New Research Proves HDTV Still ’Fuzzy’ for Consumers

Scientific-Atlanta and Cable Companies Help Consumers ’Get Connected’ and ’Get Clear’ on the Big Picture

ATLANTA, GA - December 6, 2005 - High-definition televisions (HDTVs) are available everywhere, and people are buying them. HDTVs are selling rapidly in retail chains, online warehouses and/or local consumer electronics outlets, showing that consumers want HD programming. According to recent Forrester Research data, HDTV sets will be in approximately 16 million homes across the U.S. by the end of the year. But, Forrester predicts just seven million of those households will actually be watching HD programming from their video service provider in that timeframe, suggesting that many consumers are buying HDTVs but then not taking the additional steps required to receive HDTV services.

To better gauge consumer appeal for and understanding of HDTV services, Scientific-Atlanta commissioned a nationwide telephone survey of over 500 U.S. high-definition television owners. The survey was based on an analysis of consumer awareness about HDTV and the equipment needed to watch it. The analysis identified misperceptions of HDTV owners that could help explain why demand levels for HD services have remained significantly lower than HD television adoption rates. Results show that nearly half (49%) of HDTV owners surveyed are not taking full advantage of their HD televisions, as defined by receiving HD channels and having special equipment to watch HD programming (including an HD set-top box, a CableCARD, and/or an antenna).
The ’Truth’

Although there are exceptions, (such as off-air viewing or “in the clear” programming), in most circumstances, if you are a cable or satellite customer, you need an HD set-top box or a CableCARD to view HD programming. The box or CableCARD acts as a decoder for encrypted HD channels. Those HD television owners polled who believed they were receiving HD service but lacked the proper equipment had varying reasons for not getting the equipment:

* Close to one in four (28%) of HDTV owners reported that they did not get any special equipment from their service provider to watch HDTV channels because the picture quality was already improved with the purchase of an HDTV.
* 23% of HDTV owners did not invest in special equipment to watch HDTV channels because a message at the beginning of the programs they watch tells them that those programs are being broadcast in HD.
* Nearly one in five (18%) reported that they believed the HD television would give them high-definition channels without additional equipment.

In a separate survey that polled over 2,000 of Scientific-Atlanta’s (Explorer) eClub members with HD capable set-tops, more than 35 percent of HDTV owners learned that they need to get an HD content/service package to view HDTV programming from their cable operator. With more than 26 percent of HDTV owners without HD service actively planning to subscribe to HD service in the next six months, and 28 percent researching options, cable companies have a great opportunity to tap into an impressionable consumer audience through concentrated marketing and consumer education tactics.

“HDTV isn’t complicated if you are aware of the equipment and subscription service you need to get it,” said Pat Hurley, director of research, TeleChoice, and co-author of ’HDTV for Dummies’. “For the same amount of money you would spend on a few cups of coffee a month, you can receive true HD service from your cable company. They bring the HD cable receiver to your house, take care of all the installation and hookup, and show you how to navigate to the HD channels. It’s that easy.”

“Unfortunately a large number of HDTV owners are missing out on the opportunities to watch true HD,” said Dave Davies, vice president of strategy and product marketing, Subscriber Networks, Scientific-Atlanta, Inc. “The key is to educate consumers on the fundamentals of HDTV, and then help them get connected with the service that will bring their HDTV to life as it is intended. We hope that the True-Def of Hi-Def campaign will help consumers get the most return on their HD television investments.”

To address the consumer confusion surrounding HDTV and help consumers leverage their HD television investment, Scientific-Atlanta is working with cable operators to launch ’The True-Def of Hi-Def’ - a consumer education campaign focused on HDTV.

Scientific-Atlanta will work closely with cable companies to introduce ’The True-Def of Hi-Def’ campaign into key markets and encourage a deeper consumer understanding of the HDTV experience nationwide. The campaign will integrate both public affairs and direct marketing elements to allow consumers to see, learn and experience the differences between standard definition and high-definition programming, and to better understand the necessary equipment required to truly experience the improved picture and audio quality that comes with HDTV service.
Background

The nationwide phone survey was conducted by StrategyOne via telephone from September 23-30, 2005, utilizing the field services of Opinion Access and a targeted list of HDTV owners 18 years of age and older . A Computer Assisted Telephone Interviewing (CATI) facility was used. The online survey of Scientific-Atlanta’s (Explorer) eClub members was conducted from September 2-7, 2005 to identify additional HDTV trends and collect additional consumer feedback.
Note to Editors:

To obtain a summary of the results from Scientific-Atlanta’s ’True-Def of Hi-Def’ studies, visit www.scientificatlanta.com/newscenter.
About Scientific-Atlanta

Scientific-Atlanta, Inc. (NYSE: SFA - http://www.scientificatlanta.com) is a leading supplier of digital content distribution systems, transmission networks for broadband access to the home, digital interactive set-tops and subscriber systems designed for video, high-speed Internet and voice over IP (VoIP) networks, and worldwide customer service and support.

“Forward-looking statements,” as defined in the Private Securities Litigation Reform Act of 1995, may be included in this news release. A variety of factors could cause Scientific-Atlanta’s actual results to differ from the anticipated results expressed in such forward-looking statements. Investors are referred to Scientific-Atlanta’s Cautionary Statements (Exhibit 99.1 to the Company’s most recent Form 10-Q), which statements are incorporated into this news release by reference.

For more information visit http://www.scientificatlanta.com. Writers and editors may access a variety of information on the company and its product, as well as downloadable images, by selecting News Center from the home page.

Contact Information

Sara Stutzenstein

Scientific-Atlanta, Inc.

Contact via E-mail