[opendtv] Re: Zenith/LG NOT announcing new STB's based upon 5'th gen chip

  • From: Craig Birkmaier <craig@xxxxxxxxx>
  • To: opendtv@xxxxxxxxxxxxx
  • Date: Wed, 12 Jan 2005 08:55:56 -0500

At 2:28 PM -0500 1/11/05, Bob Miller wrote:
>In The UK there was no analog turnoff and sales of receivers continue to
>accelerate with a receiver going for $37.53 and $56.29 pre Christmas. I
>think you had to buy $50 worth of merchandise to get the $37.53 price.
>As Craig mentioned sales for the quarter exceeded 1.3 million up to
>12/11/04. That would suggest 1.6 million for the quarter, 4 million for
>the year and 5.5 million next year. 11.5 million the first three years
>or in US terms 69 million. What if we had been at it for the last 5
>years instead of the UK's 2? What if we had COFDM for the last 5 years?
>How many USDTV's would there have been created if we could have had a
>business plan that made sense?

How many USDTVs would fare as well as On Digital did?

While I admire your enthusiasm for a transmission system that works, 
this aspect of the "product" is only important to consumers when it 
DOES NOT work. Consumers could care less about the "technical 
infrastruture;" what they care about is the content and the value 
proposition.

OnDigital DID NOT provide a compelling value proposition; it plodded 
along while BSkyB walked off with 80% or more of the subscription DTV 
market in the U.K.

Freeview dramatically changed the value proposition (there is 
something appealing about "FREE"); as a result it has grown to become 
the 10 largest DTV deployment in the world.

>
>USDTV almost gives their 8-VSB receivers away now at $19.95. Their cost
>is close to or just over $150 per. Our cost for COFDM HD receivers in
>2001 was $140 in quantity. Our plan at the time called for giving away
>the receiver. Actually the customer would pay for it with a one or two
>year subscription.

And how is USDTV doing?

Last i checked they had 10,000 subscribers in three markets, where 
they can reach nearly 2,000,000 homes; that  0.5% market penetration. 
Sadly, this may be the largest deployment of ATSC receivers, but it 
is not exactly setting the world on fire.

>
>What if there had been 10 USDTV ventures over the last 5 years offering
>free COFDM HD receivers? That is an even better deal than what is being
>offered in the UK.

You mean the On Digital deal that failed?

>I suggest that by the end of 2005 our digital
>transition would have been over a full year ahead of the 2006 deadline.
>We would have 90 million receivers distributed by the end of 2005. The
>only controversy left would be that many homes had 2 to 5 receivers and
>that the 85% still had not been met. But of course the whole deadline
>thing would be passe. Broadcasters would already have been turning off
>their analog transmitters as fast as they could in many markets.

Sorry Bob but I do not think you can justify this assertion based on 
the notion of using the broadcast spectrum to deliver a PAID 
multichannel service that competes with far more capable cable and 
DBS competitors. If on the other hand, U.S. broadcasters had been 
offering a reliable FREE multichannel service, I suspect that it 
would be doing as well as Freeview. I seriously doubt that this would 
have resulted in the sales of 90 million receivers; 20-30 million 
would be a more realistic estimate.

>May sound crazy but so did the numbers being racked up in the UK every
>quarter. I thought I was way out on a limb when I predicted 1 million
>for the last quarter of 2004 in the UK and we are going to be 60% over
>that. Next year could be as I predict, 5.5 million or maybe it will be
>10 million in the UK. Why not? Every time I come up with a crazy number
>the beat it.

Its amazing what can happen when the value proposition improves...

Regards
Craig
 
 
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