Digital Media Perspective 941223
December 23, 1994
Table of Contents
- Editorial: A Red Line in Cyberspace?
- The Top Ten digital media events of 1994
- Sexist Netiquette
- Cable customer service: Is it ready for interactivity?
- Kaleida's ScriptX: It's late but ahead of its time
- Inside the Current Issue of Digital Media: A Seybold Report
Editorial: A Red Line in Cyberspace?
by Mitch Ratcliffe
We were troubled by one aspect of Time Warner's announcement last month of its full service network in Orlando, Fla. The broadband network, which will host movies-on-demand, shopping and, eventually a variety of data services, will probably not reach the poor and middle-income families in the giant cable company's service areas for many years, at least not until after high-income customers make the full service network a profitable venture. If we accept that information is power, the wealthy will be the first to drink from the flood of broadband services.
The full service network will "help crack the consumer code," according to Dan Stanzione, president of AT&T's Global Public Network Systems business unit. Orlando is the first exercise in micromarketing, as each member of a household's media usage can be tracked for clues to their purchasing habits. The actual shape of the FSN will change considerably as Time Warner tunes its offerings to the realities of the market. What was shown in December was merely the first iteration of a selection of services that will likely be tempered by the shifting sands of the economy, not merely the willingness of consumers to purchase access to movies and high-priced consumer items from The Sharper Image.
But consider the FSN scenario described by Time Warner. It proscribes a level of spending that is utterly unreasonable for most homes. Say folks on the Orlando network were to use the network to watch a movie and purchase $20 in products three times a month; with a total of ten hours of gaming and the basic service cost, their cable bill will total around $125 a month. Moreover, how will the individual household's ability to live up to this model change as the next recessionary wave hits?
Levin said the success of Time Warner's widespread deployment of FSN technology to its entire customer base of nine million homes (after the completion of the company's acquisition of Advance/Newhouse and Summit Communications' cable networks), is ensured by a "clustering strategy."
During Levin's tenure, Time Warner has purchased cable systems in affluent, high-density markets that he said guarantee profitability for the full service network. Perhaps ten percent of the households in the U.S. can fork out $125 each month for media and tchochkes (like the ever-so-useful Warner Bros. hats Levin purchased during the demonstration of the network). They've bought a profitable market, but at a tremendous social cost; Time Warner has no motive to extend these services to households that can't afford the high cost of interactivity.
What Levin unapologetically described is digital red-lining. When asked about the benefits of the network, Time Warner executives said they could have come to the debut of the FSN with "philosophical" stories about the use of the network in schools and libraries, but out of an obligation to pragmatism had not. "If this nation wants to see this kind of system constructed, it will be financed by movies and advertising," Levin said testily.
Perhaps so, but a mass market cannot be built on a 10 percent share of the population. That's the lesson any information company hoping to cater only to the wealthiest households will learn posthaste.
(For a complete report on the Time Warner network, technology and programming, see the January, 1995 issue of Digital Media: A Seybold Report.)
The Top Ten digital media events of 1994
by Digital Media staff
This was the year that was; one in the long march toward a different, digital environment. No individual event signaled the transition from an analog to a digital reality, but the ten we chose do point to a decisive fragmentation of the old economy. Battle lines were drawn and long-standing assumptions about the Way Things Work collapsed weekly throughout 1994. In 1995, we think you'll see these stories, presented in no particular order, have a major impact on the development of electronic markets.
DIRECT BROADCAST SATELLITE DEBUTS
Consumers can't get their hands on these pizza-size dishes fast enough. Retailers report that they've already sold nearly 400,000 RCA and Hughes dishes, at around $800 a pop. On top of that steep entry price, subscribers must pay a monthly service fee ($30) for up to 150 channels and for pay-per-view events. The message is clear: People want control of their viewing choices and are sick of the cable companies' steep prices for relatively limited service.
