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_ Igg6[~ITIDK '------------ gaining more efficient access to vVorld ing home pages on the World Wide Wide Web sites on the Internet. In Web, a part of the Internet with an addition, the high speed access means easy-to-use graphical interface. Many faster downloading of video clips businesses have established Web sites ir offered by CBS and Home Box Oftice the hope of selling traditional mer­ over Prodigy. chandise or services to consumers who log onto the Internet each day. Some .... THE MICROSOFI :"JETWORK :l\IS'\)-No companies have even established "vir­ online service has received as much tual shopping malls" providing access advance publicity as the Microsoft :"Jet­ to hundreds of retailers and cata­ work. Launched in 1995, with cable loguers. In addition to those selling operator TCI as a major partner and merchandise on the vVeb, some compa· hundreds of companies as information nil'S are trying to make a profit by providers, the Microsoft Network is charging a subscription or usage fee to included in Windows 95, an operating those accessing their site. For example, system for many PCs. This ensures that some newspapers will allow you to a large number of potential subscribers access their main vVeb page at no cost, will have access to the service. The but charge a monthly fee and ask for Microsoft ]'\etwork is similar to other an established password to gain online services in terms of content but entrance to their features and articles. it has a different pricing strategy one that allows each information service A majority of commercial sites on the provider to set its own price. World \'Vide \'\leb are using their site to advertise, promote an image or simply YlSN also offers a few different pricing to join the "Web .Fever" while searchin! packages for its basic service, including for a niche on the "information super­ a low-cost package for those who will highway." While the number of Web use it only occasionally. Subscribers can users has grown rapidly, it is less clear access the service through the tele­ how businesses will earn a profit on the phone network, and through selected Web. The fact remains, though, that cable systems at much higher speeds. the Internet has captured the imagina­ MSN has a powerful server and soft­ tion and interest of a lot of people. ware tools, called Blackbird, that can provide seamless access to the Internet. Nearly every type of business, institu­ tion or organization can be found in .... 'I'm: INTER:"ET .\S.\ Sl'PI}UIH;fI\\,\\ some capacity on the World Wide Web The Internet has grown at a very fast Some businesses, however, have rate, both in usage and in the number embraced the Internet in a very con­ of businesses and organizations creat- spicuous manner. Some of the most common types of businesses found on the 'Neb are banks, newspapers and magazines, TV and radio, and retailers and cataloguers. Year Onllnes Seruice Subscribers [able Smlces and ActJultles 1gg5 8 Cable companies are exploring many 1gH 11 new services including telephone service, CD­ ) g97 15 ROMs, online services, interactive television and I gg8 18 direct broadcast satellite. They are competing in I ggg 1a new arenas, e.g., against local telephone compa­ nies, and hedging their bets by becoming Source: A1ultimedia PC Marketing Council partners in new services that compete with cable such as direct broadcast satellites. "24 _____________g~OlllO -----J_ With the promise of very large capacity munications (Providence]ourna~, Cox Cable Com­ cable systems in the near future, many groups munications and Times Mirror Cable TV have launched or announced new cable chan­ Prevue and TV Guide On Screen, likewise, have nels. However, the reality is that until digital established relationships with MSOs represent­ compression is implemented on a large scale, ing a large share of the nation's cable there will continue to be very little channel avail­ households. ability on cable systems. Cable is moving ahead in ways that are Gaining access to cable systems often important to public television. For example, involves striking marketing deals with cable Cable in the Classroom (CIC), an industry trade operators. This is clear in the negotiations that group that represents cable system operators and have taken place between electronic program a consortium of program suppliers (including guides (EPGs) and cable operators. The EPG PBS), has successfully wired over two-thirds of companies that now stand firmly in position to classrooms in the L:.S. It also provides a package test the market include StarSight, Gemstar, Pre­ of noncommercial programming to classrooms. vue Interactive and TV Guide On Screen. Each Public television is the largest program supplier has been negotiating relationships with major for Cable in the Classroom. Further, CIC cable operators. These arrangements will make research shows that public television is the most it very difficult for any newcomers to enter the heavily used CIC service-fig percent of teachers market. StarSight, for example, has agreements surveyed indicated that they use public television with Viacom Cable, KBLCOM, Colony Com- programs regularly. _ L-_.....:.........