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Introduction
to Interactive TV:.
What
is Interactive TV - The definition varies depending
on whom you're talking to. To some, interactive TV (ITV) specifically
refers to technology that allows consumers to fully interact
with programming. That includes services that let users access
product information during commercials, send e-mail and instant
messages and participate in polls through their TVs. It also
includes technology that lets consumers bet on live horse
races, change camera angles during sports games and order
food simply by pressing a button or two on the remote control.
In its broadest sense - the one promoted by the interactive
industry - ITV includes anything that allows consumers to
have more control over their televisions. Video on demand,
for example, lets users order up movies whenever they want,
rather than wait for set start times. Digital video recorders,
such as the well-known TiVo brand, also are considered part
of interactive TV. They not only digitally record shows but
also select programs users might like, based on the consumer's
viewing habits. Other ITV features under this broader definition
include video games, on-screen programming guides, customer
support services and local weather information - all accessed
through the television. During the last ITV boom in 2000-01,
ITV was broken into three categories; enhanced TV, internet
TV and personal TV. Enhanced TV encompassed overlays on the
TV screen that provided viewers useful information and other
capabilities. Internet TV was basically the ability to execute
internet-based functions through the TV set, similar to Web
TV. Personalized TV included functionality such as DVRs. In
any event, Interactive TV in the traditional sense revolves
around applications that launch from some type of middleware
that rides on the operating system in the set-top box. These
can include games, shopping applications, tickers, weather
reports and the like. In the general sense, Interactive TV
can mean any kind of interaction with the TV, whether through
program guides, VOD, DVRs or what have you.
Brief
history - For the last 25+ years, Cable has been
trying to crack the Interactive (ITV) gambit. In the late
1970s, Interactive TV initiatives have been developed on both
large and small scales. There was a short revival of the idea
around 1995 when the US industry was looking at video-on-demand
services. Supposedly, interactive television was touted as
the next evolution in TV, an emerging technology that would
generate up to $20 billion in revenue by 2004. Initially,
companies thought ITV would make its billions of dollars through
advertising, commerce and subscription revenues. However,
that never materialized in part because of the inadequate
capacity of the cable TV networks. As operators began rebuilding
for two-way capacity, they began increasingly looking for
new ways to capitalize on their networks, trying to figure
out how they can facilitate unique services such as news,
games, polls, tickers, multi-camera angles and so forth to
create a compelling subscriber acquisition and retention tool.
After many attempts, the industry found no definitive answers
that could be used as the foundation strategy for an ITV roadmap.
The reason interactive TV has not yet become a reality is
many, but a few of the more well discussed ones are that Cablers
have not yet figured out how to exploit this key strategic
advantage in a large-scale, economically viable way.
1999
to 2004 - Over the past five years, a new generation
of ITV vendors proposed increasingly sophisticated, complex
and expensive approaches. In 2000, the market became crowded
with the likes of Liberate, Microsoft, PowerTV, Canal+, ICTV,
OpenTV, Enreach, Source Media, Worldgate, Wink and so forth
all vying for a piece of the U.S. market. And with the emergence
of "thick" set-top boxes (STB), or those with extra
computing and processing horsepower, the industry seemed poised
for a an explosion in interactive TV services. Still, while
the industry was mostly focused on the technology, not enough
consideration was given to the viewing experience. Then in
May, 2001, AT&T Broadband, the industry leader at the
time and now a part of Comcast, decided against rolling out
"thick" STB's. The rest of the major MSOs followed
suit and subsequently the dynamics of the industry changed
on a dime. With MSO emphasis then moving to the "thin"
client STBs in order to take advantage of the 30 million 1000-,1200-
and 2000-series boxes already in the field, several ITV players
with thick client platforms, most notably Microsoft, had to
quickly adapt their business plans. As the capital markets
continued their downward spiral in late 2001/early 2002, several
other ITV vendors who were operating at losses felt increased
financial pressure. Things only got worse after the Adelphia
scandal in June 2002 caused Cable stocks to plunged. With
Wall Street and the investment community emphasizing the need
for profitability and financial performance, CAPEX and cash
flow came to the forefront. Slowly the industry started rolling
out attractive products like VOD, HDTV and DVRs while enjoying
record growth of High Speed Data subscribers. The revenue
picture improved, customers been given more choices, and Cable's
competitive position became stronger. Still, Interactive TV
remains on the side burner, but perhaps not for much longer.
With News Corp acquisition of DirecTV, Rupert Murdoch has
promised innovative and competitive services that will push
Cable operators even further. Among the key centerpieces of
his strategy are DVRs and Interactive TV. The push by News
Corp on ITV services is expected to jumpstart Cable's interest
in the Interactive TV sector. Interest and activity have already
increased through the first 2 quarters of 2004. Companies
are continuing ITV research, and popular Cable networks such
as Discovery, ESPN and the Game Show Network are heavily involved
in interactive TV initiatives. Below is a quick look at a
few of the pioneers in ITV's history.
QUBE
- QUBE Interactive was started in 1977 by Warner Communications
in Columbus, Ohio. QUBE offered an unprecedented 30 channels
of television divided equally between ten broadcast TV channels,
ten premium or pay-per-view channels, and ten channels with
original interactive programming. Clearly, it was a pioneering
product for it's time. However, the service was costly and
cumbersome. The Qube set-top box alone cost $200 at a time
when cable converters cost $40. Qube equipment at the Columbus
headend added about $23 million in construction costs. Economies
of scale were not there. Further, there were reliability problems
with the equipment, especially in the data transmission upstream
from homes to the cable headend. So despite popularity among
users, it was decided that interactive TV was not yet affordable
or feasible for mass rollouts. And with addressable converters
on the way, Cable operators had a wholesale answer to their
needs. Hence, the QUBE experiment ended.
Interactive
Network
- Interactive Network (IN), incorporated in 1986, helped pioneer
and introduce interactive TV technology by providing an interactive
service that ultimately delivered more than 40 hours of daily
interactive content. Basically, IN used FM subcarriers and
VBI for downstream and a telephone return path. Using these
technology features and specially created software housed
in a specially designed andheld 'control unit,' IN launched
the service in 1992. Consumers could play along with such
TV programming as Wheel of Fortune, Jeopardy, Law & Order,
Murder She Wrote, NFL Football, MLB Baseball and other events.
IN's programming was heavily weighted toward sports, games
and talk programs. In addition, the unit had an array of built
in games. The way the service function was as follows; subscribers
would pay a monthly subscription to IN's television simulcasts
and the programming would be delivered to the user by radio
subfrequency, presenting information and play options on the
control-unit screen in synch with programming on television.
For example, as you watch the "Jeopardy" answer
revealed on television, you enter the question on your unit
at home. Later, you would upload your score to the IN computers
and compete for prizes against other players. The unit received
it signal in one of two ways, the FM airwaves, or by an infrared
adapter. In terms of the adapter, IN provided a set-top add-on
to read signals that were in the VBI (vertical blanking interval).
