Computer Giants Giving a Major Boost to Increased Use of Corporate Videotex.
According to industry newsletter VideoPrint, the availability of competitive and affordable videotex systems from these vendors has "dramatically boosted videotex's chances in the corporation environment, offering buyers a choice and giving the technology some much-needed credibility." While the newsletter expects the home market to flounder for a while longer, it predicts that the traditional willingness of businesses to spend money to save money will drive the corporate market from annual revenues of $1 million today to $500 million in 1995.
The newsletter, which is published by International Resource Development of Norwalk, Connecticut, expects that 70 percent of all videotex sales over the neat two years will be made to Fortune 1000 companies, which it says "are choking on their internal information traffic and have both the desire and capital to streamline whenever possible." However, the growing trend to unbundle software will also enable smaller companies to afford videotex, and VideoPrint expects the pendulum to swing away from the largest of companies and toward the smaller in just five years.
IBM gave videotex a major boost early this year by joining with CBS and Sears, Roebuck in a venture "to develop a broadly based videotex service that can be used by people with home and personal computers." Analysts were quick to see synergy in the joint venture: IBM with its knowledge of hardware, software and data networks; Sears with its customer base and billing and marketing skills; and CBS with its experience in publishing, subscription services and advertising. In addition, CBS learned a great deal from its joint videotex experiment with AT&T in Ridgewood, New Jersey last year. Despite the corporate affiliations, though, the services are meant to be carried on all kinds of computer terminals, not just those of IBM. Also, the firm intends to offer a wide variety of services, not just information and entertainment programming from CBS or products from Sears and its brokerage subsidiary, Dean Witter Reynolds.
Each partner will have an equal interest in the venture, known as Trintex. However, an IBM vice president, Theodore Papes, has been named president and chief executive officer of the new company, which will have its headquarters in White Plains, New York. Because of the considerable software and hardware development needed, it's unlikely that services will be available for several years. However, a spokesman said the services will not require a special terminal and will be open to a wide variety of advertisers, retailers, publishers and financial service providers.
IBM's main videotex product is the Series 1 Videotex System (SVS/1), which supports both Prestel and NAPLPS display protocols (see "Understanding Videotex and Teletext Services" box). It can also connect to ASCH services and handle other important functions such as electronic mail. One feature of SVS/1 enables organizations to use their videotex terminals for office teleconferencing. For instance, a videotex user in one location can present information on new products or business procedures simultaneously on multiple videotex displays in other locations, while voice communications is conducted through normal telephone conference-call hooks-ups. SVS/1 also has a "billboard" capability that allows continuous viewing of a sequence of information. Frames of information in a billboard advance automaticalkly, enabling users to conduct unattended product and service demonstrations.
Reportedly, more than 30 major corporations are using the SVS/1 videotex system, which can handle about 100 users on a Series 1 minicomputer. Videodial of New York City offers a larger videotex system for use on IBM computers, while several firms supply videotex software for the IBM PC, including Wolfdata of Chelmsford, Massachussets and Videotex Systems of Dallas. In April, IBM also equipped its PC line for use as a videotex terminal. Users have the option of storing the videotex images on diskettes for later viewing, PC/videotex costs $250 for the PC and PC XT, and $220 for the PCjr. Digital Uses In-House System
For over two years, IBM has been operating an in-house videotex system for its executives, amassing a wealth of market research data on the strengths and weaknesses of videotex systems and which features corporate users are likely to want. Rival computer supplier Digital Equipment Corporation of Maynard, Massachusetts also has an in-house videotex system that may be the world's largest in geographical coverage and number of users. The system can be accessed from thousands of Digital offices worldwide. While the data bases are scattered around the globe, the system presents the user with a single data base. When the user specifies a page that is stored remotely, the system tracks down the page and forwards it to the user via DECnet. Since pages are stored in multiple languages, the system also determines the appropriate language based on the user's location.
Digital's videotex system runs on VAX superminis using the VMS operating system and VTX distributed videotex software introduced at the Videotex '84 show in Chicago. VTX can be incorporated into Digital's All-in-1 office menu system. It supports all Digital's VT100 and VT200 video terminals and the firm's family of personal computers, as well as VT100-compatible terminals.
