LAS VEGAS - Thursday's events at the International Consumer Electronics Show saw very busy booths at the satellite pavilion, innovative accessories and new product rollouts that will keep CE store floors hopping for the rest of the year. Noticeable statements made by industry leaders include Circuit City's Rick Souder observation that cable modems are selling at a faster rate than satellite did when it was introduced. DirecTV's Eddy Hartenstein emphasized that his service will no longer be just satellite-delivered television but the top provider of the digital multimedia experience. He also said DirecTV closed the year with $3.4 billion in revenue, more than double the revenues in 1998. EBIDTA also was positive in 1999. EchoStar's Charlie Ergen said the service will add the DIY Network, and may include Showtime Beyond and Showtime III in the future. EchoStar will likely have an announcement on public interest channels today. Senior executives and staff with Time Warner and a crew from Liberty Media were seen walking the show floor. During the past few months, Liberty has made significant moves into satellite with a stake in the future Astrolink platform and realigning its TSAT subsidiary. CES continues through the weekend.

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Panelists Debate New Century At Show

LAS VEGAS - With 27 percent growth in net DBS subscriber acquisitions for 1999 and local-into-local compelling Wall Street to project 3.5 million new subscribers for 2000, DBS providers DirecTV and EchoStar came into this year's CES show with a lot of confidence. Sandwiched around new products and equipment, DirecTV President Eddy Hartenstein and EchoStar Chairman Charlie Ergen joined Hugh Panero of XM Satellite Radio, Sirius Satellite Radio's David Margolese, Circuit City's Rick Souder and Via Satellite's Jeff LeHew in giving their views on the state of the satellite industry. During the panel Thursday, Ergen touted the DISHPlayer 500's Best of Show award from CES and the use of the DISHPlayer system by Bill Gates in his opening keynote speech the day before. The DISHPlayer saves time, and therefore money, Ergen said, and will be a convenience TV viewers "won't want to live without." Hartenstein said DirecTV will continue its push to provide local-into-local and noted that the service has had a 25 percent local channel sign up rate since it started offering local stations. DirecTV's Para Todos Spanish-language package will see national coverage in early 2000, Hartenstein added. The panelists agreed that for continued success in the DBS market, the needs of consumers must be met and exceeded in the customer care area. A good area to improve customer service is on the showroom floor, Souder said. Sales force training and de-mystifying the technology will improve customer service standards. Consumers also are increasingly likely to research new technology online, he said. Panero said challenges for the DARS industry will include car installations and add-ons in the 7.5 million unit aftermarket, and the fact that people spend less time in their cars than they do watching TV. DARS advantages lie in the volume of cars where satellite radios can be installed, Margolese said. Therefore, DARS could grow as fast if not faster than DBS, he predicted.

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DirecTV Reports December-Boxes Debut

DirecTV's high-power offering acquired 225,000 net new customers in December, another one-month record for the rapidly-growing service. An additional 89,000 customers were transitioned from the medium-power PrimeStar By DirecTV business last month. That brings the total number of PrimeStar conversions in 1999 to 470,000. During 1999, DirecTV acquired more than 1.6 million net new high-power customers, up 39 percent over subscriber enrollments achieved in 1998, the previous record year for the service. With the high-power service and PrimeStar, DirecTV is delivering service to more than 8 million customers. DirecTV also announced that Samsung Electronics will manufacture and market a DirecTV PLUS HDTV-compatible set-top box. Samsung is the eighth manufacturer of DirecTV PLUS systems that receive standard digital and high definition broadcasts. Samsung's model will be available in the third quarter. Meanwhile, TiVo and DirecTV unveiled a satellite receiver that will deliver programming from the DBS provider and TiVo's personal TV service. The combination system will become available for consumers later this year. Zenith also unveiled its previously-announced DirecTV PLUS HDTV set-top box at CES.

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EchoStar Gives Away DISH 500

EchoStar is offering consumers a free DISH 500 system if they commit to one year of DISH Network programming at $39.98 per month. New customers also will receive a free basic professional installation - a $199 value - with any DISH Network satellite TV system. The promotion runs through March 31. The new marketing campaign was announced at CES in Las Vegas Thursday. Also at the show, EchoStar unveiled DISH DVD, which it calls the world's first combination satellite television receiver with a built-in Digital Versatile Disc (DVD) player. And the company revealed its new DISH HD receiver, an integrated receiver with the ability to receive HDTV signals. During the show, which runs through the weekend, the company's DISHPlayer satellite receiver was chosen by CES officials for the "Best of Show" award in the Satellite Systems category. The system offers interactive features such as rewind, pause and record, as well as web surfing through Microsoft's WebTV service.

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DARS Broadcasts CES Deals

Companies developing satellite-delivered digital audio radio services (DARS) continue to make a splash this week at the CES Show in Las Vegas. XM Satellite Radio, the 100-channel subscription service scheduled to launch next year, announced design, manufacturing and marketing agreements with Sony, Audiovox and Delphi Automotive Systems. Delphi will also manufacture receivers for XM's primary competitor, Sirius Satellite Radio, which may debut slightly ahead of XM. Sirius announced at the show Thursday that beginning next year BMW Groups will offer digital satellite radio in all BMW and Land Rover vehicles sold in the United States. Hans Duenzl, BMW's vice president for North America, said, "With the 21st century promising to be the 'digital information age,' our partnership with Sirius will provide our customers with an audio information and entertainment system that matches the technology of the vehicle itself." That announcement spurred satellite industry analyst William Kidd to raise his year-end price target for Sirius stock and reiterate a Strong Buy rating. "We believe it is more than likely that every major auto manufacturer will commit to either Sirius Satellite Radio or XM Satellite Radio by year-end 2000," he said.

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PROGRAMMING: Showtime Ready With HDTV