Jeffrey L. Seglin

Screen Test

 

Nonetheless, the options can be tantalizing. Viewtron, for example, is just one of a number of interactive electronic systems that allow for some sort of at-home shopping. "The real potential advantage of videotex is that the message is communicated to the prospective customer on the same channel that can be used to place an order," claims Roger Strang, a visiting associate professor of marketing at New York University.

Knight-Ridder's Viewdata Corp. of America was the first to offer full service with its Viewtron system. It was introduced last October after a lengthy test to a potential 1.3 million households in southeastern Florida. Viewtron's goal in the first year of operation is to establish at least 5,000 subscribers in the Miami area. The bulk of the market is assumed to be families with male heads of household from the ages of 25 to 49 with yearly incomes of $35,000 or more each -- an upscale market profile that is sought by virtually all the players that have entered the videotex field.

That is why Miami auto dealer Mike Seidle is using videotex. Seidle, a vicepresident of Bill Seidle's Datsun/Bill Seidle's Miami Mitsubishi, has been using Viewtron for several months. So far, sales have been somewhat limited, in large part because the subscriber base is still small, Seidle says. But he thinks it" can work for small businesses because the markets are targeted. You're not paying for national exposure."

Times Mirror Co., through its Times Mirror Videotex Services, will launch the Gateway videotex system in Orange County, Calif., in August. Penny Welsch, manager of marketing communications for the new operation, predicts that videotex will be a "great equalizer," putting smaller companies on a much more equal footing with their larger competitors.

"A big retailer is not going to have a lot more prominence than a local merchant," Welsch explains. "We're going to offer local shopping mall merchants in Orange County a very reasonably priced package allowing a certain number of pages which include information about their stores. We also set them up with videotex terminals with which they can create or alter their own ads at their own discretion."

Silverman concurs. "There's no reason we can't grow as much as multi million-dollar retailers like Sears. Look at out market. Look at how many people they can reach. In the videotex system, we're on the same level with the big guys. The opportunity is there for a small business like ours to grow."

But videotex is not without its troubles. Currently, the systems operate over telephone lines, and that doesn't allow for the glamorous videos possible on services like The Cableshop, a 24-hour-a-day, all-commercial, interactive cable channel now operating in limited test markets nationwide; or Qube, an interactive cable system that has been hitting more than 250,000 subscribers in six test markets (Chicago, St. Louis, Houston, Dallas, Cincinnati, and Columbus, Ohio) for more than six years. But the cable systems haven't rolled out into full operation yet.

"Two-way cable just isn't ready," insists James Holly, president of Times Mirror Videotex Services. "We tested two-way cable in 1982 and it worked. But to do it on a large scale, a lot of work has to be done. The equipment, the software, the networking, the reliability is just not there in most of these cable systems. It will be over time, but it'll be at least two to five years."

These telephone-line systems, however, currently rely on a dedicated terminal developed by American Telephone & Telegraph Co. called Sceptre. Viewtron subscribers have had to purchase the control keyboard for $600, but the company just began offering the loption of renting a terminal for $39.95 a month. Gateway will include the rental of the Sceptre as part of a $30 monthly fee for the first 2,000 subscribers in Orange County.

Neither Viewtron nor Gateway has developed the software to adapt home computers into receivers of the videotex information. According to John Borden, senior analyst with the Boston-based consulting and market research firm Yankee Group, "it was a major error, failing to ride piggyback on the excitement of having a computer in the home."

Yankee Group predicts that by the end of this year, around 13.1 million homes in America will have computers. Twelve percent of these will have the modems necessary to receive the videotex services over telephone lines. By 1988, Yankee Group believes the numbers will at least double.

The question of using the home computer to receive the videotex services may have been answered emphatically in February, when CBS, IBM, and Sears, Roebuck announced a joint venture to begin development of a commercial videotex service to households with home or personal computers.

It will be several years before the as yet unnamed CBS-IBM-Sears system is up and running, but Borden believes that "we're on the verge of something new, because the medium has attracted the sophisticated players now. Over the past several years, videotex has sputtered and dragged on -- a whole lot of noise but not a whole lot of money has been made."

The very novelty of the videotex systems, however, might be a plus for some marketers. Professor Shapiro of Harvard sees two distinct advantages to being on the forefront. The first is that "sometimes the first people in just buy it cheaper because these people are all pretty hungry. The second is that sometimes you can really get a leg up on your competition and develop a whole new way of marketing."

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