xOD Caspule - July 13, 2005

Tue, 07/12/2005 - 8:00pm
xOD Capsule Newsletter CED Broadband Direct Current Issue Subscriptions July 13, 2005

Sie-ing the not-so-distant future

In April 2004, John Sie, then the chairman and CEO of Starz Encore Group, made the bold prediction that movies will regularly premiere on cable and satellite, rather than in theaters, within the next 10 years.

Speaking at a Harvard Business School Media Conference in Boston, he explained that high-definition television penetration and high-end home theater technology would head up this trend.

Sie went on to note that a studio could generate $200 million in revenue if just 20 percent of HD homes paid $19.95 to see the premiere.

I bring this up now for a couple of reasons: Hollywood isn't enjoying exactly what anyone would call a banner summer at the box office, and we're already starting to witness some of the seeds of Sie's vision.

Oh, and it doesn't hurt to mention that Starz Encore is pushing that vision a bit, as well. Its "Early Premieres" ensures that some titles are available on VOD before they are shown on Starz!, the company's linear flagship channel. It's not nearly the same as seeing a first-run flick on TV before it shows up in theaters, but it's an excellent way to add value to the SVOD service. M. Night Shyamalan's The Village, for example, debuted July 11 on Starz On Demand. It won't show up on the linear service until July 23, according to the company's Web-based schedule.

But perhaps more in line with Sie's ultimate vision are a couple of events that happened in the TV world last week.

Fanning the flames of its "VSPOT" launch, VH1 leveraged the broadband platform to offer early access to the new season of The Surreal Life 5—a "celebreality" series that puts people like retired slugger Jose Canseco, The Apprentice villain Omarosa and Sandi Denton of Salt-n-Pepa fame under the same roof—and the cameras capture the strangeness that follows.

Another fly-on-the-wall series, CBS' Big Brother 6, took a similar route with RealNetworks Inc., offering (for $12.99 per month) 24/7 access to a live video channel showing houseguest activity, including much that won’t show up on the series.

Those are examples involving the little screen. But the most interesting event last week involved the big screen—the introduction of ClickStar Inc.

A partnership of Revelations Entertainment and Intel Corp., ClickStar wants to market movies for download prior to the DVD window and perhaps while they still appear in theaters.

The growth of movie piracy, rather than the advent of high-speed data connections, is a primary factor behind ClickStar, this coming from actor Morgan Freeman, a Revelations Entertainment founder.

Although cable will play an enabler, rather than direct business role, with an "over-the-top" IP bypass service like ClickStar, it does come one step closer to Sie's image of the future.

—Jeff Baumgartner

Looking at life beyond the 30-second spot
Although DVRs and VOD technologies are starting to alter viewing habits, they have yet to completely change traditional advertising models. But advertisers and the companies that provide these new technologies are quickly forming strategies for the day when DVRs and VOD reach critical mass.

"The impact [of DVRs and VOD] is potentially dramatic," noted Atlas On Demand Vice President of Business Development Jay Stiller, who moderated a panel on this subject late last month at the C-COR Global IP Summit in Barcelona, Spain. "There must be life beyond the 30-second spot."

Although these technologies present "a lot of disruption in the advertising world today" and a possible threat, they should also be viewed as enablers for more advanced forms of advertising, noted Olivier Wellmann, head of product marketing for Europe, Middle East and Africa at OpenTV Corp.

He explained that there is plenty of value in interactive advertising, including increased recall and awareness among viewers who are more engaged to such advertising and tend to stick with those channels longer. But, he added, everything must be measurable, or it is useless to the advertiser.

NDS Group Director of Marketing David Whittaker added that "telescoping"—the ability to obtain more information on an advertised product—is a “very active” extension of the 30-second spot market in the United Kingdom. It’s so active that it carries a 20 percent premium on airtime that utilizes telescoping methods, he added.

Ascent Media Group, meanwhile, has seen this major trend coming as people continue to migrate to the Web and play more games, and further neutralize the 30-second spot.

If that trend goes un-addressed, what will likely follow is an oversupply of 30-second spot inventory, and a downward price of CPM (cost per thousand), noted Rich Fickle, Ascent's executive vice president of strategic development.

But that trend also opens up an opportunity for new forms of interactive advertising. Ascent, for example, is already working with major advertisers in the auto industry—historically an early adopter in this area.

