IQ News: Analysis – Six Degrees of Television

NAB sees interactive TV searching for common ground.
More than 100,000 broadcast professionals got together last week at the National Association of Broadcasters (NAB) annual trade show in Las Vegas. The theme of the show was “The Convergence Marketplace,” but the view from the floor showed that the point at which television and the PC will converge is still beyond the horizon line.
While radio and television programming are weaseling their way onto the Internet very nicely thanks to streaming technologies, interactivity, connectivity and TV-based appliances remain an unwilling m nage à trois. There are big problems to be solved: Who will provide interactivity to viewers? Who will pay to produce the content and services? What will it take for advertisers to jump on board, and what should interactivity on the TV be like?
That last question is thorny enough. Among the exhibitors at NAB trying to answer it were improved television services such as Replay Networks and TiVo that let viewers time-shift programs, a category often referred to as personalized TV; Internet services via the television, offered by Microsoft-owned WebTV and ICTV (which also provides games and video on demand); digital entertainment on demand from services such as Intertainer and WebTV, which will launch a satellite-based service in partnership with satellite broadcast provider EchoStar Communications Corporation in May; the Home and Road Runner initiatives, both run by cable operators, which offer Internet content via high speed cable modems; and enhanced television content that provides interactivity and sometimes links to the Internet tied to cable TV programming, provided by companies including OpenTV, ACTV and Wink Communications.
Sound confusing?
Consumers are probably very confused, too-at least those who have even heard of these services. The biggest problem for viewers who do want their television to be interactive is figuring out how to get it. The curse of Betamax still hangs over the set-top box industry with its incompatible standards, while cable providers are still in the process of laying fiber-optic cable as they struggle to keep revenue up.
The stake for cable companies and broadcast stations is bigger than just subscribers or eyeballs, though. Now is the time when they need to scramble to get in on the revenue opportunities from e-commerce, ad targeting and selling ad real estate on the television’s
interactive interface.
However, many of them are distracted at this crucial time by the mandate to convert their equipment for digital broadcasting, which will not only allow them to transmit much ballyhooed greater picture quality but also provide interactivity. “Everybody’s talking about the better picture quality, better sound [of HDTV],” said David Burkey, president of Continental Electronics Corporation, Dallas. “But the real benefit is information-it’s a broader pipeline to the consumer.” Burkey’s company was at NAB to sell broadcasters its new digital television transmitter, with a spin. CEC adds a turnkey solution for combining data services, whether Internet access, Internet-like services, or enhanced TV, directly to consumers.
Singularis, of Lausanne, Switzerland, is another company ready to usher broadcasters into the new age of television. It launched P3 at NAB, a personalization and profiling platform for use by broadcast stations. It lets viewers personalize their programming while providing preference information to the station, allowing them to target promos and ads. “We believe that information services will be provided by the operator and cable companies,” said Mehdi Aminian, Singularis’ CEO. “But they will have to become the trusted broker between all the online services and the users.”
Meanwhile, penetration of even the most established third party interactive services is low: Home boasts 460,000 subscribers, but many players peg critical mass of such services at several million. Major rollout of television-based data services, most say, won’t happen until next year. Until those eyeballs come, advertisers won’t follow.
“If I’m a major advertiser and I want to do an interactive ad, I don’t want to make one for every platform under the sun,” admits Terrence Coles, vice president of commerce and advertising of Culver City, Calif.-based Intertainer. “We have to get together on a platform, find a way that we all consider is interactive and standardize across platforms.
Even when that happens, some of the demos at the show illustrated that too many interactive television products add little more than a mechanism for the broadcaster to send more promos and purchase offers. For example, James Aguilar, director, network media group, of WebTV, Mountain View, Calif., showed an example of what his company plans to provide as the next generation of the service, which he described as “delivering a deeper television experience.” An enhanced version of Saturday Night Live, the demo added an interactive strip to the side of the broadcast window. Viewers could read the bio of guest host Ben Stiller, find out that the musical guest was Alanis Morissette, and buy her CD. Yawn.
Home plans to roll out a similar model with a television start page based on merger partner Excite’s personalization features and including e-mail; an electronic program guide (EPG); video and enhanced TV; and basic two way broadband interactive services for the most popular uses such as checking stocks.
These less-than-compelling examples do not seem like something viewers would pay extra for, and that’s another problem. “For consumers who don’t want to use the Internet or go to any additional expense, but want something in addition to the video, I think it’s a good platform,” insisted broadcasting consultant Melitta Ellerbe Certainly, some programming lends itself more easily to enhancement. Stats-heavy sporting events are perfect vehicles for the addition of text boxes, as are shopping programs.
For those who just want to veg, perhaps replacing annoying commercials will be enough to move them into a laid-back version of the digital age. According to Kenneth Van Meter, president and CEO of Celerity Systems, Knoxville, Tenn., a maker of interactive video hardware and software systems, “Eighty percent of television ads don’t have anything to do with you. In focus groups, we found that if you have the ability to block the ads you don’t want to see and get the ones you do, most people felt that was positive.”
Whether the will to kill the cat food commercials is enough to drive people to the electronics store to buy one of those little black boxes remains to be seen. ƒ