AOLTV forecasts a television revolution

Flopping down in front of the television, remote in hand, remains a favorite pastime of Americans.

But so far, attempts by the high-tech industry to make TV even more the center of American life - with games, online shopping, and e-mail - have been met with all the avid interest generally shown to cooking infomercials.

That may be about to change. Later this month, America Online will launch AOLTV, its version of interactive television. With its online community of 22.5 million members and its pending merger with TimeWarner, AOL could become one of the first to bring the new era of digital television to a broad audience.

"Whether it's AOLTV by itself that takes off like a rocket ship this year, or whether it's the combination of technological advances that will happen in the next year or two, it's going to happen at some point," says Stephen Jacobs, assistant professor of information technology at Rochester Institute of Technology in New York.

Proponents of Web TV extol its greater consumer choice and convenience. But the question is whether these virtues are enough to overcome a generally tepid consumer response to combining the features of the Net with the news and entertainment of television. Microsoft's WebTV, for example, has less than 1 million subscribers after about four years in the business.

But many believe this lackluster response will change as both technological advances and new players begin to push the market. About 2.2 million US households are expected to have some version of Web TV by the end of the year, according to Forrester research, a technology research firm in Boston. That number is expected to grow to 24.8 million by 2003.

In fact, as technology begins to change the medium, the differences between television and Web content could begin to blur. For one thing, digital technology will allow users to choose what they want to watch from a list - as if they were choosing a link on a Web page.

Times and scheduling, which almost define the TV experience today, will become less important, and users will be able to set their own schedules. In other words, a viewer could sit down with "The West Wing" or "Masterpiece Theatre" any time they have a hankering for their favorite show.

This scheduling free-for-all, which will be provided through so-called "electronic program guides," will be the first major new service offered, says David Nall, a telecommunications industry attorney with Squire, Sanders & Dempsey in Washington. "You can get the programs and events you want when you want."

In some cites, cable companies are already offering "video on demand," allowing users to order any movie they want over their cable box instead of going to the video store to rent a tape.

"So heck, if you can get that choice with more convenience, and if it's the same price, would you do it?" asks Steve Necessary, president and CEO of PowerTV, a digital set-top-box company in Cupertino, Calif. "Most consumers would say, 'Why wouldn't I?' "

AOLTV's new set-top box will come with a 56K modem, infrared keyboard, and remote. AOLTV will also combine some of the popular features from its online service with television. It will include instant messaging (a pop-up screen where users can type short notes to one another), e-mail, and access to the Web.

But the future of television will not simply be the ability to Web surf while watching a program.

As the media begin to blur, Web "portals" will offer their own kinds of video content, creating perhaps the biggest explosion of choice since the advent of cable TV. "The possibilities for content are practically endless," says Mark Stoever, a vice president of Lycos, a Web portal that recently launched its own video network. "For example, we can provide thousands of channels, or lost episodes episodes of sitcoms from the '60s, on demand. Traditional TV can't do that."

The nature of advertising will also change, says Mr. Jacobs. Just as viewers can determine their own TV schedules, so advertising will be individualized and tailored to a user's personal profile.

So, parents would be bombarded with toy and diaper commercials, while frequent travelers would get to hear Kathie Lee Gifford extolling the joys of a Carnival cruise.

Some even envision a future where people can order the clothing or jewelry or household goods they see on a particular show. Watching a "digital" soap opera, a viewer could purchase a blouse a star is wearing by simply clicking a pop-up window, choose the item from a list, and order it through the Web.

"Even for those of us who have PCs, interactive TV gives us an added convenience factor," says Mr. Necessary.

"If you're watching a show, and you see an ad for a particular car, you go, boom, and invoke the browser application, and learn more about it or even buy it."

But will consumers want all this? Some critics claim that interactive TV is technology that doesn't solve any consumer problems. They argue that it could simply end up being another version of the "blinking 12:00s" phenomenon, the VCR clock that people never know how to program.

Not so, says Necessary.

"This isn't technology in search of a market. It's either giving people more of what they want, or what they already have but in a more convenient locale," he says of the digital set-top boxes that will provide interactive television.

"And if I try it and I don't like it, I can just take it back."

(c) Copyright 2000. The Christian Science Publishing Society