Accelerating the growth of satellite TV systems is goal of new DSS marketing program that offers up to $400 savings for consumers.

INDIANAPOLIS--(BUSINESS WIRE)--Aug. 26, 1996--Electing to accelerate the growth of satellite-to the home television, RCA Digital Satellite Systems have been sharply reduced in price in an unprecedented marketing move well ahead of the holiday selling season.

With retail sales of the small dish DSS(R) systems already running 50 percent ahead of last year, Thomson Consumer Electronics "is confident we can move 1998's planned sales goal into 1996 with a powerful lower pricing strategy," said Joseph P. Clayton, Executive Vice President. The price reductions of the RCA satellite systems, first introduced in June, 1994, will be accompanied by a significant programming cash back program from the major programming service, DIRECTV.

As a result of the joint marketing effort, consumers will have the opportunity to purchase an RCA DSS system with a year's worth of programming at a savings of up to $400. Previously selling at a suggested retail price of $599, the lowest priced RCA DSS system will carry a suggested retail price of $399 effective August 29. An additional $200 cash back offer from DIRECTV equals up to $400 in savings for the hardware/software purchase. The offer is effective through December 31, 1996.

The full marketing program includes the participation of hardware brands, such as RCA, as well as programming services from DIRECTV and U.S. Satellite Broadcasting (USSB). "For the first time in the consumer electronics industry, product manufacturers will participate in the total revenue stream -- hardware and software -- involved in a major new product," Clayton said.

"DIRECTV and USSB have shown the way in recognizing a need to involve all segments of a DSS business that has tremendous growth years ahead," Clayton suggested. The two programming services for DSS have established a financial incentive program for manufacturers based on household authorizations.

Thomson expects to end the year with sales of over three million DSS systems since the 1994 introduction, said Michael D. O'Hara, Vice President, DBS Product Management. "This high level of consumer acceptance over a relatively short product life has now encouraged us to speed up the growth of DSS by at least two years. We are confident that we will surpass the industry's target goal of 10 million DSS system sales by the year 2000," he said.

The new pricing structure for DSS systems combined with the cash back offer should result in a 2.3 million sales year for the industry, 500,000 units higher than anticipated earlier in the year. The RCA brand, along with Thomson's ProScan and GE brands, is expected to account for nearly seven out of every 10 DSS systems sold in the United States in 1996.

Thomson also plans to expand its manufacturing capacity for DSS systems with the addition of a fifth production line later this year. The company began the RCA DSS system business in 1994 with only two production lines.

Thomson -- which manufactures and markets the RCA, GE and ProScan brands of consumer electronics products -- co-developed the DSS system with DIRECTV, Inc., a unit of Hughes Electronics Corporation. The system enables consumers to enjoy more than 200 channels of programming provided by DIRECTV and USSB.

O'Hara said an expected eight new brands will support the DSS sales growth in the second half, bringing the total number of DSS system brands to 12 and assuring a broad retail presence for the system. Thomson will be a key supplier of systems to the leading brands entering the market this year.

DSS system ownership has shifted from a rural and early adopter type to a significantly broader audience, said O'Hara. He also noted a shift to purchasers who have access to cable. Two-thirds of DSS system owners in a 1994 survey were located in non-cable areas, but now only four out of ten DSS system owners lacked cable access.

The demographic profile of today's DSS system purchasers suggests that, compared with the total U.S. population, they are more likely middle-aged and have a higher level of education, O'Hara said. "Additionally, purchasers are more likely to be married and have larger households which multiplies the interest in programming exclusive to the DSS system such as a wide variety of pro football and baseball games as well as 29 premium movie channels."

DIRECTV and DSS are registered trademarks of DIRECTV, Inc., a unit of Hughes Electronics Corporation.

CONTACT: Thomson Consumer Electronics, Indianapolis

Frank McCann or James Harper, 317/587-4450