Full VAX VTX software is licensed at $25,000. Licenses are also available for the VTX components: the terminal control software, which provides the communications link between user terminals and the data base access component; the data-base-access software, which controls all requests for information; and the data-base-update software, called the Information Provider Assistance Tool (IPAT), which is structured for ease of use so that any office worker, without programming knowledge, can create and maintain VTX data bases. Each of the three components can reside on one or more systems in a DECnet network, so the user can access information without concern for its location. Also any number of IPATs can be distributed throughout the network so that appropriate personnel, wherever their location, can provide information for distribution.
Digital also used the Chicago show to introduce two videotex packages for its Professional 350 desktop minicomputer: Pro/NAPLPS, which allows the Professional 300 series of computers to receive NAPLPS data bases from a remote host; and Pro/Videotex, a stand-alone videotex system developed by Genesys Group of Ottawa.
Commenting on the product introductions, Phil Neray, Professional 350 product manager, claimed that Digital was the first major vnedor to announce fully supported, single-vendor NAPLPS packages for its personal computers. "With Pro/Vieotex," he added, "we're also the first to offer a fully supported, single-vendor, stand-alone desktop videotex system." Pro/Videotex allows users to store a complete videotex data base on the Professional's 10-megabyte Winchester disk. "This significantly reduces communications costs over traditional videotex solutions, which require constant on-line connection to a remote host," Neray states.
According to Digital, the following products will also be forthcoming soon: Future versions of VAX VTX that will support NAPLPS and Prestel graphics; support for Prestel graphics on the Professional series of computers; support for NAPLPS graphics on the Rainbow personal computer, and educational programs and workshops to support the product offerings and explain how videotex can be used as a business information tool. Wang Debuts With Prestel System
Wang Labs of Lowell, Massachusetts also made its videotex debut at the show with a Prestel software terminal emulator for its Professional Computer, promising versions of the software for NAPLPS, the French Teletel and European CEPT protocols in the coming months. Equipped with the $250 Viewdata decoder software, a Wang PC can retrieve Prestel videotex frames, composed of text and color graphics, from both public videotex services and private in-house videotex systems. The Wang PC can them display those frames on a color monitor, providing up to eight colors and full blinking for high-lighting portions of the text or graphics. About 2,500 videotex frames can be stored on the PC's Winchester disk, and more than 300 frames on a diskette. Users can produce a hard copy of the frame with black-and-white shaded printing from a locally attached dot matrix printer.
Honeywell of Waltham, Massachusetts also used the occasion to introduce two third-party videotex systems for business applications. Its InfoNow videotex system was developed by the French firm Group Francais d'Informatique. Geared specifically for non-technical users, the InfoNow system runs on a dedicated Honeywell DPS 6 small system to deliver videotex information to large numbers of users.
The Retrve systems, developed by Thorn EMI of the UK, runs on both DPS 6 small systems as well as on Honeywell DPS 8 mainframes. Targeted at the company's installed base, the Retrve videotex package can coexist with applications already running on the Honeywell computers. In conjunction with the show, Honeywell formed opened its Videotex Support Center in the Chicago suburb of Schiller Park. The center arranges videotex demonstrations and serves as a benchmark test site and training resource for prospective customers. AT&T Covers All Videotex Bases
AT&T recently solidified its position as a videotex leader by joining with the UK's Aregon International to develop a comprehensive, multi-purpose videotex software package. Known as AT&T IV-5, the software is intended to support a variety of computer-based information services using either NAPLPS, Prestel or ASCII protocols. AT&T Information Systems has the US marketing rights for the software, which will be available in December. In separate contracts, AT&T-IS assigned the rights to market IV-5 outside the US to AT&T International, which in turn signed Aregon to market and support the software internationally.