FCC SPECTRUM AUCTIONS
In late summer, the FCC rung up $617 million in revenues from the sale of narrowband Personal Communications Services (PCS) spectrum. As the year drew to an end, another $20 billion may be on the table for broadband PCS bandwidth that will enable everything from voice to video communications. This category of service will explode around the turn of the century, but as much as $70 billion in PCS investments are already in place.
MICROSOFT OFFERS TO BUY INTUIT
Bill Gates dangled $1.5 billion in front of his most vexing rival, Intuit Inc., makers of the Quicken personal banking application, and they bit. Now, Microsoft has a virtual lock on the home banking and transaction market, owning as many as 90 percent of the installed software base. The software company also cemented relationships with bankers and bank card companies, most notably VISA, to tie in credit and debit card capabilities in its Windows 95 operating system. We've bet an expensive dinner that the Department of Justice will make this acquisition a difficult and drawn-out process.
THE MICROSOFT NETWORK IS NO MARVEL
The crux of Microsoft's aspirations is its online network, once code-named Marvel, now known as the Microsoft Network (for legal reasons). Gates and Co., including new partner Tele-Communications Inc., which forked out $125 million for 20 percent of the network, think they have the key to online software and retail sales. But, with the delay of Windows 95 -- which provides some critical hooks for the Microsoft Network services -- competitors have a year to prepare for this formidable competition. We believe the Microsoft Network will appeal most to newbies, as old-time online folk have already settled into their virtual neighborhoods.
HOLLYWOOD DOES THE BABY BELLS
Without content a network is, well, empty. That's why the babies Bell have been spending so much time in Hollywood this year. Conversely, Hollywood sees interactive networks as a major new source of revenue from its current and future productions. In August, Ameritech, BellSouth and SBC Communications Inc. (formerly Southwestern Bell) signed a memorandum of understanding with the Walt Disney Co., which will develop interactive services interfaces for use on the telephone networks. Disney chairman Michael Eisner doesn't see the information highway as a road paved with gold, so he's holding off on developing interactive content, but he's happy to be paid for developing these Bell services. Likewise, Hollywood super-agent Michael Ovitz, of Creative Artists Agency, will advise two companies formed by Bell Atlantic, Nynex and Pacific Bell to develop interactive programming and technologies. CAA clients will likely be connected to the Bells efforts by Ovitz. Notably, recent studio magnate-wannabe (and, in fact, magnate de facto) Steven Spielberg, who is one corner of the as-yet-unnamed Dream Team studio triad with Jeffrey Katzenberg and David Geffen, is a CAA client.
SEGA AND TCI PARTNER ON GAMING NETWORK
The collaboration of Sega and TCI to create the Sega Channel is the first real-world venture that will deliver content for home game systems over cable. It will also be the first to make money with online game delivery, well before non-trial ITV systems are deployed. Considering TCI's investment in the Microsoft Network and the Sega Channel, it's clear the cable company is rethinking its programming strategies to fit the interactive age.
VIACOM ACQUIRES PARAMOUNT AND BLOCKBUSTER
Billionaire Sumner Redstone has more creative, network and retail resources in his hand than anyone at the interactive entertainment table. With Paramount and its subsidiaries, the cable giant leaped into film production and publishing; Blockbuster Entertainment, which Viacom snapped up in the wake of the Paramount deal, is an outstanding channel for all the products -- on vinyl, CD, CD-ROM, videotape and celluloid -- that Viacom controls.
NETWORKMCI GOES MAINSTREAM
Late in November, the Internet as we know it came to an end. It was transformed by the introduction of internetMCI, an easy-to-use collection of browser and shopping services from the nation's Number Two long distance carrier (see Digital Media Perspective 94.12.01). Combining its network with Netscape Communications Corp.'s browser and secure server software, MCI will be the first to offer a bundle of robust TCP/IP services to the masses, with huge television advertising support.