The vertical blanking interval lines can carry additional
data during the very brief interval when the picture on the
television screen is being refreshed. IN worked with PBS to
pass their signals along through the VBI. When the adapter
was mounted, the signals would go from the adapter to an infrared
receiver on the control unit. From there, the unit's software
would create an "interface" from which the user
could interact with. Users could compete against one another
in events, such as NFL Football, and once the event was over,
they would connect a telephone line to the unit where it would
make a local call and 'upload' the data. As scores were tallied,
a winner would be identified. Depending on the contest, the
winner would receive prizes. IN had created an interactive
advertisement with Pepsi and had a development deal with Sony
Pictures, as well as other such ventures. Though numbers were
never made public, it was believed that IN had fewer than
10,000 members. After an IPO, some further investments and
a bridge loan or two, the start up finally went dark in late
1995. However, Interactive Network held core patents in the
field, and ended up merging with TWIN in March, 2002.
FSN
- In 1994, Time Warner introduced the Full-Service Network
(FSN) prototype in Orlando, FL. It was the world's most sophisticated
and expensive interactive television test bed yet, complete
with interactive shopping, sports, games, news and an electronic
program guide, as well as movies on demand (yes, VOD). Using
a fiber network, Time Warner had over 4,000 homes connected
to the service. Understandably, the project was expensive,
with some estimates being as upwards of $100 million. The
boxes used in the experiment were Silicon Graphics workstations
that cost about $5,000 each. At the same time, while it was
monumental and costly, it proved to be a successful research
project with a ton of experience and expertise gained along
the way. A few of the more notable facets were ISA, which
is the specification Time Warner is using for Mystro, and
other technology which led to the development and recent deployment
of a new video-on-demand (VOD) service dubbed iControl. One
of the reasons FSN failed was the huge amounts of computer
code required to operate the many complex operations. Other
than that, consumers were not ready in part because the internet
had not arrived and interactive/point-and-click behavior had
not been established. However, Time Warner and it's vendor
partners gleaned some important feedback from subscribers.
They learned that the service itself must be free to the customer;
different tiered pricing models do not work; VOD was a very
popular application; and, people really want simple interactive
options. FSN eventually closed its doors in 1997. But strides
were made that are still with us today.
Interactive
TV
Big Picture:.
Overview
- Though Interactive TV is deployed in a few million U.S.
households in one form or another (excluding interactive program
guides), it has yet to reach viability as a stand alone service.
Part of the reason is that it's a complex product. ITV requires
platform development, testing, integration, hosting, maintenance
and updating, not to mention trialing & deployment. Today,
it is largely considered a value-add service that helps reduce
churn. That said, while the integration is complex and the
business models are cloudy, with competition being an ever
present threat and satellite's forays into ITV looming, Cable
operators are staying on top of developments. As of Q2 2004,
Cable operators are looking closer at how they can develop
their ITV services while considering the implications of OCAP
(OpenCable Applications Platform), the expected industry-wide
platform that will enable interoperability. See more about
that standard below. Overall, there have been some success
stories in the industry. Insight and Source Media proved several
years ago that the service can add value and reduce churn.
Charter, with Digeo, and Cablevision with it's iO: Interactive
Optimum service have shown the service can be sleek and attractive
to customers. While none of those services generate volume
revenues, they help to increase customer satisfaction and
thus reduce churn. What's is especially noteworthy is the
trend of IPGs (interactive program guides) becoming a core
element of the ITV platform. The IPG has become the starting
point of the TV experience for an increasing amount of subscribers,
which has increased the importance of the IPG within within
many MSO's ITV strategies. And with a behemoth like Gemstar-TV
Guide that has it's IPG service in a majority of Cable homes,
it has the power and influence to push it's way into the segment.
Other developments in the past year worth mentioning include
News Corp's acquisition of DirecTV and it's plans to roll
out ITV services; Liberty Media's move to consolidate OpenTV,
Wink and ACTV into a leading ITV player; and the announcements
of ICTV's HeadendWare and Microsoft's TV Foundation. All of
these are covered in depth further below.
Why
the latest ITV push had failed
- There were many reasons the most recent exploration into
ITV from 2000-02 failed. For one, too much emphasis was placed
on TV programming enhancements and the false promise of super
powerful set-top boxes, rather than consumer value and successful
applications. In a string of miscalculations, the ITV vendors
attempted to rationalize an investment level of hundreds of
dollars per home, rather than leveraging the installed base
of existing digital set-top boxes. And while the concept of
enhancing programming is novel, it's also fraught with problems.
The now-infamous "Jennifer Aniston's Sweater" model
involves too many business interests to happen in the early
stages. This raises the issue of the ITV business model, which
was clearly an issue because there was no killer application.
There would need to be fairly large investments made by operators
for client/server licenses as well as steep ongoing development
and support costs. Then there's the integration issues. Interactive
TV requires software in the set-top box as well as at servers
in the head end. This software needs to be placed on set-top
box operating systems and must be integrated with back office
systems. This is a complex task. Another issue was the overall
lack of content. An ITV platform cannot be offered to the
customers if it is not compelling, interesting and useful.
Once you give a bad impression on your customers, it's difficult
to make that up. Lastly, and as important as any reason so
far, the generation of ITV services that spanned the last
few years were not interoperable. This is problematic for
Cablers who do not want to tie all their services to one vendor.
By having different systems that don't talk to eachother,
you create new headaches that could prove to be a barrier
down the road. While all these considerations were being weighed
between 2000-01, market conditions then changed. No longer
were thick client STBs the vision of MSOs, and then after
the capital markets crashed, Wall Street placed great emphasis
on achieving free cash flow. Cablers were then spending all
their time and efforts on VOD, HDTV and VOIP, and Interactive
TV was relegated to the sidelines.
Varying
software/hardware environments pose challenges
- Aside from the lab work, iterative testing and eventually
field trials involved with adding new services, MSOs do not
have standardized systems. Instead, across the board, Cable
operators have a multitude of software and hardware environments
that make up their network systems. For example, they may
use digital-video headend equipment made by both Motorola
Inc. and Scientific Atlanta Inc, which require separate network
and set-top box operating systems. They can also have up to
four different generations of digital set-tops deployed as
well as three different electronic program guides and a handful
of VOD vendors. The different generation set-top boxes also
have different processing chips. Among things, changes can
mean that any software need to be recompiled individually
for each processing chip and other supporting chips, like
graphics and networking as well as the embedded software within
them (firmware). Taken together, this poses great challenges
to any Cable company thinking about adding new services, especially
ones that dramatically effect the network operating system
and set-top box environments.
Porting
- Porting is essentially when software developers re-write
their application software to run in different environments.
