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MyDTV Slows Cable Churn

10/26/2003 07:00:00 PM Eastern

Cable operators looking to stop digital churn may have a new weapon. MyDTV's TV Agent, an application that sits on the cable set-top box, makes it easier for viewers to find the content they want in a sea of hundreds of digital cable networks.

"The typical cable subscriber has a comfort zone of 10 to 14 channels, but they and the operator are paying for 150 channels," says MyDTV CEO Bow Rodgers. "Our goal is to help them get their money's worth from those channels."

The system allows viewers to set preferences for their interest level in such topics as news, sports or entertainment programming. The system then sends displays an on-screen banner indicating that a program or news story the viewer may find interesting is on TV.

The system has some basic settings but also allows for keywords to be entered. For example, if the viewer enters "Murdoch" or "News Corp." and "business news," an alert will appear on the screen when a business news report on Murdoch or News Corp. appears on-air. The viewer can also set a preference for how early the alert is sent.

MyDTV's system requires the cooperation of programmers and cable operators to bring its full benefits to consumers. The programmer first installs a PC at its facility to pull information from the traffic system, information that describes the content. That information is then sent to a PC located at a cable headend, which then sends it to the MyDTV Agent software in the cable set-top box. The software then posts the alert.

Thus far, Bloomberg TV, Court TV and even two local TV stations, KESQ(TV) Palm Springs, Calif., and KLAS(TV) Las Vegas, have set up the system.

Cara Familet of Bloomberg Television oversees the network's advanced products services and she says Bloomberg looks at the system as a way to find new viewers in the multi-channel environment.

"They can get so lost with what programming is on that it will help point them to relevant business news they want to find," she says. "I think it's a service that viewers will want."

Bloomberg's WinCue system that its producers use to enter in information related to the content. Familet says MyDTV's challenge is how to deal with live content but she says MyDTV met that challenge at least with respect to Bloomberg's needs.

Rodgers says the ability for local broadcasters to get involved is important not only for the station but also for the cable operator. "Cable operators need to bring a local presence to the viewers, and KESQ is an example, bringing granular data related to local news and sports content to viewers."

KESQ was part of a MyDTV trial in Palm Springs by Horowitz Associates to gauge how MyDTV impacted viewer habits and churn rates. Approximately 374 of 600 households were qualified for the trial, with 253 households using the service during the four-week survey. Of those users, 84% switched to the channel or program the alert directed them to, and 62% said it would become part of their regular TV viewing if available. The study also showed a 35.42% improvement in churn rates and nearly 40% improvement in pay-per-view use.

"We're not going to ask the cable operator to charge the subscriber for this," says Rodgers. "But, if a customer says they're willing to pay for it, that's a good litmus test."

The cost to the cable operator and programmer, he adds, is minimal. MyDTV charges programmers a small fee based on the number of viewers who act on an alert. The cable operator pays a one-time per–set-top license fee of less than $2.

MyDTV is currently in talks with Time Warner about deploying the system, and others, Comcast them, have expressed an interest in using it to cut churn rates. As for programmers, Rodgers says a major programmer with multiple networks is close to signing a deal to use the service.

While the idea sounds like a good one for viewers, he does acknowledge that there is some reticence from the networks. He says they all like the idea of driving viewers to their channel but aren't too keen on having a banner pop up while a viewer is watching their channel to drive them elsewhere. Fox News Channel, for example, would be less than thrilled to see a banner pop up reminding the viewer to turn to CNN.

But, if MyDTV can land deals with cable operators, the networks will quickly fall into place. After all, not participating means no opportunity to drive viewers to one's own network, only the opportunity to lose them.

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