AT&T BUYS MCCAW CELLULAR
Eleven-and-a-half billion dollars later, AT&T is the largest cellular carrier in the U.S. The combination of AT&T's long distance network with McCaw's extensive wireless network is an opportunity for what's left of Ma Bell to re-enter local service business (this time sans wires), and to build a robust nationwide PCS system a half decade before anyone else. More than a year ago, AT&T executives told us they expect to offer not just voice and data services to handheld devices, but videoconferencing and interactive television services over McCaw's network as well.
SPRINT AND CABLE COMPANIES UNITE TO GO WIRELESS
A joint venture between Sprint, Tele-Communications Inc., Cox Enterprises and Comcast Corp. plans to deliver PCS services to the set top box. Sprint's long distance network will provide the links between regional cable networks owned by TCI, Cox and Comcast. Consumers will be able to tap the network via handheld and portable devices around the house that communicate through the set top box that controls their interactive television system. The cable companies will also install local wireless network nodes to complement Sprint's extensive cellular network service to roaming customers.
Sexist Netiquette
By Margie Wylie
Netiquette is sexist. The informal etiquette of the Internet not only discourages female participation on-line, but its rule structure also tends to squelch the voices of the few women who insist on speaking up, Susan Herring, a linguist from the University of Texas has found.
Herring says her studies reveal women and men have different ideas of what constitutes appropriate Net behavior. Netiquette supports more typically male communication patterns.
An outgrowth of the scientific community and of hackers' interest in talking to one another, the Internet's libertarian survival-of-the-fittest ideals codify men's speech patterns as the norm for Internet discourse. The aggressive, winner-take-all attitudes of netiquette don't appeal to the way women communicate. While women tend to create shorter posts that ask questions, hedge, seek consensus and encourage other points of view, men's posts tend to run much longer, use strong assertions, challenges and authoritative statements. That in itself keeps women away from conversations that they find insulting or simply exclusionary.
But even when women do join conversations, they are effectively kept at arm's length through conventions codified by netiquette. Women's posts are often met by flaming, long point-by-point rebuttals that pick their messages apart and strong assertions that don't seek additional input but ring with finality. Netiquette rules tend to authorize insults and criticisms as proper, so long as one allows one's adversary an equal and opposite blow. Plus they usually prohibit emotion and advocate "self-control."
Some netiquette rules also prohibit polite language. "Usenet guidelines actively discourage appreciative and supportive postings in the name of reducing message volume," Herring writes.
Most often, however, women's posts are answered with dead air, silence. Women's attempts to initiate new threads get significantly fewer responses than threads started by men, Herring's and other's studies have borne out. The answers they do get are shorter and their threads die more quickly than do male-initiated threads.
Women can fight back, however. In one documented conversation, Herring found that when women posted persistently, identified "silencing" behaviors in their posts, appealed to other women to speak up, and re-posted threads that had been ignored asking why there was no response, they were able to contribute more than 30 percent of the conversation. (It should be noted, however, the studied conversation were linguists familiar with studies on silencing, they were self-identified as feminist or supporting feminist ideals.) Linguists have found that when women contribute more than 30 percent of a conversation, analog or digital, they are perceived as dominating the floor.
Whether you think the Internet is the perfect model for the future of cyberspace or a poor model, it's well on the way to becoming the default model. Hundreds of books and a few magazines, like WIRED, are enshrining Internet culture in the popular consciousness.
Professor Susan Herring has two papers on sexism on the net due to be published in upcoming books by the University of California at Berkeley's Linguistic Society and by SUNY Press in Albany, New York. For other papers and bibliographies on woman in cyberspace, check out Yale University's The ADA Project at
http://www.cs.yale.edu/HTML/YALE/CS/HyPlans/tap/tap.html
(The January, 1995 issue of Digital Media: A Seybold Report features a more complete look at this issue.)