In the Cable sense, porting means programmers write code to
make middleware work on different set-top boxes, TV shows
more useful or entertaining, and so forth. These developers
have to ensure their software will work within the confines
of the digital video headend, IPG, and set-top generations
that make up the targeted destination. If a particular MSO
wants any customization, such as the “look and feel”
of the way customers maneuver themselves, that involves more
work. In general, the more complex the software development,
the more time and expense that is involved. This brings us
to two points. One, one of the biggest problems with the current/previous
interactive TV model is that application developers must port
their works to different environments. Each time they do this,
there is great expense involved. Two, in order for these apps
to effectively run on Motorola and Scientific Atlanta set-top
boxes, they need to be certified. Whether written in Java,
or Perl, or PHP or C++, this can add a great deal of expense
to the project, maybe well over $100,000. While that may not
be much to an entrenched software company or large firm that
has great interest in Interactive TV, the small players will
have much more problems with it. This serves to limit the
space as well as stifle innovation. Overall, the issues associated
with porting is one of the primary reasons why there is a
big push for a standardized software environment, such as
OCAP.
Competition
will drive the sector forward
- Both DirecTV and EchoStar have made it clear that Interactive
TV functions is part of their future business strategy. Each
has been investing heavily in Interactive TV technology in
order to offer new forms of entertainment and keep a competitive
edge. Starting with DirecTV, News Corp.'s BSkyB satellite
operations reap hundreds of millions annually from interactive
applications, but it's unclear whether the same business models
will be successful in the United States. Rupert Murdoch has
said the US operation will offer an array of advanced ITV
applications similar to those offered by BSkyB in the UK.
Murdoch will look to implement a single ITV platform that
will define the user experience and provide increased opportunities
for upsell. In addition, the platform will allow a migration
path for future upgrades. Murdoch is a proponent of ITV because
it can provide a competitive edge and it enables further innovation.
It is expected that News Corp will introduce an array of ITV
features and services over the next few years, with DirecTV
having the luxury of feeding from BSkyB's experience. Among
the popular ITV applications which News Corp has implemented
through BSkyB include viewing sports from different camera
angles, watching up to eight broadcast carousel channels from
which consumers can get top news stories, parlor and arcade-type
games as well as betting. Once Murdoch is ready to roll out
his DirecTV Interactive TV platform, he will have many of
the applications ready to go. Not to be outdone, rival EchoStar
also seems to be ramping up its ITV roll-outs. Earlier in
the second quarter of 2004, for example, it announced a launching
of ITV games from Buzztime and Fantasy Sports. The services,
which are broadcast over 2 interactive TV channels on its
8-million-subscriber OpenTV-powered DISH platform, are another
in a line for EchoStar who now offers 22 channels of ITV programming
and services, all accessed from the DISH Home ITV menu. Other
interactive offerings include "DISH Instant Weather"
from AccuWeather which provides 5-day forecasts and information
on current weather conditions for around 1,400 US cities;
a customer service app that allows subscribers to view their
statements, pay their bills, order new programming tiers,
and get answers to frequently asked questions; Visiware's
Playin'TV games channel; the KidsWise educational service;
OpenTV's PlayJam games channel; a "Fantasy Sports"
channel; an electronic magazine from premium programming provider,
Showtime; Zap2it; TV Mag; and news services from Reuters and
Bloomberg. Like DirecTV, Echostar will continue to push ITV
services because it provides them with a competitive edge
over Cable. As satellite companies gear up for multi-room
DVRs and wireless services, ITV will fit in as another added
value service. However, one distinct advantage Cable has over
the satellite operators is the return path. Cable has a two-way
system with reliable upstream, while the direct-broadcast
satellite return path is slower, and only about one-third
of customers are patched into it. In any event, in 2004, Cable
companies will be looking closer at OCAP and Interactive TV
strategies. They know they will need to be prepared to match
satellite offerings with those of their own because as one
platform introduces the technology, the other platform has
to step up and introduce new and better services to compete.
In the end, while satellite companies will no doubt hit the
market first with unified platforms, Cable companies will
be ramping up their efforts to stay competitive, and the cycle
will begin.
Factors
for ITV to succeed
- If the right applications are packaged together in a Interactive
TV platform that is intuitive, fun to use and well marketed,
the service has a good chance to be accepted by customers.
Charter, Insight and Cablevision are all examples of real
deployments that work. Among the applications that are being
studied are video games, shopping and news-on-demand. Games
seem to be the most developed application. "We've proven
out parlor-style games will do very well. People will spend
a lot of time playing the most simple of games" says
Cablevision Systems Corp. president of cable and communications
Tom Rutledge. Commerce is expected to be another area of interest.
OpenTV, a Liberty Media subsidiary, is working with sister
company QVC to make it easier for customers to make purchases
using their remotes. Other applications include pragmatic
functions such as the automation of customer service functions
- from answering questions to viewing and paying bills using
the remote - which serves not only to help reduces the cost
of operations, but helps the customers as well. Also on the
table is enhanced television, i.e. adding interactive features
to linear programming. And the new Digeo-Moxi box, with HDTV,
a DVR and ITV, is a product that can take Interactive TV to
a new level in part because of how tightly integrated all
the functions are. Speaking of integration, much has been
learned since the trials in 2000-01. MSOs and vendors will
be better prepared to add back office functions. Still, ITV
will have to work seamlessly with IPGs, HDTV, VOD and DVRs
among other things. And while the business model for ITV has
never been clear, what's known is that ITV can serve to generate
soft revenues, such as those that come in the form of Digital
Cable upgrades, retention and the like. Until there is a killer
application or a high value offering, customers may not be
willing to pay much for the features. To that end, unlike
the business models of 2000-01, the cost to deploy ITV will
have to fall within certain reasonable confines. Some MSOs
will take their lead from their subscribers. "Our customers
have told us the two most compelling interactive products
are high-speed Internet and VOD, and that's why we've prioritized
those services," said Comcast Cable executive vice president
of sales, marketing and customer service David Watson. "The
addition of DVRs will add to this combination. "We're
continuing to look at opportunities for adding interactive
applications where it makes sense and where it adds value
for our customers," Watson said.
Examples
of success
- To date, there have been a few successful Interactive TV
deployments in US, including Cablevision's iO, Charter's Digeo
Moxi and Insight's Source Media. Echostar is another, but
see Satellite for more information.
Starting with Cablevision, it's iO: Interactive Optimum digital
cable platform, Cablevision's iO offers customers access to
more than 200 channels, including 50 premium movie channels,
45 channels of commercial-free digital music, more than 700
titles available on demand, an interactive programming guide,
14 high- definition programming services and interactive television
applications. In essence, the ITV function is tightly integrated
into a one-stop platform for home entertainment. And with
the ITV applications, customers have access to the following
services at no additional cost; Metro Weather Interactive,
featuring localized weather information and reports on the
region, nation and world; Metro Traffic Interactive, featuring
local and regional traffic information and in select areas,
live camera shots of frequently traversed roadways; iO Dashboard,
an interactive information portal with embedded video that
enables viewers to scan current news, sports and entertainment
headlines; iO Showcase, a promotional channel designed by
Cablevision to help iO customers identify unique and interesting
elements of its digital cable service including new on demand
titles, subscription video on demand services, high-definition
programming and other benefits; and Move 'n Match Puzzles,
an entertaining and educational puzzle game for young children.
