Service Plays to Cable, Satellite

Mar 3, 2003  •  Post A Comment

Title: President, CEO and founder of Music Choice, which provides commercial free digital music channels for cable and satellite operators
Background: Mr. Del Beccaro founded the company in 1991, though he planned it from 1987 to 1991 while he was VP of new business development at General Instrument, from which Music Choice was spun off. Music Choice delivers about 45 channels of music to about 27 million cable and satellite homes. The service is found in about 80 percent of all digital cable homes and in all DirecTV homes.
Open ears: While most customers don’t purchase digital cable or satellite because of the music channels, Music Choice is actually the most used service on digital cable. Sixty percent of Music Choice homes listen to the service 17 hours per week, while most cable networks generate one to two hours of usage each week in a home, said Mr. Del Beccaro. “People have it on as background as they do other things … reading, cleaning,” he said. Most users leave the service on for an hour and a half, and prime listening occurs on weekends between 10 a.m. and 8 p.m. and on weekdays from 3 p.m. to 8 p.m. “We are what people have on what when they aren’t watching prime time,” he said.
New revenue: Music Choice is currently developing a new revenue stream in on-screen advertising to supplement the license fees it’s paid by cable operators and satellite companies. An ad resides as a graphical overlay to a portion of the screen and does not disturb the disturb the programming content, which is the audio, he said. The advertising began running on Music Choice’s cable systems last summer. Levi’s and Reebok are two of the early advertisers. Mr. Del Becarro expects it will be two to three years before such advertising becomes a major revenue stream for the company. “What it does have is a captive and targeted audience. We can deliver any demo across five or six formats, so a buy is more efficient,” he said.
New services: Music Choice plans to launch My Music Choice in April in two markets, with a nationwide rollout next year. The service uses the video-on-demand architecture in cable systems to create personalized music channels. The user selects several different formats and can choose subsets within genres. Music Choice then mixes a channel. “You could pick `80s, but you want all punk music out,” he said. The service is free and the channel remains in the system’s memory so it can be retrieved again. In addition, Music Choice plans in March to begin allowing cable modem users to access its channels through the computer as well as the television.