NEP’s purchase of Visions brings vast high definition experience to Europe. 

George Hoover explains where NEP has come from.

Back in the early seventies NEP was part of a television station called WNEP.  The station was later sold to the NY Times but the mobile business was kept.  The station was an ABC affiliate so they started to get some work from the network.  It turned out that ABC had an older mobile unit that they were declaring as surplus; WNEP bought it and upgraded it. 

The first truck was called Supershooter 1 and the ABC truck Supershooter 2.  Once they got the ABC truck back to the station they realized why ABC wanted to get rid of it – they somehow magically got it all in working order and it ended up being booked by ABC to do college football.  George Hoover, VP Engineering at NEP: “That was a pretty viable business and it’s just grown from those first two trucks to the 30 something production trucks we have today.”

“In the early eighties the mobile business in this country saw the start of a number of independent for hire companies that had smaller OBs that were filling in for the broadcast networks when they ran out of capacity.  Most of those guys were one or two truck companies doing small events.  NEP knew of a company on the other side of Pennsylvania that was having financial problems and NEP acquired them, which took NEP from two trucks to five.  That was really the start of the growth of the company in the early eighties; with five mobile units it was pretty much the largest operator in the Eastern USA.”

“This was about the time that cable began to takeover.  ESPN came on the scene and all of a sudden there was a pretty good demand for mobile units.  At the time, regional coverage for baseball, basketball and hockey was expanding from one game a week on the weekends to almost every game that was played.  Pretty soon instead of the country needing 25 mobile units it needed 100.  There were lots of little companies springing up that were building smaller to mid-sized OBs to service that cable market. 

“In the mid 1990’s, NBC chose to outsource their mobile operation when they realized that they had a bunch of analogue TV trucks and didn’t want to spend the money to make them digital.  They had had a relationship with NEP since the late 1980’s because NEP was providing management and technical services at the Olympics and had started to market the NBC mobile unit to non-NBC clients.”

“When NBC decided to sell off this side of their business NEP bought it and became the exclusive US supplier of OBs to NBC.  That added another four more trucks to the business.  Also at the same time, The Golf Channel launched its cable operation and NEP became the exclusive supplier to the channel in the US, so now the business is really beginning to take off.  Within a year of NBC outsourcing, ABC did the same -  as did ESPN and CBS.  Essentially all the major networks got out of the mobile business in the mid to late nineties.“

“In late 1999,  the Unitel studio and mobile operation needed to liquidate some of their assets and we bought their two digital trucks which produced the majority of the entertainment shows in the US.  That was the big introduction into the entertainment market place.  Golden Globes, Oscars, American Idol, a lot of concert business, Wheel of Fortune, Jeopardy, etc…”

“We’ve always tried to keep technology at the forefront; a lot of our competitors have had difficulty.  You build a new truck and then five years later, it’s old.  For a small operation it’s a very difficult time when you have to buy the newest cameras or the newest audio board or the next generation of character generators.  It used to be in the eighties and nineties that you could run stuff for five or six years before it became obsolete – not the case anymore.  So we’ve always had a program of trying to upgrade and buy new technology and trickle down some of the better, older equipment to smaller OBs.”

“As the HD marketplace has come on line we’ve seen a combination of building new trucks, acquiring some select assets and upgrading existing facilities.  This is often driven by opportunities and client schedules.  We built a brand new truck for CBS for use on football and the Masters and college basketball that we had plenty of lead-time on.  On the other hand our friends at Fox decided that football would be in hi-def and they made that decision in late spring of last year; in order to turn their facilities around there wasn’t time to build a new one, we upgraded a SD truck that we had been using that was about four years old.

“Our business model here is not to do one-offs but to look for long term contracts with our clients, those contracts almost all have technology improvement clauses in them which would include HD.  The networks are protecting their production capability by using the latest equipment or doing things the way the viewers like.  Our country is extremely graphics intensive so there’s always demands for bigger and better graphics and switchers to handle them”.

