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This Crew Hopes to Build Superhighway for TV Commercials : Technology: Tiny Sherman Oaks firm and its partners envision zapping ads to cable via computer. But infrastructure and financing are still in early stages.

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SPECIAL TO THE TIMES

You’ve heard of the information superhighway. What about the television superhighway?

Independent TeleMedia Group, a tiny company in Sherman Oaks, has tentatively signed on to the dream of a Colorado man named Rich Schmelzer, who hopes to launch the nation’s first coast-to-coast network for sending commercials via computers to air on TV.

Currently, most commercials you see on cable TV get there through the most low-tech means imaginable: Advertisers duplicate scores of videotapes and deliver them through couriers to cable offices scattered over the country. Operators then pop them into a VCR at the appointed time. But this is time-consuming and labor-intensive, and the VCRs often break down.

The new system aims to use an electronic storage and delivery program called video file servers. These are computer systems capable of downloading video spots from a computer network linked by phone lines and satellites.

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The video file servers would deliver high-quality pictures to cable operators with speed and convenience unknown today. In theory, the proposed network would allow advertisers to zap commercials to cable television operators and broadcasters instantly, so that, say, when the Raiders win a football game, spots featuring their players would run immediately on the blast of the final whistle.

In October, Independent TeleMedia announced it would acquire both SkyConnect Inc., of Boulder, Colo., the company Schmelzer founded; and Mediatech Inc. of Chicago, the nation’s largest distributor of commercials and video programming.

By merging three companies, the group hopes to combine all the elements of a new delivery system for commercials. “Now we can do in minutes what before took days,” said Schmelzer, who is SkyConnect’s executive vice president. “It’s like a giant e-mail network” for video, said the 29-year-old Schmelzer, a former video distributor.

“It’s a quantum leap,” said Lew Eisaguirre, chief financial officer of Independent TeleMedia. “The cable industry has been waiting for this.”

So far, though, this dream of creating a video superhighway is just that. Only three companies have bought the necessary hardware and software to receive digital commercials.

Although many experts expect that eventually the television industry will evolve toward this kind of distribution system for commercials, how that evolution will be brought about is far from clear.

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“Would it be good overall for everyone to have digital insertion (equipment)? Yes. The problem is who do you get to do what, first?” said Paul Woidke, vice president of operations for Adlink, a Los Angeles-based partnership of cable operators that is a potential customer of Independent TeleMedia’s.

And the three would-be partner companies still have to close their deal.

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Independent TeleMedia, a former telecommunications and billing company that sold off all assets last year, is now a public shell company with $5 million to invest. SkyConnect has the technology. It’s developed hardware and software that squishes video programs into digital form and spews them out on the receiving end to be put on the air.

Mediatech is a 20-year-old advertising distributor with $20 million in annual revenues that sends out commercials and TV programs for 3,000 clients via videotape deliveries and satellite signals. That’s important, because it provides an ongoing source of revenue while the computer network comes on line.

The final piece in this puzzle comes from Denver-based IntelCom Group, a telephone company with 1993 revenues of $30 million. IntelCom is majority-owned by the Becker Group of Denver, which is also majority shareholder in SkyConnect. For several years, IntelCom has been laying fiber-optic cables and building satellite uplinks for its system of private-access phone lines. Eventually, SkyConnect could use those same lines to transmit video programs over its network, said Becker Group spokesman Phil Allen.

The acquisitions are to take place through a stock-swap arrangement, but shareholder approval is still pending. The deal was described by Eisaguirre earlier this month as still tentative. If it goes through, Independent TeleMedia will close up shop in Sherman Oaks, move the company headquarters to Boulder and take the name of SkyConnect.

Although there is much interest in digital commercial delivery systems due to technological advancements that speed up the process, many companies may offer alternatives to SkyConnect’s systems.

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And other competitors, including computer companies, may eventually step up to rent space on existing phone lines and deliver video programming themselves. “Digital is new, and I can’t say whose technology has the leg up and who doesn’t,” said Peggy Conger, editor of Cable Avails magazine in Denver.

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