Netflix.com Provides Model for Cable VOD

Aug 25, 2003  •  Post A Comment

Ed Forman poses a timely question.
“Who is the leader in delivering on-demand video to consumers?” Mr. Forman, the senior VP marketing at interactive television company ICTV, asks.
His answer is not iN Demand, which delivers VOD content to cable systems serving more than 7 million digital cable homes, or top cable operator Comcast, with its aggressive VOD rollout agenda. Mr. Forman’s dark horse is a Web site that delivers DVDs via the mail: Netflix.com.
He’s looking to the popular consumer Web site as a model for the next-generation VOD interface that ICTV of Los Gatos, Calif., is developing with Phoenix-based MediaChoice, which provides a ratings engine for consumers to grade books, movies, TV shows and other content online at Ratingzone.com.
Mr. Forman said ICTV is working closely with several top 10 multiple system operators that plan to deploy their solution later this year. And leading interactive program guide maker Gemstar TV Guide is developing a next-generation interface to debut within a month.
Their work exemplifies the shift in the VOD market from technology and operations to marketing and promotion.
ICTV has partnered with MediaChoice to create TV-based interactive applications that allow customers to rate on-demand titles through the remote control. The service, like Netflix.com and Amazon.com, will suggest titles to the user based on the user’s interest in other titles.
The Netflix.com model translates well to a VOD world, Mr. Forman said.
“First of all, they don’t make you work hard to find what you are looking for,” Mr. Forman said. “Rather, they take all the info they have to help you find what you are looking for as quickly as possible. They provide multiple ways to find what you are looking for.”
In addition, Netflix.com provides third-party reviews and offers more than 15,000 titles, elements that ICTV plans to incorporate into a new VOD interface.
The interface is based on MediaChoice’s ratings engine that produces content recommendations. “You enter your data and build a profile and then we recommend movies for you based on how you like and dislike other movies,” said Arnie Kuenn, president of the company. The online site counts about 40,000 users.
“We hope people get used to sitting in front of the TV and asking for the recommendation and do this right on the spot,” he said.
As an insurgent in the VOD interface space, ICTV faces an uphill battle. But neither incumbent Gemstar TV Guide’s subsidiary TV Guide Interactive nor 800-pound gorilla Microsoft is concentrating its IPG efforts on providing the same type of personalization.
TV Guide Interactive, whose IPG is found in 11 million homes, is currently developing on-demand environments for its VOD movie content, said Ian Aaron, president of TV Guide’s Television Group. “We work with studios to create [for example] a themed baseball week and feature `A League of Their Own,’ `Bull Durham’ and `Field of Dreams,”’ he said. Along with the flicks would be complementary content, such as a talk with the director, interviews with the stars and behind-the-scenes coverage-content that can be culled from the TV Guide Channel, which is in 56 million homes.
TV Guide Interactive expects to roll out these “packages” later this month or in early September to cable operators. Such packaging and promotions should help drive usage of VOD, Mr. Aaron said. “This is all about creating incentives to buy the movie. The goal is to give them some material to get excited about seeing the movie,” he said.
Microsoft’s new digital platform Microsoft TV Foundation Edition is based on the notion of a VOD storefront that emphasizes a more visual and flexible user experience. The storefront concept also allows operators to package and promote content, such as children’s titles or thematic movies, said Laura Norman, marketing manager with Microsoft TV.
Foundation Edition will be tested later this year by Comcast in Seattle and is currently deployed in Mexico by Cablevision.
The user interface is the next battleground for VOD, said Raj Amin, VP business development with N2 Broadband, which provides infrastructure software and services for cable operators delivering VOD services.
“We’ve spent a lot of time over the last few years figuring out how to operate VOD and smoothing out the operational issues, and now it’s all about marketing,” he said.