AT&T-IS product manager Carol Littleton says that IVS-5, which combines AT&T-IS and Aregon technologies, will have the "flexibility to support a broad range of videotex applications, including internal business communications, private systems for common interest groups, public information systems, as well as potential consumer services." The software will support eight to 500 simultaneous users and will run initially on Digital Equipment Corporation's VAX superminis under the VMX operating system. It will interface with AT&T's Sceptre terminal and Frame Creation Systems, as well as Prestel and Digital's VT100 terminals. Analysts also expect the package will be modified to run under Unix on AT&T's family of minis.
AT&T's software unveiling followed on the heels of impessive product introductions at Videotex '84 and the announcement of a videotex-based Real Estate Information Service. The service is designed to help prospective homeowners in selecting new property and save realtors time and money when listing or selling a house. New Jersey's Monmouth County is the first to contract for the new service that allows realtors and their clients to view multiple-listed properties on a television screen. They can compare costs and features, view color illustrations of various styles of homes and street and zoning maps, and obtain information about current interest rates, monthly mortgage costs and professional services. The service also features electronic mail and messaging capabilities and allows realtors to develop client profiles that are automatically matched to new listings as soon as they become available. The Monmouth County Board of Realtors is helping in the system development by providing real estate data.
Among AT&T's products introduced at Videotex '84 was a stand-alone videotex system featuring a minicomputer-based data-base controller with an administrative terminal and ASCII printer, along with an AT&T Frame Creation System to format information, and 10 AT&T Sceptre cordless videotex terminals. The AT&T Videotex Information System (VIS) is priced at $140,000. The system has a tree-structure design and also includes keyword search and NAPLPS software packages. These features allow for branching from major topics to more detailed sub-topics and make the system easier to use by people with non-technical backgrounds. The VIS can also be structured to contain passwords to safeguard specific banks of information from persons not permitted access.
AT&T also announced a system that can convert photos and drawings into videotex frames in about 15 seconds, and a slide-maker peripheral unit for the AT&T Frame Creation System. The slide maker can provide visuals for meetings, training programs and sales presentations, and is priced at $3,500.
With its latest products and services, AT&T is now in a position to support videotex customers in a variety of ways. "Our customers can choose from our complete Videotex Information System, or build their own system using the new AT&T IVS-5 software, our Sceptre terminals and Frame Creation Systems," notes Clarence Selin, director of consumer information services for AT&T-IS. "These new products and services, such as Real Estate Information Service, expand the market opportunities for videotex and demonstrate our commitment and our confidence in the business potential of this exciting new communications medium." Public Videotex Progress
AT&T's Sceptre terminal features a remote keypad that connects to the TV set by infrared beam rather than by wire. The terminal incorporates a customer-programmable five-telephone-number autodialer and accommodates a call-waiting display function. If other calls come in while the system is in use, users can pick up the call or call back later. Also, with an encryption/security feature, those who use bank-at-home or similar services can code their transactions for private accessing of their accounts.
Earlier in the year, General Foods purchased a number of the Sceptre terminals, along with AT&T's Frame Creation System to study internal and external videotex applications at its New York headquarters. General Foods also contracted with Videodial of New York City for its TSV 5000 videotex software that is designed to run on IBM mainframes.
AT&T's Sceptre terminal was also selected from the Viewtron videotex service operated by Viewdata Corporation of America in South Florida. Initially, subscribers were required to buy the terminal for $600, but last summer a new subscription package was introduced, bundling system access fees, line charges and terminal rental for a $40 monthly fee. Less than two months later, subscriptions to Viewtron had jumped by more than a 1,000 to a total of 2,500. With the arrival of the popular home banking services, which were delayed 10 months by technical problems, Viewdata expects the surge in subscriptions to continue and possibly grow. In announcing its service plans last year, Viewdata's parent, Knight Ridder Newspapers of Miami, said it expected to have 5,000 paying customers by the end of the first year.
Viewtron shopping and information categories include major retailers, travel agencies, airlines, restaurants, real estate agencies, florists, banks, brokerage firms, auto dealerships and caterers. Also, computers from major corporations around the country are linked to Viewtron computers in Miami by gateway arrangements, providing subscribers with merchandise ordering, banking, stock market quotations and portfolio status, travel planning and access to an electronic encyclopedia.
