Home Box Office, now a subsidiary of AOL Time Warner, currently delivers movies, sports, and original series programming to 35 million households in the United States. This is about a third of the audience for broadcast network television, which currently reaches approximately 100 million households. The difference, however, is that the HBO households pay over $10 per month for the service, generating some $4 billion in revenue every year. For this reason, HBO is able to finance a tremendous percentage of Hollywood films each year.

     In addition, HBO produces some of the highest­ gloss series in the history of American television, including its break-out sitcoms (The Larry Sanders Show, Sex and the City, and Curb Your Enthusiasm) and hour-long dramas (Oz, The Sopranos, and Six Feet Under). HBO's in-house programming ranges from high-profile miniseries (From the Earth to the Moon and Band of Brothers) to Made-For-TV movies (Conspiracy, The Laramie Project). Along with PBS's Frontline, HBO represents the industry standard in documentaries. Under the direction of Sheila Nevins, HBO's "America Undercover" series provides American documentary filmmakers with a showcase for their work. HBO's sports documentary shows-On the Record with Bob Costas and Real Sports with Bryant Gumbel-represent the only critical examinations of sports in American life on American television. With the departure of ABC's Wide World of Sports, boxing coverage on HBO (and pay-cable rival Showtime) is a remaining remnant of what used to be a centerpiece of American broadcasting. HBO's long­-standing commitment to stand-up comedy is maintained via stand-up performance records of all major American comedians (including Jerry Seinfeld, Larry David, and Ellen DeGeneres) and The Dennis Miller Show.

     The basic idea for what has become the HBO empire began with Chuck Dolan, owner of Sterling Manhattan Cable, who believed he could deliver movies and sports programming to cable subscribers via what he then called "the Green Channel." In November 1972, under the direction of Gerald Levin, this dream came to fruition, when HBO delivered a National Hockey League game broadcast from Madison Square Garden and the 1971 Paul Newman film, Sometimes a Great Notion, to a handful of cable subscribers in Wilkes-Barre, PA. In the early 1970s, as a program broker (delivering Hollywood films from the studios to cable subscribers), HBO struggled, relying on the few films it could afford, playing them repeatedly throughout each month of service. As a result, HBO's business model was crippled by "churning," a term describing the high tum-over rate for dissatisfied subscribers. For every two new subscribers HBO would sign on, only one would remain at the end of the month.

     The turning point came in September 1975, when the company was the first to effectively make use of satellite technology for program delivery. HBO revolutionized the industry by using the RCA satellite, SATCOM I, to deliver "The Thrilla in Manila" (the World Heavyweight title fight between Joe Frazier and Muhmmad Ali, fought in Manila) to a national audience in the United States. Previously, network television had to film such a sporting event, fly the film to the United States, and broadcast it days later. With the satellite technology, the cable programmer was able to deliver the Ali-Frazier fight live.

     The prescient use of satellite technology rapidly pushed HBO to prominence. In October 1977, HBO turned its first profit for its parent company, Time Inc. With a stable financial position, the cable network began shifting its business model from one of program brokering to program development and production. As early as 1975, HBO had begun original television programming, with its innovative comedy shows, Standing Room Only and On Location, which gave stand-up comics Robin Williams and Steve Martin their early breaks. In 1978, HBO began "pre-buy" financing of Hollywood movies, which entailed providing significant production up-front financing to independent film producers, with the proviso that HBO would have exclusive rights to the film's run on pay cable television. Using this business model, HBO has become the single largest financier of movies in Hollywood.

     In the 1980s, HBO's financial position was threat­ened by the increasing market penetration of the video­ cassette recorder. Earlier release dates of Hollywood films to videotape, available for rental at local video stores, threatened to render HBO, primarily a movie supplier, obsolete. Rather than fight the trend, as did most of the other players in Hollywood, HBO rebuilt its business model to incorporate home video to its advantage. First, HBO intensified its role in production of feature-length films. In 1983, HBO produced The Terry Fox Story, the first made-for-pay-TV movie. Secondly, HBO moved into the video business itself, as a way of releasing its original productions. Third, HBO began to intensify its role in original series television production.

     It is this last strategy that became most noteworthy in the 1990s. HBO began such original series programming with sitcoms, the staple genre of American network television. Dream On premiered in July 1990, but it was with The Larry Sanders Show (1992-98) that HBO achieved, in Deborah Jaramillo's words, its "flagship series." Coupled with its increasing prominence in made-for-pay-television movies (including Barbarians at the Gate and Stalin), HBO won 17 Emmys in 1993 (the second-highest awarded network that year, NBC, received 16).

     HBO's strategy for competing with network television sitcoms first involved summer counter-program­ ming. Dream On's 1990 first season ran from July to October, and The Larry Sanders Show's 1993 second season ran from June to September, thus exhibiting new episodes against the network's summer reruns.

     By the late 1990s, HBO had perfected a full-blown counter-programming strategy, featuring seasons with 13 episodes only. Equally important, HBO series explicitly featured content not available on network television, as in the frank sexuality of Sex and the City.

     In July 1997, HBO premiered its first foray into hour-long drama, with Tom Fontana's Oz, a violent and graphic depiction of life inside a prison. It was with The Sopranos, however, that HBO solidified its reputation in hour-long drama. Debuting in January 1999, The Sopranos brought a cinematic genre-the gangster film-to television, hybridizing this with a melodrama about the private lives of a mafia family. HBO used the break-out success of the show to announce itself as delivering a product distinct from network television, best exemplified in their motto, "It's Not TV, It's HBO."

     Under Chris Albrecht, head of original programming, HBO continues to glean tremendous critical acclaim for its series television. At the 2000 Emmy awards, 42 percent of all nominations went to HBO shows. In October 2000, Curb Your Enthusiasm featured Larry David, the co-creator of Seinfeld, in an experimental mockumentary sit-com format, replaying in his "real" life the comedic situations that had formed the central narrative content of Seinfeld. In the summer of 2001, HBO debuted its third hour-long drama, Six Feet Under, filmmaker Alan Ball's melodrama about a family living and working in a funeral home.

     The fact of the matter is that these shows are much more complexly linked to network television than HBO's marketing scheme suggests. The shows are outstanding sitcoms and dramas, comparable to such historically significant programs as Hill Street Blues and St. Elsewhere, and defined by academic critics as "quality television." However, HBO exploits its difference from network television as an issue of quality only when it is critically advantageous to do so. In other venues-as in the soft-core porn series G-String Divas-such a distinction is used for titillation. This is not to say that Divas, which represents the lives of pole­ dancing strippers, is indefensible. Unlike puritanical network television, the women on Divas refreshingly discuss sexuality-as-performance in straightforward, non-censorious terms.

     However, most of the HBO original series-most crucially Sex and the City-are caught in this contradiction. On the one hand, the series is a continuation of the strain of television melodrama begun by Darren Star on FOX's critically reviled Melrose Place. Yet de­ spite Sex and the City's requisite featuring of breasts and unbridled sexual activity, the show does examine, in complex ways, a post-feminist, consumerist female community of friends.

     Thus, HBO offers programs as interesting as anything on network television (but not necessarily more so). Delivered without commercials, the programs perhaps seem of higher quality, less poisoned by the crass commercialism of their network peers. The fact that one is paying over $10 a month for the privilege of viewing these television shows is, of course, the re­ pressed term in this equation.