Reaction to “Empires of Entertainment” and the Rise of HBO

pepper1Jennifer Holt’s book Empires of Entertainment: Media Industries and the Politics of Deregulation, 1980-1996 traces the deregulation and development of the media industry. Her first chapter 1980-1983: Film Versus Cable was of particular interest to me. It is interesting to follow along the growth of HBO, especially knowing the tremendous success and growth they have continued to achieve up until the present day. This first chapter pin-points the beginnings of HBO, Holt addressed that as regulatory constraints began to be lifted, and after the launch of RCA communications satellite (SATCOM I), there became an overwhelming growth in cable TV that began in 1975. The first to join the SATCOM I clientele was HBO. With a new method of distribution in place, as well as lifted cable regulations, HBO became the dominating force in pay-cable service, which inevitably resulted in suspicion from the FCC. After being litigated by the FCC in March 1977, HBO won the lawsuit when, “the US Court of Appeals struck down the FCC rules that essentially protected commercial television broadcasters while restraining cable companies” (Holt, 26). This victory strengthened the continuing growth of the cable industry. As HBO continued to grow in success and viewership, Hollywood studios attempted to form their own pay-cable services to achieve the same success as HBO, while also attempting to slow down some of HBO’s success. Holt touches upon the attempted collaboration between Paramount, MCA/Universal, Twentieth Century-Fox, and Colombia beginning in 1979. These four Hollywood studios began to develop a plan for their own collaborative pay-cable service, which they called “Premiere,” which as Holt puts it, “would allow the studios to distribute their own films exclusively to their own pay cable outlet” (Holt, 30). However, the timing proved to be unlucky, as the antitrust laws under the Carter administration were still moderately regulated. This time HBO sought the help of the Department of Justice to investigate antitrust violations by Premiere. In the end the Department of Justice prevented Premiere from going on the air, and claimed, “the Premiere agreement was anticompetitive, and in violation of antitrust statues” (Holt 31). HBO managed to remain on top of the game compared, to other pay-cable services (or any attempts at forming pay-cable services, i.e Premiere), for years to come.

What was interesting to me in all this, is how HBO was able to manage steady success at the top of the game. Despite any/all threats to this premium cable service (much like the VCR, as HBO’s Chris Spencer explained in his lecture—shout out to Ella’s dad), HBO does not allow the chance for anyone, or anything, to destroy the all the past success that has obtained. However, I am interested to see what the future holds, in regards to how they will address their newest competitor—the Internet (i.e Netflix, Hulu, Apple TV, etc.)

Feature Image from Shayne Pepper http://flowtv.org/2010/05/beyond-netflix-and-tivo-rethinking-hbo-through-the-archive-shayne-pepper-north-carolina-state-university/

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