Motorists traveling west on Mulholland Drive in Los Angeles, after slithering up and around several of the road’s legendary curves, will come upon a spectacular view of the San Fernando Valley. A flat carpet of land dense with buildings and trees and criss-crossed by tracks of gray asphalt, it spills northeast nearly to Pasadena, and to the west, stretches to the Simi Hills. It is the suburban and workmanlike counterpoint to the Los Angeles of palm trees and suntanned actors that people have been taught to think of from movies and travel brochures.
The San Fernando Valley shares many traits with greater Los Angeles, however. One of them is the fact that it lots of people live there – 1.8 million, according to local estimates.
In fact, in the early 1980s, when the city of Los Angeles was playing catch-up to other big cities that had granted franchise authorizations for cable television companies, city officials feared a single cable company wouldn’t be able to serve the entire San Fernando Valley adequately. Instead, city officials chopped the thing into two pieces, creating separate cable franchises in roughly the western and eastern halves of the area. The parsing of the Valley complicated further what was already an elaborate scheme to wire the city’s various neighborhoods for cable television, and the process of selecting cable providers for the East and West Valley franchises took years.
But fighting for the right to build a cable system was just one of the complications aspiring Los Angeles cable companies had to face. Another was the considerable head-start that had been achieved by a different sort of pay television system. It went by various names, including “subscription TV” or, in the industry trenches, “multipoint distribution system” television. But San Fernando Valley residents knew it simply by the brand names that prevailed at the time. One was SelecTV, and the other was On TV.
As single-channel, over-the-air pay TV services making use of microwave frequency spectrum, On TV and SelecTV enjoyed tremendous brand recognition throughout Los Angeles, and especially in the Valley, where relatively flat terrain made it easy to attain the line-of-sight reception required for their signals, and an absence of cable TV made it easy for the two to rack up customers.
Owned and operated by Oak Industries Inc., On TV provided a schedule of commercial-free mainstream movies during the day for $19 a month, and a separate tier of sexually explicit films late at night for an extra fee. Industrious signal pirates played an ongoing cat-and-mouse game with On TV, but by and large its scrambling technology thwarted serious levels of larceny.
Of five cities, Los Angeles was the biggest On TV market by far, and the Valley was its epicenter. At its height, in 1982, On TV Los Angeles had more than 200,000 customers. With its relatively inexpensive over-the-air transmission system, the service contributed lofty cash flow margins. Oak had plans to expand to additional markets, and to add second channels in some of its markets.
But one by one, On TV’s customers began to diminish. By 1984, Los Angeles had awarded most of its cable franchises, and companies were furiously selling new subscriptions. Despite Oak’s efforts to hang on, On TV was done in by a superior value proposition: For around $30 a month, cable customers could get not only dozens of new TV channels like CNN and USA Network, but a subscription to Home Box Office, which televised the same movies On TV featured. In August of 1984, Oak agreed to sell its On TV Los Angeles operation, with about 200,000 subscribers, to its rival SelecTV. Within two years, the subscription television industry was almost entirely vanquished.
More than 20 years after On TV’s heyday, the cable industry is quick to argue that ala carte delivery of channels will compromise an ecosystem that allows dozens of niche-targeted TV channels to gain a foothold. That may be true, but a more practical lesson about ala carte pay TV already has been learned. When confronted with alternatives that offer more choices, single-channel schemes whither and die. Today you can still meander along the ridgeline of the Santa Monica Mountains on Mulholland Drive. There is still plenty of traffic in the Valley, and teenagers continue to drive too fast at night on the curvy road. But the single-channel pay TV services that used to entertain people in the neighborhoods below are like the Tataviam Indian tribe that once inhabited the San Fernando Valley: long gone.
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