In addition, the iO Games "Variety Pak" and "Casino"
are each available for unlimited play for the monthly subscription
price of $4.95. The Casino package includes seven interactive
gaming favorites developed by Zone4Play; Blackjack, Caribbean
Poker, Roulette, Video Poker, Battle Royal, Slots and Keno.
Cablevision says it will enable iO customers to instantly
subscribe to interactive games services by adding the ability
to upgrade using only a television remote control and on-screen
prompts. The iO service was first offered on a limited basis
in late 2001, and as of Q2 2004, Cablevision now has 1.1 million
iO customers, all of who have access to this ITV functionality.
Similarly, Charter Communications Inc. offers an integrated
package that allows customers to access interactive channels,
OnDemand movies & events, TV listings and live TV.launched
from one starting point. Charter launched the interactive
TV service from Digeo Inc. to some 650,000 digital-cable users
of Scientific Atlanta Explorer 2100 set-top boxes in 2002.
Called Charter iTV, the service has customers can navigate
their TV experience from "Charter 1". In terms of
ITV applications, Charter offers iTV Customer Care, where
customers can get service information and also find out about
the latest Charter promotions; iTV Weather, giving customers
up to date local or national forecasts; iTV Entertainment,
providing descriptions, listings & show times of movies
in local theaters now; iTV Games, which has 24-hour access
to free card games, puzzles, and strategy games using the
digital cable remote; iTV Sports, which provides the latest
sports scores, stats, and standings; iTV News, listing the
day's top world headlines and national stories, along with
the latest political and science news; and iTV Money, enabling
access to the latest business news and stock market activity.
On the horizon is iTV Shopping, which is for....shopping.
Insight offers it's own service based on the LocalSource platform
provided by the now defunct Source Media that split off it's
SourceSuite function after it's purchase by Liberate. SourceSuite
provided LocalSource, and is now a wholly-owned subsidiary
of Insight primarily to keep the service going. By having
customers turn to a separate channel, LocalSource offers local
weather, restaurant and movie theater listings and information
by using the remote to click through pages. Insight says the
service has had a strong effect on reducing churn.
Importance
of IPGs -
IPGs are a key element in the viewing experience and will
be a big part of the future of interactive TV. IPGs are important
is because they are usually the starting point for many viewers,
and they already involved interactivity. Gemstar-TV Guide
has been the industry leader in the segment, but others are
looking to take a crack at it (more below in IPG section).
In addition, satellite and Cable TV providers are moving ahead
with plans of their own. Comcast and Gemstar-TV Guide announced
an agreement to form a joint interactive program guide (IPG)
development group using the existing TV Guide Interactive
IPG as a foundation to create a guide for Comcast and the
cable industry. The companies also agreed to enter into a
long-term, non-exclusive patent license and distribution agreement,
and Comcast will pay $250 million to utilize Gemstar-TV Guide's
intellectual property, the companies said. Likewise, At the
end of May, 2004, DirecTV said it will begin shipping a set-top
box that features its new electronic programming guide. In
the second half of the year, a DVR-enabled set-top with more
interactive features will be introduced. Both of these newly
designed IPGs will be better equipped to handle the future
demands of ITV. Not to be left behind, the traditional IPGs
provided by Scientific Atlanta and Gemstar are also undergoing
changes. Gemstar-TV Guide is working to integrate middleware
platforms and applications to deliver a full menu of interactive
products to customers. The company believes that with TV Guide
acting as the de-facto middleware for all interactive applications
and additional services such as VOD (video on demand) and
SVOD (subscription video on demand), it will have even more
prime real estate in Cable operators' future than it does
today. But Gemstar-TV Guide is the dominant guide on Motorola
systems. Cable operators that employ the Scientific-Atlanta
platform, like Time Warner Cable, use either S-A's imbedded
SARA guide or Pioneer Corp.'s Passport IPG. Both are working
on plans of their own. And then there's Microsoft, who is
making a big push to get into the IPG arena. Lastly, there's
the decision by Tribune Media Services (TMS), a huge TV-data
provider, to get into the interactive-program-guide business
by purchasing iSurfTV Corp.'s patent portfolio in June of
2003. iSurfTV was working on a "3-D" looking IPG
that was flexible and freely branded. Nothing has been announced
yet from Tribune, but the strategy was to enter the game with
a compelling product. Together, these companies will battle
in the IPG space to become a big part of MSO's Interactive
TV platforms. Once there, with the proper integrations, the
IPG services can be the starting point for viewers to launch
VOD, ITV, DVR and other applications as well as sift through
a plethora of TV content.
Outlook
-
Since 2000 when the interest in Interactive TV peaked, Cable
operators have been concentrating on revenue producing products
such as High Speed Data, SVOD and now DVRs. However, now that
News Corp has promised DirecTV new innovative ITV and DVR
services like that of BSkyB, Interactive TV is beginning to
interest Cable operators once again. Rupert Murdoch will leverage
New's Corp's assets as best as possible to create innovative
new revenue producing services. With BSkyB having success
with ITV in the UK, and knowing ITV is one point where satellite
can hit fast and hard, Murdoch is expected to make a strong
ITV push in the coming 6-12 months. As such, operators understand
that they need to keep up to stay competitive, so they are
exploring ITV options to map out the best strategies. Unfortunately,
MSO infrastructure and set-top box environments widely vary,
and interoperability is non-existent. Worse, the industry's
answer, Open Cable Application Platform (OCAP), doesn't run
on the most widely deployed set-tops. Subsequently, Cablers
are looking for workable strategies which will allow them
to segue from what they have to what will be available in
the next generation platform. One answer may be in "OnRamp
to OCAP", an intermediary step that allows Cable operators
to deploy standardized platforms that work on present low-end
set-tops but which are also forward compatible. Meanwhile,
with ITV becoming an important issue, Cablers are also beginning
to look at the all important Interactive Program Guide (IPG).
As the step-off point for a majority of Digital Cable subscribers,
the IPG is going to be central to any ITV platform. The guide
will be key for viewers to navigate through a maze of content
offerings that will be available through DVRs, VOD, SVOD,
HDTV and Digital Cable. How well the guide integrates those
products is critical, as is the presentation, speed, revenue
opportunities and intuitive nature. Needless to say, ITV is
back.
