Satellite Access Kevin Werbach comments on the $156 million investment by Kleiner Perkins and others in WildBlue, a two-way broadband satellite company:
With DirecTV and many others abandoning grand plans for satllite broadband, one must be skepical about yet another effort. By 2004, terrestrial broadband should be widespread enough to leave only a limited market for satellite. But Kleiner Perkins and the other investors who put money into WildBlue must think they know something.
I'm equally skeptical of any investment in a market that has proved impossible to profit in at the scale a DirecTV operates. Kleiner must think there is a consolidation play here, perhaps with satellite radio operators like XM and Sirius.
[RatcliffeBlog: Business, Technology & Investing]
The failure of the current FCC's policy of granting quasi-monopolies by access type (DSL, CATV, Sat.) is quickening. DirecTV is also abandoning DSL efforts. Since Satellite can't compete in telephony, they are destined to be pure play TV. Cable will continue its entry into telephony and access. Cable recently consolidated again to the point where, according the LA times this Sunday, Comcast posesses significant leverage as a distributor over content providers and will go to war next year renegotiating contracts. This may mean favorable terms for satellite providers as contracts are benchmarked.
If your average consumer is faced with only the choice between ILEC DSL or municipal monopoly CATV, there is room for a third way. Especially if by tweaking TCP/IP settings latency is resolved to provide a comparable product in Satellite. And since it bypasses many of the rollout costs and scales well it may reach competitive price points ($10-20/month), WildBlue may have something. Something attractive to Satellite operators to acquire when awarded for being acquisitive again and competitive with other quasi-monopolies.
4:39:51 PM 
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