Blue Skies: A History of Cable Television

12: 500 Channels (1992–1996)

12 500 Channels (1992–1996) The person whose face is to be transmitted by the Telephone Company’s new process of television sits in front of a machine at one end of a telephone line. —“Seeing Over the Telephone,” The American Review of Reviews, May 1927 1 I n 1947, engineers working at Bell Laboratories created the first transistor . In the late 1950s, they developed methods to multiply the functions of many of these devices on a single silicon wafer, an integrated circuit, or chip. In 1968, Robert Noyce and Gordon Moore founded Intel Development Corp. to improve and manufacture those chips. In 1975, a small businessman in Albuquerque, New Mexico, Ed Roberts, placed an Intel chip at the heart of the first widely publicized personal computer, the Altair. Inspired by the Altair, two young computer enthusiasts, Steve Wozniak and Steve Jobs, created and promoted the Apple computer. Prodded by the success of Apple and a rapidly expanding personal computer market, IBM, working with a pair of young software designers, Paul Allen and Bill Gates, introduced its own “PC” in 1981. Through the mid- and late 1980s, a growing legion of PC users were exchanging files, messages, and ideas by connecting their computers through telephone lines, frequently tapping into a high-speed data exchange system developed by the government called NSFnet. The computers spoke their own language, the digital vocabulary of zeros and ones. A new technology was evolving, and it would have a profound impact on cable, the broader telecommunications industry, and society. The “Western Show” was the cable industry’s second largest annual event, surpassed only in importance by the NCTA’s national convention . Sponsored by the California Cable Television Association and typically held in Anaheim in December, it drew the leading operators and 582 / Chapter 12 programmers, equipment suppliers, and assorted retainers. John Malone was there in early December 1992, two months after Congress had overridden President Bush’s veto of the 1992 Cable Act. Malone had an announcement to make. TCI was placing an order for 1 million new cable boxes with General Instruments. The boxes would harness digital technology to supply the consumer with hundreds of new channels; 500 channels was the number he picked. “This is just the beginning, this first round of products is the first of an evolution,” Malone told reporters.2 The set-top boxes would start going into living rooms in January 1994. “Television will never be the same,” he said.3 It was not Malone’s first public comment on the promise of digital technology to deliver a cornucopia of cable programming. A high-tech company—SkyPix—demonstrated its digital equipment at the NCTA National Show in New Orleans in March 1991 and Malone suggested it could deliver 200 or more channels. But it was an off-hand remark. It was not backed by a formal news conference, an order for a million cable boxes, and a story on the front page of the New York Times. “A Cable Vision [or Nightmare]: 500 Channels,” read the Times headline,4 and the 500-channel future suddenly was a part of the business and cultural lexicon. Malone’s announcement was widely reported, and sometimes gilded, by the business and popular press; with each retelling, the vision grew in scope and complexity. It was the latest turn in the social construction of cable. Fueled by the emerging power of digital processing and communication, Blue Skies were back, promoted by the same dependable cast—academics, policy analysts, regulators, politicians, and cable leaders themselves—which had driven the rhetoric through each of its earlier manifestations. All were assembled again for the task of redefinition. The new social construction promised hundreds of channels, and more. The social definition was dramatically expanded to encompass not just television, but telephone and data services as well. In reporting Malone’s announcement, the Times declared the new technology would likely “accelerate the marriage between computers and television , allowing customers to roam through video libraries hundreds of miles away,” and “offer a broad range of interactive shop-at-home services, in which customers order anything from pizza to jewelry by pressing a button on the television remote control.”5 Malone’s 500-channel box would be but one piece of a larger telecommunications infrastructure, one that was churning discussion in every quarter of the television, computer, and telecommunications universe. The system, as sketched in the collective mind of the industry and its observers, used digital technology bound by...