Cable customer service: Is it ready for interactivity?
by Neil McManus
I recently got the first phone call I have ever received from my local cable company. What prompted it? The cable company wanted to know why I had decided to return my cable box. That same day, I got a newsletter and a postcard from the Prodigy online service. The newsletter provided a number of tips on how to use the online service. The postcard was one of several I had received from Prodigy offering me additional tips and thanking me for subscribing to the service. A few weeks earlier, I had received a phone call from a Prodigy customer service representative reminding me that if I ever needed help with the service, I could call Prodigy's 24-hour toll-free help line.
Cable companies are going to have to change the way they provide customer service when they move into the interactive age, and Prodigy is a good example to follow. The reason is that cable companies have to change to survive the crumbling of their monopoly status. A customer only has to decide to subscribe to cable once. But with an interactive service, like Prodigy and interactive television, she could make hundreds of small purchasing decisions a month: "Should I pay for this stock service? Should I subscribe to this online newspaper? Should I order flowers for my mother? Should I click into this advertisement?" This is where tip-sheet newsletters and postcards can come in handy, along with relentless online marketing.
At this month's Western Cable Show in Anaheim, Lynn Elander, director of product development at Cox Cable Communications, pointed out another reason why cable companies have to revamp their customer service for interactivity. "There's a different level of customer involvement and customer expectations in [interactive] services," she said. "Our [cable] customers don't really expect us to know how the special effects in Forrest Gump work, but it may be that our customers will expect us to be able to tell them where the backdoor is that will get them from level 2 to level 8 in a video game."
Cable networks are learning about interactivity by setting up forums on commercial on-line services. (Prodigy alone hosts more than 30 cable networks.) For cable providers it's not that easy. Some providers, such as Time Warner and Viacom, are conducting ambitious interactive television tests. Others, such as Continental Cablevision, Jones Intercable and Comcast, are experimenting with cable modem services, which let home PCs connect to online services at high speeds through the cable wires. Online services, such as Prodigy, are goading cable providers to move cable modem services beyond technical trials and into the marketplace. One carrot they can wave in front of the cable companies -- beyond the promise of new revenue streams -- is that offering cable modem access will be a real education in providing customer service in the interactive age. The stick? Without this level of customer service, people will look elsewhere for an interactive television provider.
Kaleida's ScriptX: It's late but ahead of its time
by Stephan Somogyi
With much media fanfare, Kaleida shipped its long-anticipated ScriptX development kit and the 1.0 version of the Kaleida Media Player (KMP) for Macintosh and Windows on December 19th. Now that Apple and IBM's three-year-old start-up has finally borne fruit, the question is whether or not developers will bite.
Kaleida's authoring environment is remarkable for its ease of use, particularly when it comes to upgrading an existing ScriptX title. New material can be dropped in without substantial rewriting, because every element is an object. This will be useful for developers who need to make frequent changes to a title rapidly. For example, a monthly CD-ROM-based magazine could strip content out of an established interface and add new material, including animated characters that adapt to the graphics of the interface.
ScriptX is an object-oriented authoring language that builds upon a rich set of so-called "core" classes that provide a high common denominator feature set for ScriptX-based development. ScriptX itself is an interpreted language, translated from a human-readable form to binary code that is interpreted at runtime. Since the core classes are compiled code and aren't interpreted, Kaleida expects performance of ScriptX titles to be high because the interpreted code spends a lot of its time calling the compiled core code.
However, Kaleida's rosy performance estimates are tempered by another ScriptX "feature," the resource requirements of the KMP. On a Windows machine, the KMP needs 3.3MB of RAM just for the basic runtime -- a title's requirements must be added. On a Mac, a 2.9MB RAM partition is required for the KMP alone. The hard disk footprints aren't much slimmer: 2.5MB free space is require for the Windows KMP, 1.7MB on the Mac. The ScriptX development system on both platforms strains available resources even more.
What's particularly strange about the Macintosh support is that neither the Kaleida Media Player nor the ScriptX development tools are available in native Power Macintosh versions -- 8 months after the first Power Macs shipped to customers. Given that Power Macintosh is such a great authoring and playback platform, and is strategic to Apple's long term business to boot, this omission seems incongruous.
