The TV antenna manufacturer's many clients are wondering who will service their existing RF systems and who will emerge to sell them new ones. Demand could shoot up greatly if the FCC OKs band repacking following a spectrum auction. Possible solutions could be current U.S. competitors to Dielectric as well as a number of foreign firms.
Figuring Out Life After Dielectric
The news last month that longtime TV antenna manufacturer Dielectic is getting out of the business is still reverberating throughout the U.S. broadcasting community. By some estimates, the company supplied two-thirds of the antennas to the industry.
While Dielectic’s many customers fret about on-going support, they and other broadcasters also worry about whether rival manufacturers will be able to meet future demand with antennas and other RF gear of similar quality, especially if the FCC moves ahead with its planned incentive auction of TV spectrum and repacking of the TV band in two or three years.
“All of our main broadcast antennas are Dielectric,” says Marty Faubell, VP of engineering at Hearst Television. “Dielectric is the Cadillac name for a lot of reasons. We’ve been very pleased, having done business with them in my 30 years. This is a real tough pill to swallow.”
But all is not lost, says Dick Fiore, president and CEO of Comark, who as a manufacturer of transmitters has a keen interest in all aspects of the RF marketplace. “You take the Goliath out of the market and typically the secondary one will rise up, but there’s also an opportunity for the smaller ones to catch up, too.”
And those Davids say they are ready to go.
“Certainly, this is a significant impact, but at the same time, we’re in a position where we can fill that void,” says Bill Harland, VP of marketing for Electronics Research Inc., the No. 2 U.S. TV antenna vendor.
“We have the resources and capacity. And unlike SPX Corp., we’re a privately held company completely focused on the broadcast business…. This is a boutique industry that is best served by specialty companies.”
Publicly traded industrial conglomerate SPX Corp., based in Charlotte, N.C., is Dielectric’s parent company. It sent out emails in late April to customers notifying them that Dielectric will close in the next two months after filling outstanding orders.
Alex Perchevitch, president of Sacramento, Calif.-based Jampro, a smaller player in the market, says his company can pick up some of the market slack.
“There’s … a lot of digital rollout around the world that we’re involved in. We’ve been doing single-frequency networks in a number of countries for years now. This is not something new to us. We have the capacity for things like this.”
Whether the likes of ERI and Jampro can meet the spike in demand that would come from the incentive auction and related repack is uncertain, say the experts. The repack would involve channel reassignments and they generally require new attennas.
“If this repack affects every TV station in the U.S., like it did for the digital transition, there’s going to be a huge supply issue. It will take years — four, five years, maybe more,” says Gary Cavell, a broadcast consulting engineering and president of Cavell, Mertz & Associates. “But even if it’s … a much lesser number, it still requires all these other manufacturers to increase capacity over what they have now, and that takes time.”
In addition to ERI and Jampro and smaller domestic manufacturers, Cavell says, broadcasters might consider any of a number of foreign vendors, including RFS, Kathrein, Rymsa, ABE Elettronica, Aldeba and Sira.
“The trick is to find manufacturers that are comfortable and experienced in the manufacture and support of higher-powered antenna systems,” he says. “Some of the above do not seem to have products for the higher input power levels.”
Speculation persists that somebody may acquire Dielectric and keep it alive. And Fiore suggests that by putting out only a press release with no concrete plans for the future, SPX may have been fishing for a buyer.
An SPX spokesperson declined to comment on a possible sale.
Fiore said he would be surprised if SPX did not at least sell off Dielectic in parts. “I think they are probably in the process of trying to liquidate inventory, trying to figure out how much cash they can get, probably sell some assets and IP…..”
ERI’s Harland declined to discuss his company’s interest in Dielectric or its parts. “I can’t go into that. Obviously, they’re going to try and reap some value from the assets.”
Oded Bendov, a former senior VP and chief scientist for Dielectric and architect of the antenna array at the original World Trade Center, is hopeful that Dielectric somehow survives.
“They have a lot of intellectual property and a lot of capability,” he says. “If they kill it, it will be a tragedy for the U.S. broadcasting industry.”
For most broadcasters, the immediate concern is support. The company said it would fulfill all existing orders, but it’s still unclear how support will work in the months and years to come.
Craig Harper, VP-CTO of Belo Corp, says his station group has used Dielectric antennas since it started broadcasting television in the late 1940s. “All 20 of my antennas on the air right now are Dielectric.
“It’s an American company, which is also a big deal,” Harper adds. “We prefer to do business with companies we’ve known and worked with for a long time, and now we’re most likely going to be shopping foreign antenna manufacturers that we’ve never done business with before.”