The announcement marks the latest piece of positive news for the Microsoft-owned company. Despite early marketing mistakes, high prices, and low sales, WebTV now appears to be catching on with consumers. Infomercials aired earlier this summer as well as drastic price cuts in the set-top box receiver units have caused an uptick in demand, say analysts and WebTV executives.
Prices on the first generation of WebTV boxes are at all-time lows. A Montgomery Wards department store in the San Francisco Bay Area recently advertised a WebTV classic box for $59.99 after rebate. The box generally sells for $99 after rebate and retailed for over $300 last year.
"They have about 160,000 subscribers," said Jae Kim, associate research analyst at Paul Kagan & Associates, who cited lower prices and better marketing as contributing factors to increased demand. "From a consumer electronics perspective, that is small. But, when you look at it from the standpoint of an ISP, it's substantial," he said.
Meanwhile, Mitsubishi's shipment confirms a prediction by WebTV executives that at least some units would get onto retail shelves by the holidays, followed by a more widespread release next year. Last month the company admitted that WebTV Plus would mostly miss the holiday season.
Mitsubishi's WB-2000 Plus receiver comes with a 1.1GB hard disk drive, a 56-kbps modem, a built-in TV tuner, and a printer port.
In addition, Mitsubishi is bundling a wireless keyboard with the terminal and a standard infrared remote control device, for a recommended retail price of $379.
WebTV Plus boxes come with a number of improvements over the classic WebTV box. With WebTV Plus, users can surf the web and watch TV at the same time; users have to choose one or the other with classic WebTV. Classic WebTV boxes also have no hard drive and less memory. Both generations, however, connect to the Web through phone lines.
"WebTV Plus is the mother of all set-top boxes," commented Kim of the second-generation product's improvements.
While shipping product to dealers now, Mitsubishi did not state how many units would make it to shelves. WebTV executives have already said that the more general release will come next year.