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ACTV tests custom channels
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October 5, 1998: 3:08 p.m. ET
Digital "individualized" TV will let you talk back to the television, and it'll answer
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NEW YORK (CNNfn) - The miracle of cable television has ensured channels for food, history and just about everything else, whether you're interested in it or not. Now ACTV Inc. is about to balkanize the television experience even further by launching "individualized TV."
ACTV (IATV) Chief Executive Officer William Samuels revealed some of the medium's expanding potential during an interview with CNNfn's "Business Unusual." A partial transcript of his comments follows.
LAUREN THIERRY, CNNfn ANCHOR: This is the set-top box which will bring us ACTV. Tell us what it is and what it does.
WILLIAM SAMUELS, CEO, ACTV: Well, television is going digital and there are now a million digital set-top boxes being installed in homes around America. And eventually, (the) 65 million cable subscribers will all be digital. . . . America will see a whole new type of television.
THIERRY: And the digital component of it actually makes it so that it can be more individualized, which is your bailiwick. Tell us then what individual TV means and what I will see on my screen.
SAMUELS: Imagine you're watching a basketball game. And you want to focus on Michael Jordan and see what he does for a minute or two. How he plays defense. You can do that. Or maybe Joe Torre is out at the mound, and you want to switch out to the bullpen and see who's warming up. All you have to do is hit a button on your remote, and you can watch a sporting event the way you want to watch it.
THIERRY: So I have choices. I can look for highlights, I can look for replays, I can look for different facts about players and team stats, things like that?
SAMUELS: Basically, we give the sports fan better quality and more in-depth sports. But it's more than that. Imagine your child is watching Big Bird on "Sesame Street." Big Bird can actually talk right to your child in the way that your child would like to learn.
Big Bird may say, "I can't see you, are you a boy or a girl?" And with a simple button push by the child, Big Bird says, "Oh, you're a girl, well, I'm going to make math fun for you today." TV talks back to you. It has tremendous social implications, and it will improve the quality of everything from children's programming to sports to news.
THIERRY: So I can block out maybe the entire game, or the entire "Sesame Street" song [291K WAV] [569K AIFF], to get that individualized attention to me. What are advertisers going to say about this? Can you block out advertisements at the same time?
SAMUELS: Well I don't think that we're going to encourage blocking out advertising, because advertising is very important to television. But we improve advertising more than any other genre because channels are becoming fragmented, it's harder for the advertiser to get his message across. We let the individual who wants to learn about a sports utility vehicle versus a convertible -- and that's the advertisement you will see.
And maybe you want to learn about the safety features versus the cost. So the advertiser is going to be able to profile the viewers. And you, the viewer, are going to find that the advertisement really is more valuable to you. And as a result, CNN (for example) will get more money when it sells advertising.
THIERRY: This is truly interactive television, then. Not only can you tell it what you want it to do, but then it talks back to you, having gained that information. Will that information also go to advertisers?
SAMUELS: Well, I think that's an issue of privacy. Your responses are right in the digital set-top box ,and we'll let public policy decide that. But the information is available.
THIERRY: For a true layman like myself, tell me what digital television means and why that permits you to go interactive like that.
SAMUELS: Digital (TV) is really not that complex. Imagine you have CNN. With digital, you can do three things with that CNN program: (1) You can have 10 CNN programs, so we can give you more quantity. (2) You could make the picture a better, sharper picture. (3) Or we could individualize TV.
We are saying that the option of improving the quality will turn out to be more important than improving the quantity or the color. There is a place for high-definition TV but you need a very expensive TV set.
For the individualized TV, you just need a digital set-top box. Eventually, the consumer will decide what's more important. Should Big Bird be more yellow, or should it talk back to the child? Do you want to see the hardwood floors in a basketball game clearer, or focus on Michael Jordan? We think individualized TV is a third option and will surface as more important than high-definition TV and pure quantity.
THIERRY: Is ACTV the only company doing this?
SAMUELS: We are the only company doing this. There are many companies that are involved in interactive TV, and the reason we call what we do "individualized TV" is that it's different. It's regular TV, but it's better quality. It's simple, it's all software, there's no technology, and we're already in commercial launch in Texas.
THIERRY: I guess any cable subscriber is going to ask you whether it will cost more money.
SAMUELS: Well, our initial network, FOX Sports Plus, will be a premium (channel) and we're positioning it much like HBO was in the analog world to be a real quality (value-added) channel.
But as digital becomes pervasive, and everyone has it, some ACTV programs will be advertiser-supported, some will be pay-per-view, and some will be premium, and we'll let the consumer and the advertiser decide which model fits best the particular genre.
THIERRY: This third wave of television, when will this be in every home?
SAMUELS: I think that it's starting to roll into homes very rapidly now under the leadership of TCI (TCOMA) and Liberty Media (LBTYA) who are really in the forefront of rolling this out. And I think over the next five years, you'll see a majority of homes that are digital in the United States.
THIERRY: What does the individual customer need in order to go digital? Just the set-top box?
SAMUELS: All you need is your set-top box. It's no different than in the old days, there were no set-top boxes and then they delivered an analog box and you could get pay-per-view and HBO. There is nothing complex about it.
My mother can do it and a first-grade child can do it. And the most exciting thing is this is just not a change in technology. It's really going to improve the quality of TV that you can produce at CNN because you can do in-depth stories, and it's going to improve the quality of TV for the families, and that's what ACTV is about. 
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