Selling HD In Turbulent Times

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Sean Moran, Hitachi
Kokusai Electric America's national sales manager, recently spoke with HD
Update contributor George Winslow about the current sales climate for high-definition
cameras and the prospects for 2010. An edited transcript follows.

MCN: What have been some of the main
strategies you've been pursuing to help your clients make the transition to HD
with your products?

Sean Moran, Hitachi

Sean Moran: We
have been developing some new, lower-cost cameras to help customers in tough
times that we are going through now and probably will continue to face for a year
or so.

We've also strengthened our line of accessories and cameras.
We have very flexible products to help our customers with their various
production applications. We are one of the few manufacturers that offers a
high-def dockable camera. It gives our customers flexibility on whether they
want to use digital triax, or our optical fiber system.

And we have a couple of co-ventures [that provide even more
flexibility]. We have one with Panasonic for a P2 recorder.

Over the last [few] years, we've also made available various
space stations, camera control units, etc., at a lower cost, to address the
needs of the educational, cable, corporate, government and religious users.

We have always been a leader in box cameras and we'll be
coming out with a new box camera at [the National Association of Broadcasters
Convention]. We offer very fine products right now but we are at the high-end
of that market and we will have a new camera that is still high quality but
half the cost of the terms that we offer now.

So those are some of things we are doing to help our
customers enter into the field of HD.

MCN: What kind of an impact is the economy
having?

SM: I would say
it has slowed everyone down. Money isn't available like it used to be. It seems
like everywhere it is being pushed back and it has definitely impacted business
a lot.

But we have maintained a pretty good percentage of business
out there. We have kept our quotas the same and sales people are doing very
good at getting close to their quotas.

Some of the territories that have been really affected by
the recession have been the West Coast and the Midwest.
Fortunately, the Northeast and the Southeast are in very good shape.

MCN: What sectors have been stronger than
others?

SM: We are doing
well in education and we are doing a lot [of sales] for video boards and HD
cameras at college stadium and professional stadiums.

We have also had some strong cable sales over last six to
nine months.

I think what our weakest sector right now is probably
broadcast. We have introduced some very good packages, but it seems that some
broadcasters -- not all of them, some broadcast groups -- are saving money by
doing anything just to put something on the air. That has definitely affected
us because we really don't jump into that low-cost HD camcorder businesses.

It seems like the accounting people have more control then
engineers. We make very fine product and sometimes quality is overlooked, as
opposed to cost.

MCN: You recently cut a deal to provide
Canada's Olympic Broadcast Media Consortium, which is broadcasting the
Vancouver 2010 Olympic games, with 39 new Hitachi SK-HD1000 multistandard,
multiformat studio/field cameras. How did that come about?

SM: We have been
very strong in Canada
for a long time. We do have an office there which gives us an advantage as well
and our relationship with CTV [the lead broadcasters in the consortium] has
been very strong over the years. We are offering a fine product. For the value
they got, there is nothing that could touch the SK-HD1000.

But we are also giving them a lot of flexibility. They have
all this fiber going back and forth between Vancouver
and Toronto. For the Olympics, they
are going to use the cameras with fiber, but down the road they wanted to plan
on using some triax systems and our system gives them that flexibility.

MCN: Any other major deals this year you can
discuss?

SM: We will soon
be announcing several more deals. [But so far this year] we had a large sale to
the United Nations, Rutgers University, University of Alabama, University of
Delaware.

There was a large sale to Bright House [Networks], a big
cable company in Florida that
produces high school and local sports in Florida.
We also did three of their studios and we did their truck.

We've had many government sales. The U.S. Senate has been
integrating our camera systems for the last four or five years and they keep
adding to that.

We had a new sales to C-SPAN. They were previously using our
standard definition cameras but they're now planning to upgrade to high def in the
next two to three years.

We had some PBS sales, KSMQ in Minnesota
[for the SK-HD1000 cameras]; KVIE in Sacramento.
We've had some sales in with Homeland Security involving high-definition studio
cameras.

There are some that I can't talk about but those are ones
that come off top of my head. We have also been strong in standard-definition
sales, so business hasn't been too bad.

We are lucky because we are not selling monitors and
switchers. We basically are just selling camera systems. We have a good
reputation and we have been in the industry over 45 years. So we've had a lot
of sales.

MCN: How do you see the market developing in
2010?

SM: I really
don't see the West Coast as strong as we would like it to be but I do see the Midwest
coming back a lot stronger. The Northeast and the Southeast will be phenomenal
next year for us with our truck business. I see a lot of our current users
upgrading to HD. They have already indicated to us that they will be making purchases
of HD equipment in the second and third quarter of 2010.

I also think our new, attractive lower-cost HD packages will
help our business with core customers and our overall business.

The fact that we are offering some new products, and
the fact that these older customers plan to upgrade next year, means that we
could have a very good year.

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