Will your TV cerf?

This paper is an examination of efforts to bring Internet access to television. The paper is an assignment for a class titled Impact of Multimedia and Networks and taught by Professor Howard Besser. John Dick 11-20-96

For a number of years there has been considerable hype about the coming information superhighway. This was originally envisioned as coming about as a result of developing compression technology that should allow cable operators to greatly increase the number of channels they transmit. A cable operator with 750Mhz of bandwidth may eventually be able to transmit 500 channels of programming.(1)

The explosive growth of the Internet has led some to conclude that the superhighway is already here, though in a different form than originally envisioned. Part of what makes the Internet different than the proposed superhighway is the fact that it has only been accessible by computer, not through televisions. This paper will examine developments in the effort to bring Internet access to television sets and also issues of user adoption that will surface if the technical obstacles are overcome. The paper begins with a brief description a particular technical obstacle that must be overcome to display Internet material on a television. Some of the key players in the field are identified, and then the issue of user adoption is discussed.

Technical Obstacles

One of the most ominous obstacles to putting web content on televisions is the type of scanning used to project a picture onto a screen. Most televisions use what is called interlace scanning.(2) This process scans in a picture by first scanning in every second line and then returning to the top to scan in the remaining lines. Most computers use progressive scanning. This process scans in the entire picture at one time, horizontal line by horizontal line. Naturally, many in the television industry believe that only an interlaced scheme maximizes the picture quality of a television. Those in the computer industry adamantly hold to a progressive scheme because it reduces flicker.

There has been an effort to establish one standard for transmissions. This group operates under the name Grand Alliance and has been pushing both industry and political forces to adopt standards that would allow the receiver to use either interlacing or progressive scanning to display.(3) There has been very little progress despite the fact that a new technology called a Multimedia Bridge which would allow for both techniques appears close to completion. The television industry continues to insist that interlacing must be included in the standard, while the computer industry is extremely resistant, citing increased cost of decoders for consumers and higher costs to broadcast.

Players

There are now a number of new and established companies working to solve the technical issues so the Internet can be accessed from the home television. The reason for the sudden increased attention to the issue has been caused by the exploding popularity and awareness of the Internet. The fact that only 1/3 of all US households have a computer when almost 100% have a television has given manufacturers the idea that the popularity of the Internet could drive people to buy a device giving them access through their televisions.(4)

One of the most significant players currently is WebTV. This company has developed the technology for a set-top box which gives access to the Internet. They have contracted with both Sony and Philips to manufacture the devices, with Internet service providers like Concentric Networks and UUNet to provide bandwidth.(5) WebTV does have its product now available in the market.

Another player in the market is Diba. This company will offer Internet TV through Zenith.(6) Navio is a Netscape investment that is developing a Web operating system and browser for both televisions and other electronic devices like telephones and PDAs. There are also major consumer electronics companies working to bring the Internet to televisions. These include Matsushita, Toshiba, Sharp, Hitachi, JVC, Samsung, Mitsubishi, Sega, and Nintendo.(7)

Adoption

As is the case with most innovations, the fact that a company can build a box so people can access the Internet from home does not mean that people will actually adopt such a device. One example of this is the fax machine. The technology to create a facsimile from data transferred aver telephone lines has been available, crudely, since the 1930s. Of course fax machines were not widely adopted until after the mid 1980s.

Theories and research on the topic of innovation adoption have circulated for decades in business literature. In reviewing some of the research in this area, it became clear that many models of innovation adoption conducted in the past 15 years follow a kind of Think-Feel-Do pattern. Behind such models is the presumption that a person must mentally accept an innovation in the Think and Feel stages before actually adopting it. In addition, each stage may have multiple sub-steps. The Think phase, for example, might include hearing about a new modem at a conference and then looking for information about the new modemís attributes at home on the Internet.

An example of a Think-Feel-Do model is shown below.(8)

1) knowledge, which involves exposure to the innovation and an understanding of how it functions;

2) persuasion, which occurs when a favorable, or unfavorable, attitude is formed toward the innovation;

3) decision, which occurs when an individual engages in activities that result in a decision to either adopt or reject the innovation;

4) implementation, which occurs when the innovation is actually put to use (for innovations that have a positive decision);

5)confirmation, where an individual seeks reinforcement for the decision made, but may reverse this decision (i.e. discontinue using a previously adopted innovation, or make a decision to adopt a previously rejected innovation), if exposed to conflicting messages about the innovation.

Some more recent adoption models are raising serious concerns about the validity of Think-Feel-Do models. One objection to the models is that many, if not most, product adopters are imitators whose adoption decisions rely on the personal opinions of peers who have already adopted the innovation.(9) The norms of a personís peer group or society as a whole may play a greater role in adoption decisions for imitators than any objective information. This changes the process of adoption from Think-Feel-Do to Feel-Do-Think. In this case a person becomes aware of an innovation and then evaluates the likely social consequences of adopting or rejecting the innovation. The final Think phase involves actually searching for information to confirm the adoption decision and learning more about the innovationís attributes if the person decided in favor of adoption.

This more recent model leads to a very different interpretation of how an innovation is adopted over time. This model gives rise to two distinct populations of adopters.(10) One population includes people who can be early adopters of an innovation. These people are either very early, following an adoption path of Think-Feel-Do in which they intellectually evaluate an innovation before deciding on adoption, or they are imitators whose peer group includes many other typically early adopters. An example frequently given of such a group is engineers.

