Collette Drives Interactive TV with Innovation

Cable World, May 1, 2000 by Karen Brown

As the SVP of marketing for a company in the infant interactive TV market, ICTV Inc.'s Michael Collette is essentially driving a new car down a dark road with no headlights. He may not be entirely sure where the road is, but he thinks he knows the general direction.

That direction is toward a voracious interactive TV market filled with competitors. He hopes his ICTV is one of the survivors.

"It's fascinating," he says of the market. "It's clear mere is a very large transition taking place, and it's clear there is a lot of inertia within the establishment in the industry. It is fascinating and exciting, though I think everyone in the industry wishes it could go more quickly."

Collette made his way to ICTV after stints with mainline pay-per-view operations, including TVN Entertainment, Playboy Enterprises Inc. and the former General Instrument Corp. At GI, he helped plan the launch of the cable equipment maker's Digicypher line, only to be frustrated when the rollout ground to a halt.

He left and started up his own new media consulting company. That increasingly required trips to the Silicon Valley and contact with -- Internet innovators -- including former Comcast Corp. president Bob Clasen. It was Clasen who lured him into a job at ICTV.

Easier route

ICTV is a provider of the platform for interactive broadband TV services. Competing in the same space as WorldGate Communications Inc. and Microsoft Corp.'s WebTV, ICTV's system uses open standards and works across many mainline digital set-top boxes. The company aims to be the easiest for cable operators to incorporate in their systems to offer the latest in interactive, including CD-ROM gaming, e-mail and Web surfing.

Just nine months ago, interactive TV was the source of wariness and outright ridicule -- famous only for being able to sell pizzas. Collette has seen a marked shift in perception in favor of interactive TV -- from inside the industry and even on Wall Street.

"I think the product is starting to mature," he said. "I think the industry is sort of tidal. People have been talking about it and exchanging ideas, and now they are deciding this is something worth pursuing."

Often, the synonym for interactive TV has been convergence. Collette maintains what you call it depends on where you stand.

"Convergence is a term used by the large, established companies to describe the crumbling at the edge of their business," he said. "Broadcasters talk about convergence. The people at heavy.com don't talk about convergence."

Instead, the operating word among the industry innovators is emergence, and Collette thinks these outfits will have an easier time building up a business than long-time companies will in trying to reinvent themselves.

ICTV hopes to stand with the innovators, and Collette says to expect some interesting things from the company in May -- though not necessarily timed with the National Cable Television Association convention.

"We're hoping to hatch a little bit," he said.

That won't be an easy task, given the fierce currents in the young interactive TV market. While interactive features such as Video on Demand, e-mail, enhanced ads and programming and even Web surfing are targeted, how they are delivered is still up in the air. A sort of architectural philosophical war is brewing, where one side favors delivering all the promised, fancy new interactive applications through powerful next-generation digital set-top boxes with relatively simple server systems. Others, like ICTV, side with the idea of putting the brains more in the system, allowing operators to funnel these services to customers with a mix of older, less-powerful boxes and newer units.

Competitive struggles

"That's a sort of natural clash," Collette said.

Another struggle facing interactive TV is the role of the Internet. Collette is one who thinks while its systems may be Internet-protocol based to access the Web, it may depend on private information highways for its actual delivery.

Collette sees applications such as Video on Demand being delivered through a network of servers located at cable headends, which cache content and direct services but are connected to a private network. Because of the erratic bandwidth and frequent snarls, flowing these heavy video files over the Internet is not practical.

"I envision a big, powerful, cool Video on Demand library where I sit down and for a $5 a month subscription I can decide what videos I want to watch," he said. "It mostly has to do with the economics and performance. I just can't deliver a quality service over the Internet."

Another recent trend is toward content that is technically complicated, but not to the user. Collette points to Traffic Cam, which allows viewers to check a live feed of major highways before they head out. Though a technical challenge to coordinate multiple live-feed cameras in real time, huge effort has gone into making it easy for the user.

"It's really part of daily life," Collette said. "It's not about engaging with or contending with the technology. It's all embedded. All you use is a remote -- which is a very complex thing but a very familiar thing to you -- and click on it to access it."