"Do you feel like a story?"

With those words Thursday night, talk show host David Letterman launched into a mesmerizing discussion of sex, blackmail and celebrity that will go down as a milestone moment in television history and a textbook case on dealing with scandal in the digital age.

Mr. Letterman's 10-minute tale of a box of damning evidence left in his car, an alleged $2 million extortion plot and admitting to affairs with female staffers before a grand jury was shockingly confessional, and audience members laughed awkwardly throughout.

"This whole thing has been quite scary ... I had to tell them all of the creepy things I have done," Mr. Letterman said of the jury, although the same could be said for the millions watching at home or in computer clips at work yesterday.

In a time when people can become celebrities for not only having scandalous sex but doing so on film -- see, literally, the works of Paris Hilton and Kim Kardashian -- Mr. Letterman faced the issue head-on before millions of viewers, and before the likes of the National Enquirer, TMZ or the Smoking Gun could do the dirty work for him.

"The most important thing is to be as proactive as possible. Tell your story before someone else tells the story for you," said Saul Markowitz, who has 24 years in the Pittsburgh public relations and crisis management business.

"In the media now, you're not going to see the footage of reporters running after [Mr. Letterman] in his car, interviewing this person and that person. You're always going to see him telling the truth first."

Fellow PR man Bob Oltmanns of Skutski & Oltmanns Downtown replayed Mr. Letterman's confession several times yesterday, and found the delivery so smooth that he was sure the comedian had practiced it.

"I thought he did a great job of endearing himself to the audience, to the greatest extent possible under the circumstances," Mr. Oltmanns said. "He said he did terrible things, came clean and fell on his sword."

Police charged Robert J. Halderman, 51, a producer with CBS's "48 Hours" television news magazine, Thursday with attempted grand larceny. If convicted, he could face up to 15 years in prison. According to the Manhattan district attorney's office, Mr. Halderman demanded the comedian pay him to keep quiet about affairs with staffers, warned of ruining his reputation and mentioned Mr. Letterman's "beautiful and loving son."

Mr. Letterman, 62, married his longtime girlfriend, Regina Lasko -- a former staffer he had been dating for two decades -- in March. They have a 6-year-old son, Harry. The comedian has been in crime headlines before: police discovered a plot to kidnap Harry in 2005, charging a house painter at Mr. Letterman's Montana ranch in the plot, and arrested a woman for stalking the comedian in 1988.

During the past three weeks, Mr. Letterman and his attorney helped police nail Mr. Halderman by secretly recording his demands during two meetings at a luxury hotel and giving him a $2 million check on Wednesday, which the producer cashed the next day before he was arrested.

Mr. Halderman, a 27-year CBS veteran, pleaded not guilty at his arraignment yesterday.

Besides the pure "Mad Men" like drama of Mr. Letterman's predicament, some of the shock was tied to the Indiana native's closely guarded privacy -- he is "practically a hermit," noted Alessandra Stanley of the New York Times. "I'm motivated by nothing but guilt ??? I am just a towering mass of Lutheran Midwestern guilt," he said Thursday night.

Mr. Letterman has long used this stoicism for laughs, such as this line about his sexual affairs on Thursday: "I know what you're saying -- Oh, Dave had sex!" he said.

Mr. Letterman's career peaks have been emotional ones, from introducing his doctors and nurses after emergency heart bypass surgery in 2000 to his somber, serious shows in New York after 9/11. His lows have been when meanness shows through, during lame gags as Oscar host in 2005 or others about Sarah Palin's 14-year-old daughter this summer.

In the abstract, the tale was a tangle of further contradictions: While he was trying to get ahead of the story by talking about it on his 11:35 p.m. show, the news broke hours earlier as soon as he taped it. And while Mr. Letterman outfoxed the 21st century digital media with his warts-and-all expose, the comedian remains one of the last old network TV dinosaurs roaming the earth, having been a 1970s guest host for Johnny Carson.

The scandal comes during an otherwise great time for the talk show host, with the his "Late Show" lately trouncing NBC's "Tonight Show" with Conan O'Brien, and critics dumping all over the new NBC show from longtime rival Jay Leno. He scored his best ratings in years with Barack Obama as guest Sept. 21 -- and pre-publicity over the extortion plot shot his ratings up 22 percent on Thursday, according to Nielsen.

"What a better way to get publicity than to act badly, but with class?" asked Brian Tedeschi of Think Inc. in the Strip District. "This was a deliberate approach in which the publicity was not only controlled but gave him the opportunity to have millions of people watch him."

Public relations-wise, Mr. Letterman is not out of the woods yet. He may be seen as a hypocrite (for his constant jokes about Bill Clinton and others in sex scandals) and find himself the butt of jokes as well -- the name of his production company, "Worldwide Pants," is an especially easy target.

CBS could face questions about the "Late Show" workplace. Some fans could be turned off by the affairs, or could place Mr. Letterman into the same disgraced camp as philanderer politicians Mark Sanford, Eliot Spitzer and John Edwards.

"You came away feeling he was victimized, but a lot of people may question who is the real victim here: Is his wife the victim? His child?" said Mr. Oltmanns. "Time will tell. With the parade of public pronouncements lately [from Mr. Letterman and the politicians] it's becoming difficult to decide who wins and who loses."

That is where Mr. Letterman's humor and Midwestern self-deprecation could help him, said Dr. Audrey Guskey, a marketing professor at Duquesne University.

"His brand has changed forever. But he's a comedian, not a politician -- if people don't like the brand they can change the channel."

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