Two other videotex services are scheduled for introduction this fall. In Orange County, California, Times Mirror Videotex Services is offering an introductory price of $29.95 per month for the first 2,000 subscribers to its Gateway videotex service. This price includes the rental of an AT&T Sceptre terminal and access to the Gateway service. In Chicago, Keycom Electronic Publishing has tailored its Keyfax Interactive Information Service to its local audience, adding a Chicago trivia game into the mix of educational programs and banking, shopping, electronic mail and financial services.
Time Mirror Videotex Services decided to introduce Gateway based on what it calls "overwhelmingly nine-month field trial conducted with 350 households in Southern California during 1982. A subsidiary of the Times Mirror Company, the firm was formed in 1981 to explore the viability of videotex services. Company president James Holly recently announced that more than $1 million in advertising commitments have already been received for the first year of Gateway service. In making the announcement, Holly reported that the 1982 field trial showed that subscribers value the advertising messages and product information they receive. "They linked the two-way form of communication they were able to establish with advertisers," said Holly. "Advertisers who have signed with us realize that."
Gateway is represented to national advertisers by Videotex America, which is a partnership between Times Mirror Videotex Services and Infomart of Toronto, creator of Grassroots and Teleguide, two videotex services now operating in Canada and being developed for US markets. Videotex advertising takes many forms, from brief messages and logos on index pages that direct users to a special part of the data base to sponsorship of information or games. Times Mirror expects more than half of its revenues to come from advertising. Subscribers will thus be exposed to selective advertising as they access the almost limitless source of electronically stored information and services, including news, shopping, electronic mail, home banking, games and educational programs.
The Gateway trial results revealed that participants desire a considerable array of information and services that will keep them informed, save time, save money and, to some degree, keep them entertained. When asked what information or programs they would consider essential for future videotex services, among the most frequently mentioned items were interactive services and shopping information: 71 percent wanted more stores for ordering merchandise; 68 percent wanted bill paying with their bank; 66 percent wanted travel reservations; 65 percent wanted shopping information; and 60 percent wanted to order bargain and sale merchandise.
More than half of all households ordered merchandise through their home terminals. Gateway users expressed confidence in videotex; 87 percent stating that they did not fear a lack of privacy or security in their transactions. Electronic mail and community bulletin boards also recorded high level of usage, despite the relatively small subscriber population. During the final three months of the trial, in fact, electronic messaging was used more often than games.
Keycom Electronic Publishing was formed in April 1982 as a joint venture of Centel (54 percent), Honeywell (30 percent) and Field Enterprises (16 percent) to provide a broad-based videotex service. Last January, News America Publishing acquired Field Enterprises' share of Keycom as part of its purchase of the Chicago Sun-Times and other Field Enterprises properties. Like the IBM-CBS-Sears joint venture, Keycom's three parent companies bring a synergistic mix to the videotex arena. Centel is one of the nation's leading communications companies, while Honeywell provides the expertise in computer hardware and software. News America Publishing, a subsidiary of News Corporation Limited, is an Australian public company with more than 60 newspapers and magazines in the US, Great Britain and Australia.
Over the past two years, Keycom has developed or acquired an array of hardware and software components to give birth to Keyfax. Many local and national businesses and organizations will provide information for the service, and Keyfax news, sports and weather reports will come from its own 24-hour-a-day newsroom. A dedicated telephone network has been developed to allow the vast majority of subscribers to reach the systems with a local telephone call. Subcribers will have a choice of using their own personal computer or a Keyfax videotex terminal in conjunction with their television sets to access the service from their homes or business offices. Information and services are organized under six topics: bank, shop, reserve, inform, mail and special. Electronic Home Banking a Hit
Electronic home banking is likely to become one of the more popular videotex applications. According to "Home Financial Services Delivery Systems," a recent study by Frost & Sullivan, the key to service growth will be the spread of microcomputers equipped to serve as full-color videotex terminals. Although videotex is not required for home banking the many related services that can be sold via the medium, along with advertising revenues, are seen as insuring videotex's spread and economic viability, thus opening up the market for banks and investment firms wishing to deliver their services electronically.
