Taking an INTERACTIVE CUE

JEAN BERGANTINI GRILLO

Digital Convergence develops new products to take consumers directly from print, TV or radio ads to the Web.

Special to Cable World Imagine this: A 25-year-old female viewer watching Strong Medicine, Lifetime's new hit series focusing on front-page medical issues important to women, hears a small audio tone at the end of the show alerting her that the show's Web site features an in-depth follow-up on issues raised in today's episode.

The site already has downloaded to her home computer even as she sits in her lounge chair sipping a wine cooler.

While Lifetime doesn't have access to such technology yet, it will very soon. The question for cable: Will it jump on this latest technological bandwagon, one that doesn't require set-top boxes, doesn't require digital and doesn't cost consumers a dime?

CRQ and CueCat, two new proprietary products from Digital Convergence launched in September, link TV, print and, eventually, radio spots to directly related Web sites. Interested consumers, via a TV audio tone or by simply swiping the bar code on a printed page, can saunter over to their PCs then or later to download information otherwise dozens of clicks deep.

CRQ, a TV-to-PC hookup, and CueCat, a bar code-reading hand-held device that attaches to the computer mouse, are installed by the consumer and then self-run. Digital Convergence says its goal is to offer consumers, programmers and advertisers the ultimate one-to-one interaction - when, how and if the public wants it, creating a unique electronic direct response.

CRQ and CueCat are available free. Just walk into your local Radio Shack and ask for it, or download it yourself. Tens of millions of these cute little items soon could be out there, making cable programming and advertising competitors such as local newspapers and national magazines significantly more interactive.

CueCat, in particular, gives print a decided edge in one-to-one outreach (something local cable highly prizes). But while :CRQ and CueCat are backed by partners that include broadcast station groups and newspaper chains (Belo and Milwaukee's Journal Communications), the roster also includes a major retail outlet (Radio Shack), a major advertising agency (Young & Rubicam) and a major broadcast network (NBC), all of which have cross ventures with cable. A recent deal with Scripps-Howard means not only will MSNBC and CNBC get the :CRQ tone, but Food Network, HGTV and DIY will also.

Wired and Forbes magazines are also partners. Forbes, alone, has mailed 810,000 free CueCat and :CRQ units to its subscribers. Radio Shack reportedly has distributed 500,000, with Digital Convergence pledging to make at least 10 million available free.

The danger zone Some media observers see danger in the technologies because they may be judged only by the number of viewers or readers who scan Web sites, rather than the more traditional measure of gross impressions.

"Our software is not the death-knell (for any media)," says Scott Carlin, president, Digital Convergence Media Group. "Instead, it is very empowering. In fact, ultimately, television will be in the best position to take advantage because they're aggregating the largest audience. We are giving the old media ways to control their new media destiny."

Such far-reaching technology wasn't in Digital Convergence's plans when the company was formed two years ago, largely to produce a TV program called Net Talk Live, extolling the latest, coolest online destinations.

"What we soon learned was the quantum difference between telling a person to go to a Web site and being able to make that happen immediately, synchronisticly," Carlin explains. Acting on such an unmet need, Digital Convergece designed and built the :CRQ and CueCat software now able to link all media or products to the Web instantly, without consumers having to know 800 numbers or long and convoluted Web site addresses.

Digital Convergence's library of bar codes and URL addresses does that heavy lifting.

"We are encoding every bar code on earth," Carlin adds. Among the many applications he's touting: Broadcasters and radio stations can enhance newscasts or weather reports linking viewers to information detailed to their Zip code.

Advertisers can put cues into their commercials to provide relevant information such as additional features, pricing and dealer locations. Audio cassettes, DVDs and CDs can have cues placed in them to link listeners to concert information or audio clips from an artist's new release.

This winter, local TV viewers of WFAA in Dallas and WTMJ in Milwaukee and national viewers of NBC, CNBC and MSNBC will have instant access to :CRQ if they install the equipment (essentially a 20-foot wire connecting your TV to your PC) and take an Internet access service. The TV and the PC need to be on at the same time, although you don't have to be online at the time.

When a show you're watching flashes the :C cue, material is sent to your computer.

"For cable programmers, this ability to link selectively from the TV to the Web is critical to building brand equity," says Jay Feldman, EVP-Media Group. "Cable can offer something interactive and interesting. For MSOs, it's an opportunity to see advanced advertising in their local markets. They can even put a cue in their bills every month that can be scanned by CueCat and paid online. Also, our technology passes through everything, including TiVo and Replay."

Feldman hasn't talked with MSOs yet, and the company only recently began discussions with the major cable networks, but their pitch is clear.

"The opportunity for promotional cues and content cues are unlimited," he says. What's needed, of course, is critical mass.

"The measure of success is if our clients are satisfied," he says. "It's only been out a month, so it's hard to tell. What we can predict, however, is increased Web site visits, increased brand equity using a cutting edge technology, offering a single brand across multiple platforms."

Checks and balances While its goals seem limitless, :CRQ's audio tone is being reined in. Only two commercials cue-tones per half hour will be allowed.

For Tom Rolfe, EVP-e-business, Impiric, a division of Y&R, that number is fine for a start.

Young & Rubicam has a minority stake in Digital Covergence, Rolfe says, "because we wanted to make sure we infuse our agency culture with great new ideas to communicate with our client's customers."

What :CRQ does for television, he adds, is allow it to become interactive without additional hookups and, most importantly, keeping the separation between PC and TV.

"There has been a failure to try and make that (convergence) happen," says Rolfe, citing ICTV, WorldGate and Web TV as examples. "People aren't yet ready to do e-mail on their TV. No one knows where the trade off between interactive, the computer and passive TV is, but, the keyboard seems to be deadly with TV. Most people won't have a laptop (on their knees). With :CRQ you capture what you want without making you move."

And the computer doesn't even need to be in the same room.

According to Feldman, no actual advertisers have signed up to use the :CRQ/TV application (although plenty have for the CueCat print option).

The issue, as always, is numbers. With Wired and Forbes already planting bar codes on their pages and mailing off thousands of CueCats to interact with them, print seems to have a leg up here. However, Feldman adds, the lack of TV advertising is part of the plan.

"We don't allow any (television) advertising for the first 30 to 60 days that a consumer has wired :CRQ," Feldman explains. "We do that to get the consumer to see it as content-enhancing."

Right now, to build that critical mass, Digital Convergence is licensing its technology to third parties for an annual fee. Then, when these media affiliates bring on the advertising component, Digital Convergence will get an additional fee each time that :C-toned cue occurs.

"We ask for a set fee per spot," Feldman notes, adding, "Broadcasters and cable nets can negotiate any fee they want from advertisers."