Rivalries, technologies confuse set-top market
news.com
By Jim Davis
Staff Writer, CNET News.com
June 17, 1999, 12:15 p.m. PT
news analysis CHICAGO--Despite the homilies and Industrial Age metaphors
espoused at a big cable convention here, many roadblocks still stand in the way of
mass use of the new TV set-top boxes, interactive television, and other services.
Many cable industry executives in attendance at their annual national convention, as well
as officials from the Federal Communications Commission, latched onto railroad
metaphors for describing how the infrastructure of the cable industry needs common ways
of connecting and sending information.
Standardization, they remarked with great consistency, is the key to future prosperity. But
back in the real world of the 20th century, frustrated software and content developers are
finding more than a few potholes on the connection road and on-ramps that haven't been
built yet.
And while there is a growing list of high-tech companies
offering ways to implement interactive services, the content
providers--i.e., cable and broadcast networks--are either
standing on the sidelines waiting for standards to emerge or
placing bets on a potpourri of technologies.
The reality is this: Combining television with interactive
services is a still big gamble, but one many are willing to
take for potentially astronomic returns.
The lure is inescapable. Interactive television mean networks
and advertisers can potentially know more about who is
watching (and doing) what, and what they are buying.
More-targeted advertising with better response rates has long
been a goal in the television industry. And what the industry
is banking on are the new digital TV set-top boxes running
new kinds of applications and content.
Placing bets on technology
Microsoft cofounder Paul Allen, the billionaire owner of cable operator Charter
Communications, predicted in a speech at the convention that digital set-top boxes with
increasing power and storage capacity will lead to a host of new applications.
"These advanced new set-top boxes are a whole new platform for applications," he said.
"We can't predict what all those [applications] will be."
And therein lies the problem for content developers, who have to place bets on which
software and hardware platform to target and on which pipeline to use. These pipelines
include satellite, digital subscriber line, over-the-air broadcast, and cable.
Not only that, but content developers have to figure out whether to enhance a live
broadcast, offer links from a program to a Web site, or if they want to be placed in, or
create, a "walled garden," or virtual mall of interactive content related to programming. And
the choice could be vital, because better consumer response to the right technical model
means better advertising opportunities and more money.
No single answer
There isn't one answer, either, say industry insiders and observers alike.
"There will be a multitude of platforms and different operating systems for every [cable
operator]. By its nature, there are different states of technology being deployed in different
areas at different times," in the cable industry, said Hal Krisberg, chief executive of
Worldgate Communications, a provider of interactive software technology to cable
operators.
However, that's not a scenario content developers want.
Bob Zitter, senior vice president of new business development at HBO, said at a panel
discussion this week that standardization of enhancement data and the handling of
video-on-demand streams was a critical issue for developers, because they don't want to
come up with 20 different screens of interactive content for one show.
Content providers are having a hard time figuring out what to do. Some, such as NBC, are
betting on as many different technologies as they can. Others, such as cable network
programmer Court TV, are being more circumspect.
"We're exploring all the usual options. Because we dominate our [program] niche, we have
an incredible opportunity" in bridging commerce and content, said Betsy Vorce, senior vice
president of communications at Court TV. However, "we have to plan for a realistic future.
We will figure out what we want to do [in terms of building brand identity] and then decide
what technology to use," she said.
In the meantime, the company has allied itself with Yahoo to do chat rooms based
on legal issues and Broadcast.com to stream clips of trials to consumers.
A growing number of the film and music studios are letting Intertainer do the heavy
lifting of working on what it calls its "broadband programming service." Studios such
as Warner Brothers are working with the company, and a number of Disney's
operations, including Buena Vista and the Disney Channel, are on board as well.
Sony Music just signed on to provide videos for use on the service, although music
won't be available for digital downloading just yet.
"We believe the history of interactive TV is just about to be written. What we need is
a common language to write to," said Jonathan Taplin, Intertainer's co-chief
executive at a press conference.
The need for a common language is important, because Intertainer is developing its
service for use over both DSL and cable networks. It already runs
on Scientific-Atlanta's Explorer 2000 TV set-top and will be
available on General Instrument's DCT 5000 set-tops. The
company just announced that they are working on making the
service available on Microsoft's "TV Platform," which is basically
what used to be called the WebTV platform, but is now being targeted for use in
cable set-tops.
Despite fears that Microsoft will be able to come in and duplicate its command over
the PC industry by spreading the use of the Windows CE platform, there is also a
clear need for standardization, a factor which could aid Microsoft.
But various efforts in the industry mean it's not clear if Microsoft can duplicate its
PC success. There are two main standardization efforts which could potentially limit
its ability to dictate market trends. One, being worked on by CableLabs, the
industry's research consortium, is attempting to set hardware and software
standards that would make it easier for content and applications to run on any
platform. That effort is progressing slowly, though, leaving room for a company to
come in and set a de-facto industry standard merely by getting more companies to
use their technology than others.
Another effort may produce results sooner. The Advanced Television Enhancement
Forum (ATVEF), whose members include Microsoft, Disney, CNN, NBC, Intel, and
many others, is getting ready to license its technology for use in combining Internet
content with television programming. In essence, by emphasizing the use of
standard Internet technologies such as HTML, content will be easily re-usable on a
variety of platforms, including TV set-tops, handheld devices, and PCs. This will
have the effect of reducing the control any one company can have on the
development of interactive television.
Watching AT&T
But big names could still rule. In the cable industry, at least, AT&T's choice of
hardware and software could become a de-facto standard. The company's cable
arm, dubbed Broadband and Internet services, has increased clout now with its
ability to reach such a large portion of the American public through its TCI and
MediaOne acquisitions. Where AT&T goes, other cable operators are sure to follow,
say industry insiders.
Some insights as to the company's thoughts on interactive television surfaced at
the Cable 99 convention this week.
Laurie Priddy, senior vice president of advanced technologies at AT&T Broadband
and Internet services, said in a panel discussion that interactive services is "not
about the Internet on TV."
"We have to keep it simple, but take risks," she said, offering up a vision of what
she called a TV-centric device where AT&T is still making programming selections,
both in video and interactive offerings. There needs to be an easier way of getting
consumers used to using the remote to respond to text on the screen, and
eventually a keyboard, she said.
By focusing on the TV experience, the company's electronic programming guide
becomes a key area of focus. It becomes something analogous to a portal for the
TV that aggregates and organizes TV content, and becomes the "first screen" that
users will interact with on a day to day basis. What arises from this scenario is that
the screen real estate AT&T controls becomes more valuable to content providers if
there is only a limited amount. Unlimited access to Internet content from the TV
diminishes that control.
Development of something as seemingly innocuous as the electronic programming
guide then also becomes an order of magnitude more complex as a variety of
components are stitched together--and a variety of companies, each with their own
interests, are involved.
AT&T, for instance, is working with Excite@Home, Microsoft, and TV Guide
interactive on the EPG for its most advanced new TV set-tops, and all parties want
to see their logos placed somewhere on a screen.
"The issue is to not make it so overwhelming it starts to look like a race car," said
Priddy.
Another issue: how to meld the program guide with interactive content running on
Microsoft's WebTV platform, which has an interface with a different look and feel. So
far, AT&T has not decided how to solve that issue, say sources at TV Guide.
Just who will be powerful enough to set standards won't really be known until
interactive services start commercial deployment. Until then, there will likely be
see-saw battles on many fronts, including real estate on a TV screen as small as
1-inch square. |