The National Bank of Detroit is planning a 90-day market test of a Prestel-based home banking system called Video Information Provider (VIP). For the trial, 100 customers will have free use of banking services aas well as recipes, movie listings, sports scores and daily horoscopes via Tex terminals supplied by Telelogic of Cambridge, Massachusetts. If the trial is successful, the bank will add electronic news and other home services via a gateway and offer VIP to other Michigan banks in the hopes of creating a state-wide videotex network.
Electronic home banking is already a hit in California, where Bank of America signed 8,000 customers for its Home-Banking service in the first six months starting last November. More than 1,000 branches offer the service, and the bank estimates if may have 25,000 HomeBanking customers by the end of the year.
Unlike Videotron, HomeBanking is an ASCIi service, compatible with virtually every personal computer on the market. This has allowed Bank of America to quickly establish its large customer base. When personal computers with NAPLPS graphics capability become available, Bank of America will be able to upgrade its service to accommodate other videotex-style offerings.
In the meantime, subscribers can use their personal computers to transfer finds between accounts, check their account balances, review checking account statements and pay bills to companies in more than 600 categories, including department stores, hospitals, insurance companies and utilities. The cost is only $8 a month, and there are no line charges since subscribers reach the service through a local or toll-free telephone call.
In New York, Chemical Bank's Pronto service and Citibank's Home Base offer similar services for monthly fees of $12 and $10, respectively. Home Base subscribers can also access the Dow Jones News and Information Service for an additional $10 a month. By year end, Chemical Bank plans to add stock-investment services, including on-line stock trading, to its Pronto service. In addition, the eight banks that have signed license agreements for Pronto will be able to offer similar brokerage services connecting with any brokerage house of their choice.
One securities firm, EF Hutton, already offers an on-line service, called Huttonline, giving its clients access to portfolio and account information, proprietary investment research and electronic mail. In August, the firm also added a stock quote service. Subscribers can access Huttonline from anywhere in the US on a personal computer, data terminal or communicating word processor equipped with a modem operating at 300 or 1200 b/s. Access is also available from many foreign countries. Subscribers in South Florida can also access Huttonline through the Viewtron service. Subscribers pay a $25 sign-up fee and a monthly charge of $17 that includes up to two hours of free use. Additional use costs $7.50 per hour. For people without suitable terminals. Hutton offers selected personal computers, including the IBM PC, Wang Professional Computer, Convergent Technologies' WorkSlate portable computer and the Quazon Quik-Link 300 terminal whose list price is $249. Britain Builds on Prestel
Videotex continues to thrive in Britain, the country where it all began. British Telecom's public Prestel service now has more than 42,000 terminals connected to it, and the number is growing by 1500 each month. Recently, the biggest growth has been among residential users. Nearly 40 percent of all terminals are in homes, compared with only 18 percent in 1982.
Sales of private videotex systems have also been brisk. Disc International Limited alone sold 150 systems in the first quarter, all for installation in the UK. Other suppliers include Rediffusion Computer and Aregon International. Rediffusion donated a $100,000 videotex system to the town of Gateshead for a teleshopping service geared tof the housebound, elderly and disabled members of the community. Now three years old, the Gateshead experiment has attracted international attention as an example of how videotex can help the disadvantaged.
In another social development, Prestel will enter Britain's 7500 secondary schools starting in January under a program funded by Britain's Department of Trade and Industry. The program will give schools access to the Prestel World Service plus several special features for a cost of about $65 a quarter, which represents a $20 discount over normal service costs. The program will also supply all the hardware and software needed to convert personal computers owned by the schools to Prestel terminals for considerably less than full commercial prices.
Meanwhile, British Telecom has been adding new capabilities and services to Prestel. The service now offers 16 gateways to third-part computers, and photo videotex is being readied for applications requiring illustrations, such as the display of house pictures by real estate agents. Electronic Electronic mailbox service is scheduled to be available nationwide by year end. Also, through joint ventures. Prestel is able to offer a variety of services ranging from home banking to stock quotations and a comprehensive library of software for personal computer users. In the spring, Prestel also began a service for farmers called Farmlink, which uses government and private sources to provide farmers with a list of business-oriented informational and transactional services.
