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New technology and functionality is driving the adoption of interactive TV applications, opening revenue streams for media firms that embrace it, writes Saad Mouneimne.
In the last 10 years market forces and technology have resulted in the advent of many new interactive TV services, including SMS voting and SMS chat shows, game packages on set–top box networks, and parallel publishing of alternative viewpoints and add-on material on digital TV.
While these services have been labelled interactive and are commonly understood to be so, their true interactivity is limited. In fact, the consumer/viewer for the most part interacts in a very restricted way – for example by casting a vote – only with the site owner or broadcaster itself rather than with his or her fellow viewers. And the site owner does not and cannot respond individually to the viewer.
Similarly, technical issues regarding bandwidth, software and processing power have made some of these even limited interactions unfulfilling for consumers and thus for the media sponsors, who as a result may not have achieved the market results they sought.
For example, it has been common for a viewer attempting to cast a vote for his or her favourite performer, or to make a comment on a talk show, never to see the vote counted or the comment appear. This has usually happened when the attempted interaction took place near the close of the voting or commenting period.
Again, because of the systems’ extremely limited interactivity, there was no way for the sponsor to respond to the individual consumer even with a friendly: “Sorry, voting is over for today. Please try again tomorrow!” and as a result the consumer may have felt disenfranchised and discouraged from participating in the future.
Today, however, improved technology combined with the vision of media enterprises and telecom providers as well as consumers’ hunger for the next new thing is yielding fresh, more satisfying, and more individually responsive interactive media projects. In time, these projects will redefine the concept of interactivity and have significant implications for viewers, for media companies and other site owners, as well as for the advertisers.
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Both technical and market trends will continue to drive the proliferation of interactive TV services. For one thing, there is an ongoing, rapid increase in television signal distribution capacity both globally and locally. This has led to more channels with the inevitable drop in the number of viewers per channel. At the same time, television viewing in general has begun to decline in mature markets, chiefly because of competition from the internet.
As a result, broadcasters are constantly on the lookout for ways to lower production costs and to tap new revenue streams. Interactive TV has the potential to meet both these goals.
Enhanced processing power running more efficient, specially designed software is enabling improved levels of automation. This is resulting in a dramtic increase in cost efficiency of the operation within the interactive TV environment – cutting down on the overall production expenses.
Faster SMS and more universally accessible wireless and broadband internet access are making interactivity available to more people every day.
New revenue opportunities for media companies include over-charged text messaging (charging viewers to participate in discussions taking place on television talk shows for example), content downloads, direct sales of merchandise, sponsored return-messages, and sponsored micro-WAP sites.
Because both mobile phones and computers can give unique identification of a viewer, media advertisers can target individual buyers. Coupled with today’s improved, more focused software technology, this fact means the media enterprise can comprehensively monitor viewer/consumer participation, location, and even – based on past history – the revenue implications of their participation.
The most effective of these modern software systems are integrated with the business and sales side of the media enterprise. Not only can results be easily tracked and readily understood, but even billing can be part of the integrated solution, further automating the process as well as reducing the potential for glitches that irritate viewers and advertisers.
The full potential of these interactive systems has yet to be exploited, but some illustrative projects have been undertaken.
In Norway a car company invited interested buyers to take test drives at their local dealerships. Various broadcasters are using interactive TV as a forum for commentary in both a talk show format and for sporting events.
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