Interactive TV: Don't Repeat Web Advertising's Mistakes

Jeremy Lockhorn, who alternates writing this column with me, has been raving about interactive TV for a while now, and he’s giving me technology envy.

Jeremy, a newlywed, was somehow able to accumulate a bunch of hot stuff before getting married. I’m lucky if my wife takes me half-seriously for five seconds when I say something like, “You know, I think I’d like to buy a TiVo. It’s only $399!” As far as my wife is concerned, I watch far too much television. But I can’t help myself; I’m a born early adopter.

I know that if I weren’t married, I’d own just about every gadget and toy out there. You know my type: I’d waffle between an absurdly large mobile phone (because it has a huge screen for surfing the Internet) and an absurdly small mobile phone (because it is SO cool). I’d have the flat-screen 40-inch plasma display television and digital cable (not basic). My version of TiVo would be upgraded to Microsoft’s new Ultimate TV the moment it came out.

But I don’t have any of these things, because my wife is the voice of reason. She’s not only much more practical but also much smarter. And she does occasionally let me win and get something fun. Although now that I think of it, she uses our cable modem more than I do since she’s discovered eBay. Things might be changing.

First, it’s time to take a look at how these new media models are going to play out as they move past the early-adopter stage. Second, how can we circumvent the difficulties we’ve faced with Web-based advertising in these new mediums?

The Time Is Right

I am finally convinced that the time is right for interactive TV. Which means we probably have one to two years before our mothers have it. But all the single men you know will have it in six to eight months.

The definitions are still very blurry: Is TiVo interactive TV? What about Web TV? Maybe, maybe not. But I can see some very interesting things on the horizon:

• Wal-Mart is carrying the Philips TiVo unit, although Sony’s version matches my Wega television. (Like I said, sometimes she let’s me win.)
• Microsoft has built a new campus in the Bay Area to support its television ventures.
• Sun (finally) is getting into the mix.
• And AOL TV is rearing its head.

When AOL gets on board, you better start listening — right? Maybe. This product is for the typical early adopter — and AOL’s user base is NOT that. There’s no free CD for AOL TV. It costs $300 up front, and $24 per month after that. If you’re an AOL user already, you can get AOL TV for a low $14 per month — but that’s on top of your regular payment. Yes, you can check your email without leaving the couch — and you can chat right alongside the show you’re watching, which is very cool. But it’s pricey for the typical AOL user.

In fairness to AOL — I’m not worried. It’ll figure it out soon given its newly expanded cable empire lurking in the wings. You know it’ll build the killer app for its audience — the all-in-one personal video recorder, broadband set-top box, and Internet appliance with instant messaging service. It’s only a matter of time.

Learning From the Web’s Past

But when it does, how will we make this medium work for advertising? As you might imagine, I have a few suggestions:

1. Don’t set standards too soon.
We learned the hard way that the advertising industry has an uncanny ability to crystallize around standards and become inflexible. In my last column, I talked about the extreme financial pressures required to shake up some new ad standards. Stay flexible until you really nail it down.
2. Make sure that your advertising formats are intrusive but not obtrusive. Web publishers were overly worried about the user experience for too long. Early adopters won’t put up with much — they are notoriously fickle and hard to please — and Web publishers bought off on this group as their audience. The masses coming next will put up with a lot more, and the agencies will work hard to build ads that entertain as well as brand or drive direct response.

3. Make use of rich media inherently in your technology. Don’t expect simple animated GIF ads (or even basic Flash ads) to work when applied against a television background. Television commercials work because they interrupt the flow; this very interruption is a necessary thing in the television model. And make sure you get all sorts of transactions going right from the beginning. If we’re going to crystallize around something, let it be of value.

4. Cable modems are your market — broadband is required for this to catch on. Huge hard drives with room for dozens of hours of video will be the norm in the varied devices of interactive TV. Make use of it — load broadcast-quality interactive and fulfilling advertising into these spaces.

That’s it for this week. Go buy something online. Help the economy.