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To: Ed Perry who wrote (8251)	5/9/1999 10:14:00 PM
From: DennyKrane	Read Replies (2) \| Respond to of 17679

May 8, 1999 Mitsubishi Unit Will Pay to Convert CBS's Shows for High-Definition TVs By EVAN RAMSTAD Staff Reporter of THE WALL STREET JOURNAL LAS VEGAS -- Mitsubishi Digital Electronics America Inc. will pay for CBS Corp. to prepare most of its serial prime-time programs for broadcast in high-definition digital signals during the 1999-2000 television season. The agreement is the first time in the era of digital broadcasting that a manufacturer has paid for shows to help drive demand for its TVs. Such arrangements happened decades ago during the advent of radio and color-TV broadcasts. The company, the U.S. manufacturing arm of Japan's Mitsubishi Corp. conglomerate, will spend just more than $10 million to encode CBS's prime-time shows, which are filmed, into digital language. Under the agreement, CBS will distribute approximately 12 to 14 hours of its prime-time shows in digital as well as regular, or analog, signals. Likely candidates include the sitcom "Everybody Loves Raymond'' and dramas "JAG'' and "Chicago Hope,'' though final decisions will be made after the network announces its fall lineup later this month. "We're serious about making the transition to digital and this helps us do it,'' said Martin D. Franks, senior vice president of CBS. About 60 of the nation's 1,500 TV stations are now broadcasting digital signals, including 14 that CBS owns. Federal regulations currently require stations in the nation's 10 largest cities to send digital signals; stations in another 20 cities are required to start this fall. Mitsubishi executives hope the availability of more HDTV shows will boost sales of its TVs equipped to display digital signals. Fewer than 20,000 high-definition television sets have been sold since they became available last August, compared to about 15 million regular televisions sold during that time. And just a few hundred receivers needed to pick up digital broadcasts have sold. "Most people ask why buy a receiver when there's nothing digital on,'' says Bob Perry, Mitsubishi's top U.S. TV marketer. "We're trying to end the confusion.'' Broadcasters in the mid-1980s made the original push to develop high-definition TV but now face high costs in equipment and dual transmissions during a transition period expected to last seven more years. CBS in January approached TV manufacturers for help in paying the costs of digital programming. The company offered its prime-time shows, movies, sports events and awards shows for underwriting. While Mitsubishi has an exclusive arrangement on prime-time shows, the network may yet forge similar deals with other manufacturers. Mitsubishi announced the agreement Saturday at a news conference here, where it unveiled its 1999 line of digital and analog TVs. The company also announced plans to manufacture digital satellite receivers that work with the DirectTV service offered by General Motors Corp.'s Hughes Electronics. Mitsubishi's arrangement with CBS is similar to those seen in the early days of broadcasting. For instance, Westinghouse and General Electric, early manufacturers of radios, started some of the nation's first commercial radio stations around 1920. "This is an 80-year-old business model,'' said Garth Jowett, a film and TV historian at the University of Houston. No TV manufacturer has had a meaningful financial stake in a TV network since the mid-1980s, when General Electric Co. bought the old RCA Corp. and sold the consumer electronics business while keeping the NBC network.