ON TV was an American subscription television (STV) service that operated in eight markets between 1977 and 1985. Originally established by National Subscription Television, a joint venture of Oak Industries and Chartwell Communications, ON TV was part of a new breed of STV operations that broadcast premium programming—including movies, sporting events, and concerts—over an encrypted signal on a UHF television station and leased decoders to subscribing customers. At its peak in 1982, ON TV boasted more than 700,000 customers—more than half of them in Los Angeles, its most successful market. However, the rapidly expanding availability of cable television, coupled with a recession, caused the business to quickly lose subscribers at the same time that Oak Industries was experiencing severe financial difficulties. Between March 1983 and June 1985, all eight operations closed.

History Los Angeles launch

In 1973, Oak Industries, a maker of cable television equipment and other electronic components, and Chartwell Communications, a company majority-owned by Jerry Perenchio and Norman Lear, founded a joint venture initially known as World Pay Television, Inc. to create and operate a subscription television system in the Los Angeles market. The connection was made when Everitt A. Carter, an executive at Oak Industries, attended a tennis match between Billie Jean King and Bobby Riggs in Houston, organized by Perenchio; Perenchio approached Carter and asked if the company could build a system to scramble over-the-air signals for pay distribution. While Oak was initially resistant to the idea, it ultimately agreed to develop the equipment if Perenchio fronted $200,000 for research and development, which he did. In 1976, Oak president Frank A. Astrologes was named chairman of the new venture, with Carter succeeding him at Oak. The company intended to open franchises in 14 different states, per Federal Communications Commission (FCC) filings at the time.

The system, which would use scrambling of a standard UHF television station, required a carrier. That was secured by the venture in 1976 when, under the name of Oak Broadcasting Systems, Oak and Perenchio purchased Los Angeles television station KBSC-TV (channel 52) for $1.2 million as part of the liquidation of its parent company, Kaiser Industries. After changing its name to National Subscription Television (NST), the service launched under the brand name ON TV on April 1, 1977, offering unedited, uninterrupted motion pictures, as well as limited slates of Los Angeles Dodgers, California Angels, Los Angeles Lakers and Los Angeles Kings games, during evening hours. The first 500 subscribers lived in the San Fernando Valley, as part of a soft launch of the new system. It was the second subscription television system in operation, with Wometco Home Theater having launched in New York City the previous month.

Ambitions to expand ON TV beyond Los Angeles were immediate. When the first system went live, Carter claimed "firm contracts" to move forward in eight cities—five of which would eventually be home to ON TV-branded subscription television operations—but stated he wanted to see if the Los Angeles system was a success first. In January 1978, Oak reached a deal with Sears to market ON TV service in the Los Angeles and Orange County area. The next year, ON TV got a competitor: SelecTV, which pioneered a pay-per-program model and only showed movies.

Expansion beyond LA

In October 1978, Oak and Chartwell, the partners in the Los Angeles system, reached an agreement to each develop six ON TV markets on their own; the Oak markets would be Chicago, Phoenix, Miami, Philadelphia, Minneapolis, and Dallas–Fort Worth, while Chartwell was tasked with development in New York, Detroit, Atlanta, San Francisco, Cleveland, and Houston. In Philadelphia, NST had reached a deal with Radio Broadcasting Corporation, which in 1977 was awarded a construction permit for a channel 57 TV station there. The next year, the company announced it would license its equipment and technology in cities where it did not intend to operate itself.

The first of the Oak expansion cities firmed up considerably in November 1978 when Oak announced it would begin operating in Phoenix in July 1979 in a joint venture with the New Television Corporation, which held the construction permit for KNXV-TV (channel 15); New Television would program the station during the day as a free independent, while ON TV would air in the evenings. Oak announced at that time that it would be on the air in Philadelphia and Miami by 1980.

Meanwhile, the ON TV system in Los Angeles grew to more than 100,000 subscribers by the end of 1978 and 200,000 by August 1979, earning it the title of the world's largest single pay-TV operation. Oak's increasing involvement with the entertainment business spurred the entire company, previously headquartered in Crystal Lake, Illinois, to move to southern California, where it built a new headquarters building in the planned community of Rancho Bernardo. As very large cities, like Philadelphia, saw years-long delays in cable television wiring due to political disputes over franchises, the specter of services like ON TV loomed over the horizon and served as an impetus to consider more rapid action.

Chartwell, too, began the task of developing markets. As early as 1977, NST had an agreement to run an STV service on WXON in Detroit, and the two parties aimed for a July 1, 1979, launch. In 1979, the company, through affiliate Tandem Productions, acquired New York City-area station WNJU-TV, and Tandem was waiting in the wings to buy Washington, D.C.'s WDCA-TV if the FCC had rescinded its approval of that station's sale to Taft Broadcasting. Chartwell also explored buying a station in Sacramento, California, in 1980, going so far as to enter into advanced negotiations to purchase that city's KMUV-TV.

