Riding the Backchannel to Interactivity

It’s no coincidence that the two entities offering service providers their greatest chance at a competitive edge in years begin with the same prefix: Internet Protocol and interactivity.

The prefix, inter-, has always been a part of telecom: interexchange, interLATA, interconnection. It’s good, hearty telephone company jargon. Even Internet Protocol, late to the telecom game, has a nice techno ring to it. But this other term, this interactivity, is different.

Applied to networking, it is the proverbial next step for prefixes. Interactivity is the evolution of a telephony term that raises networking to a new level far above the point-to-point or multipoint circuitry of old. Interactivity is the opposable thumb and cerebral cortex of networking. It is the FOXP2 gene of video communication. It sets service providers apart from their Bell System ancestors.

Why? Unlike the interconnectedness of geographies or carrier systems or calling areas mentioned above — all inanimate — interactivity connects humans. It engages them. It includes them by making them part of the network.

At least that’s the dream. And if interactivity is the dream, interactive advertising is the dream maker. Interactive advertising has the potential to generate the revenue necessary for continued innovation and reach. But while basic interactive features such as gaming and video on demand are available today, and some nascent Red Button advertising is offered, performance needs to improve. And only then can service providers get serious about interactive advertising. Besides, they don’t yet have a clue how relationships with the advertising world will play out.

In addition to questions about relationships, a big question for service providers is: Do they have time to get it right? According to Yankee Group Senior Analyst Daniel Taylor, the ability of cable and IPTV providers to deliver interactive advertising is not as great as they have promised. Not enough reach compared to the Internet, where advertising dollars already are headed, he said. Conversely, Eitan Gelbaum, vice president of marketing in Amdocs’ Advertising, Commerce and Entertainment division, says there is less a sense of urgency than a need to get it right.

Antony Carbonari, interactive and commercial media director at BT, said, “Reach can clearly be an issue compared to the Web, but I think we can play the quality card and overcome the reach issue.” Here’s how.