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Place Your Bets - If you like to gamble, but you just hate
to get off the couch, pay-TV operators have just the thing
for you, By Peter Grant, The Wall Street Journal, 5/24/04;
Microsoft wins key Comcast deal for cable TV software, by
Michael Paige, Investor's Business Daily, 5/21/04; Paul Allen
resurfaces in cable waters, by Sallie Hofmeister, Los Angeles
Times, 5/18/04; Sky throws down interactive TV gauntlet to
creatives, RevolutionMagazine.com, 5/17/04; National affairs:
Show hosts home-media marriages, by Matthew Miller, EDN, 5/4/04;
Buying Into Cable Future, by Paul J. Gough, MediaPost.com,
April 2004; Conquering the Digital Wave, by Mark Hess and
Sergei Kuharsky, Multichannel News, 3/1/04; The Western Show
dies, but technology abd Cable Lives, by Jonathan Tombes and
Jennifer Whalen, Communications Technology, February 2004;
Pushing Back Interactively, by Carl Weinshenk, Communications
Technology, February 2004; Cable Operators Gear Up To Offer
Interactive TV, by Peter Grant, The Wall Street Journal, 1/22/04;
Rupert's World, by Ronald Grover and Tom Lowry, with Catherine
Yang in Washington, Kerry Capell in London, and Manjeet Kripa,
Business Week, 1/19/04; "One more time in Anaheim"
VoIP, HD the tech focus of final Western Show, CED Staff,
cedmagazine.com, January 2004; Murdoch plans bells, whistles
for DirecTV, by by Andy Pasztor and Charles Goldsmith, The
Wall Street Journal, 12/19/03; 'Unprecedented Competition'
Coming; News Corp. Chief Murdoch Vows Innovations When He
Gets DirecTV, by Mike Farrell, Multichannel News, 12/1/03;
Bigger is looking better in the bew competitive landscape,
by Mavis Scanlon, CableWorld, 11/3/03; Cable Gets Game, by
Jeff Baumgartner, cedmagazine.com, October 2003; Digital cable
falls short of expectations. The Wall Street Journal, 9/24/03;
Enhancing the Digital Experience, by Craig Kuhl, CED Magazine,
September 2003; TV: the Next Portal War, by Erin Joyce, InternetNews.com,
8/8/03; What's Wrong With Interactive TV?, by Phillip Swann,
tvpredictions.com, 7/5/03; Ops Missing Out on ITV's Bounty,
by Gerard Kunkel, President of WorldGate Communications Corp.,
Multichannel News, 2/3/03; In ITV Deployments, Less Can Be
More, by Wes Hoffman, President and CEO of ICTV Inc, Multichannel
News, 1/20/03; Charter, Digeo Hit Play Button on ITV Games,
by Karen Brown, Multichannel News, 11/18/02; Interactive Quarterly,
Communications Technology, July 2002 Issue; Interactive Quarterly
- Building Interactive Platforms: Cable Operator Choose a
Range of Partners and Strategies, Communications Technology,
Summer 2002 Issue; Wall Street Journal 6/7/95; www.insight-com.com;
www.charter.com)
ITV Technology & Components, How ITV Works:
BASIC
COMPONENTS OF ITV
Components of interactive TV
- The components required for an ITV system today are fairly
straightforward. They include the actual network operator
as well as a set-top box (STB), underlying middleware, application
providers, program content producers and eventually advertisers.
STB
providers
- The STB makes include companies like Motorola, Scientific
Atlantic, Digeo, Pace, Samsung and Pioneer among others. These
manufacturers incorporate all types of functionality and technology
into their set top boxes for the kinds of services that drive
the sales of the Cable operators. Each digital set top box,
from any manufacturer, has an individual IP/MAC address, making
it uniquely identifiable. Some boxes provide memory to hold
a viewer's data until it can be sent out of the house by telephone
call, known as "store and forward". Others provide
software applications with information about other devices
connected to the set top box. These set-top boxes have CPUs,
RAM, flash memory, graphics, tuners, RF return, a client engine
that supports HTML/Javascript etc, a conditional access system;
and an operating system. New generation boxes can do much
more, including HDTV, DVR capability, 3 or more tuners, Dolby
AC three, supporting wireless functions and home networks,
enabling master/slave operation where smaller unit in another
room is controlled. To that end, many people in the industry
predict that the set top box will eventually become the network
gateway into the home. Cablers would love this to happen.
Middleware
providers - These are software companies such as
Microsoft, ICTV, Digeo, Liberate and OpenTV that provide middleware
software that run on set top boxes or similar solutions. They
are the equivalent of the Windows or Linux operating systems
that run on PCs. By offering the same middleware interface
on top of multiple operating systems, middleware providers
have been hoping to encourage developers to use their development
tools to create a large body of cross-platform applications.
For instance, set-top box middleware offered by OpenTV simplifies
life for application developers by offering easy access to
various system functions. OpenTV has developed a strong "toolbox"
with which developers can create different types of innovative
services. Microsoft is creating a similar platform for developers.
Middleware has not taken off in part because the competing
solutions are not interoperable.
Application
providers -
These can be software houses that have their own operating
systems and tools, such as Microsoft, or they can be small,
niche companies that specialize in some business need that
interactive TV might fill. Their software will be used to
produce ITV applications, programming and advertising, or
run interactive services over the networks. These companies
have done much of the innovation, thinking up new ways to
gather, analyze and use information. Their products are now
being taken up by the MSOs, networks and box makers who will
put them in people's homes. Some of the application providers
include Twin Entertainment, GoldPocket Interactive, MetaTV,
Buzztime, etc. Some of their applications are "bound,"
for example, meaning that they come in via a specific program
network. Other applications are "unbound," meaning
they have no specific correlation to a TV show in progress.
The guide is an example, as is VOD selection, or any of the
"walled garden" applications of the recent ITV past.
Program
content producers & advertisers - This is who
makes the television programs and advertisements that contain
interactive elements. They will be commissioned by advertising
agencies, television broadcasters and MSO's. In some instances,
they may have "hooks" built into their programming,
where the software in the set-top box can grab the hook and
open an interactive application of some kind. Advertisers
commission new interactive content, but with interactive television,
they also benefit from or co-ordinate the use of data taken
from viewers' living rooms. Advertisers and manufacturers
are being wooed by the people making iTV. Some companies,
like Proctor & Gamble, Ford Motors, Domino pizza and some
advertising agencies, like JWT and Starcom Worldwide have
been enthusiastic participants.
HOW
ITV WORKS
How ITV works - Interactive
TV is complex and has too many nuances to explain in one paragraph.
But a basic overview would work as follows; A viewer clicks
on interactive information or applications available on a
channel. The command either interacts with information already
present in the STB, such as with IPGs (interactive program
guides), or it rides through the upstream path to the head
end or hub (Cable TV distribution point). In the case where
it goes to the head end/hub, it makes it's way to a specific
server where it is processed. The appropriate response is
then generated by that server and returned to that specific
user either in band or out of band. The key elements of the
ITV system lie in the Client/Server architecture. For that
system to function, there needs software in both the STB and
the server at the head end/hub. STB's already have an operating
system that is loaded as part of the manufacturing process.
This operating system accounts for the basic functions of
the box and provides a layer between the Cable system and
the STB's functioning hardware. For the Client/Server architecture
to provide the interactive TV element, a second layer of software
is loaded into the box "on top" of the resident
operating system. This is called middleware. Once inside,
the middleware creates a platform that can take full advantage
of the STB environment and enable it to run various applications
it wouldn't have been able to run, such as games, tickers,
email, instant messaging, weather forecasts and the like.
In essence, the box is still limited by it's physical properties,
such as memory, processing power and so forth, but it can
now do more things than it was able to before without the
middleware. As such with Client/Server systems, the middleware
works with a server located in the head end. There can be
many servers which have different purposes, and they can communicate
with other servers in and outside the Cable system.
