However, according to several national surveys, consumers are much more interested in using emerging networks for information access, community involvement, self improvement and communications. The Benton Foundation's Communication Policy Bulletin 2 illustrates public sentiments also measured by the Mac World survey of October 1994. In fact in the Mac World survey consumers ranked video-on-demand as 10th among services most desired. However, what consumers want and what they are willing to pay for should be the prevalent issue for telecommunications companies to address.
| Ranking | On-line Capability | Would Pay $10/month or more |
|---|---|---|
| 1 | Vote in Elections | 20% |
| 2 | Search Reference Books | 22% |
| 3 | Distance Learning | 34% |
| 4 | Obtain Local School Information | 18% |
| 5 | Search Card Catalogs | 19% |
| 8 | Participate in electronic town hall | 13% |
| 10 | Video on Demand | 19% |
| 18 | Video Teleconferencing | 14% |
| 25 | Gambling | 4% |
The MacWorld data suggests that the consumers surveyed are willing to pay for Information on Demand and consider it a higher priority than additional entertainment services. The Benton Foundation's research illustrates similar public opinions. A survey of 1000 adults to evaluate public opinion on government policy with regards to the National Information Infrastructure revealed similar attitudes as to what use of the new networks should be.
- Government should support education programs that adults can use from home over a computer or two-way television, or that children can use to help them with their homework (70% support, 25% oppose).
- Government should require companies that profit from the new technologies to dedicate a part of their resources to supporting community uses and community access to government information (76% support, 18% oppose).
- Government should provide grants to help communities and nonprofit groups make new technologies available in schools, libraries, and hospitals (77% support, 18% oppose).
Another type of interactive television which has had limited success in the United States is Videotex." Videotex is any interactive electronic system which allows users to send data to and receive data from computers or other videotex users by means of a terminal capable of displaying text and pictures." Theories of Mass Communication The basic hardware that users of this system require is a client device, like a cable television box, or personal computer, that are connected via telephone or cable television lines to a server. This concept lies as the fundamental premise of the arrival of another form of interactive mass communication, the Internet. The World Wide Web provides a higher degree of interactivity than early video-tex systems provided and has enjoyed phenomenal growth. It is likely that a major telecommunications provider or cable television operator will offer full Internet capability with TCP/IP access to a large base of consumers within 3 years.
The necessary industry alliances are coming into existence to facilitate these services. Microsoft Corporation recently announced a strategic alliance with Sony, and TCI cable for interactive television services. The first of these service will likely provide consumers with computers high speed access to Microsoft's new information service. Sony, Microsoft near interactive-TV alliance. Consumers can now reach information providers like Compuserve with new modems that allow computer users to interface with an information provider via cable television. This new approach allows the user to take advantage of high speed communications that can be facilitated by the cable operators existing hybrid coax-fiber plants. LANcity Intros Cable TV Modem
This concept could soon go a step further in a directions that will bring these functionalities to consumers who do not have computers. Advanced set-top boxes, similar in concept to those that descramble signals now, can provide computer like capabilities that allow users to interface to these networks with their existing television receiver. Power TV Point and click capability common to multi-media platforms can be facilitated with a remote control giving users access to Internet type services like e-mail and the World-Wide-Web. Commercial services could potentially pay for these capabilities as it will be possible to conduct banking on-line, and engage in commerce from the home.
| Service | Revenue | Other Markets | New Markets |
|---|---|---|---|
| Plain Old Telephone Service | $96.5 Billion | ? | |
| Long Distance | $40.2 Billion | ? | |
| Local Wireline | $40.2 Billion | ? | |
| Wireless | $10.0 Billion | ? | |
| Cable Television | $30 Billion | ? | |
| Broadcast TV | $27 Billion | ? | |
| Home Video | $11.0 Biilion | ? | |
| Theatres | $7 Billion | ? | |
| Broadcast Radio | $8.5 Billion | ? | |
| Records/Tapes/CD's | $7.5 Billion | ? | |
| Print Advertising | $37 Billion | ? | |
| Postal Services | $25.2 Billion | ? | |
| Video Arcade Games | $7.0 Billion | ? | |
| Video Games Software | $6.0 Billion | ? | |
| T.V. Shopping | $2.5 Billion | ? | |
| Information Services | $2.0 Billion | ? |
Broadband networks will give the telecommunications industry an opportunity to capture a portion of a potential $140 billion annual market that already exists. Getting dollars flowing through the networks is the primary motivation. Companies with broadband infrastructure can generate revenue from providing connectivity to subscribers, information-service suppliers, and by charging overhead by capturing a percentage of commercial transactions over their networks. New services yet to be conceived also offer potential to generate substantial revenue.
