Technology and Interactive Television
by David M. Schwartz, CEO,
ImaginOn, Inc. 11 May 1998
Concept of iTV
Since its inception, television has been a broadcast
medium aimed at a passive audience whose only choices
during viewing are changing the channel or switching
the TV set off. Advocates of advanced television
systems have proposed fully interactive TV ("iTV")
that will allow viewers to play games with other people
or with a video game software program, shop for merchandise
and purchase it, navigate and view remote locations
anywhere on Earth, participate in classrooms, direct
the outcome of theatrical presentations, select any
movie and watch it anytime, and so on and so forth.
There has been no lack of ideas regarding desired
capabilities and content for iTV.
There are at least three types of obstacles barring
the path to iTV implementation: technical, economic
and regulatory. This paper will not consider
the regulatory barriers, on the assumption that if
the technical and economic barriers are overcome,
suitable regulatory accommodations will be made.
The economic obstacles are arguably the most formidable
at this time; affecting all aspects of iTV.
Many of the technical barriers to iTV implementation
have been hurdled in either field or lab demonstrations,
though some troublesome issues remain.
The technical problems related to iTV that have
been solved include head-end system speed, bandwidth
and storage, user back-channel systems, TV set-top
boxes, user interfaces and internet connectivity.
Among the biggest technical problems that remain are
distribution channel bandwidth and user-feedback latency.
Although brute-force solutions to distribution channel
bandwidth and user-feedback latency are conceivable,
they are so far from practical as to remain technical,
not economic, issues.
bandwidth limitation of coaxial cable or hybrid fiber/coax
distribution systems is presently at about 500 digital
TV channels encoded using MPEG 1. For iTV applications
such as movies on demand or home shopping, this number
of channels is probably sufficient. Two-way
oriented applications, such as World Wide Web browsing
and chatting, quickly consume all 500 channels, even
at relatively low 128 kbps connection rates, allowing
only 10% of a 50,000-customer cable system to be online
simultaneously. 3D video games consume a channel
per user, allowing only 500 simultaneous users, unless
the game is downloaded to the set top box. Interactive
classroom and remote viewing applications fall somewhere
in between video game and internet bandwidth requirements.
feedback latency in two-way communications is highly
variable among trial iTV systems and demonstration
systems. A few iTV systems have demonstrated
round-trip response times of as little as 50 milliseconds,
while many systems average over 500 milliseconds.
For almost realtime iTV applications such as home
shopping, latency is not an issue. For other
applications, such as multi-user video games and internet
telephony, this factor is one of the keys to user
To date, the economics of iTV have discouraged commercialization.
Only one limited form of iTV, movies on demand, has
proven economically viable in some markets.
Cable and satellite distribution system owners have
not been able to find a business model that justifies
the costs of the upgrades and new capital equipment
required for iTV. Presently, the economics are
marginal at best. For example, for a 50,000
customer overhead cable plant in a suburban area,
the estimated cost of upgrading the plant, plus new
equipment and set top boxes is about $500 per customer.
Such a system can provide users with "500 Channel"
two-way digital service. Assuming that a 20%
annual return on investment is acceptable, the cable
operator must find a way for the iTV system to generate
$5,000,000 per year of net profit. Clearly,
the customer base can not be counted on to provide
the entire ROI needed, though they might carry half
the burden. The other half would have to come
from advertisers or channel sub-licenses.
the fundamental problem of paying for the upgrade
or conversion of the plant, is the content problem.
Two obvious sources for interactive content, films
and the internet are readily available, with known
price structures. Beyond those, content sourcing
at reasonable cost is an open question. Existing
home shopping service providers, such as QVC, do not
offer any method of increasing interactivity beyond
the telephone dial-in already in use. Interactive
adult video content is either internet or CD ROM-based
and does not have any iTV-specific application.
games are only practical for iTV if the game software
can be downloaded and executed on the set top box.
However, very few video games have been ported to
any set top box environments. Multi-user head-end
server-based games are few and far between.
learning systems are presently all PC-based, with
no provision for iTV support. Price aside, there
isn't much iTV content available.
The economics of iTV will improve over time in
at least four ways. The costs of the physical
plant upgrades and additions will continue to decrease
as all computer-based and computer-related products
decrease in price. Improvements in the quality
and quantity of interactive content for use in the
new channels will become compelling enough to generate
premium usage fees. Innovative methods for delivering
advertising embedded within iTV programming will attract
more advertisers. Methods for increasing the
efficiency of bandwidth allocation and maximizing
the usage of the new channels will be implemented.
ImaginOn software technology impacts iTV economics
in three of the four areas mentioned above.
On the content creation side, ImaginOn software tools
reduce the production cost of original interactive
content based on film, video or animation. These
same software tools can be used to re-purpose existing
film, video or animation assets for interactive use.
"Mining" existing archives of film and video can yield
large numbers of iTV programs in a short period of
time, since no new production is needed.
movies made with ImaginOn's software tools consist
of hundreds of short clips that are assembled together
in real time. During playback, the viewer's
position in the timeline of the movie is recorded.
Advertising or promotional clips can be spliced into
the movie anywhere that makes sense, at any time.
This combination of known user position and instant
splicing makes "just in time" highly-targeted advertising
possible. For example, ImaginOn movie playback
software can be linked to an advertising sales function
so that the actual number of viewers approaching a
scene in the movie can be used to offer an upcoming
advertising slot only minutes before the ad will be
aired. The highest bidder for the slot gets
their ad dropped in on-the-fly. For iTV systems
with internet connectivity, ImaginOn playback software
displays an on-screen "Go On Line" button that instantly
pauses the movie and connects the viewer to whatever
website is paying to be shown at that point in time.
every customer of an iTV system should feel like they
have control over what they see and when they see
it with the fastest response time available.
With 500 channels available, full frame-by-frame forward,
reverse and pause video control of movie playback
by each viewer in a 50,000 customer system is impossible,
since each person would need their own separate video
stream. Aggregating viewers into groups by assigning
movie playback starting times is the typical solution.
ImaginOn software provides a powerful new method for
conserving bandwidth during playback of interactive
movies by a multitude of viewers: looping. As
discussed above, movies produced with ImaginOn tools
are composed of numerous short clips strung together
in real time. Any of those short clips can be
seamlessly looped. When a film clip is designed to
be a seamless loop, it is relatively unobtrusive and
useful from both the cable operator's point of view
and the viewer's. On the operations side, film
loops provide locations in the video stream playback
where multiple asynchronous video streams can be re-synchronized
on-the-fly. For example, two video streams offset
by 1 second can be re-synchronized during a two-second
loop by holding the first stream in the loop for one
"extra" loop to allow the second stream to "catch
the viewer's perspective, loops are convenient places
in a movie to make a choice about what should happen
next. For example, while watching a travelogue
of San Francisco, a film loop repeatedly showing a
view of the Golden Gate Bridge on one hand, and Chinatown
on the other, gives the viewer a chance to select
which part of the city to see next. Viewers
maintain control of the content via decision loops,
while operators conserve channels via resynchronization
loops; two sides of the same coin.