Touchtone Plans Satellite Video Rentals

Tired of schlepping back and forth to the video store to rent your favorite movies? A newly formed company called Touchtone Video Network Inc. thinks that it has an answer to your problems.

Santa Monica-based TVN has announced what it calls a “revolutionary” new satellite-fed television programming system that will allow you to electronically “rent” videocassettes by simply dialing an AT&T; 800 service number. You won’t have to drive anywhere or carry anything. There’s one catch, however: You’ll need a satellite dish in your yard.

According to Stuart Z. Levin, president and chief operating officer of TVN, the new service is planned for launch in mid-1989. It will offer 10 movies a month, each beamed to Earth on a separate channel from AT&T;’s Telstar 303 satellite.

“It will be completely consumer driven; you buy it when you want it. The films will be playing continually 24 hours a day, so you don’t have to be there at 8 o’clock or 10 o’clock,” Levin said Thursday.

Better-Quality Picture

Levin said he sees the new service as more of a “complement” than competition to video stores, since it will offer only the current top 10 rental titles. The video stores “are always out of the hottest movie titles because they can’t afford to stock more than a few copies of each,” he said. “But we will always be in stock, and the quality is better because it’s first generation, direct, not a copy.”

There are some drawbacks to the new service, however. It will cost between $25 and $30 a month for the decoder box that enables the subscriber to receive TVN’s scrambled signal, plus $4 per view for the movies. That’s appreciably more than video stores, which rent movies for as little as 99 cents and rarely for more than $2.50--and you can watch them as many times as you want.

Then there’s the matter of the satellite dish, which costs anywhere from $1,000 to $2,000 and can be as big as a small building.

“You have to remember that there are 10 million to 15 million homes in this country that will never be wired for cable,” Levin said. “There are now about 2 million homes with satellite dishes, two-thirds of which are in non-cabled, mostly rural areas, and sales of dishes are up to 25,000 a month. That’s our market base.”

What’s more, Levin said, developing technology will soon produce satellite dishes that are “less than 2 feet in diameter.”