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Satellite Television & Associated Resources

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Satellite Television & Associated Resources (STAR) was an American operator of subscription television (STV) systems. Owned by businessman Byron Lasky and headquartered in Santa Monica, California, the company operated services under the "Star" and "Star TV" banners in markets including San Francisco, Boston, and New Orleans, which either broadcast in scrambled form on UHF television stations or via multipoint distribution service (MDS) microwave channels. With $12 million in liabilities, the company was forced into Chapter 7 bankruptcy in 1983 and its assets closed and sold to other companies.

History

In 1979, STAR obtained federal licenses to operate microwave systems in 40 cities, including Richmond, Virginia, and Louisville, Kentucky.[1] Programming was provided by Hollywood Home Theatre's Fanfare service, based in Houston.[2] By September 1980, when the firm completed an initial public offering, STAR was operating in Richmond, Louisville, Birmingham, Alabama, and Norfolk, Virginia;[3] a fifth MDS system in New Orleans was added between then and May 1981,[4] and it also operated a sixth franchise in Los Angeles.[5] Shares traded on NASDAQ under the ticker symbol SATV.[4]

The original antenna for Boston's WQTV, which a STAR affiliate acquired in 1981 alongside the purchase of its STV business

In January 1981, STAR acquired two unused subscription television franchises from Universal Subscription Television of Burlingame, California, a subsidiary of Canadian firm CanWest Capital Corporation, for $1.9 million—$1.1 million for the rights to a service on WGPR-TV in Detroit and $800,000 for the franchise for KSTS in San Jose, California; it also purchased $2.1 million in equipment from Universal.[6] The Detroit service had not been built by Universal and never came to fruition under STAR, likely because there were already two STV services on air in that city.[7] Later in the year, it spent $20.5 million to acquire Universal's only going STV venture, "Starcase" on Boston's WQTV (channel 68), and another $600,000 for the station itself in a subsequent transaction.[8]

By mid-1982, generally the peak of STV operation nationally, STAR's Boston service had 52,000 subscribers with another 24,000 in the San Francisco market (between KSTS and KTSF, where it took over from that station's prior "Super Time" offering by acquiring it in November 1981[5]). However, the company was bleeding cash. In 1981, it had lost $7 million, and in mid-1982, it sold its five MDS systems,[9] having exhausted its bank lines that spring.[5]

Satellite Television and Associated Resources would be one of the first and highest-profile failures in the STV industry, even after the attempt to raise capital by selling the MDS operations and focusing on the two broadcast STV operations. On January 4, 1983, the general manager of Star TV in San Francisco informed his 70 employees that it would be acquired by Willamette Subscription Television of Portland, Oregon, which had been operating an ON TV-branded service on KECH-TV serving that city; at the time, the company was losing 750 customers a month, and the general manager reported that a Chapter 11 bankruptcy filing was imminent.[10] However, by March, the company was still trying to sell the operation.[11] In Boston, STAR sold its assets to its direct competitor: Preview, which had been broadcasting on WSMW in Worcester, Massachusetts. At the end of January, STAR's 23,000 remaining subscribers got Preview program guides for February;[12] the end for Star came on the night of February 12, when customers were confronted with a graphic slide after a second mortgage holder foreclosed on the operation and sold its assets privately.[13] Preview bought the subscriber list and temporarily simulcast most of its programming on both channels 68 and 27 until it could switch Star's subscribers to Preview equipment.[14]

Our view of the STV business is that it has gone down the drain.

