Vendor Race Heats Up

Jun 5, 2006  •  Post A Comment

The race for supremacy among companies that supply interactive television tools to cable and satellite operators is tightening as TV networks roll out more advanced features and uniform technological standards stimulate more competition.

Navic Networks and OpenTV are front-runners among vendors of interactive TV technology. Time Warner and Cox, the most aggressive of the cable operators in rolling out interactive TV, have recently introduced new services powered by Navic. EchoStar, with 12 million subscribers, uses OpenTV.

The competition is likely to get more intense as cable companies adopt interactive TV standards that will allow television networks to develop interactive features that run on multiple vendors’ systems. As interactive TV companies adopt common standards, they’ll likely seek niches in the industry such as graphics or campaign management, said David Porter, VP of marketing and new media for Cox Media.

Promise of Interactive Ads

Demand for the technology vendors’ services is rising as networks such as Bravo and NBC introduce on-screen features such as trivia quizzes that viewers answer via remote control, and advertisers are drawn to the possibility of hooking viewers with interactive ads.

“The tipping point is when programmers start bringing the opportunity,” said Tracey Scheppach, VP and video innovations director for Chicago-based media agency Starcom USA. “That’s where the big money is moving.”

Currently, technology vendors cozy up to the cable or satellite operators who deploy their tools, rather than the networks whose shows have interactive features. With industrywide standards, more interactive television vendors probably will gain traction, said Joan Gillman, VP of interactive TV and advanced advertising for Time Warner Cable.

So far only a few interactive TV vendors have successfully deployed features. In addition to Navic, Time Warner worked with interactive technology vendor BIAP earlier in the year on a project that allowed NBC to create an application for the Olympics. Time Warner’s recent work with NBC properties is based on a deal the operator struck with Navic two years ago.

“We are aggressively moving towards supporting ITV standards in 2007 so multiple vendors can support the programmers,” Ms. Gillman said.

That’s a big change from how business is done today. Interactive TV so far is available in only a handful of markets, making it impossible for TV networks to introduce national programs, said Kagan analyst Ian Olgeirson. Navic and OpenTV, as well as BIAP to a lesser degree, have generated the most headlines this year. That’s because EchoStar recently launched interactive programming from CNN, powered by OpenTV. Time Warner has rolled out a number of trivia and polling options for Bravo and NBC viewers using Navic tools.

“Navic has established a footprint with Time Warner and Cox, which have been the two MSOs who have taken the most forward leaning stance on interactive TV,” Mr. Olgeirson said.

Common Standard

As cable and satellite operators move to support a common standard, Tandberg Television, which acquired in- teractive TV technology firm GoldPocket last year, is intensifying its push into the market.

Tandberg will focus on providing the so-called “end-to-end” infrastructure that supports the business of interactive, such as billing, scheduling and reporting. Tandberg already does that for several cable companies’ video-on-demand and interactive efforts.

The company will piggyback on its existing deployments with operators as the interactive TV business migrates to a more open field for vendors, said Braxton Jarratt, senior VP of marketing and business development at Tandberg Television.

“We are supporting whatever vendor the customer wants to use,” he said.

He also said Tandberg recently completed a deal with a major cable operator to use its technology, declining to name the operator.

Comcast had been expected to launch a trial with several programmers in Baltimore earlier this year with one-screen technology from Tandberg. That trial hasn’t happened yet.