Pushing
& pulling
- When experts talking about "push," they are talking
about the ITV system sending a "carousel" of different
content for the viewer. As with ordinary TV, all viewers receive
all channels to their TV sets at once, known as a multicast
signal. In terms of ITV, the multicast signal carries interactive
information required for the STB to effectively present interactive
information to the viewer. In essence, the interactive data
is already being sent to all users, it's just a matter of
whether they ask their box to go out and grab it. Liberate
took advantage of carousel technology. The Java-based system
requires less set-top memory by downloading applications from
the headend and then erasing it when the user is finished.
This allows operators to increase service offerings, provided
they don't try to stack too many applications onto the network.
"It's like a train," Patrick Forde, Vice President
of New Technology Integration at Insight Communications says.
"Each application is a car on a train that is constantly
circling the track. If a customer wants VOD, he has to wait
for the VOD car to pass by. The more applications there are,
the longer it takes to come around. But we're still talking
about very short periods of time. On the other hand, when
we speak of "pull", the user is essentially making
a request for information, just as we do with the internet.
When a user clicks a button, he or she is requesting a file
of content. The set top box waits for the file and then knows
how best to use what it gets. Both push and pull formats can
be incorporated into a two-way system. What happens is the
most popular interactive data is sent downstream in push format
while the less popular interactive data uses the pull format.
Methods
of collecting viewing data -
And integral piece of the ITV system is it's ability to learn
and understand just what it's viewers are doing. This enables
Cable marketers to better plan their ITV services and to possibly
create tailored campaigns to their customer base. The methods
of collecting data consist of real-time, where raw or aggregated
data is sent immediately to storage database; store and forward,
where data is saved on set top box and sent to storage database
at night (as seen with older STB's and today's satellite &
TiVo services that use a telephone return path); and, stay
on the box, where a storage database is kept on the set top
box. The data is kept either in raw form, aggregated form
or into statistics. The kinds of statistics generally followed
include "click stream", or the raw viewing data;
viewing data aggregated over people; viewing data aggregated
over time; "anonymous" identifier, similar to a
cookie; STB IP address; PIN codes (personal identification
number); and ZIP code.
(sources:
How to Zap DBS with Interactive Gaming: The Power of the HFC
Return, by Mitchell Askenas, ICTV, Communications Technology,
March 2004; The Western Show dies, but technology abd Cable
Lives, by Jonathan Tombes and Jennifer Whalen, Communications
Technology, February 2004; Pushing Back Interactively, by
Carl Weinshenk, Communications Technology, February 2004;
What's Wrong With Interactive TV?, by Phillip Swann, tvpredictions.com,
7/5/03; Ops Missing Out on ITV's Bounty, by Gerard Kunkel,
President of WorldGate Communications Corp., Multichannel
News, 2/3/03; In ITV Deployments, Less Can Be More, by Wes
Hoffman, President and CEO of ICTV Inc, Multichannel News,
1/20/03; Interactive Quarterly, Communications Technology,
July 2002 Issue; Interactive Quarterly - Building Interactive
Platforms: Cable Operator Choose a Range of Partners and Strategies,
Communications Technology, Summer 2002 Issue; Wall Street
Journal 6/7/95; Network Magazine; Essential Guide to Digital
Set-top Boxes and Interactive TV; by Gerard O'Driscoll, November
1999; Telecommunications Transmission Handbook, Fourth Edition;
by Roger Freeman, April 1998)
Interactive
Program Guides (IPGs):
Overview
- An interactive program guide (IPG) is the source that customers
turn to for programming information. As opposed to electronic
programming guides (EPGs) scrolling guide where there is no
interactivity, IPGs have clickable features that enable viewers
navigate through information and interact with screens of
information using their remote controls. Essentially, IPGs
list TV schedules and content information as descriptions,
casts and so forth. The guides usually offer the viewer access
to additional features, such as parental control, messaging,
favorite channels, music and more. For the most part, the
IPG is a critical component for an effective user experience.
Therefore, it plays an important role in Cable operators offerings.
Gemstar-TV Guide is the dominant guide on Motorola systems,
covering about 80% of the Cable systems in the US. Companies
that use the Scientific-Atlanta platform, like Time Warner
Cable, use either S-A's imbedded SARA (Scientific Atlanta
Resident Application) guide or Pioneer Corp.'s Passport. Other
guides are available through Digeo Inc., SourceSuite, TiVo
and Microsoft. In addition, Tribune Media, a big player in
the TV listings sector, has entered into the fray. Last June
it acquired upstart iSurfTV, an IPG developer which featured
added functionality and 3D technology. Tribune says it will
enter the market with a competitive product. Aside from the
IPG players, there is a whole range of issues and considerations
to discuss about the segment. Tops on the list is how all
the new advanced services will be integrated into a seamless,
intuitive, sleek user interface that enables customers to
navigate a plethora of information and choices. Considering
there is already content listings from TV networks, Digital
Cable channels, Video On Demand, HDTV and digital video recorders,
IPGs are a core element of Cable TV viewing experience. In
the end, the plain IPGs will soon be a thing of the past.
Instead, new innovative solutions that provide integrated
experiences, like that of Digeo and Microsoft's TV Foundation,
will be the next generation platforms.
IPGs
transitioning to a new era
- Since the early years of Digital Cable, IPGs have been about
functionality. Cable operators needed to provide their subscribers
with an ample tool for navigating program choices. The goal
was to enable their customers to effortlessly get to their
favorite channels. With the digital revenue stakes rising,
however, that model is changing, evidenced by the expanding
use of compelling graphics and efficient on-screen interactive
applications now being counted on to drive customers to new
content and services. "Guides are increasing in value
as on-demand services grow. Now, they're essential in driving
the whole on-demand category," says Bruce Leichtman,
president and principal analyst for Leichtman Research Group
Inc. The advent of on-demand content and a host of other services
such as DVRs and HDTV is driving the category. "We've
almost quadrupled the number of channels and titles. With
all this new content, we must improve the navigational tools,"
says Mark Hess, vice president of digital television for Comcast
Cable. Peter Kellogg-Smith, vice president of product marketing
for Digeo Inc, concurs, "Cable hasn't had a good on-screen
guide to navigate digital channels. Now, DVR, VOD and HD are
emerging and branding makes it even more valuable. It needs
a good on-screen experience." Aside from these new services,
another driver for change is the competition. Satellite providers
and companies like TiVo have dramatically effected the approach
to IPGs. Viewers appreciate the speed and breadth of those
services. That said, Cable operators are well aware of the
great potential that new IPGs can offer. With their advanced
software, graphics, design and sales potential, MSOs know
that next generation IPG products will offer a compelling
on-screen experience for viewers while enabling more revenue
opportunities to increase their bottom line. However, the
charter of IPGs is still clear. "The core reason for
IPGs, EPGs and UIs (user interfaces) is managing the increased
number of channels. Before they become too much of an advertising
and branding tool, they must be functional. Utility comes
first before revenue opportunities. That's the business model,"
Leichtman adds. Similarly, Ed Graczyk, Director of Marketing
for Microsoft TV says "The biggest priority now is driving
revenue, but you can't get too whizzy with the graphics. The
guides must be presented in a nice, fast way." IPG providers
are not looking at how to incorporate next generation features
in a way that makes sense. It's not only about the way TV
viewers navigate the puzzling maze of digital channels, but
the ability to personalize the relationship between customer
and service provider. This will ultimately lead to those new
revenue streams. In the end, clunky IPGs and EPGs are on the
way out. Zippy, simple navigational tools, cool graphics and
smooth interfaces are in, especially when on-screen guides
are expected to generate revenue.
