Two-Way Television Finding Its Way Again

Interactive television, the once-promising technology that has failed to live up to its hype, might be staging a comeback--at least in a few corners of the Southland.

Analysts and pundits had all but declared two-way TV dead, now that personal computers are in nearly half of all homes and the World Wide Web has emerged as the interactive media of choice. Extended interactive TV trials found that few consumers were anxious to spend time with their televisions on such tasks as electronic banking or home shopping.

Even movies on demand--thought to be the most appealing application for interactive TV--were judged to be too expensive. Less than two weeks ago, Time Warner finally pulled the plug on its Full Service Network, which was introduced in Florida two years ago amid great fanfare.

But hope springs eternal. In Santa Barbara, a new pilot project aims to turn ordinary TV sets into virtual PCs with two-way technology from ICTV Inc. of Los Gatos. And GTE last week began selling its mainStreet interactive TV service in Ventura County from Thousand Oaks to Camarillo.

MainStreet allows customers to participate in game shows and cooking classes, get updates on local news and weather, and search an online encyclopedia by pointing remote control devices at their TVs. Selected Web sites will be added to the two-way cable service.

Most of the same services were featured in a decade-long test in Cerritos that ended last fall and is widely considered a flop.

“A lot of people hyped interactive TV, and unfortunately it couldn’t fulfill the hoopla,” said Robert J. Regan, senior vice president of GTE mainStreet. “We have more services available today than in Cerritos.”

Subscribers to GTE’s americast cable service can order mainStreet for $3.95 a month, or $2.95 with a package of premium services. So far, about half of all americast customers have ordered mainStreet services, and Regan said he hopes to have 20,000 mainStreet subscribers by the end of the year.

The technology from ICTV is designed to turn a television into a virtual PC. It allows customers to use cable lines to use the Internet, play CD-ROM games, send e-mail and surf the Web.

Computers and other equipment at the local offices of Cox Cable Communications take data from a file server and convert it to broadcast specifications before sending it to customers over cable lines. Then customers use a wireless keyboard--complete with tracking ball and mouse buttons--and a small electronic device to send keystroke commands back to the cable office. ICTV has won 11 patents for its technology; an additional 10 are pending.

The ICTV technology offers a broader range of services than WebTV Networks--its most like-minded competitor--or traditional interactive television programs, said Wes Hoffman, president of ICTV.

Early results from the Santa Barbara trial, which began in late March, show that customers use ICTV to open sound and video files from the Internet, two tasks that can be extremely time-consuming using computers and ordinary modems. Movie previews and other video samples are more striking on a television screen than on a smaller computer monitor, Hoffman said.

Three of the CD-ROMs being used in the trial were produced by Cloud 9 Interactive, a Marina del Rey firm.

“The graphics are so clear, it actually looks better” on a television than on a computer screen, said Debra Streicker-Fine, Cloud 9’s president and CEO.

Cox is charging $6.95 a month--including five hours of access time--to customers who want to participate in the three-month ICTV trial. The cost for additional hours is $1.99 between 7 a.m. and 11 p.m., 99 cents otherwise.

So far, 35 Santa Barbara residents are paying for the service, although Hoffman said he hopes to sign up at least 80 customers before the trial period ends. Hoffman plans to launch the service this fall, although no companies have signed up yet.

After the official launch, Hoffman plans to sell ICTV equipment to cable operators and local phone companies, which could provide the service over fiber-optic lines. Cable and phone companies would then sell subscriptions for the service directly to their customers.