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Technology Stocks : Zenith - One and Only

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To: Scott Lerner who wrote (4279)1/30/1998 12:07:00 AM
From: Robert Utne  Read Replies (1) of 6570
 
Looking at it from the local broadcasters' view:

Local broadcasters have been told they will receive a new digital channel and will lose their analog channel in 2006. Total cost of conversion for each broadcaster to purchase a new tower, camera equipment, etc. to be in the many millions. If they are located in one of the 10 major metro areas (in total, able to reach approximately 50% of America's eyeballs/ears), they have to be broadcasting in digital by April 1999.

So, the broadcasters go to the Consumer Electronics Show in Las Vegas and discover that HDTV sets will be available only to those wanting and able to spend at least $7,000 (RCA's announced price of a 61" projection model HDTV).

Then, the broadcasters return home to report to their respective board of directors that HDTV will be a very slow mover since the price of HDTV sets is out of the vast majority of our audience's reach. "Let's wait as long as we can to go digital", is a likely response.

Zenith can turn this scenario around 180 degrees by announcing to the nation's 1600-2400 broadcasters. "By April 1999, we will have digital TVs and digital converters, in ample quantity, for your viewers, priced from $495."

Then, follow up with: "Our product mix includes large projection units, Inteq labeled, (priced from $10,000) for the early entrants/home theater crowd and Zenith-labeled projection and direct-view digital TVs (priced from $2495) and digital TV converters at $495."

The ball is in Zenith's court......


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