Interactive TV inching forward in the U.S.

April 29, 12:22 PMMedia Industry ExaminerJudah Freed

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When I first began writing about interactive television for media trade magazines back in 1993, the enthusiastic expectation within the cable industry was that interactive TV would be in homes almost overnight.

By 1996, fantasies about the "Information Superhighway" evaporated as reality sunk in. When cable  executives announced that constructing the nationwide digital infrastructure would take another five years, the interactive TV market crash.

Investment capital immediately shifted to the newly emerging Internet until the "dot com" bubble popped in mid-2001, followed by the general market crash after the 9/11 attacks.

Meanwhile, the cable industry has continued working steadily toward full deployment of interactive TV services. The Issues resolved along the way include set-top box operating systems and middleware, creating an standard graphical interface for all interactive TV application on cable, developing customer service interfaces, building back-end provisioning systems, and integrating digital video recorders into the set-top boxes.

Cable also faced a broad array of difficult "interoperability" issues between proprietary applications for pay-per-view, video-on-demand, data-on-demand (like weather or sports scores), games, homes shopping e-commerce, interactive advertising, and so on.

While Europe and Japan and even Canada leapt years ahead of the U.S. in deploying full interactive TV services, American cable operators decided (rightly or wrongly) that interactive services had to be introduced into the marketplace gradually. Cable execs feared alienating potential customers by introducing too many innovations too fast.

Therefore, based on this cautious thinking, cable inched forward by progressively adding interactive program guides and then video on demand. Only lately have data-on-demand services and games begun to gain any traction in the digital tier of cable services. Interactive advertising also is gaining ground, even if too slowly for some tastes.

Interactive TV is poised for in important breakthrough, in my opinion, as cable begins later this year deploying the tru2way (formerly called OpenCable) software platform that enables digital set-tops, digital TV receivers, sets and other devices to access cable’s two-way, interactive capabilities.

Leading this effort, as with most of the technical innovations in the industry, has been CableLabs in northwest metro Denver. You can learn more about true2way if you are attending the 2009 NCTA Cable Show in Washington DC this week. Visit the CableLabs exhibit and say farewell to retiring CEO Dick Green.

All that said, I hesitate to predict when cable customers will soon enjoy full interactive TV services.  if I've learned anything from more than 15 years covering the media trade, it's that planned innovations always take longer to penetrate the marketplace than the planners expect. (In contrast, the unforeseen innovations, such as peer-to-peer file sharing, tend to burst onto the scene with exponential growth.)

At the same time, I'd be remiss here if I limit the discussion of interactive TV to the cable industry.

The telephone industry is gradually rolling out IPTV video services over fiber and copper wires on the eastern coast and other parts of the country. Where available, these IPTV services are competitive with cable, and interactivity is built into most of these services from the get-go.

The digital broadcast satellite (DBS) services, DirecTV and Dish, have long offered interactive program guides and their own form of video-on-demand, but they've been limited as a one-way transmission system except where their set-top boxes have been equipped with phone-line return paths to accommodate digital video recorders.

This situation could change now that the DBS services are launching Ka-band satellites with two-way spotbeam capabilities. I do not expect Dish or DirecTV to take advantage of this two-way capability any time soon, though, because it would require customers to swap out their old receivers and dishes for new ones, which is a harder task than with cable, which generally rents its home equipment instead of sells its equipment like the DBS services.

And finally we come to terrestrial broadcast television. Broadcasters are now making the switch to all digital digital signal this year. June 12 is the final deadline. although some cities are switching earlier,such as Denver, were the transition happens on April 16.

Sadly broadcasters have missed a tremendous opportunity to introduce interactive services into their digital broadcasts as part of the transition. The set-top converter boxes have no interactive capabilities beyond a basic program guide.. Further, broadcasters have no industry-wide plans to work with the consumer electronics industry the near-term addition of interactive capabilities to convert boxes or digital TV sets. 

If U.S. broadcasters would look outside our borders to places like the UK, they would see that interactive services can be delivered very effectively within one-way broadcasts by embedding interactive elements into the signal for activation within a set-top box or digital TV receiver. The inclusion of a phone line return path would give broadcasters two-way interactivity.

But U.S. broadcasters can't seem to think outside their box, unfortunately, at least, not very far outside their box.  If you are going to the NAB Show in Las Vegas this month, look around and see for yourself.  If you see any mainstream interactive TV services from broadcasters, please let me know, and I'll happily report your finding here.

So, my conclusion is that interactive television services in the U.S. are still inching forward as the rest of the developed world in Europe and Asia surges ahead. We like to think of ourselves in America as the  technological leaders of the world, but interactive TV is one area where we are lagging behind.   

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