Time Warner Cable (TWC), the nation's second largest MSO, believes its new Enhanced TV service will keep customers hooked up—and become a potent advertising tool.
The company is offering subscribers, for free, a suite of time-shifting features meant to go the DVR one better by giving viewers greater flexibility. The features include Start Over, which allows viewers to restart a program if they tune in late, and Look Back, which lets them see shows that aired during the past 24 hours. In addition, Catch Up permits viewing of older episodes, and Quick Clips offers short-form video content. All of these features fall under the umbrella title, Enhanced TV.
The services have similar functionality to DVRs, but here's the rub: Viewers can't fast-forward through commercials. Also, with features like Start Over, Time Warner will be able to integrate interactive advertising. That's a potential money tree for Time Warner, says Glenn Britt, TWC president and CEO.
Start Over is available in six Time Warner Cable divisions: Columbia, S.C.; San Antonio, Texas; Rochester, N.Y.; Greensboro, N.C.; Albany, N.Y.; and Hawaii.
Britt talked with B&C's Jon Hemingway about the technology and features, and explains that while Enhanced TV may just seem like an extension of the DVR, its real difference is what it can do for advertisers.
Why develop Enhanced TV rather than modify the DVR so viewers couldn't fast forward?
Using a DVR requires planning ahead. Enhanced TV does not. It is different from a DVR and available to anyone with a digital set-top box.
Enhanced TV takes place in a linear environment. The viewer accesses the feature from the linear network and then is deposited back on the linear network at the conclusion of their viewing.
The interesting thing we are seeing so far is that people who use Start Over very heavily also use DVRs very heavily.
So you don't worry about it cannibalizing DVRs?
Not particularly. They are both forms of watching things when you want, but they really work differently because the DVR requires planning ahead. Start Over, which is the only thing we have in the market now, is just there. It's a different psychological thing, even though it sounds similar.
People who are heavy users of DVRs fill up their DVRs with a lot of programming. Then the first place they go to when they turn on the TV is their DVR list. Let's say they watch a program—pretty much by definition they don't come out of that on the hour or on the half hour. If they go back to live TV, Start Over is perfect.
What are the capacity constraints?
Enhanced TV features work like VOD. Streams are delivered only when they are requested, meaning that the additional bandwidth they require is incremental and based solely on usage. It is akin to continually expanding our VOD offerings.
Where are you in the development stage of your interactive advertising plans?
We and some of the other [cable operators] have been testing on a small scale basis. I think you'll start to see some things in 2008, as sort of a road map for rolling it out. We are working with other MSOs and members of the broader advertising community to bring interactive features to television advertising.
The Internet seems to have created some technical abilities that would make advertising more efficient than traditional forms. We have technology to do that on television and television on a big screen is far more powerful than the Internet.
We put together a group of all the big cable companies, and we're trying to target certain of these features that we can enable fairly quickly and do it in a common way so that people can go to the advertising community and offer a similar set of features across the industry.
Bottom line, what does Enhanced TV do for your business?
Enhanced TV is meant to address consumer desires. We have features that consumers really like that are hard for our competitors to replicate, particularly the satellite companies, which don't have two-way capacity. People are still going to tinker with the Internet, but this is an economically viable way to meet the consumer need that people think they are doing on the Internet—where I don't think anyone is making any money, by the way.