InTV’s Screen Test : Interactive Cable Service Puts Viewer in Command, but Analysts Call Offering Relatively Low-Tech

It’s been six weeks since Javier Cedillo and his family signed on as human guinea pigs in a test of a new interactive TV system with Ventura County Cablevision.

Equipped with a special remote control and a new cable TV box, the Cedillo children, Alexis, 12, and Nicholas, 8, spend at least two hours a day playing video games on what’s known as InTV. And when the basketball playoffs were on a few weeks ago, Cedillo admits he got hooked on a feature allowing him to zero in on a star player at the touch of a button.

“We like it [InTV] and we use it,” said Cedillo, who lives in Westlake Village.

The Bukowskis of Agoura Hills are also enthusiastic, although it’s not the interactive sports coverage that turns them on.

“The whole family has gotten interested in the blackjack and the roulette,” said Susan Bukowski, mother of Katie, 10, and Janis, 8. Her husband, James, now regularly plays chess with the TV screen, sometimes fitting in moves to avoid commercials while channel-surfing.

InTV may not signal the arrival of a new route along the much-vaunted information superhighway in Southern California, but it’s a tiny step in that direction.

“This will change the way consumers watch TV,” said Richard Yelen, director of marketing for Ventura County Cablevision. “The technology allows consumers to learn as they go.”

The company is two months into a market test of the interactive system in Agoura Hills, Calabasas and Westlake Village. If viewers respond, Ventura County Cablevision will market InTV as a premium programming service like HBO--probably charging $8 to $12 on top of the typical $30 cable bill--by March 1996.

Eventually, ACTV, the New York-based company that owns InTV, hopes to market the service throughout Southern California.

That, however, could prove difficult. InTV’s technology is not as interactive as, say, a program that could run on a personal computer. And viewers can’t communicate directly with advertisers, although they can choose which commercials to view.

And the company has been struggling.

ACTV, 24% owned by the Washington Post Co., lost $1.952 million on revenues of $341,634 for the first quarter ended March 31, 1995. In 1994, it lost $4.5 million on revenues of $938,400.

The InTV test is the first U. S. trial of a technology that’s been in use in Canada for five years. Since 1990, the technology has been available to cable TV subscribers in Montreal and other parts of Quebec. About 26% of the 1 million customers of Canadian cable operator Le Groupe Videotron pay $8.95 (Canadian) to receive it.

No one knows if consumers truly want these interactive services, said Bob Diddlebock, editor of Cable World, a Denver-based national trade magazine. If people do want it, he said, there’s no telling what they’ll be willing to pay. “The industry is still at the point where it’s throwing stuff against the wall to see what sticks,” said Diddlebock.

During prime time, InTV features Prime Sports Network, which carries the Angels, Lakers, Mighty Ducks and Kings in the Los Angeles area. InTV allows sports fans to pick from a variety of camera angles on the field, call up instant replays, statistics, player profiles, trivia and so on, all at the push of a button.

There’s more coming. Brent Imai, InTV’s vice president and project manager, said the service hopes soon to deliver a special feed of a local newscast. With the push of a remote control button, viewers will be able to choose the order of news reports, or call up more in-depth coverage. For example, viewers might be able to call up historical background on people or places in the news.

InTV will also give viewers a modicum of control over the commercials they view. When a commercial break is coming, viewers receive cues on the screen. If the advertiser is a car maker, for example, would they prefer to see a message about a minivan, or a sports car? Push a button, and the selected spot airs.

However, a viewer can’t order a brochure or hook up with a car dealer by selecting the commercial since it’s not currently equipped for true two-way communication.

ACTV Entertainment President David Reese defended the service’s simple nature.

“We don’t want people to think about technology,” said Reese. “This is programming designed to take an existing service and make it better.”

Unlike other interactive TV trials taking place around the country, InTV doesn’t require a cable operator to make massive investments in powerful fiber optics or two-way digital technology to accommodate it.

That, said Imai, allows the company to get in on the ground floor, offering an interactive service years before more advanced technologies can get off the ground.

“We prefer to get the jump on it and do it now,” Imai said.

Reese said ACTV has been preparing for more than two years to introduce InTV to the United States. The company built the master control facility at Ventura County Cablevision’s Agoura Hills offices for $500,000 and bought around 1,000 cable boxes--at $200 each--to deliver the telecast. The master control room will serve as InTV’s Southern California emanation point.

Reese wouldn’t specify the terms of ACTV’s deal with Ventura County Cablevision. But he said that often the revenues from premium services are split 50-50 between the network and the cable operator.

ACTV chose Ventura County for the test because the region is relatively affluent, with a large number of families and high level of cable TV penetration. About 85% of the homes in the cable operator’s territory are subscribers.

Meanwhile, the Ventura County trial comes just as Ventura County Cablevision changes hands. Tele-Communications Inc., based in Englewood, Colo., has signed a deal to buy the cable holdings of The Chronicle Publishing Co., owner of the San Francisco Chronicle newspaper. The acquisition of Western Communications, Chronicle Publishing’s cable arm, is expected to close in January.

TCI is engaged in several interactive TV trials of its own. And it owns InTV’s programming partner, Prime Sports.

So has the time come when Southern California TV viewers will change their viewing habits of the past 40 years, abandon their roles as passive couch potatoes to be active directors of what they watch on TV and how they watch it?

Analysts point out that, while InTV gives viewers a choice of what they see, the number of options is limited. Its version of interactivity is kid’s stuff compared to the highly advanced interactive TV trials taking place around the country.

It’s possible that ACTV’s technology will serve as an interim method of providing interactivity, likely to be overtaken by other, more advanced methods in the future, said Peter Krasilovsky, a senior analyst at Arlen Communications Inc., a Bethesda, Md.-based consulting firm.

Jake Prescott, creative technology director of the advertising agency Ogilvy & Mather in New York, said his industry’s attention has shifted to the commercial possibilities on the World Wide Web, the easy-to-use graphics portion of the Internet, rather than interactive TV. “Interactivity is much easier with a personal computer,” said Prescott.

But many in the advertising community are very interested in interactive TV, said Doug Livingston, president of Western Interactive Media, the interactive arm of the giant media buyer Western International Media in Los Angeles.

Interactive TV, Livingston said, has the potential to deliver highly detailed information on the viewing habits, buying patterns and lifestyles of those watching. That’s more than current ratings and research can deliver.

“Everyone is very interested in the interactive side,” Livingston said. “It allows you to really know who’s watching.”