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Samsung Bullish On Connected TVs

Consumer electronics
manufacturer Samsung touted the appeal of broadband-connected TVs and Blu-ray
players in showing its latest products at a New York press event Wednesday, and
unveiled a new Internet-delivered application from ESPN that will give viewers
access to in-depth scores, stats, game predictions and news headlines.

Samsung sees "huge
potential" in connected, or "smart" TVs, said Samsung Electronics America President
Tim Baxter, who predicted that 6.5 million connected TVs will be sold in the
U.S. this year, equivalent to about 20% of the overall TV market. Samsung,
which Baxter claimed has a 60% share of the connected-TV market, first showed
Internet-delivered content on its TVs in 2008 and integrated Yahoo's "widget"
technology in 2009.

This year at CES the
company launched "Samsung Apps," an initiative to get programmers and software
developers to create connected TV applications, similar to the way they have
created apps for smartphones like Apple's iPhone.

Since March, 50% of
Samsung customers buying a connected TV or Blu-ray player have activated the
"Samsung Apps" functionality, said Baxter. He said there are over 100 apps
today, and forecast close to 200 apps by year-end.

"There is healthy
consumer demand for apps, not just on the phone, but also on the TV set," said

In that vein, Samsung
is now offering exclusive apps for Hulu's subscription program service and for
ESPN. The free ESPN app will deliver four categories of information to Samsung
connected TVs including headlines, predictions on the winning team for major league
sports, an extensive scoreboard feature and a selection of features from "ESPN
The Magazine." Samsung will be promoting the ESPN application, and connected
TVs in general, through a new marketing campaign featuring New York Giants
quarterback Eli Manning.

The company has also
built new premium apps, including an on-demand service that lets one watch 3D
movie trailers and an educational app for children. It now offers a software
developers kit (SDK) to open its TVs up to the creation of new apps and is
holding a developer day on Aug. 31 in San Jose. Samsung is also conducting a
contest, the "Free the TV Challenge", in which the developer of the winning app
will receive $500,000. Finalists for the contest will demonstrate their apps at
next January's CES show, where the winner will be selected.

Of course,
stereoscopic 3D is the other new technology driving the purchase of new HDTV
sets like Samsung's new 65-inch, 8000 series LED, which will be available in
September for a list price of $5999. Baxter said that 3D-capable sets would
account for 20% of the big-screen (40" and above) TV market this year, and by
2012 will account for 70%.

He and other Samsung
execs described Samsung's ongoing 3D marketing partnership with Dreamworks
Animation to create 3D Blu-ray discs, including the new 3D Blu-ray of the hit
"How to Train Your Dragon." Samsung also announced new relationships with IMAX
and Giant Screen Films to create 3D Blu-ray titles and said it will offer a 3D
"starter kit," including three Blu-ray discs and a pair of 3D glasses, to
consumers buying a Samsung 3D-capable TV and 3D Blu-ray player.

Samsung hasn't to
date sponsored any TV network content in 3D such as live sports, as its
competitors Sony, LG and Panasonic have done. Samsung SVP of Home Entertainment
John Revie said the company has had conversations with programmers about
underwriting the cost of producing 3D fare, but hasn't reached any deals.

"To date, we haven't
done it," said Revie. "But it doesn't mean we wouldn't in the future."