-:-..:.... 11 _ tures about science, nature and history. [ROlt LtlflHHll rlLrlllrlbilllf ,dj These are supplemented by daily news Humber of Percentage reports, bulletin boards and live chat ~uailable Channels of :,ystems about specific topics. Revenue is derived from an online store, advertis­ 1 B ing and a planned subscription ft'e of 2 1B $24 per year. J 21 4 10 .. VIACO\CI ONU'iE DSL\ ACCESS. Viacom 5. g 16 is providing online access to Prodigy, 10 14 11 America Online and the Internet to a 15 . 1g 10 group of trial households in Castro Valley, California. Viacom is testing the 20t I system from both technical and market- Source.' Beta Survey ing perspectives. Cox Cable also is . testing data delivery over cable on thm systems in Omaha, Phoenix and San Other cable activities include: Diego. Data can be sent over cable at much higher speeds than over a stan­ .. C:\"N AND CNBC DESKTOP VIllEO. dard telephone line. However, cabk Both CNN and CNBC have launched modems are expensive compared to desktop video services. They provide telephone modems. J\:fost cable video feeds of their news services to modems cost $500 or more, compared businesses and other organizations. to $50-$200 fiJr telephone modems. CN1\"s service, "C:"JN At Work," is a Zenith recently introduced a cable partnership with Intel. They charge modem for $300. $150 per user per year fiJr the service, which delivers video at 12 frames per .. TI\tE WAR'\ER'S FUl.L SERVICE second (compared to 30 Ii-ames per sec­ '.\'ETWORK. Time Warner's high-end ond for normal video over cable or interactive television service in Orlan­ broadcast). It does not provide true do, Florida The Full Service video-on-demand but a user can store Network-was announced with great the incoming video ICed and view it finfilfe in 199:-1. It was to be launched later with near-video-on-demand con­ in earlv 1994 and was scheduled to troL provid~~ video-on-demand, home bank­ ing and shopping, telephone service, .. D1SCOVERY CHA:\:\EL. Discovny Chan­ video conferencing, and video games nel is very active in developing played between households, among applicati(;ns for new technologies. It other services, to 4,000 households. It has developed a video-on-demand ser­ was launched and installed in late 1994 vice, Your Choice TV, that has been in just a few households. The number tested in a few markets. It otli>rs televi­ of services and users grew slowly in sion programs to users for prices 1995; a filII service network is not ranging from less than $1 to a kw dol­ expected to be in place until 1996. The lars. It is also participating in a trial of delays experienced by Time \Varner interactive television with Microsoft in are not unusual. .:"Jew technologies and Seattle. Discovery Channel's multime­ services invariably take longer to imple­ dia group has also created P(: software ment than planned. and CD-RONIs, including the CJ)- ROyI Sharks! An Interactive ]oul'lle)!. Telephone Company Rcttuttles After launching modest services on Telephone companies have announced Prodigv and America Online, Discov­ many plans to offer video services to consu~ers. erv Ch~nnel launched an ambitious They also have changed their plans many tImes. W~Jrld Wide Web site with monthly ka- A few important trends are now becoming clear. _26 g g First, telephone companies have put high-end tems in direct competition with existing interactive TV on a much slower path of devel­ cable operators. The Ameritech systems opment. Several trials have been canceled; mix fiber and coaxial cable. They can others have been postponed. The reasons J()r provide hundreds of channels through this are the high cost of the technology, the the usc of digital compression and can equally high cost of creating new content, and cvolve over time to provide advanced uncertain demand by consumers. services such as interactive TV In the Secondly, telephone companies are short term, however, it is becoming a exploring alternative ways to deliver video to regular cable TV operator. At the same homes, including wireless cable (transmission of timc, it has f()rmed a programming video by microwave to small dishes on homes), alliance with three other large tele­ ADSL (transmission of VCR-quality video over phone companies and the Disney ordinary telephone lines), and hybrid fiber-coax­ company. ial cable systems that are similar to the systems used by cable TV operators. A high-end system ... SNET (SOl THER:'\ :"JEW El'\GLA:'\D that utilizes fiber throughout the entire systcm is TELEI'HO!\E) has a very ambitious plan simply too expensive in the near term.

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