WINK ipo Update : Its trading, plus more on set-top connection
The ipo has doubled from its $16 pricing, careful, I suspect the "pop" is already priced in.
Beyond this, on paper WINK sounds like a biz with HUGE potential... yet does anyone want WebTV ? (IATV seems to be the leader in this field )Do TV viewers want to interface with the internet while watching TV ? All the big names listed below might think so. I am not so sure...any thoughts
Company Description
Wink Communications provides a complete end-to-end system for low-cost
electronic commerce on television. Our system, Wink Enhanced Broadcasting,
allows advertisers, merchants and broadcast and cable networks to create
interactive enhancements to traditional television advertisements and programs.
With a click of their remote control during an enhanced program or
advertisement, viewers can purchase merchandise, or request product samples,
coupons or catalogues. Similarly, viewers can use Wink to access program-related
information, such as news, sports and weather, participate in votes and polls,
and play along with gameshows. Our business plan is to derive the primary
portion of our future revenues from transaction fees charged to advertisers and
merchants for each purchase order or other request for information.
Our immediate goal is to maximize the presence of Wink Enhanced
Broadcasting in television households. To this end, we have established
relationships with, and licensed our technology to, over 40 key participants
from many segments of the television industry. In addition, we have agreed to
share a portion of our transaction fees to provide incentives for industry
participants to adopt and transmit Wink Enhanced Broadcasting. We currently have
agreements with:
- most of the major broadcast and cable networks, including NBC, CBS, ABC,
The Weather Channel, CNBC, TBS, TNT, CourtTV, E!, Showtime, HBO,
Lifetime, Nickelodeon/Nick-at-Nite, VH-1 and TNN;
- five of the six largest cable operators in the United States, including
AT&T/TCI, Time Warner Cable, Comcast Cable Communications, Cox
Communications and Charter Communications;
- the largest direct broadcast satellite operator in the United States,
DirecTV;
- the leading software company in the world, Microsoft Corporation;
- several of the leading set-top box and television manufacturers,
including General Instrument, Scientific Atlanta, Pioneer, Toshiba,
Matsushita and Thomson Consumer Electronics; and
- several national advertisers, including AT&T, Procter & Gamble, J. Walter
Thompson USA, Inc. on behalf of Ford Motor Company, The Goodyear Tire &
Rubber Company, Charles Schwab, Levi Strauss, The Clorox Company,
Universal Pictures, General Electric and Wells Fargo.
A number of key strategic and financial investors have invested in Wink,
including set-top box and television manufacturers, such as General Instrument,
Scientific Atlanta and Toshiba, as well as GE Capital and Vulcan Ventures
(controlled by Paul Allen). In addition, in May 1999, Microsoft agreed to
purchase 2,500,000 shares of our convertible preferred stock and to collaborate
with us to develop, market and distribute Wink Enhanced Broadcasting on
Microsoft's television platforms.
We began the roll-out of our service in the United States in June 1998, and
we currently serve viewers in select cable markets in California, Connecticut,
Florida, Illinois, Missouri and Tennessee. In addition, Wink Enhanced
Broadcasting has been offered by Wink licensees in Japan since October 1996.
MARKET OPPORTUNITY
Television is one of the most pervasive communications media in society
today. According to Nielsen Media Research, there were approximately 99 million
television households in the United States in August 1998. Veronis Suhler &
Associates, a television industry market research consultant, estimates that the
average person in the United States watched approximately 1,600 hours of
television (approximately 4.3 hours per day) in 1998. With recent advances in
technology, new televisions and advanced analog and digital set-top boxes can
provide a platform for interactive television. According to Paul Kagan
Associates, a leading cable industry research firm, in 1998 there were
approximately 30 million cable set-top boxes in use, of which approximately
eight million were advanced analog or digital cable set-top boxes. By 2002, Paul
Kagan Associates expects that the number of advanced analog and digital cable
set-top boxes in use will increase to approximately 33 million.
Television advertising is considered to be one of the most effective
methods of building brand recognition and general consumer awareness of products
and services. According to Veronis Suhler & Associates, the total amount spent
on television advertising in the United States in 1998 was approximately $49
billion. Despite the fact that traditional television broadcasting, cable and
direct broadcast satellite television systems do not provide an integrated means
for viewers to respond to programs and advertisements, the Direct Marketing
Association estimates approximately $91 billion of goods and services were
purchased through direct response television programming and advertising in
1998. The Direct Marketing Association predicts this amount will grow to
approximately $127 billion in 2002. In addition, we believe that electronic
commerce conducted through television viewing devices will benefit from the
rapid growth in internet online shopping, as consumers become more accustomed to
purchasing goods and services electronically. We believe that an opportunity
exists for a simple, immediate, inexpensive and automated method of responding
to direct response advertising on television.
THE WINK EXPERIENCE
The Wink service is free to viewers and easy-to-use which we believe will
encourage broad and frequent usage. Viewers can receive Wink Enhanced
Broadcasting through Wink-enabled televisions and new and existing advanced
analog and digital set-top boxes. Many existing set-top boxes already installed
in consumers' homes can be activated through a remote cable download to receive
Wink Enhanced Broadcasting. To access a Wink enhancement, a television viewer
simply clicks the remote control when the Wink icon appears on the screen. For
example, with a few clicks of the remote control, Wink allows viewers to:
- access additional information (graphics and text) about a specific news
story from CNN Headline News;
- respond to an offer for telecommunications services from AT&T;
- access the local weather forecast instantly from The Weather Channel or
find weather forecasts for other cities;
- obtain coupons and product samples from Procter & Gamble or a new car
brochure from Ford;
- access real-time game scores on-demand or search for statistics relating
to a specific sporting event while watching ESPN;
- subscribe to HBO or Showtime upon seeing an advertisement; or
- enter a virtual shopping mall which offers products for sale through
dedicated interactive channels.
BUSINESS STRATEGY
Our objective is to capitalize on the pervasiveness and popularity of
television to create a mass market medium for sales lead generation and
electronic commerce. Our strategy to achieve this objective consists of the
following key elements:
- increase the presence of Wink Enhanced Broadcasting in television
households by promoting the deployment of Wink-enabled set-top boxes and
television sets and the launch of the Wink service through these devices;
- promote usage by offering viewers an easy-to-use, entertaining and
informative interactive television experience;
- expand the availability of Wink-enhanced direct response offers by
working with our broadcast and cable network partners to enlist
advertisers to add Wink enhancements to their television advertisements;
- benefit multiple participants in the television industry by offering new
opportunities for generating revenue and cost savings while preserving
traditional revenue streams and customer relationships;
- leverage relationships to encourage television industry participants to
adopt Wink Enhanced Broadcasting; and
- promote the Wink icon and the Wink brand to attract viewers.
Our success will depend upon the broad acceptance of the concept of
enhanced broadcasting by industry participants. Many of our agreements with
industry participants do not contain firm commitments or may be subject to
further negotiations. Because of the complex interrelationships among industry
participants, failure to adopt Wink Enhanced Broadcasting by a significant
industry participant or group of participants could impair our business and
deter or preclude adoption by other industry participants. |
