Hi-Def Outlook Getting Sharper For Showtime

BY JON LAFAYETTE Premium networks are putting a premium on picture quality. Showtime Networks said it will be making a bigger commitment to high-definition television by producing six of its series and all of its original movies in HDTV. “We have been investing and growing our investment as the marketplace grows,” said Glenn Oakley, SVP of corporate strategy and international at Showtime Networks. “All indications…are pointing to this being perhaps that watershed year” when a critical mass of high-end consumers own HD sets and will demand more HD programming. Showtime already offers a high-definition service. It transfers theatrical films into HDTV — a process that costs $40,000 to $50,000 for movies shorter than two hours — and produced its science fiction series Odyssey 5 in HDTV. That show was canceled, “but the positive feedback we’ve gotten on that had definitely been a contributing factor in terms of increasing our commitment here,” Oakley said. Next week’s Mike Tyson-Clifford Etienne heavyweight boxing match will also be broadcast live in HDTV. One of Showtime’s rivals, HBO, is broadcasting about 70% high-definition material on its HDTV feeds, which simulcast the network’s primary channel. Some HBO series, including The Sopranos and Six Feet Under, are distributed in HDTV, as are all HBO movies, an HBO spokesman said. (Band of Brothers was also shown in HDTV.) HBO’s sister network Cinemax plans to add an HDTV channel in the second half of the year that will carry about 75% of its content in true high-definition, rather than standard material upconverted to a hi-def format. Starz Encore has the equipment to launch an HDTV service, but is still waiting for the market to be ready. “We’re looking for a good business, a good revenue opportunity,” said John Beyler, SVP of technology operation at Starz Encore. “We need to see a good demand for it from our affiliates and the subscribers.” Beyler said standards being set for content protection and the recent plug-and-play agreement between cable operators and the consumer electronics industry are increasing HDTV’s momentum. But Starz Encore isn’t concerned about being perceived as being behind its rivals in the HDTV race. “We’re watching developments closely, but don’t have a time frame in mind,” Beyler said. Showtime’s Oakley declined to put a dollar figure on the size of the network’s commitment to additional HDTV programming. Its return on that investment was also unclear. Subscribers to Showtime’s multiplex package automatically receive the HDTV channel, but they must pay their local cable operator or satellite service provider for the equipment to decode and display the HDTV images. Showtime, along with other programmers, do not receive a piece of those equipment charges, which means that while operators benefit, Showtime is counting on the service adding to its subscriber rolls, Oakley said. Showtime HDTV is available nationally from both Direct TV and EchoStar. Cable operators in about 50% of the country make the HD service available to subscribers. Showtime will be promoting its HDTV service, but not with a traditional TV ad campaign, partly because the market is still relatively small. “It’s hard to show HDTV on NTSC, so we’re focusing our investment dollars at the point of display,” Oakley said. Showtime is working with retailers including Circuit City, Best Buy and Sears and is producing monthly tapes that will be broadcast via satellite into stores. The network is also creating programming for the HDTV barker channels on DirecTV and EchoStar “so those people who are putting it in showrooms can be running a constant 24-hour feed of HD material, and consumers can see it.” The series that will be produced in HDTV are Queer as Folk, The Chris Isaak Show, Jeremiah, Earthlings, Dead Like Me and Out of Order. Some of those series are shot on film, others using 1080i high-definition equipment. All will be produced in the 16-by-9 format or wider, and transmitted in 1080i. Oakley said it won’t be long before Showtime is offering multiple channels of HDTV. “I think one of the things on the horizon as well is the HDTV PVR,” Oakley said. “I’ve seen several different manufacturers. And I think if they’re not out, they’re about to hit the CE stories in the next quarter or two. It’s just an amazing progression of digital technology.” Further down the road may be offerings of HD titles via video-on-demand or subscription video-on-demand. “I wouldn’t be surprised if I didn’t see that in the next year or two,” Oakley said. “Nobody’s there yet, but we are very active in the VOD and SVOD forefront. So when they ask, we will deliver.”