November 1, 1997

Web Offers A New Way To Watch TV Low Price, Interactive Features Boost Webtv’s Chances

Lynn Gibson Correspondent
 

At the end of the day, Spokane resident Tom Engdahl grabs a soda, relaxes in his living room recliner and picks up his remote control.

With one click, Engdahl’s large-screen television comes to life; another click calls up the Internet. Elevating his feet, Engdahl sits back and surfs the Web, using the wireless keyboard on his lap.

He scans the box scores of his favorite baseball teams, listens to audio clips of the latest Rolling Stones album, and checks airline ticket prices for an upcoming vacation. He does this by easily navigating through icons displayed in a colorful menu on the TV screen.

This is WebTV, the pioneer in Internet-television products which represents a business foray into the future of interactive television.

Engdahl is a new subscriber to WebTV, the plug-and-play “set-top” box and Internet service that combines television viewing with Internet Web-browsing, e-mail and a host of personalized content features. WebTV is the product of a Palo Alto, Calif., start-up company called WebTV Networks, which has since become a subsidiary of Microsoft.

WebTV Networks is betting on the inevitable - and potentially lucrative - marriage of television with the Internet, and is hoping to grab a slice of the profit pie.

WebTV is not a computer, nor does it require a computer. Lacking the power of a computer results in some performance limitations, but from a price standpoint, WebTV has the advantage. Traditionally, a computer has been necessary to access the Internet along with a modem and an Internet service provider. Although prices for computers are dropping, consumers still face an investment of $1,000 to $3,000 for a multimedia computer. With WebTV, you get Internet access and up to six e-mail accounts for around $300.

Engdahl already owns a computer for the video production business he operates from his South Hill home. He says his current system is powerful enough to get the job done, but eventually he knows he will have to upgrade.

Meanwhile, Engdahl wanted to get on the Internet, not only to expand his business but to enhance his hobbies of trading baseball cards and researching genealogies.

“I had read about WebTV in magazines and was fascinated by it,” says Engdahl. “I knew upgrading my current computer would be expensive and when I saw the affordability of WebTV, it was a done deal.”

Plus, he adds, there is the comfort of surfing the Net from a living room chair, rather than from a computer in a downstairs office.

Three components are necessary for WebTV: the set-top box, a wireless keyboard and a monthly subscription to the WebTV network.

The Internet Terminal is the set-top box, resembling a video cassette recorder. It plugs into the television and can sit atop the TV or be grouped with stereo components.

The company’s manufacturing licensees - Sony, Mitsubishi, and Philips-Magnavox - offer the Internet Terminal for $199. For a limited time, WebTV Networks is offering a $100 rebate to all its customers, which effectively lowers the price to $99. Included with the Internet Terminal is a wireless remote control, an audio/video cable, and 25 feet of phone line. No modem is necessary for WebTV since the line is plugged directly into an existing phone jack.

A second component, the wireless keyboard, costs $40 to $70. Although it is possible to perform many of the functions of WebTV with the remote control, Engdahl recommends the keyboard for speed and convenience.

Finally, the WebTV Network account is necessary for the content. The Network bills the customer a flat rate of $19.95 a month, similar to Internet service providers such as America Online.

Engdahl hooked up WebTV one month ago. Since then, he has become adept at sending e-mail, discovering Internet Web sites and exploring the WebTV content from its main menu, the homepage.

Engdahl uses WebTV to access mutual funds, read concert reviews, and hear recent offerings from musical groups. Many of the Web sites he enjoys are not exclusive to WebTV and can be accessed on the Web via any Internet computer.

Like every other online service, WebTV is trying to position itself as offering premier content and exclusive programming. The company has formed partnerships with several content providers to offer entertainment and news from its homepage, including Discovery Channel Online, PBS Online, Nickelodeon, E! Online, Warner Bros. Online and Excite Search.

Engdahl uses a WebTV exclusive called Around Town, a personalized directory of community sites, services, restaurants and information selected according to zip code. By keying in a Spokane zip code, Engdahl can access a map of the city and enter destination points for a customized route. He can read (and write) reviews of Spokane restaurants and peruse menus.

WebTV has its limitations, mainly because it lacks the power, storage and speed of a multimedia computer. Subscribers note that it does not support some sophisticated types of Web programming, like video clips. When users visit a Web site with these features, they receive a no-access message.

The company is addressing these issues in their next product version, the WebTV Plus, which will be available before the holidays for around $300.

The higher performance system will be faster because of new features such as picture-in-picture (PIP) capabilities. PIP will allow a user to view a television program and explore related Web content simultaneously. WebTV Plus will offer printer support for high-quality color output directly from the television screen using selected printer models.

In spite of the technical limitations and murky future of the Internet television business, new start-ups are racing to jump in. Companies with products like NetChannel, uniView, NetLink, WorldGate and PlanetWeb are now, or soon will be, WebTV competitors.

While roughly 15 percent of American households get online through computers, many industry analysts believe computer usage has hit a plateau. Not so with television. TVs are the ubiquitous household appliance. Ninety-eight percent of all U.S. families have one, and the possibilities are endless to exploit this market with interactive television programming and applications.

Companies such as WebTV envision a set-top box for every family where viewers can, for instance, watch the World Series and at the same time click on a player on the screen. A window at the bottom of the screen will display the player’s personal statistics from the Internet, which are updated continuously.

The technology is getting there, although it is still unclear if the public wants it. Television has traditionally been a passive activity. The last thing people want to do, skeptics suggest, is “interact” with their televisions.

One thing is certain, however: The Internet is reshaping television as we know it.

Will WebTV succeed? No one knows for sure, but subscribers like Engdahl are satisfied. “I’ve run into a few roadblocks,” he says, “but for accessing the Internet, it’s an affordable alternative to a computer.”

, DataTimes ILLUSTRATION: Photo

MEMO: This sidebar appeared with the story:

WHERE TO FIND IT

WebTV is available at area department and electronic stores including Future Shop, Magnolia Hi Fi, and Huppins Photo Hi-Fi & Video.

This sidebar appeared with the story: WHERE TO FIND IT WebTV is available at area department and electronic stores including Future Shop, Magnolia Hi Fi, and Huppins Photo Hi-Fi & Video.


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