The Interactive Television Alliance (ITA), a new trade association established to represent the interests of the ITV industry, held its first annual meeting and announced its board of directors at last month's BroadbandPlus show in Anaheim, CA. [itvt]'s editor-in-chief, Tracy Swedlow, recently spoke to the ITA's president, Ben Mendelson, and its chairman, Art Cohen (who is also senior vice president at ACTV), about how and why the organization was founded, about how it is structured, about its plans to use an infomercial to build consumer awareness of ITV, and more.

Ben Mendelson:

Mendelson:Well, there was an original Interactive Television Alliance that was started in 1993, and some of the people who are still well-known in the ITV business were part of that. What was perhaps surprising was that such an organization no longer existed.

[itvt]:So how did the new group get formed?

Mendelson:There was a group called the Addressable Media Coalition. It was started by Art Cohen, and it was part of AIM, the Association of Interactive Media. The group consisted of around 25 of us who were basically ITV people, but we were always, so as to speak, an outcast group in AIM because everybody else in the organization was Internet-based. We were TV-based. Eventually I heard that AIM had originally been called the ITA, and, during one of our executive meetings, I brought up the fact that what we really had here was an Interactive Television Alliance. That was the gestation of it. AIM, by the way, is run as a wholly owned independent subsidiary of the Direct Marketing Association, and at the time it was headed up by Ben Isaacson.

[itvt]:Ben Isaacson subsequently left the organization, didn't he?

Mendelson:Yes. The original plan was that the ITA would be under the wing of the DMA: the way that we presented it at the time was that if you were an Internet person you would join AIM, and if you were a TV person you would join the ITA. The DMA was going to provide us with infrastructure staffing and a little bit of seed money.

[itvt]:I understand that the ITA is no longer associated with the DMA.

Mendelson:That's correct. We were scheduled to launch the ITA at the NCTA show in the beginning of May. A month before we were to launch, none of the money had come through. At the same time, the coalition we had built up was a little wary of being that closely aligned with the DMA. We ended up agreeing that it would be better if we launched the ITA as an independent organization. So, while we share some common members and some common interests with AIM, we agreed we would be partners, but 100% independent.

[itvt]:When it became clear that the ITA would have to be a separate organization from the DMA, presumably you had to think a lot more about the logistics of running a non-profit trade organization.

Mendelson:Well, when we split from the DMA, and obviously weren't going to get money from them, I had to change my role. Originally, I was sort of shepherding the ITA along, but presumed it was going to be run by the DMA. That, of course, changed. Back in January or February I had brought in Allison Dollar as my partner. She had actually been very integral--even before she officially came on board--to helping me think about how to put this together, and she has a long history with the TV world and with putting events together. So we started an association management company that we call "2degree Partners."

[itvt]:What does 2degree do exactly?

Mendelson:Well a lot of non-profit trade associations are actually run by association management companies: essentially, an association will contract out to the company to have them manage and run it. So that's basically what the ITA does. When the ITA was ready to launch, and it was clear we were going to go the independent route, we had to approach the companies that were our original members and ask them to come up with their dues ahead of time. So we had around 5 companies that gave us money very early on, and that was enough to get things started.

[itvt]:Could you talk a little bit about the ITA's organizational structure and executive team?

Mendelson:Well, Art Cohen is chairman. He founded the Addressable Media Coalition, and one of the reasons he is chairman is because our group started from that organization. Karen Lennon [of BeyondZ] is co-chairman. The organization has a voted-in board of directors and leadership: there's people who staff and run it--that's Allison and myself--and then there are the people who are voted in to be the lay leaders.

[itvt]:Where did the nominees for the board of directors come from?

Mendelson:Well, when we were getting the ITA off the ground, I sent out close to 500 packages containing what was basically a letter of intent that came out of the original concept outline. We got back pledges to join from around 130 companies and 50-60 individuals--close to 200 responses altogether. So we got together early on with Charlie [Tritschler, former VP of marketing at Liberate], Michael [Collette, former VP of marketing at OpenTV, now CEO of Ucentric], Art Cohen and a couple of other people. We discussed the whole idea of structure, and who the people in leadership roles at the organization should be--it was a matter of consensus at the beginning, because there is really no way to have a vote for that many people at that early of a stage. So the consensus was that the companies that were able to help fund the ITA in the first place would be governing members. We tried to ensure there would be a broad constituency base, so we split up the industry into 8 different segments and we made sure there was representation from each of the 8 segments.

[itvt]:What are the 8 segments?

Mendelson:The 8 segments are content, advertising, marketing, production, distribution, application, data commerce and hardware.

[itvt]:Could you define the "data commerce" category for our readers, as it's not self-explanatory?

