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In exchange for their help, Fox and DirecTV got options worth as much as 20% of Cuban's new network. For Thompson at Fox, HDNet is a handy "laboratory" to see how high def works, technically and economically. "If you've seen high def, you know it's gorgeous," says Thompson. "But I was skeptical of the financial model. They need to go well beyond 100,000 homes." Cuban says his customer base through DirecTV is growing 10% to 15% a month, and he's working the retail angle hard--getting 1,000 outlets such as those of Circuit City to play HDNet in stores.
Meanwhile, the price of digital TVs and set-top boxes is dropping fast. A 50-in. high-def TV set that cost $8,000 two years ago is now $1,800 and could drop further by Christmas. Prices of the set-top decoders necessary for high-def reception are falling too, to $250 from $750 in 2000. (Samsung, Zenith and Sony are making TVs with built-in high-def tuners.) The Consumer Electronics Association says February shipments of such digital-TV products were up 83% over the same month last year, largely in anticipation of NBC's Olympics broadcast and HDNet's NCAA March Madness.
By year's end every commercial TV station is supposed to be broadcasting digitally, with all analog transmissions to cease by 2006. But with more than half the nation's stations seeking delays, FCC chairman Michael Powell this month went on the offensive (right before a critical broadcasters' meeting), urging networks, broadcasters and equipment makers to rush digital-TV offerings to consumers by 2003. "I agree with Cuban that HDTV is inevitable, but it will take 10 years," predicts Gerry Kaufhold, In-Stat's principal analyst for digital TV. The savings of all-digital production will win out, especially because such influential directors as George Lucas have vowed to dump film. "By September 2003, most TV programs will be produced in HDTV, so sales of set-top boxes should kick into gear. By 2008, more than half of new sets sold will be high def," says Kaufhold.
Networks and cable channels are moving cautiously ahead. CBS, the HD leader, records almost all its prime-time shows in high def, and ABC about half. NBC lags far behind. Entrepreneur Paul Allen has his own high-def channel, ASCN, based in Portland, Ore. HBO (owned by TIME's parent company AOL Time Warner) and Showtime provide high-def programming to satellite-TV subscribers.
Now that HDNet is on satellite, Cuban is hoping to hawk his network to cable companies, which reach two-thirds of the nation's viewers. Cox Cable announced in March that it would start delivering high-def shows from the major networks. Comcast launched HDTV last November, while Time Warner Cable offers it in 42 markets, from New York City to Houston.
Garvin, a TV producer for nearly 30 years, is amazed at the turnaround on HDTV. "A year ago, we were way out front. No one else was at the table. Suddenly, in the past month, cable operators, the Comcasts, the AOLs, Charter have all decided it's time to get high def into homes," he says. "It's starting to look like Mark may have hit another home run."
Home run? That's not the right metaphor for Cuban, who at 6 ft. 2 in. is about the size of a smallish NBA guard. He would probably prefer to think of himself as launching a shot from outside the three-point circle and hitting nothing but net.