As 1979 continued, activity accelerated. Oak announced its intention to open subscription television in Miami at the end of the year from Fort Lauderdale-based WKID-TV, which it had purchased. In Chicago, it reached an agreement with Video 44, owner of UHF station WSNS-TV, to use Oak equipment and technology in its service. (While Video 44 then attempted to sell 50 percent of the company to American Television and Communications, a subsidiary of Time, Inc. and owner of the Preview STV services which had a deal with Zenith to produce its equipment, the company pulled out of the deal in October when major movie studios protested the potential for a monopoly on pay-TV programming between Time's STV holdings and Home Box Office cable network.) The Dallas–Fort Worth market entered the picture when Oak reaffirmed a 1976 deal with Channel 21, Inc., the Sidney Shlenker and Milton Grant–led consortium that held the construction permit for Fort Worth television station KTXA, to bring ON TV to the Metroplex. Oak also filed for construction permits in various cities around the United States, including channel 38 in St. Petersburg, Florida; channel 38 in New Orleans; and channel 20 in Denver. Those applications were joined by a 1981 filing for channel 16 at Everett, Washington, near Seattle.

The Phoenix operation began September 9 when KNXV-TV began broadcasting, and WKID-TV in the Miami–Fort Lauderdale market commenced subscription television broadcasts on January 11, 1980. The first licensed ON TV system, owned by Home Entertainment Network—a division of Buford Television—went live on that company's WBTI-TV in Cincinnati on February 1; the station itself took to the air on January 28. Oak went on air with ON TV in Chicago on September 22, after having bought a 49 percent stake in the licensee of WSNS, and in Dallas–Fort Worth on February 28, 1981. Just eight months after going live in Chicago, ON TV was profitable in that market—said to be unprecedented in the STV industry—and by October 1981, it was joined by all of the Oak-owned operations except Dallas–Fort Worth.

Still more stations appeared to be in the pipeline: Oak had a deal with Baltimore's WBFF to enter that market, and it owned 45 percent of an STV franchise for channel 29 at Minneapolis. Meanwhile, Chartwell—after having attempted to nab rights to New York Yankees baseball—dropped its New York subscription television plans, opting not to scrap WNJU-TV's successful Spanish-language programming and battle the market's dominant STV provider, Wometco Home Theater. (Perenchio would ultimately sell WNJU-TV in 1986.)

Oak in control In Los Angeles—the largest ON TV market, where Oak and Chartwell remained partners—the arrangement came into doubt in March 1981. The two sides disagreed over Perenchio's appointment of William M. Siegel, the chief executive of Chartwell, as the general manager of National Subscription Television—Los Angeles. Oak refused to consent to the appointment and claimed that Chartwell and Perenchio had "surreptitiously" placed Siegel on the payroll; it was reported that Oak had no dispute with Siegel but wanted to affirm its authority as 51 percent owner of the venture. Oak chairman Carter was surprised to learn that Siegel made more money than he did. Further, Perenchio drew Oak's ire when the Chartwell ON TV operation in Detroit ordered new decoder boxes from one of Oak's competitors.

Oak and Chartwell settled in September; the suit was dropped, and Oak bought out Chartwell's 49 percent share of National Subscription Television for $55 million. Oak now controlled the entire Los Angeles and Miami systems, as well as majority shares in the Chicago, Dallas–Fort Worth and Phoenix markets, while Chartwell continued to own and operate the Detroit ON TV system. Cincinnati was licensed, to be joined by another licensing agreement Oak made starting January 31, 1982, with Willamette Subscription Television, the STV franchisee for KECH in the Portland, Oregon, market.

By May 1982, ON TV in southern California had 400,000 subscribers. Oak boasted some 600,000 subscribers in its five ON TV markets, not counting Detroit, Cincinnati, or Portland. Additionally, Oak planned to start a ninth system in Houston in 1983, broadcasting over KTXH (channel 20), the under-construction sister station to KTXA. However, by November, as KTXH itself neared air, it had become clear that Oak was not pursuing Houston plans, having essentially shuttered its part of the operation; Houston Chronicle television editor Ann Hodges cited the increasing wiring of the city for cable, the increased carriage of KTXH by cable systems without STV operation, and more expansive sports coverage planned in Houston than in Dallas–Fort Worth.

Headwinds + ON TV subscribers by market, June 1982 Station Market Owner Subscribers KBSC-TV Los Angeles Oak 379,000 WSNS-TV Chicago Oak 120,600 WXON Detroit Chartwell 61,900 WBTI-TV Cincinnati United Cable 45,200 WKID-TV Miami–Fort Lauderdale Oak 44,700 KNXV-TV Phoenix Oak 38,500 KTXA Dallas–Fort Worth Oak 24,800 KECH Portland–Salem Willamette 12,000 Total 726,700