MSOs may bet on Vegas

Feb 26, 2001  •  Post A Comment

Charter Communications’ subscribers may soon find a little piece of Las Vegas in their living rooms.
The St. Louis-based multiple system operator said earlier this month it will start trials integrating Digeo’s interactive services into its lineup.
One such offering being developed for a number of MSOs, including Charter, is the Vegas Channel, an interactive service being created by Steeplechase Media, an enhanced television content development company.
Privately held Steeplechase is in the middle of negotiations to sell the new enhanced television channel to Digeo, a company that manages content for the walled gardens, or interactive television portals, that will form the backbone of MSOs’ menus of digital TV programs.
Digeo has partnered with St. Louis-based Charter, whose nearly 6.4 million subscribers rank it as the nation’s fourth-largest MSO. In a conference call earlier this month, Charter said it is moving forward with integrating Digeo’s interactive walled garden into its programming lineup.
“We’ll continue our interactive TV focus in 2001, primarily through Digeo, which we’re going to be [putting through trials] in St. Louis,” Charter President and CEO Jerry Kent said during the call. The trials in St. Louis are expected to begin in the next several months.
“Anticipating successful results of the trial in St. Louis, we’ll launch Digeo in several markets in 2001,” Mr. Kent said.
The Vegas Channel, which is slated to become part of the walled garden Digeo is packaging for Charter’s system, will broadcast short three- to five-minute videos about entertainment in the gambling locale while offering viewers the opportunity to book travel reservations through t-commerce links.
Steeplechase CEO Larry Namer said he believes the new channel will expand upon the success of travel reservation sites on the Internet by providing more compelling content than its online counterparts.
“Rather than just selling products, you need to present content and products in context,” Mr. Namer said. “We think the Vegas Channel is huge because there’s very identifiable commerce that comes with it. It has already been demonstrated that people want to book Las Vegas through some electronic mechanism.”
Steeplechase is developing the new interactive cable network in partnership with Vegas Television, a small company that conceived the idea for the television channel and then hired Steeplechase to construct it. Steeplechase is also taking a minority equity stake in the company.
While Steeplechase is in the midst of negotiations with Digeo to produce several enhanced television products for Digeo’s walled garden, including The Vegas Channel, Mr. Namer said Steeplechase has yet to submit a written proposal to Digeo.
“We actually have to draft contracts,” Mr. Namer said. “We finalized our plan less than a month ago. Lawyers aren’t working at the same pace our minds are working.”
However, Mr. Namer added, “We do have certain agreements to do certain things with [Digeo Director of Content Development] Marty [Berens.]”
Repeated calls to Digeo for comment were not returned.
In addition to The Vegas Channel, Steeplechase is working on about 12 other enhanced television channels for Digeo. One such network will be an interactive television version of Steeplechase’s Television.com Web site. Like the site, the enhanced TV program will feature news for consumers about television entertainment and television appliance technology. The channel will also feature previews of upcoming television shows.
Other enhanced television offerings in Steeplechase’s pipeline include:
The Source, a home shopping channel that will target a more urbane demographic than traditional home shopping networks. The network will derive its revenues from sales of merchandise rather than advertising.
Health Styles, a network that will provide information about alternative health care and medicine. The channel will be both t-commerce and advertising driven.
Space Station, a scientific, educational channel for children.
All the interactive channels Steeplechase is developing are being formatted for a variety of digital TV hardware platforms. The company participates in Microsoft TV’s Content Builder Initiative, a project in which the software conglomerate provides both Motorola DCT5000 set-top boxes and technical support to a small group of interactive content developers.
The company is producing two separate versions of each interactive channel-one that is compatible with Motorola’s low-end DCT2000 set-tops and another that can be viewed on the more advanced DCT5000 devices. The former, which is similar to the Internet for personal computers, will feature still-frame scenes coupled with text, while the latter will pair interactive chat, e-mail and online purchasing links with a television broadcast.
Steeplechase Media was founded by a team of television industry veterans including Mr. Namer and Executive Vice President Rick Portin, both of whom held positions at E! Entertainment Television. Bob Mariano, the company’s vice president of affiliate marketing, has worked in similar capacities at both Fox and CBS Television.
Since its inception in 1995, the company has survived on content development fee revenue alone. Now, because of the grand scale of its newly launched enhanced television effort, the company is entering the venture capital markets for the first time to raise funds.