Future
IPG offerings
- Clearly there are significant and fundamental changes ahead
for the interactive program guide segment. There will be plenty
of emphasis on enhancing the on-screen graphics and interactive
capabilities to effectively drive viewers to VOD, SVOD, gaming
and DVR services, all of which will be integrated as part
of the experience. There will also be branding and advertising
opportunities, "storefront" graphics and messages,
and highly intuitive interfaces. Personalization and customization
features will be combined with imagery and video feeds to
complete the picture. Software and technology will play a
key role. For instance, Gemstar-TV Guide has plans to further
use technology to beef up its guide. The deals Gemstar-TV
Guide has with its MSO customers include clauses that allow
for interactive links to programs, so customers can eventually
see a movie listing and go to that movie's promotional Web
site, view the trailer, see interviews with the stars or drop
into a chat room. "We want to have a guide that can produce
quality editorial and drive viewership of cable services,
as well as one that has quality advertising and has solid
functionality behind that" said Gemstar's Todd Walker.
On the TV side, IPG sub-channels could evolve, similar to
the topic-specific channels on Web portal sites. "What's
to say that it doesn't make sense for [MTV: Music Television]
to have their own branded guide to all of the different MTV
services that are available, especially in digital cable,
where you've got multiple channels for these networks?"
Microsoft Corp. TV platform group director Ed Graczyk asked.
So what will IPGs look like in the next few years? They'll
be lot more coordinated, said Gemstar's Walker. "What
you are going to see is VOD, PVR and network PVR all integrated
tightly within coupled user interface," he said. "That
is, whenever you do a search for a program, the results that
come back from that search are going to be from one of those
three types of delivery mechanisms." But more than likely,
the guide will stick closer to digital TV applications, rather
than reaching out to gather in digital music and Internet
content, according to Ireland. "I think there are ways
to integrate the PVR, VOD and program guide experience and
not have it be this whole catch-all for a networked entertainment
infrastructure in the home," says International Data
Corp. DTV market analyst Greg Ireland. "So say that there
can be the integration, but cable operators don't necessarily
have to get themselves into the situation where they are now
supporting using the TV Guide interface controlling your audio
jukebox on your PC." Concludes Leichtman: "With
20 million digital households and growing, clearly, there's
revenue potential from IPGs and on-demand guides. But they
must be unobtrusive, because if they're overloaded with advertising,
promotions and branding, that's not a good model. However,
they must keep pace with customer expectations, and today,
generic graphics just won't fly. They must be compelling."
Among the factors being considered for future IPGs:
Presentation
- The graphical user interface (GUI) and overall experience
are critical for the viewer to have intuitive, friendly interaction.
Subscribers need to have a well organized experience that
draws them to the IPG without the feeling of being cluttered
or oversold. Links, advertisements and glitter should be well
conceived so they are not imposing. "If you're in an
IPG, you should get previews of shows and more ways to find
content. It's really about enhancing a customer's experience,
so we are always looking at the technology to robustly improve
graphics and resolution, but from an ROI (return on investment)
standpoint, there's a fine line between graphics and functionality,"
says Mark Hess, vice president of digital television for Comcast
Cable. Just the same, some software and guide companies are
pressing ahead with on-screen graphics and technologies designed
to wow MSOs, programmers and advertisers. Digeo, which cable
operators agree has a dazzling navigational interface, offers
a complete experience in a highly presentable fashion. Though
Digeo has the luxury of running their system on a much more
powerful set-top box, they have integrated such functions
as video on demand, digital video recording, HDTV content,
instant messaging, photo imaging, a music jukebox, home networking
and video gaming into a single box. This has helped to pave
the way for a distribution deal with Comcast.
Branding
- In the days of fierce competition and consumer messaging
bombardment, branding strategies are key. While the on-screen
guide experience is morphing into more than just simple program
selections, better branding opportunities for MSOs and advertisers
are on the horizon too. "On-screen branding for MSOs
is very important, and we're learning what operators are looking
for and the set-top box capabilities," says Barbara Needleman,
vice president of entertainment products for Tribune Media
Services. Some MSOs have their own plans. Comcast announced
an agreement with Gemstar-TV Guide International to form a
joint interactive program guide (IPG) development group using
the existing TV Guide Interactive IPG as a foundation to create
a guide for Comcast and the cable industry. Clearly, Comcast
is going to want significant branding presence over that of
TV Guide's.
Upselling
- The ability for an IPG to facilitate upselling opportunities
will also be critical. "Operators aren't seeing the revenue
from IPGs and are looking at guides to drive revenue for new
release VOD movies, HBO and other content," says Ian
Aaron, president of Gemstar-TV Guide International's TV Group.
"How does a guide drive more advertising and programming
revenue and from other services like PVR, DVR, cable modems?
Clearly, the next opportunity is personalization with the
subscriber, and operators love that, but how do you monetize
it? It's really all about driving people to VOD, promos and
new shows." Initially, the revenue from IPGs is expected
to come from VOD, SVOD and upselling. Microsoft's TV Foundation
is an excellent example of a portal type approach that has
an integrated IPG and plenty of upsell capability. As with
Digeo, this has gotten the attention of MSOs, leading to the
May `04 announcement with Comcast.
Retention
- Of paramount importance to the Cable industry is keeping
their customers. With an increasingly fierce competitive environment,
and with huge infrastructure investments needing to be paid
off, retention is as important as ever. "Churn reduction
and upselling key content like SVOD and VOD are keys,"
insists Bow Rogers, CEO of MyDTV, a software technology company
that provides personalized content distribution for digital
cable. "People are in a 10- to 12-channel comfort zone,
and operators want to expand that because they're paying for
the channels." This increased the value for subscribers,
which provides MSOs with a better chance of keeping them.
Driving SVOD, VOD and DVR usage is also critical, experts
insist, and customized, personalized on-screen guides and
promos are crucial for its success. "The on-screen experience
is the key to VOD [and SVOD/DVRs] and it's getting more interesting
how people use the guides. More than 40 percent of the people
use them. That's sticky," says Bruce Kasrel, director
of product marketing for SeaChange International.
Advertising
- Advertising is another key area of IPGs' future, though
it's expected to be a factor in the short term. "Advertising
on guides hasn't proven to be terribly successful, and guide
experiences are clunky and slow. We wanted to build an easier,
faster, better IPG that will allow MSOs to merchandise, and
for VOD users to self-provision movies right from the screen,"
says Ed Graczyk, director of marketing for Microsoft TV. Clearly,
this is the case for many guide providers. With revenue generation
becoming more of a factor for IPGs, new designs are being
implemented to better integrate advertising opportunities.