Perhaps the most lucrative market for the telecommunications industry to tap lies in the nation's educational industry. "The nation's school and industry together spend between $400 and $600 billion per year on education and training, an activity that is 93% labor-intensive, with little change in teacher productivity rations since the 1800's." Informedia Digital libraries will allow independent self-motivated access to information for learning, exploration, and research. Potential new technologies could bring about a revolutionary improvement in the way education and training are delivered and received.
Hypothesis
The data illustrates that there is an economic case for telecommunications providers to consider the primary motivation for building broadband networks to be a delivery system for information on demand. Previous experiments in Interactive television has demonstrated that content is the key motivation for consumers to utilize information on demand services. Vast digital libraries will soon have to become available on this infrastructure in order to meet demand. The telecommunications providers will find the most challenging aspect to be building content for the digital libraries that consumers are willing to pay for.
Informedia
Informedia is a research project at Carnegie Mellon University funded by the Federal Government and private industry to explore the development of digital libraries. Informedia has been commissioned to deploy a digital library which will encompass 1000 hours of raw and edited program assets from public television stations, schools, and other universities. The content of the library can be enriched with resources drawn from the Internet and other sources of information. There are several significant problems to overcome in the development of a digital library. Informedia must prototype tools to automate the process of building digital libraries, and deal with the problems of content storage, retrieval, and distribution over broadband networks.
The process goes beyond existing systems for re-mastering video into digital format, as intelligent software can analyze the video to derive additional information about it's content. Video consists of images and audio which in context is a communications process. With Informedia, computers converting materials to digital format, explore the information for content. Audio components are converted by speech recognition systems into a transcript, and are accordingly indexed to each frame of video. Thirty frames of images per second are also explored for Information. Information hidden in the images like words on the screen or within objects are also captured and related to the frame index. Other artificial intelligence research may be able to go a step further, utilizing technologies like semantic nets, to recognize objects like cars, people, or computers adding to the depth of the index.
Image understanding techniques are also employed in the segmenting process. Segmenting is a technique for organizing the data so that it can be stored in a manner from which it can be efficiently retrieved. Video sequences are arranged like paragraphs, Informedia mechanisms automatically locate boundaries for shots scenes and conversations. Storing the information in segmented format allows for additional utilities to be deployed which add considerable functionality with regards to retrieval of the data.
The Time-Warner project in Orlando, is the nations first full service interactive network. FSN trials are offering consumers a broad range of services, including 500 cable channels, and true video-on demand. Consumers will be able to take advantage of Information on Demand Services in the near future.
Many future applications that will become available to customers
of the Full Service Network next year were also shown for the
first time. These include: educational applications such as
access to a local public library; Shoppervision grocery shopping
service; Sports Illustrated's sports on demand service; HBO's HBO
on demand service; Time Inc.'s The News Exchange, the world's
first news on demand service; US WEST's Go TV and U S Avenue
services; the Warner Magic Music Store for the purchase of
recorded music; and Warner Bros.'s Omnio navigator, which also
will be tested as a gateway to the network.
Time Warner's network in Orlando is based on fiber-optic transmission technology, and is the first large scale implementation of broadband technology in the context of information on Demand. Other broadband technologies are under exploration which take advantage of existing telecommunications infrastructure, compression and transmission protocols. According to the acessment in the Mac World, most telecommunicatons companies plan to build interactive-TV systems over the next decade based on the concept of super-cable TV, offering 300-500 channels and limited video on demand services. One fiber-optic cable will be connected to 500 or more homes via coaxial lines. Unfortunately this model lacks the switching mechanims and dowstream capacity needed to faciliate information on demand.
Information on demand, which emphasizes communication over entertainment services, could be implemented with broadband technologies like Integrated Services Digital Network (ISDN). This takes advantage of existing telecommunications capacity as it could be implemented on copper mediums. Unfortunately, ISDN lacks the ability to deliver full motion broadcast quality video, required by the multi-media component of true Information on Demand models.
It is unlikely that the telecommunications companies will build the fully switched fiber-optic networks that would supply enough upstream and downstream bandwidth to support elaborate Information on Demand Services in the immediate future. Several technologies that are being explored show promise. Delivery Systems for Information on Demand