Prestel is also enjoying a groundswell of interest in the United States. For users satisfied with eight colors and not needing high-level graphics, Prestel offers an inexpensive and technically proven alternative between ASCII devices that have virtually no graphics capability and NAPLPS devices, which are much more expensive. IBM's support also helps, as do firms such as Videotex Systems of Dallas, which offer Prestel products for the IBM PC and PCjr.
Prestel were also selected by Telecom Australia for its national home videotex service in the face of heavy competition from North America and Europe. The system will offer the latest developments in Prestel technology, including key-word search capabilities and transactional facilities for electronic shopping and banking. France Vies for Leadership
France is vying with Britain as the country with the greatest videotex activity. France's most-publicized program is its Electronic Directory Service, which uses a small display terminal given away free of charge by the French Telecommunications Authority. Through these terminals, telephone subscribers can make White and Yellow Pages inquiries anywhere in France. Special "guidance pages" can be displayed if the user needs help, and the system can offer alternative spellings of names as well as a variety of synonyms for various topics. Geographic uncertainty is solved by the ability to extend the search to contiguous areas. French officials claim that over 80 percent of all directory inquiries are now being answered within 12 seconds. The goal of the French PTT is to have Electronic Directory Service installed in three million homes by 1986. Directory inquiries within the local area are free; to any other area, the charge is for a local call, or about 20 cents.
Meanwhile, France's public Teletel videotex service now numbers 250 registered information providers covering agriculture, banking, retailing, travel, publishing, and local and national government. Teletel subscribers have reportedly leased 30,000 terminals from the French PTT and purchased 10,000 terminals directly from manufacturers. An estimated 5,000 terminals are being added monthly.
Citroen has installed 500 Teletel terminals in its French car dealerships so that car dealers can enter their orders directly, consult the central stock and check on clients' credit ratings. Citroen expects to cut the ordering cycle by six days and provide its marketing people with precise and up-to-date information on user demands. Ford France and Renault are also using Teletel videotex terminals for their dealership and distribution networks. Meanwhile, Cycles Peugeot is equipping 600 of its dealers with videotex terminals in a $2-million operation. Portable terminals have also been given to 30 salesmen so they can access the same central data base, which took two years to develop.
In the French National Assembly, videotex terminals are helping the parliamentarians keep abreast of the daily agenda and access data bases on legal matters and economic and domestic affairs. The system also provides nightly updates on proposed laws and an electronic mail service, enabling the political leaders to direct messages to their party members and assuring that they will get messages even while away from their offices.
France's major videotex showcase, however, resides in the Basque resort town of Biarritz, where homes, shops and hotels have been equipped with 1500 videophones interconnected via 10,000 kilometer of fiber optic cable. The videophones allow callers to see each other as they speak and also double as color "supervideotex" terminals. Subscribers can send electronic mail and get a full range of videotex services.
Another French success is the "smart card," a plastic card with an embedded computer chip that combines both computational capability and non-volatile memory. The card is also available with a magnetic stripe so it can be used in traditional automated teller machines as well as special terminals that add to or debit from the cash balance stored in the chip. Over 120,000 cards are being used in three French cities with "smart card" readers placed in hundreds of retail shops, restaurants and banks. In addition, 400,000 cards are being distributed nationwide for use in 10,000 Smart pay phones being installed this year.
France's two largest credit card organizations have adopted the so-called "smart stripe card." Also, pilot trails are underway using the smart card to store vaccination records for school children and medical records for the chronically ill, and in Paris, 8500 university students have been using the card to record their grades and enroll in advanced courses of study. Each card carries the student's university record of courses taken and credits earned in addition to name, address and national security number.
Trials of the smart card are also underway in Norway, West Germany and the United States, where the Department of Defense is testing the smart card as a substitute for the traditional, laminated paper IDs. DOD hopes to reduce or eliminate the estimated $60 million wasted annually from the use of lost, stolen or forged ID cards.
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|Date:||Oct 1, 1984|
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