Mendelson:The category includes data collection, transactions, personalized content, asset management, etc. So it's, for example, Wink and companies that are doing back-end stuff.

[itvt]:What's the importance of these 8 categories to the ITA? How are they useful?

Mendelson:Well, I think one of the important issues for the ITV industry is defining what exactly the ITV industry is. There are companies like Disney, Showtime and PBS--the content guys. Then you have the advertisers--in our case, we have Kraft Foods, Proctor & Gamble and Johnson & Johnson. That's a group that has its own constituency with an interest in ITV. There are also marketing companies--basically the agencies. Each of these segments includes people who deal with ITV. You have the cable companies in the "distribution" category, the Open TV's and Liberate's in the "applications" category, the digeo's, GoldPocket's and Chyron's in the "production" category. So the fact of the matter is we need to get somebody representing each of those segments.

[itvt]:I understand that the ITA counts among its forebears other organizations in addition to the Addressable Media Coalition?

Mendelson:Yes, we absorbed the ATVF [Advanced Television Forum] right before we launched. That was pretty important because that was the other major group that was dealing with ITV at the time. Their board of directors agreed to fold their legacy into what we were doing.

[itvt]:When you say "their legacy," you are referring to the ATVEF 1.0 specification, right?

Mendelson:Yes. Actually, at that point they were really trying to get away from that. They were having a hard time, and that was one of the reasons why they felt they needed to disband…

[itvt]:They were focusing on how to market the technology to the industry, and on how to market the industry in general, as I recall.

Mendelson:Yeah. They were making some progress; but the problem was it was difficult with the structure that was created for them to continue as a membership organization. We brought in all of their members. Then, about 4 months later, in July or August, Intel had started a thing they call the "2-Screen Promoters Group." They also decided it was better for us to run it than for them to run it independently. So we are really a combination of the Addressable Media Coalition, the ATVF, and the 2-Screen Promoters Group.

[itvt]:Could you explain in a little more detail the ITA's structure and activities?

Mendelson:It's set up as a non-profit trade association. We currently don't do any lobbying. What we do is partner with existing lobbying groups that have similar interests. So, while we believe that lobbying is important, we feel at this point it is better to partner rather than to do it ourselves. The ITA's leadership consists of 3 parts. There is the board of directors, which is 20 people. Then there are the chairman and the co-chairman. Then there is the executive committee. The board of directors is representative of the various companies that comprise the ITV industry. The executive committee is chaired by individuals not acting in the capacity of representing companies. They do the day-to-day stuff that runs the organization: industry relations, association relations, public relations, government policy--we have somebody who is in charge of government policy issues, and he works in Washington.

[itvt]:Who is that?

Mendelson:Gary Arlen.

[itvt]:So what kinds of things are the board and the executive committee doing on a daily basis?

Mendelson:Well, it would be lovely if everybody did something on a daily basis. However, we are a volunteer-based organization, so the only ones who work for the ITA on a daily basis right now are myself and Allison, and some people who help us around here.

[itvt]:What are the ITA's primary goals?

Mendelson:Well, we felt that nobody really needed or wanted to start another organization in the normal sense. We believed there were issues with this industry where we really needed to be able to represent ourselves: the existing organizations, like the NCTA, the NAB, and CTAM, all have ITV segments, but it is hard for them to represent specifically the interests of ITV. The ITV industry needs to represent itself. So what we wanted to do was, instead of working from committees…well, each executive chairman technically does have a committee, but we actually don't put people in those committees, because our feeling is people don't want to go to committee meetings or board meetings. As for our board meetings, we will only have 2 a year, and maybe a couple of conference calls. But what people do need and want are things related around very specific projects that have deliverables. So what we did was we identified areas that people really needed to rally around. For example, developing consumer awareness and stimulating consumer demand. We call that the "Consumer Outreach" campaign. It is built around an infomercial that we are putting together for the 2nd or 3rd quarter of next year. We are already through the stages of plotting it out and putting the partnerships together. What we want to do is create a national brand so that people all over the country will understand what ITV is.

[itvt]:A national brand for what?

Mendelson:For ITV--for understanding what ITV is through a uniform campaign. So we will be working very closely with our MSO and DBS partners, and creating a series of 3 minute modules, with each module containing a different type of technology. We will do 60 minutes worth of that stuff. Then we'll go to a Comcast or a Cox and say, "you pick out the 30 minutes that is appropriate to your deployment." So if they are doing SVOD but they are not doing tcommerce, they will use the SVOD part; if they are doing virtual channels, they will use that part. So they get to pick out the appropriate content. A lot of this stuff is in a very preliminary phase, but we have the opportunity to work with some important creative-director people in the entertainment and film business to create a campaign that will, as it were, unify all this information. Then the idea is that we are going to give this content to our distribution partners in exchange for carriage. Basically using remnant space just to do an infomercial.

