A Doughnut for Your Navigation?

By Shirley Brady Former Comcast marketing/new products SVP Andy Addis knows the competitive terrain. So he understands cable’s need to improve navigation and the user experience. That’s why two years ago he signed on as an EVP at Hillcrest Labs, a small start-up with a big idea: a doughnut-shaped, RF-based motion sensor remote—which Hillcrest calls The Loop. It zooms over content displayed in a video-store-like array of poster art and icons (see above) within in a user-interface environment that Hillcrest calls HoME.

The funky-looking remote, which acts and feels like Nintendo’s Wii remote, zips through an array of content from traditional TV networks, movies, VOD and HD titles to games, broadband video and personal content, all in a highly visual and intuitive interface. What’s more, the award-winning navigation is fun and easy to use — which is a lot more than you can say for today’s remote controls and grid-locked program guides.

Addis told us how Hillcrest is developing a navigation suite for Music Choice and also is talking to cable, satellite and telco service providers; consumer electronics manufacturers; retailers (including uber-etailer Amazon); plus content providers and other parties with a stake in rethinking how consumers find what they’re looking for (or discover new delights) in today’s exploding, time-shifted, professional- meets-personal-media content warehouse that is more than just a humble TV.

Andy, will navigation/search be the battleground where cable’s war with DBS and telcos will be won or lost?

Addis: Operators recognize that the battle for that high-end sub base is going to be ferocious, and Apple TV is just a shot across the bow in terms of what the world will look like in two to three years. They realize they need to improve that high-end experience and they need to make their cross-platform experience sing.

You’ve been meeting with folks in the cable industry and beyond. What’s the response to Hillcrest’s products from your former cable colleagues, in particular?

Addis: They like that our experience makes their cross-platform experience consistent, from using a pointer on the PC to using a pointer on TV. We offer a lot of ways for the operator to make more money, and a big part of it is they get more out of the services they’re already providing. Video on demand at Comcast is fabulous, but customers don’t know half the stuff that’s on there. And if they can’t find it, they don’t derive the value of VOD and — who cares? It’s like a tree falling in the forest.

Are consumers ready to break free of the grid and ditch the electronic program guide they’re currently using?

Addis: We did a large consumer study with 450 consumers and 14% said they watch free on demand three times a week or more. After giving them a demo and letting them play with [our system], they told us their free on demand usage would triple and their pay-per-view/VOD buy rates [for movies] would also triple, from about 1.1 per month to about 3.3 a month. And as we know in cable, as usage goes up, churn goes down.

Anything that reduces churn would certainly be music to operators’ ears…

Addis: I know that from my days at Comcast that 11% of cable customers are just looking for a reason to leave … With 18-20 million HDTV sets shipping this year, every time a consumer buys one they’re up for grabs, they’re reevaluating their purchase and decision-making because the blue shirt at Best Buy says ‘hey, now that you’ve got this HDTV, did you know that DirecTV is going to offer three times the number of HD channels that cable offers?’

How is Hillcrest improving the user experience for music videos, the No. 1 free-on-demand content?

Addis: We’re working with Music Choice on an application [set for ’07 deployment] that houses 5,600 music videos, versus the 250 or so they have now on broadband. Music Choice can deploy this on their website while a cable operator could offer it to high-speed data customers. It’s a tiny application you can download to your desktop and then you can quickly create a playlist. Or it could be used in a broader TV offering as Internet/broadband content delivered to the TV; or they can use this as VOD . And it’s set up for interactive advertising.

How will that work?

Addis: You can watch a 15-second pre-roll ad for a Ford F-150 truck and when you click on it be taken to a 15-minute immersive video experience.Or, if you want, you could check out every SKU in the Ford line, so you can see all their pick-ups. Interactive advertising is another way we help the operator make more money.

What about remote purchases over the TV? That’s a hot topic these days.

Addis: When we presented this to Jeff Bezos at Amazon, he said as soon as you guys get some distribution give me a call and we will do this like that (snaps his fingers). We did a demo where we took live data off Amazon’s server and presented it to their directors, and it worked. So it’s not that hard for us to do if we can ingest and present Amazon’s volume of content within our interface.

What’s in that for cable operators?

Addis: From a moneymaking standpoint, Amazon [pays] people who refer sales to them a 2-7% commission, so if you’re an MSO, that’s pretty cool. And it doesn’t have to be physical items — it could be vacations, or pretty much anything you can think of.And from an ad sales perspective, this is nirvana. You’re going from a CPM (cost per 1,000 model) to a CPC (cost per click) to a CPA (cost per action).

• To find out more, click here for Cable360’s CES video with Hillcrest.