High Definition

“We traditionally don’t like to be the first guy to dive in and we saw a number of our competitors make early decisions to move into the HD marketplace on a speculative basis not really having any commitments.  We found that they were not being successful and were either having to sell off those assets or use them as SE trucks and not be able to command the higher dollar that the investment required.  We got into HD when ESPN announced the launch of their HD service, we were already doing their main football games – they came to us and said, ‘We need to be HD in April (this was in November) and we need to have a truck and we’d like you guys to take the lead on moving that forward’.  Again the schedule meant we couldn’t build them something new from the ground up, but we were able to wrap up their football package in January and turn the truck back around and have it out doing HD in March. 

“We moved away from a tape based architecture to EVS servers.  In the US there is active interest in multiple HD production formats so some of our clients are doing 720p and are some doing 1080i.  All of the trucks that we have built have also been built switchable SD/HD; part of our organization’s mantra is to make sure our assets are used.  So having an SD truck sitting in a parking lot when you’re desperate for an HD truck isn’t good business!

“We approached EVS and asked if they could produce a codec so we can switch – so that the EVS will work SD/HD.  Our clients actually preferred the advantages of disk-based systems for sports over VTRs.  They were saying, ‘We’d much rather have four EVS’ than two EVS’ and six VTRs.‘  In sports just to have a room full of 12 VTRs to do replays and then throw the tapes away at the end wasn’t an advantage to the client or to us.   We saw a huge shift where we converted our SS20 to HD for ESPN Sunday Night Football, went from 14 DigiBetas to seven EVS’, a couple of D5s and a DigiBeta for archiving.  That has turned out to pay off very well for us and for our clients; it’s really given the production team a lot of nice features that they wouldn’t have had with VTRs.  We’re mirroring this everywhere in our trucks now, the only trucks that have a tape-based focus in HD are trucks doing light entertainment where there is going to be post production and they need to take away a VTR.

“That being said, at the Academy Awards this year we had almost 35 channels of Profile and six EVS’ running, even though there were tapes going; there was a lot of disk based capability to play back all those clips and show elements like screen backgrounds because it works so much better at that.  When you’re sitting there at the Academy Awards and there are six people who might win, in the old days there would be six VTRs and every one of the winning clips was cued up waiting to roll.  Now its ‘its going to be number two’ and the one EVS plays back the appropriate clip instantly.

“When high definition started in the US there was a feeling that if it took off it would happen very rapidly – shortly after doing the ESPN truck, there was a regional cable operator in the North West USA who had just built a new HD truck and had decided to go out of business because they couldn’t secure carriage for their programs; we acquired that mobile unit for about half of what it cost to build.  That became our second HD truck.  It gave us an opportunity to meet some business without a huge capital investment.  We ran that truck for another six months as a second.  At the same time as we acquired it, CBS decided to do their NFL football in HD; so that truck covered the football.  So once again we had no available inventory to satisfy the burgeoning demand so we started out to build a very large HD truck and our friends at CBS, once they got wind of that development, decided to move into the bigger truck, freeing up HD truck number two.  This was again fortuitous because around about that time HBO announced that they wanted us to move their boxing over to HD, so now all three trucks are busy.  The next thing you know, Fox is knocking on the door and wanted the NFL in HD so we converted the Fox truck to HD.  Just about that same period of time, the entertainment side of the business was saying ‘we really need to start to do more of our work in HD’, so we upgraded one of the two entertainment trucks to HD.  We also have just recently acquired three HD trucks from NMT and of course the units from Visions.  We bought NMT’s Fox and ABC contracts and of course the OBs that serviced them.

“We currently have nine HD trucks, 16 SD trucks and two analogue mobiles”.

HD Driver in the US

“The thing that took HD so long to get off the ground in the USA was for the program producers to find a business model; that’s what hindered the OB suppliers because people who made TV shows had no money to do HD.  Everyone was expecting that the business model was to be driven by the broadcast networks, that they were mandated to do HD and they would just embrace it and dive right in.  As it turned out, there was no financial incentive, there was some government incentive but no real money.  They had to move to digital;  they didn’t have to do HD.

