TCI Northwest Division to test marketing program with BMG Distribution, The Musicland Group and Fulfillment Plus; A co-promotion for TCI's Digital Music Express cable music service

Business Wire, Feb 6, 1996

BELLEVUE, Wash.--(BUSINESS WIRE)--Feb. 6, 1996--The Northwest Division of Tele-Communications Inc. (TCI) has been joined by BMG Distribution, The Musicland Group and Fulfillment Plus in a co-promotion targeted to TCI's Washington and Oregon Digital Music Express (DMX) customers in a year-long test program called "DMX PERKS."

Digital Music Express (DMX) is a digital music service offering 30 channels of CD-quality audio delivered over cable wires straight to a customer's stereo. TCI cable customers have the option to subscribe to the DMX service, which is offered on all 26 TCI cable systems in the Northwest.

During the program test, TCI's DMX subscribers will receive a mailing every two months containing a card featuring music releases from selected BMG distributed recording artists from Arista Records, RCA Records, Private Music, Zoo Entertainment, BMG Classics, Jive Records and Windham Hill. The DMX PERKS card can be presented at Sam Goody and Musicland stores to receive a discount on the selected records.

Customers will also have opportunities to win prizes such as autographed guitars, home entertainment equipment and concert-related offerings. In addition, customers can collect six proof-of-purchases for the selected CDs and cassettes and send them to TCI to receive one month of DMX free.

In addition to being a value-added program, DMX PERKS will also be used as an acquisition tool to entice new subscribers. Throughout the program life, advertising will run on cable networks. The ads will stress "Get DMX, Get DMX PERKS...The Most Music for Your Money." Each spot will highlight the featured BMG-distributed artists for that period.

Artist releases featured in the first mailing of DMX PERKS include the new self-titled record from R. Kelly; The Dave Matthews Band smash "Under the Table and Dreaming"; "Hundred Year Hall" by The Grateful Dead; "Cool Down Time" from Dan Zanes; "The Songs of Westside Story" sung by today's top music stars; "Strong Enough" from country music stars Blackhawk; "100% Fun" by Matthew Sweet and Martina McBride's latest "Wild Angels."

Lars Lofas, special products manager for TCI Northwest, initiated the development of the program. "The beauty of DMX PERKS is that it serves the needs of all the parties involved. TCI's DMX customers win with savings on music-related products. TCI wins by adding value to our DMX service and by keeping our customers more satisfied. BMG wins by gaining exposure for its artist and titles. Sam Goody and Musicland win by increasing foot traffic to Northwest store locations."

Rick Bleiweiss, senior vice president of marketing for BMG Distribution, adds, "BMG has always been aggressive in trying new and innovative ways to gain exposure for our artists. When TCI approached us, it didn't take us long to hammer out the framework of what we all mutually wanted to accomplish."

Scott Richman, project manager of marketing for BMG Distribution, continues, "As we developed the program, we worked with TCI, Musicland and Fulfillment Plus to make this a strong program. We are excited to target DMX subscribers since they are already music lovers."

Annette Discerni, director of national promotions for The Musicland Group, concurs, "We see a synergy between the program's sponsors. With 29 locations in Washington and Oregon, we cover close to 75 percent of TCI's cable service areas in the Northwest, and we want to drive that message to TCI's DMX subscriber base by offering the discounts."

Fulfillment Plus, a music wholesaler in Omaha, Neb., will supplement cable system service areas which do not coincide with a Sam Goody or Musicland store location. In addition, the Fulfillment Plus will be providing DMX PERKS member discounts on many consumer electronic brands and products. Mike Pichik, Fulfillment Plus' director adds, "We are happy to participate because this expands our sales for both music and electronics, while providing 100 percent coverage of the areas not served by a Sam Goody or Musicland store."

DMX PERKS is being offered in Washington and Oregon for the entire year of 1996. The initial phase will end on Dec. 31, 1996. TCI, BMG, The Musicland Group and Fulfillment Plus will be monitoring the program's success to determine if the program should be offered to other TCI systems across the nation.

TCI Northwest is an operating unit of Tele-Communications Inc. covering the two-state region of Washington and Oregon serving close to 1 million cable customers. Tele-Communications Inc. is the leading provider of cable television and telecommunications services to the home.

BMG Distribution is the U.S. distribution arm of BMG Entertainment North America. BMG Entertainment North America is a unit of BMG Entertainment, the $5.3 billion a year entertainment division of Bertelsmann AG, the $13.7 billion a year media enterprise. BMG Entertainment North America includes the music lables Arista Records, RCA Records, Zoo Entertainment, Private Music and Windham Hill Productions, as well as BMG Direct, BMG Interactive Entertainment, BMG Music Publishing, BMG Video, BMG Canada and Nice Man Merchandising.