Going for the Gold
Newnam predicts 15 million homes interactive by 2005
By Staff -- Broadcasting & Cable, 8/22/2004 8:00:00 PM
Scott Newnam, president and CEO of GoldPocket Interactive, has turned CBS, ABC, NBC and Fox into interactive-services believers. It's a system applicable to set-top boxes, mobile phones and PCs. In fact, Newnam says the much-maligned interactive market is ready for prime time. He recently discussed the market segment with B&C.
Interactive-TV services are now more than just an ancillary interest to cable and satellite. Why the increased attention?
There are two things serving as the catalyst for interactive TV. The first is Rupert Murdoch, who made a killing doing ITV in Europe and says he'll do it here with DirecTV. That's getting cable operators to move. The other is the fear of TiVo. Historically, we never saw advertisers throwing any dollars at ITV. Now that's not the case. More and more money is moving to new media; the 30-second spot is [no longer] the dominant solution. This has led to a big jump in our business.
We now have 15 television networks that are new customers, including ABC, NBC, CBS and Fox. And about 80 advertisers have come in during the past year.
What is it they're doing?
The TV networks and cable operators are buying technology from us that allows them to make ads interactive. Then, they're selling those spots to the advertisers.
Which cable operators are doing interactive advertising?
Time Warner Cable in Hawaii was the first to launch a system that most would call a vision of the future. Viewers turn on their TV, and they can play against TV shows. And three times every hour, we put the names of the top players playing live at that moment. Another big operator is EchoStar, with 8 million boxes fully capable. They're actually now doing an application with NBC for a video mosaic of all the different Olympic channels.
Time Warner Cable is dabbling with interactive in Hawaii, but when does it deploy that service system-wide?
Every operator is having an ITV trial in some market, but those trials never result in a system-wide deployment. In the U.S. today, there are 9 million households with interactive: 8 million EchoStar and 1 million in different cable pockets. My estimate is that at the end of 2005, we'll be at 15 million homes, with about another 6 million on cable and 2 million on satellite.
For advertisers to get interested, won't they need a single MSO to offer the kind of scale that makes ITV advertising attractive?
The tests now, particularly in Hawaii, are going great. What you'll see is each operator launching one or two test beds. Next year, the market will expand to well over 30 million. And unless something goes wrong, all the operators will be doing it. Interactive will be more like VOD, which has rolled out everywhere.
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