“What happened was the FCC commissioner who regulates our broadcasters and cable systems cajoled the cable operators into providing in their top 100 markets five HD channels.  It was like ‘There are things you guys want in terms of de-regulation, but the thing the FCC wants is HD capability so you guys are going to offer five channels’.  He didn’t say to the cable companies they need to be five broadcast channels, he said five channels.  So straightaway the folks at the Discovery Channel decided that because they had already had a lot of great stuff in HD they were going to get one of those channels.  A couple of other people had similar thoughts; HBO dove in, as did Disney for ESPN.  This was strategically a brilliant move on Disney’s part, they already had rights to all the events, and their only extra cost was to produce it in HD.  They were able to go back to the cable operators and secure an additional revenue stream to cover the cost of producing HD.  Establish yourself as one of the leading sports networks in HD and away you go.

“Meanwhile our friends at CBS are trying to find sponsors to pay for the incremental cost of moving to HD and they were predominantly focused on television set manufacturers to help with the HD cost.  They actually struck a deal with Samsung and Sears to pay for the production of college football in HD – to catch the Saturday afternoon shoppers.  Sears and Samsung did that for two seasons before CBS figured out how to fund that on their own.

“So from our broadcast guys figuring out how to fund it and our subscriber-based clients going ‘We’ve got a business model here’ that’s when it really started to take off.  The next step in the mix was when Rupert Murdoch, who owns the Fox Television Network, bought DirecTV, all of a sudden Fox’s desire not to produce HD turned immediately around because Mr. Murdoch realized he could produce his NFL football games in HD and sell them on DirecTV for a premium price.  Once again Fox was already paying the rights to the games, they were already producing them, so they had a revenue stream for them to pay for the HD upgrade.  DirecTV was faced with the problems of the cable guys who had those five HD channels and they needed some HD programming for DirecTV.  Fox already had the programming so they said ‘lets go ahead and convert it to HD’.  So its been the cable guys and the satellite guys who have been pushing the HD agenda much more that the broadcasters.  The broadcasters are now in the cycle of feeling the pressure to deliver HD because an audience has started to develop.

720 v 1080 – a non-issue?

“In the US, the two largest producers of content on location are ESPN and Fox Sports and those guys are doing 720P.  Throw ABC into the mix who have a reasonable amount of product.  720P by the number of minutes produced is certainly the dominant format currently.  I think the consumers have grown to accept both formats, particularly the market for flat panel displays which are generally more 720P friendly than interlace friendly.  We knew we had to do it, had to do both formats and was a significant factor in our selection of the Thomson Grass Valley Worldcam camera, which is switchable.  We’ll do a show for CBS on Monday and one for ESPN on Wednesday with the same OB and you’ve got to be able to go both ways.  Everything in the truck was switchable except Sony HDCAM VTR but now Sony has introduced the SRW series of decks, which in their latest version of software will do both 720 and 1080; D5 will do both; DVC PRO will do both; EVS will do both.  By this year’s NAB Conference I think everybody will make agnostic equipment.  There’s still lots of debate about which is better but I really think it’s down to the guy at home and how big the screen is.”

Welcome to Europe

So do we see NEP’s purchase of Visions as a signal of the potential of HD in Europe?  NEP is obviously very astute and will only act on purchases like Visions when the time is right – price-wise and opportunity wise.  Europe has some very big events in the next couple of years and Visions with NEP backing could easily be contenders.  It does feel good though to have the Amercians involved: “We share the same clients as Visions so the synergy is already there.  One of the things that really helps is the HD equipment is country agnostic so I can send over five Worldcams to Visions when they need extra cameras and they can run them.

“Europe is on the road to more location production and HD will be a critical element of that.  We think HD will happen in Europe as it has in the US by non-traditional broadcasters; the Skys of the world and also American producers wanting to do more work in Europe.  We will be increasing our fleet in Europe soon.”