DirecTV customers will have the option of bundling the new broadband offering, called DirecWay, with DirecTV's 225 television channels. The service will cost between US$59.99 and $69.99 per month, in addition to the cost of DirecTV programming, and is scheduled to be available later this year.

'Major Step Forward'

Also, the Federal Communications Commission (FCC) said Thursday that it will permit 11 satellite broadcast companies, including Hughes, to offer services on additional satellite spectrum.

The FCC move was called a "major step forward on the road to providing rural Americans affordable access to digital TV, local broadcast signals and high-speed Internet access," by Cheryl Crate of Pegasus Communications Corp., one of the companies awarded spectrum. "We applaud the FCC for making bridging the digital divide a top priority."

One-Dish Service

The DirecWay service offers a new antenna that provides broadband service and access to the TV programming, both from a single dish. The DirecWay-based satellite system will be in addition to the company's direct subscriber line (DSL) service, which began last spring.

DirecTV is the leading provider of satellite TV services in the U.S., with about 10 million subscribers. Its partners include America Online, Earthlink, Pegasus NRTO and Juno.

"DirecWay will be marketed to a combined base of over 45 million existing subscribers of television and Internet services in the United States," said company spokesman Paul Gaske.

Tracking Hacking

DirecTV, in common with other satellite and cable companies, has been plagued by viewers stealing services with phony access cards bought from hackers. The company has embarked on an aggressive campaign to clamp down on illegal use of its system.

It recently sent letters to about 100,000 people it believes are using its services free, warning them of potential legal action and fines of up to $10,000 per violation. The company got the list of names from records it seized from hackers and companies it has sued.

In addition, the company periodically sends out an "attack" signal without warning that detects and disables unauthorized access cards.

Competition Heats Up

The slow speed of broadband deployment across the country has stymied those who forecast that it would bring about a high-speed Internet revolution.

Reasons for the delay are numerous, including technical difficulties and what critics call over-regulation by the government.

Still, competition is starting to heat up between satellite broadcast companies and other firms offering broadband, particularly cable companies, many of which also offer television programming bundled with broadband service.

EchoStar Slashes Prices

Investors have poured about $3 billion into upgrading cable systems for high-speed access. Those accessing high-speed Internet services through cable modems numbered 5.5 million subscribers in North America, according to research firm Kinetic Strategies. Those using DSL, which has had numerous technical difficulties, numbered 2.3 million.

However, a Morgan Stanley Dean Witter report predicted that there would be 10.1 million DSL subscribers by the end of 2001 and 9.1 million cable subscribers.

The FCC predicted that by 2004, almost half of all Internet connections in the U.S. will be broadband.

Competition is also developing among satellite broadcast companies, currently running a distant third in the race for broadband subscribers. But industry analysts say satellite may yet make a significant impact.

EchoStar this week slashed the price of selected TV packages to $9 per month. The company said it presently has 6 million subscribers.