UltimateTV Hits Retail With Marketing Might


The personal video recorder market just got a big shot in the arm from software giant Microsoft Corp.

The first Microsoft/WebTV Networks UltimateTV set-top boxes were scheduled to hit retail shelves this past weekend. Thomson Consumer Electronics last week confirmed it had shipped its first RCA-branded UltimateTV receivers, which boast dual tuners for DirecTV Inc. direct-broadcast satellite television, a digital video recorder and WebTV Internet-over-television capability.

Last Wednesday, Microsoft kicked off a $50 million marketing campaign to help back the retail launch. The effort includes new television spots that follow teaser TV and print ads that began in mid-February.

Additionally, UltimateTV last week launched a six-page print-advertising insert in top titles like Time.

"It's not just a branding campaign," as other PVR-category players have conducted recently, said UltimateTV senior director of corporate marketing and sales Sam Klepper.

The TV spots use family situations to demonstrate UltimateTV's benefits. In one, a father pauses a live basketball game so he can attend to a baby upstairs in a crib. In another, a husband and wife getting ready to go out for the evening both stop to set up the receiver to record simultaneous shows, Friends
and Survivor 2: Australian Outback.

The two-tuner feature is UltimateTV's most compelling benefit, DirecTV executive vice president Bill Casamo said. Not only does it allow a family to record two shows at the same time, but viewers also can record one program while watching another.

Dual tuners also allow viewers to use picture-in-picture features to watch two shows simultaneously.

Best Buy Inc., Circuit City Stores Inc. and RadioShack Corp. are among the first retailers slated to receive UltimateTV shipments. Best Buy senior DBS buyer Dave Ryan said his stores expected to have the product available this past weekend, although the company had not yet started to promote it in its weekly newspaper circulars.

Concord, N.H.-based American Satellite Entertainment Inc. began shipping UltimateTV receivers in early March. Some of the company's online customers were referred from a link at the www.ultimatetv.com
Web site. Thomson also plans to sell UltimateTV at www.rca.com.

Later this year, DirecTV may do its own selling online.

"A very high percentage of initial customers for UltimateTV will be existing DirecTV subscribers," Casamo said. That's one reason consumer education is so important, according to retailers.

Ryan said he's concerned that current DirecTV subscribers might think they can just switch out the existing receiver and automatically access two tuners. In reality, a second line must be run from the antenna to the set-top box.

DirecTV subscribers that don't already have a dual-LNB system would need to upgrade their outdoor equipment.

Klepper said UltimateTV has encouraged retailers to make sure their displays include a dual feed and Internet connection to the receiver so consumers can get a live demonstration of the product while they're shopping.

Best Buy, which will showcase the product in high-exposure endcap displays, plans to train its entire DBS department staff this Saturday (March 17). Retailers will receive educational support from Thomson, DirecTV and Microsoft.

Thomson has created a CD-ROM with training materials. There's also a dealer Web site for UltimateTV, and Microsoft plans to bring sales reps to key stores across the country for special "Demo Days," Klepper said.

DirecTV will back the UltimateTV launch with increased staffing at its call centers, as well as training and scripting for its customer-service representatives.

UltimateTV also plans to bring sports celebrities to some retail locations to help draw crowds and promote the features that will appeal to sports enthusiasts, such as pause, instant replay and Internet-delivered sports statistics.

UltimateTV is not Microsoft's first foray into the digital video recorder category. EchoStar Communications Corp. has sold a DishPlayer receiver with built-in DVR and WebTV Internet access for more than a year. The DishPlayer model has a smaller hard drive and a single satellite tuner.

The UltimateTV box is the first DBS receiver to offer dual tuners, although dual-tuner software downloads for DirecTV/TiVo Inc. combination boxes are expected later this year.