But measurement has to go beyond the traditional CPM model and delve further into the quality of the audience. With new technology at their fingertips, advertisers will want to know how long and how often people are viewing advertising content, Fickle noted.

(Editor’s note: Much more on this panel and subject will be covered in the August 2005 issue of CED.)

—Jeff Baumgartner

Comcast enters VOD 'Vortex'
Comcast Cable will expand its on-demand programming menu for kids via a deal with Canada-based Corus Entertainment.

Comcast plans to launch the service, dubbed Vortex On Demand, by mid-month. It will feature hundreds of hours of programming for kids ages six to 12, including titles and series such as Jacob Two-Two, Tales from the Crypt Keeper, Pippi Longstocking and My Dad the Rock Star. Comcast will offer these shows "free" to digital customers in VOD-enabled markets, which today includes 90 percent of the operator's footprint.

Vortex On Demand complements other children-related VOD services from Comcast. The MSO also offers Pre-K Kids On Demand and PBS KIDS Sprout.

EchoStar in a sporting mood
EchoStar Communications Corp. has expanded its interactive television (iTV) lineup with Sporting News TV, a service that enables viewers to track players, stats and team news spanning leagues such as the National Football League, Major League Baseball and the National Basketball Association.

The service, developed by OpenTV Corp., is being offered for no additional charge on Channel 100 on the DISH system. It essentially combines several EchoStar iTV channels (My Scores, Baseball, Pro Football, College Football and College Hoops) into one.

In addition to the NFL, MLB and NBA, the service also features coverage of the National Hockey League, NASCAR and NCAA football and basketball.

Time Warner adds Turner VOD fare
Time Warner Cable has agreed to distribute on-demand content from TBS and TNT in several markets, including Austin and El Paso/Rio Grande, Texas; Binghamton and Syracuse, N.Y.; Charlotte, N.C.; and Los Angeles, Calif. The TBS On Demand and TNT On Demand services will each offer eight to 10 hours of programming.

TBS, for example, will showcase shorts and highlights from original shows such as Minding the Store and Daisy Does America, as well as original, full-length movies, including Sweet Revenge and T-Bone & Weasel.

TNT, meanwhile, will serve up movies and series shown on the linear network, as well as extras (behind-the-scenes and long-form trailers, for example) for originals such as Into the West and The Closer.

We are making changes and additions (including international deployments) to our Web-based "living" deployment chart. If you have a new deployment to report for the VOD Scorecard and the Web-based deployment chart, please contact CED Editor Jeff Baumgartner.

July 2005   
Issue Contents >>

ClickStar Inc.

Santa Monica, Calif.


CEO: Nizar Allibhoy

Company claim to fame:
Distribution of downloadable Hollywood films in pre-DVD windows. Oscar-winning actor Morgan Freeman is a co-founder.

Recent news of note:
Intel Corp. and Revelations Entertainment (producer of films such as Levity and Under Suspicion) introduced the service last week, noting that its pre-DVD window strategy will serve as an alternative to piracy.

Vidiom Systems Corp.

Broomfield, Colo.


CEO: Timothy Wahlers

Company claim to fame:
Creates OCAP stacks and publishing tools for cable operators and content providers.

Recent news of note:
Cemented a licensing deal with OCAP Development LLC, a joint venture of Comcast Cable and Time Warner Cable. The company is slated to host the next three-day "OCAP API Essentials" course from Sept. 13-15 at the Millennium Harvest House in Boulder, Colo.

CED Webcast:
The need for (more) speed — scaling bandwidth and services using DOCSIS 3.0 channel bonding (sponsored by
Motorola Inc.)
July 14 at 11 a.m. ET
Register online

SCTE Web seminar:
Digital Program Insertion:
Digital Spots in Digital Slots
Cost: Free to SCTE members, $29 for nonmembers.

July 20 at 2 p.m. ET
Register online

CTAM Summit:
Philadelphia, Pa.
July 24-26, 2005

NCTC Members’ Meeting:
San Diego, Calif.
July 31-August 3, 2005

TelcoTV Conference & Expo 2005:
San Diego, Calif.
Nov. 8-10, 2005

Copyright © 2005 Reed Business Information, a division of Reed Elsevier Inc. All rights reserved.


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