[itvt]:What are the ITA's goals for the coming year?

Mendelson:We are focusing very much on accelerating deployment. We want to make this stuff happen because, if it doesn't, it obviously really affects a lot of the companies that are involved. We have another campaign called the "Enhanced Advertising Lab." It's a very specific meeting of about 12 companies: 6 content companies and 6 companies representing advertisers. The idea is to really get in and incite sponsor-based ITV programming, so that we can really help facilitate the advertiser relationship; because, again, that's where a lot of the money is going to be coming from. There is a lot of value there in small deployments, so we are doing things that actually have deliverables, that actually push the industry forward. Those are our main goals.

We also have an initiative called "Extended Television." It came out of us absorbing the 2-Screen Promoters group, and it's about expanding ITV. We are working with a number of partners to develop a next-generation high-end home theater system that has various next-generation-enabled technology plug-ins. We are getting all of the next-generation stuff, putting it in a very comfortable atmosphere, and taking it from trade show to trade show. So we are able to actually show what the future will look like, and we work with our content partners to start developing that content, while keeping it separate from the stuff that is happening here today. We think it is very important to be able to show what is here today and show what is here tomorrow, and keep them separate.

[itvt]:Have you been able to put this together yet?

Mendelson:Well, we have been in business for 6 months, which is not a very long time: in those 6 months, we put the structure together for the Consumer Outreach Campaign, and we will be presenting that to the board of directors at our first meeting. We had 6 Enhanced Advertising meetings in the last 6 months--which I think is pretty good: they have been very successful, and we have a very supportive group of companies that are helping us out. As for the Extended TV Lab, we are doing the 1st generation of it at BroadbandPlus. We are working with WGBH and PBS and their technology partners to put out the first generation of the Extended TV Lab. As we go from show to show, we will build it out larger and larger.

[itvt]:Any other goals for the organization?

Mendelson:The main goal is to push this stuff forward and to help create interest in what we are doing among outside companies--for example advertisers--in order to get them more involved, so there is more money in the system.

[itvt]:Speaking of which, how well-funded are you?

Mendelson:We are a bootstrap organization. Our dues structure is very reasonable--it is a lot less than most organizations. The money is used just to run the organization, so when we have things like trade shows, they all have to be funded independently. So, in addition to our board of directors and the executive committee that actually runs the different parts of the organization, we have a 3rd thing we call the "Foundation Board." The Foundation Board will actually be in charge of the money that is used to fund the various projects we're engaged in. I think we have uniform support from the industry. I think some people were pessimistic about whether the industry was mature enough to have an organization at all. I think we proved that to be the case.

Art Cohen:

Cohen:Well, my role is not dissimilar to Ben's--although Ben is actually more on the "hands-on" side of the ITA. I'm more of a gatherer person, and more of a carrier of the flag of ITV and the industry. I'm a member of the industry, whereas Ben is an organizational manager of this organization. I'm chairman of the board of directors, and chairman of the organization as well. So when the ITA's board of directors meeting was held in Anaheim a few weeks ago, I ran the meeting along with Ben.

[itvt]:And what are your responsibilities?

Cohen:To get as many tentacles as I can, so as to speak, into the industry and its top people--so to all the major companies in the industry--and keep them working together and moving this ITV thing forward. Gathering as many important folks as I can to attend the meetings that we have, and getting as many speaking engagements as I can, in order to spread the gospel of ITV--which I've been able to do, fortunately. And also to present what I think is a challenge to the industry to do more than it's done.

[itvt]:How do you see the role of the ITA now, and what should it be two, three years from now?

Cohen:Right now, its role is to be, as it were, a beachhead for ITV.

[itvt]:A beachhead?

Cohen:Until now, there has been no organization to represent the ITV industry. Now we have an organization that represents all parties: from the creative side, the technology side, the advertiser side, the consumer electronics side--i.e. the various pieces that form the grand equation of all things that revolve around the digitization of television. And an organization that promotes all the things that will be possible as a result--especially ITV. But ITV has got so many parts to it, that it needs to be corralled, it needs to be visioned, it needs to be categorized. And I'm trying to help with that: ITV needs to be de-mystified.

[itvt]:Why does it need to be de-mystified?

Cohen:Most people don't know what ITV is, and they don't care. Demystifying ITV means answering questions like: "What is this thing?" "Who's in this business?" "What do these people do?" "What can I get out of it as a marketer?" "What can I get out of it as a consumer?" "Is there really an ITV industry?" and so on.

[itvt]:Would you say the ITA's primary goal is trying to organize the industry itself and trying to provide services to it? Or rather that its goal is to organize how the industry speaks to the consumer and how the industry speaks to government?

