Thomson selected to provide 3 million digital set-top receivers for TELE-TV's wireless cable home video delivery system

NEW YORK -- Thomson Consumer Electronics' RCA brand further strengthened its leading position in digital video product development with the announcement today that the company has been selected as prime contractor for TELE-TV's wireless cable home video delivery system. A three-year contract that could exceed $1 billion is now being negotiated.

TELE-TV -- a joint venture of Bell Atlantic, NYNEX, and Pacific Telesis -- was formed to create television program services for customers in the three companies' service areas, and to acquire and integrate the technology needed for the delivery of those services. Programming is planned to be delivered via a Multichannel Multipoint Distribution System (MMDS). Thomson will work to develop a system infrastructure, and will provide digital set-top boxes that will enable TELE-TV customers to receive 100 or more channels of digital television entertainment including local programing.

``The selection by TELE-TV reaffirms our position as the leading provider of digital home entertainment products,'' said Thomson's James E. Meyer, senior vice president, product management. ``It also signals the speed at which consumer electronics and telco technologies are converging, leading to a myriad of new digital products that will further expand consumer entertainment choices in the home.''

In a separate venture, over 1 million RCA-brand digital satellite receiver boxes have been produced and distributed to dealers and consumers, noted Meyer. ``We believe the digital set-top box is a new growth area for our Americas technology center and manufacturing facility, and our goal is to be a leading supplier to TELE-TV for the next generation of set-tops that utilize fiber optic systems to the home,'' he said.

Current plans call for TELE-TV customers to utilize an antenna, the digital set-top box, and a specially designed interactive remote control to access premium cable TV programming, movie channels, sports, entertainment, and educational programming in addition to pay-per-view movies and other special events. The system -- which will be developed and coordinated by Thomson at its Americas Technology Center in Indianapolis -- is planned to provide the capability for TV picture quality comparable to that of a laserdisc player and sound equivalent to a CD player.

The system developed by Thomson will enable TELE-TV users to quickly and easily access desired programming that will include local broadcasts, basic and premium cable channels.

Meyer said 3 million set-top boxes -- labeled with both the TELE-TV and RCA logos -- are planned to be produced at Thomson's digital receiver manufacturing facility. Thomson plans to invest $40- to $50 million in capital and manpower to complete the MMDS project, including a $15 million expansion of the plant. The addition closely follows a recently completed expansion at the facility which increased production capacity to approximately 2 million set-top receivers annually.

Programing from TELE-TV's distribution center is to be delivered via microwave to up to 3 million homes and apartments, beginning next year.

DiviCom and Nagra Vision will participate in developing the broadcast infrastructure of the system. DiviCom will be the encoding system provider, and Nagra Vision will provide the conditional access security system.

Thomson Consumer Electronics, the largest television receiver manufacturer in the United States, is the successor company to the RCA and GE consumer electronics businesses. Over 10,000 employees in six states are involved in manufacturing, technology and marketing at the company's nine locations in the U.S. Television, video, satellite, audio and communications products are sold under the RCA, GE or ProScan brands from the Indianapolis headquarters.

Thomson Consumer Electronics is a subsidiary of THOMSON multimedia whose parent is Thomson, S.A.

Sales revenues for Thomson Consumer Electronics and its Americas business reached $4.2 billion in 1994, an increase of some $896 million over the previous year. The sharp rise was due principally to the record-setting acceptance of the RCA Digital Satellite System and strong growth in large screen television receivers and projection models produced in the U.S.

NYNEX is a global communications and media company that provides a full range of services in the northeastern United States and high-growth markets around the world, including the United Kingdom, Thailand, Gibraltar, Greece, Indonesia, the Philippines, Poland, Slovakia and the Czech Republic.

The Corporation is a leader in the telecommunications, wireless communications, cable television, directory publishing and entertainment and information services.