CAMPAIGN-I: Spotlight on: BSkyB's interactive strategy - Should BSkyB integrate Open into its interactive services? Open's future remains an open question as Sky acts vague, Alasdair Reid says

BSkyB has been uncharacteristically indecisive about its

interactive TV proposition lately. Consider the fate of John Swingewood,

the BSkyB director brought in 18 months ago to head the company's

expansion in new media.



Over the past month or so, he has suffered a whispering campaign and

press speculation about his rumoured, imminent departure, yet official

sources at Sky can neither confirm that he is to leave nor give

assurances that his position is safe.



Swingewood's voicemail has been fielding an awful lot of calls

recently.



Not all of them, it has to be said, are being returned.



It's no secret that Sky boss Rupert Murdoch, who was sceptical about the

commercial prospects for the internet in the late 90s, has (despite a

U-turn a couple of years ago) recently hardened his attitude to the web.

That's hardly a surprise given that the rest of the world shares his

rediscovered scepticism. What is surprising, however, is growing

marketplace confusion about a related area - Sky's interactive TV

proposition.



This, after all, was surely one of its trump cards in the digital TV

race.



It all dates back to Sky's successful moves last July to gain full

control of Open from its erstwhile joint venture partners - BT,

Matsushita and HSBC. Having acquired control, it was assumed that Sky

would absorb the Open sales force - and there was plenty of trade press

speculation that it was indeed about to happen.



It didn't. But if anyone suspected that Open was re-emerging with a

strengthened hand, they'd be wrong. For it began to become apparent that

a separate interactive platform being developed in parallel by Sky was

actually beginning to encroach on Open's territory. Sky Interactive was,

in theory, principally a viewer benefit - for instance, subscribers were

able to choose their own camera angles during football coverage or could

call up more in-depth information behind news stories. But as

advertisers this year have been showing, it can also be used as an

interactive advertising platform too, with viewers being given the

opportunity to click through from the broadcast stream to a Sky

Interactive rather than an Open advertising domain.



And, in recent weeks, advertisers have been receiving ambiguous signals

about Open. There's been speculation that it might merely be rebranded

but some believe it could face more radical integration into the Sky

fold - in terms not just of structure and personnel, but of platform

technology too.



A Sky spokesman plays down any such suggestions: 'Open will continue to

exist as an interactive shopping mall but interactivity is being

introduced across our whole broadcast stream. It is already an integral

part of Sports and News and is being introduced to Sky Movies over the

next couple of months. There will be t-commerce and a wide range of

interactive opportunities right across the Sky offering. Open is just

one element of what interactivity is about and Sky Interactive people

will continue to work with Open people.'



That's fair enough, but it fails to convince some agencies. Sky, they

say, needs to reinvigorate its interactive strategy and rediscover the

big picture. Paul Longhurst, the managing director of Quantum New Media,

argues that if you take the long view there are some obvious barriers to

growth in the interactive ad market. So almost by definition, he

implies, there are issues to be addressed. 'The main barriers to growth

are cost and technological complexity. Companies want interactive TV

platforms to integrate in a seamless fashion with the existing direct

marketing technologies - websites, call centres, etc - that they already

have. I'd be amazed if Sky didn't understand this.'



Longhurst won't be drawn into outlining the task facing Sky but Andrew

Howells, the managing director of BMPTVi, thinks that change is

inevitable - and not just for technological reasons. He says: 'In my

opinion, not much has been done in building the Open brand. It's a bit

anaemic. Put it this way, it wouldn't do it any harm to be integrated

into the Sky interactive family. I think most people in the market

believe Sky will do it - and it's not hard to see why they might want

to. There's potential cost cutting where there's an overlap and Sky

doesn't normally appear keen to duplicate job functions. And you have to

ask yourself, from an agency point of view, where's the relationship?

It's with Sky mainly.'



Is that view widespread? Yes, in general. And some argue it's all the

more obvious now that ONdigital has been integrated into the ITV family

of brands. Sky has to do something similar to Open. And according to

Nigel Sheldon, the managing partner of m digital, the digital arm of

MindShare, branding issues are becoming more important in the digital TV

sector.



'You could argue that, initially, multichannel subscribers signed up

because of their appetite for sport and brands were not as important to

early adopters. But as the multichannel market enters a new phase,

brands will be much more important for the new audiences and it will

apply especially in the area of interactive TV,' he states. 'Technology

will continue to evolve and that is a factor to be considered here. But

there clearly needs to be some form of coherence from the outset.'



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