I think it was BSB's answer to the satellite dish as far as I Remember ! It's a bit hazy as my family only had terrestrial at the time !
(We'd had cable in the past - rediffusion with a dial on the wall, but had given it up in favour of a video recorder).
Basically what was supposed to happen with satellite TV was the IBA would control satellite broadcasting, just like the regional franchises, and a companies would bid to run satellite TV in the UK, now BSB used their own high-power satellites and so were able to use smaller dishes/antennas than other systems.
Now as I understand it, whilst no one else was allowed to operate their own satellite TV service with their own satellite in the UK you could get around it by using a satellite owned by someone else, and thats how SKY's direct to home service started.
Now both SKY and BSB for many reasons, were loosing money hand over fist, SKY was in a better postition, though, as it had nowhere near the running costs nor regulatory burden of BSB (BSB had their own satellites, expensive headquarters/studios, more expensive transmit/recieve technology (D-MAC rather than PAL) and were limited to five channels) and they ended up merging, selling off the satellites and expesive headquarters (that were for a time used by QVC) and in the end were financially viable.
BSB might have been technically superior (PAL was not ideal for satellite TV), the lower cost of the hardware (both the recieve and dish) meant the entry price was lower, it's also why AMSTRAD pulled out of BSB during bidding, as Alan did not believe that they could get the hardware costs under £250.
Problems with getting reception equipment also hampered BSB, with problems with the Squarials (although a mini dish was an option) and with the decoder ICs for the set top boxes.
Note also that BSB/SKY were free to view at the start (as it has been iirc with SKY channel/Super Station Europe from OTS-2 previously) and so that woud have had an effect on revenue, adverts were to be the primary income stream.