The second population includes people who will not be early adopters, and this population consists mainly of imitators. One result of this split is that different tools are employed to reach the two populations. At first, a great deal of scientific and authoritative literature and support material is required to attract the earliest adopters. Then more reference type of material and mass marketing tools (all your friends are buying it!) are required to attract the imitators. One other result can be an adoption pattern shown similar to the one shown below.

**
**
**
** **
** ** **
** ** **

In this case, there is a pause in demand after the early adopters have finished buying and before the imitators start buying. Bridging this gap can be extraordinarily difficult because most imitators, unlike the engineers mentioned earlier, do not trust early adopters. They typically look to other imitators when deciding whether or not to adopt an innovation.

Both types of models allow for other factors that prevent actual adoption even if the innovation has been mentally and emotionally accepted. The clearest example of such a preventative factor is lack of money.

Adoption Issues

One of the larger issues potentially facing adoption of set-top boxes is the lack of potential early adopters. It may be the case that a large percentage of the population that could be early adopters for Internet television already have access to the Internet through computers. If that is true, a company entering the market could have great difficulty gaining the attention of the later stage imitators who are the true market for these devices. The imitators will not have peers to copy, and they will not typically adopt a product without that social guidance.

Other problems are typical of many computer products. In order to successfully get people through the Think and Feel stages with the intention of adoption, most innovations require a "killer application" to overcome resistance. Examples of killer applications include spreadsheets and word processing for PCs and browsers for the Internet. The killer application that will address the adoption stages Think and Feel for Internet televisions is simply access to the Internet. Some of the most popular uses of the Internet, like e-mail and chat rooms, are therefore the most likely attributes that will make people believe that this product is right for them. An example of an adoption scenario for an imitator might be a person who spends part of the holidays with a family member who has an Internet capable television. Through conversations with this family member and through actual demonstrations, this person might convince themselves that they need to get an Internet television because they must be able to e-mail their aunts and uncles. The person might look into access through a computer but will probably choose the television because of the direct family reference and the lower cost of the set-top box.

Such a scenario may not be likely due to a possible absence of early adopters and because the current products have shortcomings. One obvious shortcoming is the price. The WebTV units are currently priced retail around $300. That seems very expensive for access to e-mail, and many people may balk unless the price is significantly reduced.

Another shortcoming is the quality of the images displayed. I have looked at WebTVís offering, and I was surprised by how good the pictures looked although I recognize that the system was attached to the finest available television. However, this is not the same quality we are used to seeing with PCs. The text is legible, but it tends to be blurry at the edges, and it certainly can not be read at normal television distances. While this may not impact the attractiveness of e-mail, it would certainly detract from other proposed TV-centric applications such as looking up recent batting statistics for a favorite baseball player. I do not believe any one will get up off the couch to squint at statistics.

The placement of the keyboard and the size of a normal TV screen combined create another obstacle. The keyboard is attached to the television, so in order to use text a person will need to sit very close to the television. That causes a problem because televisions tend to be much larger than most older PC monitors, giving a feeling of being overwhelmed while sitting so close to such a big screen. It is true that this device comes with a remote that can be used to type by pointing and clicking on displayed numbers. The remote did not work on the device I saw, and I doubt many people will be willing to type an e-mail by pointing and clicking for each letter.

A final obstacle that I observed is the placement of the television itself. Most televisions that I see are placed on a cart or in an entertainment center. I have never seen a TV cart or entertainment center with room for a keyboard, and certainly none that had room under the screen for a personís feet so they can sit close to the screen comfortably.

Conclusion

There are obviously a number of large companies which are pursuing the ability to bring Internet access capabilities to televisions. The main drive behind this effort is the potential to sell these devices into the homes of people who do not have a computer to use for the Internet. This targeted market includes approximately 2/3 of all US households.

As the technology for displaying Internet content on television screens progresses and as these products are rolled out, there will be significant obstacles to adoption. These obstacles include a lack of potential early adopters and also product attributes which make integrating a television with a keyboard and text from the Internet unappealing. The long-term adoption of these products will most likely depend on the ability of mass marketers to convince people who usually imitate peer group purchases that they want these devices that none of their friends have and also on the ability of the manufacturers to overcome the attribute deficiencies of current products.

Endnotes

1. Institutional research report, Broadband Access Networks, by T. Savageaux of Robertson Stephens & Co., April 23, 1996.

2. Mastering monitor specs., Machine Design v68, n7 (Apr 4, 1996), p 49.

3. Broadcasters arm for ATV fight., Broadcasting & Cable v126, n44 (Oct 21, 1996), pp 6-12.

4. Buyerís Guide - Technology, Time, v148, (November 25, 1996), p 87.

5. Internet for the masses, The Red Herring, (October 1996) pp 82-85.

6. IBID

7. IBID

8. Rogers, E.M. (1983), Diffusion of Innovations, The Free Press, New York, NY

9. Parthasarathy, Madhavan; Rittenburg, Terri L; Ball, A Dwayne, A re-evaluation of the product innovation-decision process: The implications for product management., Journal of Product & Brand Management v4, n4 (1995), pp 35-47.

10. Lectures of Professor A. Wilton, Haas School of Business. For BA295A, fall semester, 1996.