Finally, the myth of "author once, deliver many" has been debunked over and over again as impractical, and it can't be different with ScriptX. Even Macromedia has had to deliver Director for Windows, partially because of the growing number of Windows-based title developers but also because titles authored on a Mac need some final palette polishing and other tweaking for the Windows environment. While ScriptX provides a layer of abstraction between a title and the operating system, today's reality necessitates some knowledge of the delivery OS and hardware at the authoring stage. Propagating the myth of portability-for-free undermines Kaleida's believability.
The personal computer industry has shown again and again that the best technology doesn't always win. ScriptX, despite its limitations, looks to be truly innovative and well thought out. However, it's late -- having already missed the first boom in the CD-ROM market -- and its resource requirements are huge. Until the ScriptX runtime is built right into playback devices, Apple's recently announced Pippin game platform and PowerPC-based settop boxes from Scientific-Atlanta come to mind as potential candidates, and its memory requirements are scaled back (or RAM prices drop, whichever comes first), the number of devices that can play ScriptX titles are limited. And since developers have to sell thousands of copies of their titles to make money, this is not a good match.
Kaleida has shipped ScriptX, for which it is to be applauded. The battle has just begun, though. Without more tools and major developer adoption, ScriptX may wind up another footnote in the annals of technological innovation. Given all of ScriptX's capabilities, that would be a tremendous shame.
Inside the January Issue of Digital Media
Part two of "Hollyweb Babylon," where we sort out the spaghetti plate of alliances, mergers, acquisitions and interests that are Hollywood and Silicon Valley. This installment looks at the telephone industry from Hollywood's perspective;
An extended examination of the gender politics in the on-line world, where women by all measures compose a slim percentage of connected folks and thus face serious marginality in the information age;
Analysis on the transition from the regulated telecommunications environment to the open market and who's going to be calling the shots, federal or state regulatory bodies;
An up-front investigation that we will get flamed but not fired for: the "adult" title industry and its relationship to high technology markets;
A first-hand report on Time Warner's Full Service Network launch in Orlando, which, after a year of delays, looked like the Michael Huffington of ITV: hyped, ballyhooed, and not really there;
Scrutiny of home gaming systems' hardware and prospects for 95;
A review of Nickelodeon's Director's Lab CD-ROM, a truly interactive title that lets kids make their own fun;
A futuristic view of an "on-line personality" in the Note from the Chief;
The Good Stuff: A list of Things Digital Medians Should Know.
Digital Media: A Seybold Report, the monthly paper newsletter that sponsors Digital Media Perspective, brings its readers the most provocative analysis of the developing industry for interactive titles, smart networks and broadband applications. We turn an eclectic eye to the stories of the day to provide a more informed perspective with which readers can judge new technologies, new competitors and the assumptions driving the growth of the electronic economy. We question everything, and bring back the hard facts.
Digital Media: A Seybold Report is available monthly for $395 a year; individual issues are $40. Call 800.325.3830 or send email to info@digmedia.com for information on how to subscribe.
Who We Are, Where to Reach Us
Digital Media Perspective is a twice-monthly electronic newsletter
produced by Digital Media: A Seybold Report.
- Publisher: Jonathan Seybold
- Editor in Chief: Mitch Ratcliffe (godsdog@netcom.com)
- Editor: Neil McManus (neilm@netcom.com)
- Managing Editor: Margie Wylie (zeke@digmedia.com)
- Senior Editor: Stephan Somogyi (somogyi@digmedia.com)
- Editorial Assistant: Anthony Lazarus (lazarus@digmedia.com)
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Copyright (c) 1994 Digital Media: A Seybold Report. This electronic newsletter may be freely duplicated, reproduced or retransmitted, but only in its entirety. Excerpts used for the purposes of quotation must be attributed explicitly to Digital Media Perspective.
