America Online's (AOL) new venture into interactive TV is something like building an airplane around the year 1900. It may indeed fly, but up until now, most similar attempts have ended up crashing and burning.
The nation's largest online service has gotten plenty of attention for Monday's unveiling of AOLTV, a service that the company hopes will be an enjoyable combination of the boob tube and some of AOL's content and interactive features. With the coming debut in cities that include Phoenix, Sacramento, Calif., and Baltimore, the company is hoping that AOLTV will add "new and exciting dimensions" to TV and will be a major step in the company's goal of making its brands available to people anytime, anywhere and through a range of devices.
But AOL, which calls AOLTV a mass-market service, will have to climb over the carcasses of numerous interactive TV failures to succeed. And that will be difficult, according to someone who's well qualified to judge: Bob Gerson, editor-at-large of the consumer electronics trade magazine
. Investors agreed Monday, pushing AOL shares fractionally lower even as the major market averages put in triple-digit gains.
Gerson, who has spent 39 years covering the consumer electronics business, says that past attempts by other companies have made it clear that people, when they're watching TV, pretty much don't want to interact with it. "How many of these have to fail before it occurs to somebody that maybe most people just want to
television, thank you very much?"
Among the efforts that haven't taken off is the interactive TV system publicized by
a decade ago, which allowed hockey fans, for example, to select which camera angle they'd see as they watched a game on TV. ACTV lives on, but its vision of "individualized television" has resulted in widening losses over the past five years. In 1986,
shut down a high-profile venture called
that transmitted pages of news and information to users through their TV sets.
Interactive cable TV, which first showed up in the
system in Columbus, Ohio, in the 1970s, never took off. And AOL's merger-partner-to-be
set up an experimental cable system in Orlando, Fla., in the early 1990s, featuring movies on demand, interactive shopping and home printers, but shut it down later in the decade rather than expanding the concept.
Back to the Present
But you don't have to look too far back into history to see a failure, says Gerson, pointing to the set-top boxes marketed for
WebTV service. WebTV, which lets consumers connect to the Internet through their TVs, has reached about a million subscribers since Microsoft bought the firm in 1997. Three years ago,
was predicting that 5 million people would be surfing the Net via TV.
For years, says Gerson, marketeers have dreamed of interactive applications such as being able to send coupons to TV viewers to accompany the commercials they watch or to allow people to order pizza by pushing a button on the TV's remote control. But these scenarios overlook basic issues, says Gerson, such as what pizza parlor the TV is connected to and people's individual tastes.
"Nobody wanted it," Gerson says. "No one cares. This is not why people watch TV. If you want to order a pizza, you pick up the phone."
'No Great Demand'
Gerson continues, "People have so many other options that they're used to, that training them for this one is going to be one terrible job."
Of course, changing times may be on the side of AOL and other companies developing interactive television products, such as
. The Internet's development has relegated QUBE and Viewtron technology to the Stone Age, and indications are that a growing number of people are logged onto the computer while they watch TV.
But Gerson questions whether new features, such as the ability for AOLTV users to use instant messaging while they watch TV, are enough to push interactive television into the mainstream. "Internet aficionados always want to be in touch. They're going to like it," he says. Still, "there's certainly no great demand out there for this kind of thing."