Robert L. Oppenheim, president of STAR, on his company's troubles in March 1983[5]

In early March 1983, Robert L. Oppenheim, STAR's president, acknowledged that the firm had $12 million in liabilities; while it had hoped to shed liabilities with the MDS system sales, it was still losing subscribers "hand over fist", attributed to the growth of cable systems and the recession then affecting the economy, which caused company-owned systems to start losing subscribers before they ever broke even because most costs were fixed.[5] At the end of March 1983, Satellite Television & Associated Resources was forced into Chapter 7 bankruptcy by three movie studios and Admarketing, an advertising company in Los Angeles.[13] The latter was the firm's largest creditor, owed more than $750,000.[15] One legal action related to the company continued into 1984; it unsuccessfully petitioned the Supreme Court of the United States to hear an appeal of an appeals court ruling in which it had charged without success that Continental Cablevision in Richmond, by requiring apartment companies to wire their own complexes or pay Continental and enter into exclusive contracts with the company, stifled competition.[16]

References

  1. ^ Dorsey, Tom (July 13, 1979). "Louisville Subscription TV Limited offers alternative to cable-television". The Courier-Journal. Louisville, Kentucky. p. C2. Archived from the original on March 29, 2022. Retrieved January 26, 2022 – via Newspapers.com.
  2. ^ "HHT Programs Richmond MDS". TVC. March 15, 1979. p. 20 – via Internet Archive.
  3. ^ "Werbel-Rorth Securities Inc. of Lauderhill..." Fort Lauderdale News. Fort Lauderdale, Florida. September 19, 1980. p. 12C. Archived from the original on March 29, 2022. Retrieved January 26, 2022 – via Newspapers.com.
  4. ^ a b "Current Corporate Reports". Barron's. May 25, 1981. p. 49.
  5. ^ a b c d e Gelman, Morrie (March 10, 1983). "STAR's luster fading with stv". Electronic Media. pp. 1, 23 – via Internet Archive.
  6. ^ "Two subscription TV franchises were sold for $1.9 million". The Los Angeles Times. Los Angeles, California. January 23, 1981. p. IV:2. Archived from the original on May 24, 2021. Retrieved January 26, 2022 – via Newspapers.com.
  7. ^ Duffy, Mike (February 9, 1981). "'Mister Lincoln' rates a vote for artistry". Detroit Free Press. Detroit, Michigan. p. 5C. Archived from the original on January 23, 2022. Retrieved January 26, 2022 – via Newspapers.com.
  8. ^ Wessel, David (August 4, 1981). "The medium's message: money". The Boston Globe. Boston, Massachusetts. p. 27, 33. Archived from the original on May 31, 2021. Retrieved January 26, 2022 – via Newspapers.com.
  9. ^ "Special report: Subscription television" (PDF). Broadcasting. August 16, 1982. pp. 33–45. Archived (PDF) from the original on 2020-10-30. Retrieved 2022-01-27.
  10. ^ "Star TV station sold". Oakland Tribune. Oakland, California. January 5, 1983. p. B-1. Archived from the original on March 29, 2022. Retrieved January 26, 2022 – via Newspapers.com.
  11. ^ Harris, Kathryn (March 11, 1983). "Pay TV Payoff Shrinks as Some Try to Sell Out". The Los Angeles Times. Los Angeles, California. p. 4, 21. Archived from the original on March 29, 2022. Retrieved January 27, 2022 – via Newspapers.com.
  12. ^ McLean, Robert A. (February 12, 1983). "Star and Preview planning to merge?". The Boston Globe. p. 35. Archived from the original on May 25, 2021. Retrieved July 13, 2019 – via Newspapers.com.
  13. ^ a b Harris, Kathryn (March 28, 1983). "Pay TV Firm Is Forced Into Chapter 7". Los Angeles Times. p. IV:2, IV:6. Archived from the original on May 24, 2021. Retrieved May 23, 2021 – via Newspapers.com.
  14. ^ McLean, Robert A. (February 15, 1983). "Star sinks: its subscribers get Preview". The Boston Globe. p. 17. Archived from the original on July 14, 2019. Retrieved July 13, 2019 – via Newspapers.com.
  15. ^ "Falling STAR" (PDF). Broadcasting. April 4, 1983. p. 131. Archived (PDF) from the original on 2021-11-08. Retrieved 2022-01-27.
  16. ^ Wermiel, Stephen (February 22, 1984). "Justices Uphold Law Requiring States To Let Tandem Trailers on Major Roads". The Wall Street Journal. p. 1. ProQuest 397962350 – via ProQuest.
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