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By SARA FISHER

Staff Reporter

Don’t search TV Guide for the debut episode of “Chad’s World,” a new dramatic series for teens. Turn on your computer.

“Chad’s World” is a television-style series that is slated to air in May on computer screens, rather than TV screens, via the Internet.

The company behind this Web show, Digital Entertainment Network, sees “Chad’s World” as its initial step toward becoming the country’s first virtual network. Within the next three years, Digital Entertainment expects to offer 24-hour programming in the form of some 500 different series.

“We are creating entertainment for groups that don’t have television shows reflecting their lives: Communities such as gay teens, which ‘Chad’s World’ addresses, Hispanic teens, and Asian teens,” said founder Marc Collins-Rector, who acknowledges that his schedule is ambitious.

“We’re not broadcasting; we’re narrow-casting to these (niche) groups, and the Internet is the ideal means to reach them,” he said.

Collins-Rector and his partner Chad Shackley founded Digital Entertainment in 1996 and spent the ensuing two years conducting extensive market research. Their findings led them to develop shows targeting the above-mentioned groups, as well as college students and science-fiction aficionados. “Chad’s World” is the first show to go into production.

Despite addressing issues that mainstream media are unlikely to embrace “Chad’s World” is about a teenager who lives with his homosexual older brother and struggles with issues surrounding adolescence the company has developed a marketing plan designed to make every episode immediately profitable.

“To cover our production costs we only need to attract a base audience of 50,000, an audience size that wouldn’t even register with network counters,” Collins-Rector said. “By marketing to the virtual communities that already exist, such as in online chat rooms, we can easily reach that number.”

An episode is essentially e-mailed as a compressed-data file to a personal computer. This prevents users from being assessed for phone charges while watching in real time.

Digital Entertainment’s shows are free to viewers. The company plans to cover its expenses through product-placement deals and by selling eight minutes of advertising for every half-hour episode, mimicking a traditional television format. Advertisements would also mimic a television model with 30-second spots. Advertisers, who will be charged monthly based on the number of downloads, pay 7 cents every time the half-hour episode is downloaded.

Collins-Rector said Digital Entertainment has already signed several advertising and product-placement agreements.

“Our audience is clothing savvy, so most of our advertisers are in the clothing market,” he added.

Product placement, already rampant in television and movies, will be even more prevalent in the Web show. If a piece of clothing or a pair of shoes worn by a particular actor catches a viewer’s eye, in certain cases the viewer would be able to click with a mouse on it and be connected to the manufacturer’s home page. Product placement deals have been made with apparel maker Diesel USA, Luxor eyewear and Star Jeans.

“We chose to work with Digital Entertainment Network because we see the potential of the Internet,” said Steve Ellingson, regional sales manager for Diesel USA. “The company’s work and plans are impressive, and the format of the show hits a demographic that is our customer base.”

Ellingson said Diesel has signed a product placement agreement and is discussing buying 30-second advertising spots. Under the deal, viewers will be able to buy Diesel jeans online.

So far, original content on the Web has not been very successful. Microsoft Corp. pulled the plug on its creative efforts at the end of last year and American Online Inc. effectively shut down its creative content development unit, Entertainment Asylum, in early 1998.

Yet Digital Entertainment executives remain confident they will succeed where others have failed.

“Other entertainment efforts on the Web have tried to copy broadcast models and appeal to wide groups of people, and they have failed,” Collins-Rector said. “We’re making Hollywood-style programs for targeted groups that they can see at their convenience. Forget ‘must see TV;’ people have lives.”

New episodes of “Chad’s World” will appear bimonthly, and production of the first five episodes has been completed.

After an initial visit to the Digital Entertainment site, a viewer will be able to arrange to have new episodes automatically e-mailed as soon as they are available. The show will have the look and quality of a television show, with real-time video and audio. Collins-Rector said

The question is whether there is actually an audience interested in watching passive entertainment on their computers. Collins-Rector is convinced the answer is yes.

“Will people spend time in front of their computer to be entertained? Critics said the same thing about surfing the Web a couple years ago and now look at the hours and hours spent by people online,” Collins-Rector said. “We’re going to do fine. The audience is out there.”

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