Cohen:No, we're not a political organization. We don't plan to do that, at this point. What I think needs to be done, is that there should be a monetization, a valuation, of what happens when ITV takes hold. What is the value of it? How does it make things better monetarily? What is the business plan? There should be an omnibus business-planning process that demonstrates the value of ITV.

[itvt]:What kinds of things take place at the ITA on an ongoing basis? And what kinds of things do you do on a day-to-day basis as chairman?

Cohen:Ben and I speak at least once or twice a week. We get a lot of emails from people who want to join and who want to do things for the organization. We're trying to organize the various pieces of the organization, so as to give it some structure and some definition. For instance, there's a distinct piece of the organization that speaks to 2-screen interactive scenarios.

[itvt]:Where do you think the ITA will be 3 years down the road?

Cohen:I don't know. I expect it will be further along than the IAB was…

[itvt]:IAB stands for the Interactive Advertising Bureau, correct?

Cohen:Yes. I think the ITA will be further along than the IAB was at the same stage, in the sense that the Internet is something that was created out of the ether. It wasn't necessarily ever meant to be an advertising medium. The IAB--and I was one of the first members, back when I was at AT&T--was creating Internet advertising out of the ether, and the Internet became an advertising vehicle in spite of itself. The television industry has always been an advertising medium, and has the most revenue, by far, of any medium ever. It's an industry at a turning point, and needs some redirection to take advantage of all the technologies and data experiences that new technology offers. But it is an advertising medium, first and foremost, and it's the future of television that it become interactive. Our organization will assist in moving that forward. Right now, television is a dumb box, a one-way proposition. You look at it, and that's it. It will become a two-way instrument in the future. It will continue to be a community viewing experience, but more of a one-to-one experience in the future, and it may encompass the Web as well.

[itvt]:Does the ITA aim primarily to serve the industry, to serve the programmers and content creators, or to serve the viewers?

Cohen:I have to say all three. The viewers are important to us. The consumer outreach program was the first thing Ben and I discussed at the birth of this organization last April.

[itvt]:What kinds of developments do you think we'll see in the ITV industry in the coming year?

Cohen:We're moving forward. Though for ITV to truly take off, there are a lot of things that have to be resolved in the cable industry: mergers have to be completed and the various problems the cable industry has stubbed its toes on--for example, Adelphia's problems and Charter's problems--need to be flushed out. There are a lot of issues surrounding the cable industry, and they take many forms. For example, the cable industry is stuck with the requirement of laying cable, of spending money for plant and equipment. Unlike the DBS industry which doesn't have to do that, right?

[itvt]:So what issues do you think will shape the ITV industry this coming year?

Cohen:Well, VOD is a killer app, no question about it. Whether or not the consumer is going to pay for it, and whether or not the cable industry is going to charge for it are questions I can't answer at the moment. If the cable industry gives it away for nothing and then they charge for it later, the consumer might balk at paying for it because they've gotten it for nothing. On the other hand, if the cable industry wants to lower churn, which is what they're doing with this, then they must offer the consumer more for the dollar.

[itvt]:How does one drive interest in ITV?

Cohen:Well, you don't know how many people are going to interact, and you can't make people interact. I can't grab you around the neck and say "Love me." People are going to do what they want, right? So, when people have to interact, they'd better have a compelling reason to do so. If it's something they can't get anywhere else, they'll interact for sure. If it's a value proposition, they'll interact, for sure. If you're trying to get them to use ITV to get more information about a product or service…well sometimes they do, sometimes they don't. Direct marketers know best how to do this. And one important thing the advertising industry has to realize, the brand companies have to realize, and the television industry has to realize too, is that the direct marketing industry, in a lot of respects, knows how to do this stuff. They know how to reach people. They just don't know how to reach them on television, because television hasn't been an interactive medium, it hasn't been a targeted medium. So, the way it is now is that advertisers just have to work with the television industry and hope for the best. Throw enough stuff against the wall, and hope some of it will stick. That's what television advertisers have traditionally done. Nielsen Media Research tracking, of course, makes the process much more accurate. It's, nonetheless, difficult to control the impact of advertising on television without some form of electronic controls. Today, advertisers want accountability for their marketing dollars. So, you have to be intelligent in the process and target your audience using the new technologies. It follows that more accurate targeting will increase the yield on interactive television.

[itvt]:Do you think ITV, this "intelligent" medium, will change the way the world sees itself? Do you see it as a technology that will shift the culture in some way?

Cohen:Yes. Because television will be more in the hands of the consumer. The consumer will be able to manipulate it on their own. Just as when we gave them the remote control they were able to begin that revolution, that power shift from the programmer to the consumer.

For more information on the ITV Alliance, go to www.itvalliance.org

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