Newest Entry in PVR Industry Plays It Advertiser Friendly
TiVo and ReplayTV either outsource their PVR technology to satellite and interactive television companies or sell it at retail in a set-top box for upward of $300 and a possible monthly service fee. Jovio Inc., Pittsburgh, plans to offer its PVR service free -- depending on what partnerships develop -- and earn profits from serving targeted ads through permission-based profiling technology.
The Jovio service will be available to consumers in three ways: with a cable or satellite provider using the newest Motorola DCT 5000 digital set-top box; bundled with an I-TV service; or through another PVR such as TiVo or ReplayTV.
Like TiVo and ReplayTV, Jovio allows people to use their televisions like a VCR and record programs and create whole channels consisting of programs they pre-select. The difference is the Jovio service uses the Internet, and not a TV set, to accomplish this. Jovio will partner with sites that feature electronic program guides like Gist.com and TVGuide.com. Jovio will then receive the programming and targeting information from the TV viewer through these sites.
The main source of revenue for the company will be permission-based targeted advertising in agreement with cable and satellite providers, I-TV services, PVR services, Internet entertainment sites, TV networks, advertisers and agencies.
A person who subscribes to a service or purchases a Jovio-partnered set-top can visit a site with a Jovio-enabled electronic program guide and enter his name, ZIP code, cable provider and a personal identification number. The subscriber then enters into a system that will track his television viewing. By entering into the service, the user will receive targeted ads as well as suggested programs based on the same information. After learning from a customer's viewing habits over time, Jovio then suggests certain advertisers and gives the option of eliminating certain companies' commercials.
"We are able to develop a composite sketch based on demographic, geographic and, most importantly and interesting, psychographics," said Richard Roberts, vice president of sales and marketing at Jovio.
"With psychographics, we are able to determine product categories and brands that a person may have a preference for, so we are able to glean a purchasing pattern on that individual based on the programs they watch. We can actually deliver targeted ads to different viewers in the household," he said. "We feel that we can develop, within an 80 [percent] to 85 percent degree of accuracy, a composite sketch of that individual after about 10 different program views -- so somewhere within five to 10 days."
For example, a person who primarily watches sports programs would be sent an ad for basketball sneakers. That same basketball sneaker company -- or more likely a network -- could then also suggest programs to the viewer through an e-mail or the Jovio home page that appears on the TV screen.
This arrangement can also be worked out with the cable provider, who will pay to have a channel upgrade advertised. Therefore, if a person doesn't have a pay movie channel and chooses to record a Batman cartoon, Jovio would suggest that having a pay movie channel would enable him to watch an upcoming broadcast of the movie "Batman." The Jovio service will also help facilitate the order by sending out e-mails alerting customers of promotions.
Though viewers may be receiving targeted ads, like TiVo and ReplayTV they will have the option of fast-forwarding through those advertisements -- sometimes. Jovio will give advertisers several options in controlling the fast-forwarding button: They can pay to have it neutralized during their spot; they can have a picture-in-picture frame pop-up that would contain a smaller version of the spot while most of the screen is taken up by a static billboard ad for the same product; they can reverse this with a small chyron taking the place of the pop-up window while most of the screen contains the spot as it is fast- forwarded through; or they can slow the fast-forward to half-speed so logos are still recognizable to the viewer. The advertiser can also do nothing and allow the viewer to fast-forward through the commercial.
Derek Minno, CEO of Jovio, said this late addition to the service came as a result of an early press tour when reporters accused the company of being unfriendly to advertisers.
"We are now playing all sides," Minno said. "We are friends of the consumer in that we act as their own personal video search agent; we help the network out because we will recommend programs that are tailored to a viewer's taste; and we are also friends of the advertiser through our fast-forward technology we have developed."
Jovio is in an infrastructure build-out after using most of the last year to raise capital and secure patents, Minno said. The company is seeking its second round of funding and is in talks with undisclosed companies.
"We'll have a test later this year, early next year, with a cable operator, but right now we are not able to release any information," Minno said. "Within the next month or so we will also have an announcement about a relationship with a dot-com electronic program guide, a storage-enabled set-top box and some major advertisers and packaged-goods marketers.
"At this point we are agnostic. We are looking to build this company out with partnerships. And we believe that we have an application that could drive the demand of the products we want to partner with," said Minno.