systems being pirated at time of installation, but many existing systems were being "modified" to steal programming services. Ultimately, of 1.9 million VCII units manufactured between 1986 and the mid-1990s, less than 500,000 were legally receiving services. Clearly, satellite signal theft posed a serious threat. In 1987, SBCA leadership was contacted by executives of major Hollywood movie studios to discuss the emerging problem. The message from Hollywood was clear - while they strongly support the DTH industry, piracy needed to be handled immediately. Failure to effectively deal with the issue would leave the movie studios with no choice but to discontinue licensing distribution to DTH owners. With this message in mind, the industry embarked on a two-front effort.

General Instrument Corp. (which had now acquired the Cable Home Communications Division of MA/COM) started a series of electronic countermeasures to shut down illegally modified boxes while also beginning work on a second generation scrambling system dubbed, the VideoCipher II Plus (VCII Plus). The SBCA created an Anti-Piracy task Force comprised of several retired senior FBI agents and a former Federal prosecutor who organized a network of private investigative firms to collect evidence of piracy. The summer of 1990 saw the introduction of the VCII Plus system. Once legitimate paying consumers received VCII Plus decoder at no cost, the programming services began transitioning to the new system in the fall of 1992. The result of this movement is reflected by the dramatic rise of net decoder authorizations in 1993 and 1994 as "pirate" consumers were forced to purchase new modules and begin paying for the services they desired.