Video-On-Demand Gets Another Boost

The new holy grail of the media business is video-on-demand (VOD)---the ability to make high-quality video, audio, and Web content available on customers' TVs when they want it, not according to a broadcaster's schedule. When you add shopping-on-demand supported by live video and sound, you have the makings of a new media empire.

Last week, NBC and Intertainer, Inc. announced an alliance to advance the cause of VOD. Under the terms of the agreement, NBC will acquire 6% of Intertainer for $3 million, with an option to buy up to 19% of the VOD company. This isn't the first time that major players have courted Intertainer. Back in April, USWest and Sony threw in their hats following investments from Intel and Comcast (see previous story).

NBC will join Time Warner, Sony, and Buena Vista (Disney) in providing select content for Intertainer's on-demand service, making it the first broadcast network to provide VOD content from its library of past programming. For Intertainer, the alliance with NBC brings additional financial backing and the opportunity to become the first on-demand service to offer television-network programming. NBC programming details are expected to be unveiled in the fall.

Intertainer's services will be available to consumers via their personal computers or televisions starting in the third quarter of 1998. Initially, distribution will be provided by two of its existing partners, Comcast and USWest.

According to Intertainer, additional technology will be provided by Firefly Networks, Inc. This technology creates an "intelligent agent" that "reads" users' preferences and provides prompts and suggestions, "leading them to personalized movie, music, television, or interactive-shopping program options." Other technology partners of Intertainer include Intel, Sun Microsystems, Sony, and Informix.

"We were willing to offer up some of our content with the hope of pushing this along," says Tom Rogers, president of NBC Cable, explaining the company's first investment in VOD. "We are actively looking to be involved with companies that we think can guide the way to that [VOD] TV future."

According to Intertainer co-chairman and co-founder Richard Baskin, "In the end, consumers will be inspired by the fact that they can get access to great television shows from the same source through which they can get the movies, music, and shopping services they want---all on their own schedules."