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TIME Europe, March 22, 1999
Talk-Back Television
Soon we'll be surfing through the TV
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The ubiquitous television set is poised to take a leap even bigger than its jump from black-and-white to color. This year thousands of European consumers will start using their TVs to do everything from ordering pizza, to buying stocks, to checking out new cars and booking a test drive. "We are talking about the redefinition and rebirth of television," says Roel Pieper, a board member of Philips, the Dutch consumer electronics company that makes TVs and set-top boxes.
Philips and other manufacturers are bringing out products that promise to change the way we think about our TV sets. One Philips product, Ambi, transmits PC software applications and Internet access to any TV set, creating a second desktop for families with a single PC. Another Philips gizmo, Personal TV, lets viewers pause, rewind or instant-replay live broadcasts. It also learns what a viewer likes, and looks for and recommends programs. A third product, Internet TV, gives families without a computer their first ramp onto the information superhighway.
Taking advantage of new hardware, European digital TV operators are coming up with interactive services that give the ability to use the TV to surf at least some websites, send e-mail, participate in chat rooms, bank from home, order stocks in real time and access interactive ads which enable consumers to request specific information and order products. At least six TV operators are planning interactive TV services in the U.K. this year over terrestrial, cable and satellite systems.
German phone company Deutsche Telekom and German public broadcaster ZDF expect to showcase "Internet-enriched TV" services at this month's CeBIT information technology trade fair. The demonstration will be based on a set-top box made by France's NetGem and includes an icon on the TV image which connects to a related Web page. With the set-top box, a standard TV set and a regular telephone connection, users will be able to e-mail, chat in real time, and access customized electronic program guides and stock or weather information. Deutsche Telekom is considering a service. "We are a large Internet service provider and it is very important to us to have content, so we are testing various possibilities," a spokesman said.
Few expect the TV to replace the PC, but if such services become popular the TV could become an important electronic commerce tool. "TV could deliver some of the functionality of the Internet without the need for the type of money and skills required to access the Internet on a PC," says Adam Daum, a media consultant at Inteco in Woking, Britain. In Europe 24.3% of households have PCs compared to 49.3% in the U.S., and only 8.1% of European households access the Net, versus 37% in the U.S. That means European digital TV operators have more opportunity with interactive services, he says. And those Europeans who do have PCs at home spend less time using them than their U.S. counterparts, giving them more time to interact with their TV.
But it's not enough to slap websites on a TV screen. Viewers sit about 3.5 m away and thus can't read small print. They may also have trouble accessing sites which require advanced software to download images. The hope is that as more viewers use interactive services, companies will build TV-friendly websites. TV operators think most consumers won't need access to more than a few hundred sites. One idea is to organize them like TV channels to make searching simple.
Another consideration is what Pieper calls lean-forward and lean-back habits. People do the former when using their PCs and concentrating hard, while more passive TV viewers lean back. That means transactions must be kept relatively simple — like pushing a big button marked "OK" in the middle of the remote control to order a pizza.
French digital satellite provider TPS and rival Canal Satellite have pioneered a marketing approach based on that theory. They have each launched more than half a dozen services specifically designed for TV, such as home banking and interactive ads. TPS is additionally planning an April launch of a real-time stock trading service.
And the rest of Europe is catching up. Open TV of the U.S. is providing the technology for interactive TV services in Denmark, Spain, Sweden, Italy and Greece later this year. And rival Canal Plus of France is working with TV operators in Spain, Italy, Belgium, the Netherlands, Poland and all four Nordic countries. But while 1999 looks like a breakthrough year for these services, European TV operators won't know if they have a hit until significant numbers of viewers signal their okay via their remote controls.
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