Viodi View – April 19th, 2006 Issue – Go to Viodi.com and Viodi.tv for current posts

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Viodi View Newsletter – April 19th, 2006

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Create Your Own, Get Lost or Both – Random Musings from the National Cable Show

By Ken Pyle, [email protected], Managing Editor, Viodi View

The collective attitude of the cable operators who spoke at the National Cable show was definitely one of confidence, but not arrogance. It was summed up well by one speaker who suggested that cable has been able to compete on features and service, while telcos have had to compete on price. It was said by several of the speakers that cable is in the best position it has ever been despite the uncertainty caused by over the top efforts of independent producers, as well as some of the major content owners, like Disney.

While Disney was announcing distribution direct to consumers of Lost and a few of their other popular programs, they were also announcing a plan to create an affiliate-customizable, taggable spot to raise consumer awareness of high definition. They cited a study that found that only half of all HDTV households subscribe to HDTV programming. These spots could potentially be bad for telcos unable to support HDTV. The reason Disney is probably making these spots is to differentiate their high-quality programming from lesser-quality programming from over the top competitors.

Another theme was the importance of creating communities of interest around content, as a way to create customer loyalty. Many of these operators and cable networks would be envious of what independent telcos are able to do with their communities when it comes to the creation of real content.

One of the ways cable companies may create more engaged customers is with games. Gaming was so big at the Natonal Show that there was a special show space. There were a number of companies providing games on the television.

NTN Buzztime, Inc, the folks who brought television trivia games to bars, showed their cable version of their service. They have achieved some level of success, as 20% of Blue Ridge Communications digital cable customers played along with the service, averaging seven hours during February and March. The impressive thing is that promotion of the service was minimal, so customers either discovered it themselves (e.g. on the EPG) or were told about it by friends.

ReacTV promises audience members a chance to win money and promises to pay cable operators for carriage. ReacTV is essentially a 24 hour advertising channel, where the ads become the content. They also present regular trivia questions. One of the things making this channel unique is that the interactivity is enabled by a web site that is synchronized to the television channel. This allows the channel to be transmitted on a one-way cable system without the need for set-top boxes.

They have created a WiFi-enabled remote control that doubles as a bar code reader. The bar code reader is a sign of the home shopping potential of this upstart channel. What they are selling to the advertiser is very accurate reporting, as well as detailed demographic information as to who is watching their advertisements.

Demographic targeting of advertising was shown in a demonstration that between Terayon and Invidi. Invidi has a piece of software that looks at viewing patterns to determine which commercial to provide to a particular customer. The Invidi software would tune the set-top box to a commercial that most closely matched the viewers demographics. The compelling thing about this concept is that there is no customer intervention, while, at the same time, the customer does not give up any privacy.

Terayon also showed ad insertion that allows for splicing in different advertisements into an MPEG-4 stream, such that different geographic regions can receive different advertisements. They demonstrated a variation of this, where the same basic ad would be shown throughout a region, but different graphics would be sent with the ad (e.g. a common pizza advertisement, but a different call-in phone number would be shown on depending upon customer location). These demonstrations are significant, because they show that IPTV does not have a monopoly on advanced video features.

PanAmSat, Nagravision and SkyWay Connect made an interesting announcement regarding a MPEG-4 satellite transport system. Their release suggests it will support IPTV approaches through DSL or DOCSIS. DOCSIS could be an interesting way for small HFC cable operators to add an IPTV digital tier.

More on the National Show in the next issue

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