NASSAU, Bahamas, Dec. 11 / Cable Bahamas Ltd., the exclusive cable television operator for this Caribbean nation, and Digital Equipment Corporation today announced the industry's first hotel pay-per- view (PPV) service that combines a computer-based video server with a hybrid fiber/coax distribution network.

The first hotel properties to join Cable Bahamas' new SelectVISION service will deliver 45 channels of basic programming plus 19 channels of PPV originating from Digital's AlphaServer-based Near Video-on-demand (NVOD) system beginning later this month. Nearly 2,000 rooms in seven hotels are participating in the first wave, with 5,000 rooms – more than half of hotel space in the Bahamas – expected to be live within two years. The Digital system will also deliver six of those PPV channels to

residential customers.

Cable Bahamas is the first operator to bring regional server-based NVOD to hotels. Philip Keeping, president of Cable Bahamas, said he expects significant growth for this business: "Dedicating two-thirds of our PPV channels exclusively to hotels lets us show movies immediately after their theater debut. Access to first-run movies, combined with our ability to tailor our programming and marketing to the preferences of our market, is something that the satellite-based hotel PPV services cannot match."

As an example, Erik Russell, director of marketing for Cable Bahamas, said their promotion of "Flipper" highlights the fact that the feature film was filmed in the Bahamas. "If it is wildly popular, we can quickly move it from two channels to four channels so it starts every half-hour. Our NVOD system puts that flexibility in our own hands.

"Most hotels find it hard to resist our proposal," Russell continued. "We completely rewire their property if necessary and deliver a turn-key revenue- generating system integrated into their current billing software – and they share the PPV revenue."

"We're delighted to offer our guests this exciting new service," said Brian Adderley, executive assistant manager at Nassau Beach Hotel. "Our ability to offer in-room movies with a Bahamian twist adds to the comprehensive resort experience our guests enjoy."

Russell said that their SelectVISION system is entirely impulse-driven: hotel guests and residential customers press just two buttons on a remote control for their General Instrument set-top box: "Just push SELECT and ENTER – there's no phone call or scheduling involved."

The billing is automatic, thanks to a set of custom interfaces developed by Atkin & Associates, a Toronto-based consulting firm whose Broadview(TM) product suite has been designed to serve as an ideal front-end to Digital's NVOD systems. Billing data is exchanged with the hotels via Zenith cable modems attached to Cable Bahamas' fiber/coax system. This form of data communication was chosen because of its speed and reliability.

Russell said his company considered video tape-based alternatives to deliver their SelectVISION service, "but we determined that maintenance risks would leave us too vulnerable to outages," he said. "We also considered laser-disc systems, but found that we'd have to pay for mastering our own discs if we were to show them in the hotel release window. And since they're not random-access devices, we'd have to have at least one player per channel. So we decided to use a computer-based system in which one large disk array can serve all our needs.

"We chose Digital's system after evaluating three vendors," continued Russell. "Digital had a mature product that we saw running in a production environment. It's a low-maintenance, true NVOD system that gives us the scheduling flexibility we need. And the tight integration of the Digital and Atkin billing and scheduling software was critical in enabling us to meet the unique needs of the hotel PPV market, and serve our 'bread-and-butter' residential customers."

Cable Bahamas delivers more channels from a single headend, or central broadcast facility, than any other cable operator in the world. Majority- owned by Bahamian shareholders, the island operator invested $40-million in a 750-MHz hybrid fiber/coax system that has the capacity to deliver more than 100 channels. Each participating hotel is served by its own fiber line and no more than 200 homes are attached to a single fiber node, enabling Cable Bahamas to narrow-cast custom programming to hotels, businesses, and neighborhoods.

Keeping said that they plan to offer additional services that will take advantage of their state-of-the-art network: "Effectively we've brought the bandwidth of half a T1 line into every home, so it will be easy for us to offer high-speed data transmission. We're very excited about the revenue potential we have with our new technology."

About the companies

Digital Equipment Corporation is a world leader in open client/server solutions from personal computing to integrated worldwide information systems. Digital's scalable Alpha and Intel platforms, storage, networking, software and services, together with industry-focused solutions from business partners, help organizations compete and win in today's global marketplace.

Atkin & Associates is North America's most innovative provider of broadcast information management solutions for conventional, specialty, and pay-per-view television stations and cablecasters.

Cable Bahamas was issued an exclusive franchise by the Bahamian government in October 1994 to provide cable television services throughout the Bahamas. The first subscribers were installed in Nassau in the spring of 1995. That summer, some 3,000 Bahamians took advantage of Cable Bahamas' public share offering to purchase 51 percent of the company, which provided more than $10 million in capital. More than 26,000 subscribers are now receiving service in Nassau and the country's second-largest city, Freeport.

NOTE: AlphaServer and the Digital logo are trademarks of Digital Equipment Corporation. Broadview is a trademark of Michael D. Atkin & Associates Ltd.

Roger Horine, 508-841-2609