In addition, better measurement tools are being developed
to provide advertisers with the data they need.
Commerce
- Commerce will also be a key consideration for IPGs in the
future. As with advertising, commerce will open up more revenue
opportunities. However, it may take a while to materialize.
In general, the priority will be on upgrading the graphics
and ensuring a sleek, intuitive interface which effectively
integrates new services. As IPGs continue their development,
commerce will move to the forefront. "There are interesting
new revenue possibilities like QVC-type sales and enhanced
TV such as sports scores while watching another program, and
we're thinking of those things. But most of our effort is
toward on-demand TV and enhancing content value. Then we'll
move to commerce and advertising."
Embedded
Agents
- While the biggest priority now is creating an effective,
modern interface and driving revenue, the guides must be able
to help viewers reach their intended programming choice with
ease. And comfortably, maintains Rogers of MyDTV. "A
smart agent finds things you enjoy. That's how we'll get people
to feel comfortable. They can use a remote and squirt in preferences
through a default tree in the software. And, we put up an
on-screen alert to list what's coming on." Such agents
will enable viewers to drill much deeper into content searching,
a clear advantage considering the wealth of programming these
days. "An Ôsmart agent embedded in the guides has
to be helpful to subscribers; then the revenue opportunities
can be significant." says Bow Rodgers.
New
Revenue models
- Most believe the money spent to graphically enhance the
IPGs, EPGs and UIs will produce revenue down the road, but
not immediately. That said, IPGs will be counted on to play
a role, and some believe it should be sooner rather than later.
"Wall Street wants profitability and growth. That's the
new mantra. But you can only cut costs so far before you have
to show profitability and growth, and revenue must come from
new services, and that's where IPGs can help drive revenues,"
maintains Gerry Kaufhold, principal analyst for converging
markets and technology for In-Stat/MDR. "There's great
opportunity for upscale graphics and room for cool graphics,
so whatever MSOs can do to make it a customer preferred service,
they're all for." Indeed there will be new revenue opportunities
available to MSOs as next generation IPGs are introduced,
but operators may need more time than that. Typically, after
being tested and deployed, services will probably need to
be tweaked and updated both from a software and service side.
(sources:
Jazzing Up Cable IPGs, by Steve Donohue, Multichannel News,
5/17/04; Sky throws down interactive TV gauntlet to creatives,
RevolutionMagazine.com, 5/17/04; Sell! Sell! Sell!: Viewers
(Finally) Love IPGs, by Mavis Scanlon, CableWorld, 5/5/04;
TV Guide Prepares For Next DTV Wave, by Greg Tarr, TWICE.com,
4/5/04; Buying Into Cable Future, by Paul J. Gough, MediaPost.com,
April 2004; MSOs Can Test-Drive TV Guide’s New ‘i-Guide’,
Multichannel News, 3/9/04; Comcast, Gemstar Partner, SkyReport
2/20/04; TV Guide - SkyReport 2/11/04; Cable Gets Game, by
Jeff Baumgartner, cedmagazine.com, October 2003; Enhancing
the Digital Experience, by Craig Kuhl, CED Magazine, September
2003; TV: the Next Portal War, by Erin Joyce, InternetNews.com,
8/8/03; Op Needs, Not Foe Microsoft, Top TV Guide Agenda:
Aaron; by Matt Stump, Multichannel News, 7/21/03; Vendors
Tweak Their IPGs To Manage VOD's Bounty, by Matt Stump, Multichannel
News, 8/19/02; Isurf + TMS, TV Foundation, by Matt Stump,
Multichannel News, 7/28/03; Microsoft Gets Into the Guide
Game, by Simon Applebaum, Multichannel News, 5/6/02; Cable
Players Wrestle With IPG Navigation, by Karen Brown)
Challenges for IPGs:
Overview
- With the opportunities of the future generation of IPGs,
there comes plenty of challenges and pressures for IPG providers
to develop and integrate their software and graphics into
the puzzling and disparate labyrinth of cable networks and
legacy systems. IPGs will need to be increasingly drawing
on vast pools of live and stored content from many databases,
and that will present it's own issues. Furthermore, IPG providers
will be trying to figure out how to create searchable order
to the deluge of content in the digital-TV universe, while
also maintaining the operator's brand presence. "You've
got to look at it at the highest level as this core concept
of providing a window into all of the different services that
are available through your TV," said Microsoft's Ed Graczyk.
"And some of those will be the traditional services people
think of today with EPG, which is how can I find what is on
at a certain time," he said. "But I think you will
see these EPGs evolving to more useful navigational tools
that are not necessarily going to be just limited to what's
coming out over the broadcast stream," he continued.
Getting there poses some obstacles, though, and one of the
biggest lies within the boxes themselves. For companies such
as Gemstar, transitioning from a standard IPG to a new era
guide has its own unique pressures. Admits Ian Aaron, Gemstar's
president of TV Guide Television Group: "The guide business
is only getting more difficult. The guide has to work on dozens
of different set-tops with different features and software,
so you need lots of resources and experience to cut across
multiple boxes." Integrations with operators and their
variety of advanced services is another. These days, it's
not uncommon that a MSO is offering VOD, HDTV and even DVR.
Getting these apps to work together seamlessly using the IPG
as the core is a daunting task. The power in the STB is yet
another. These boxes are very limited on resources. Then there
are conflicting branding strategies. Operators want more control,
while companies such as TV Guide are protecting their real
estate. Lastly, metadata is becoming more important. The consistency
of data and content descriptions is something which needs
further attention. The following paragraphs explain each in
more detail.
IPG
& integrations
- Because the IPG is the central starting point for viewers
to access content, several operators would like to enable
seamless operation between their IPGs and other applications
such as video on demand and now including HDTV and digital
video recording devices, or DVRs. In turn, herein lies one
of the biggest challenges today for IPG providers; handling
the myriad services that require guide integration. All these
new services now being implemented by cable operators require,
at a minimum, a level of integration with the guide that lets
interact with the new VOD, SVOD, HDTV and DVR services. Even
more, It's critical for guide vendors to interface with other
software systems. "We see that as a charter to get distribution,"
Ian Aaron, President of TV Guide Television Group said. "We're
looking at how we partner" he continued. More important
is the direction of the guide heading into the future. An
IPG could become a key portal for cable operators to upsell
all kinds of services. "We have a unique opportunity
with the brand, the platform and the content," said Aaron.
"The question is how do we become agnostic across all
these different platforms? We've developed interfaces with
Liberate that we did for Comcast, and we did the same thing
with Charter, Wink and [former ITV provider] WorldGate. "We're
helping drive APIs (applications program interfaces) with
server vendors. We have this platform across the varying different
combinations so we can gain the broadest distribution. We
will have to integrate into other configurations that partners
want to bring to the table." In the old days, TV Guide
might have h |
