March, 2006

When Channel 4 announced it was to abandon the red button in its interactive TV future there was a collective gasp from many industry players at what looked, on the face of it, to be a case of old-fashioned technophobia. Go back to mere telephone interactivity? Surely not.

Channel 4 chief executive Andy Duncan calls the red button “clunky” and says it has been “overtaken by the opportunities offered by the internet and broadband.” That said, the broadcaster is not abandoning the red button altogether in its iTV strategy.

The truth is that Channel 4 is not alone in reassessing its relationship to the red button. While pushing red is not about to disappear completely, when it comes to red button applications much of the UK TV industry is pausing on amber.

Channel 4 will retain the red button for interactive advertising and for betting because it reckons it can make money on these, but the next Big Brother will not include red-button voting. Under its new controller of ITV interactive and ITV.com, Ann Cook, ITV is “evaluating” red button effectiveness. Even Sky has reorganised its interactive unit, re-naming it “networked media” with plans by its new head, James Baker, to “figure out which types of interactivity suit which types of content on which interactive devices” – be they set-top boxes, mobile phones or broadband.

“Red button is a bit like the emperor’s clothes,” adds Duncan. “It is costly and it doesn’t pay for itself. But more importantly it’s about where the audiences are and they are increasingly on mobile and broadband. Unless there is a step change in red button we’ll stay out.”

Red-button interactivity began in 1999, with Sky, Channel 4 and the BBC pioneering the technology. But seven years on, the cost of developing and running red-button applications remains high – and appreciably higher than creating similar services using phone, SMS or a website.

Using the red button can indeed feel clunky, especially compared with the ease and speed of texting or using a broadband-connected website. “Red-button applications look slow and the interface is kind of ugly,” says Claire -Tavernier, senior vice-president of interactive for FremantleMedia, producer of The X Factor and Pop Idol. “Pressing red is like going back to an old-style website and this makes it feel like old technology. People are used to something much smarter now.”

Seven weeks of planning to be spontaneous

Fremantle and ITV have enjoyed success with red-button voting on hit shows like Pop Idol and I’m a Celebrity… Get Me Out of Here!, but Tavernier says her company has not developed any new red-button applications for 18 months. A simple red-button voting application can cost £20,000 to £30,000 and then must be okayed by Sky before it can launch – a process that can take up to seven weeks.

Broadcasters must pay Sky for use of its platform as well as negotiate a revenue share and the phone provider must also be paid. Even after all this is in place, red-button voting can still be overwhelmed by high calling-volumes.

Even as the premium phone line companies have upped their game for landline voting, viewers who push red during popular programmes such as The X Factor may not get through. “I think we are at a crossroads for the technology, where red button will either become completely sidelined and disappear or it will reinvent itself alongside the new set-top boxes and re-emerge as something interesting,” says Tavernier.

Despite the relative chill among commercial broadcasters towards the red button, the BBC is continuing to push the red button as part of its iTV remit to reach audiences across all platforms. Last year the BBC spent £17.1m on BBCi, including its always–on iTV content plus the “enhanced TV” that sits behind the red button on specific programmes.

The BBC doesn’t run live, red-button voting services anymore. The corporation did have red-button voting in the first season of Fame Academy but this was simplified in the second season to give people access to live video from the house.

“Giving people too many voting options can be really off-putting and the red-button technology isn’t really up to lots of people voting at the same time,” says Emma Somerville, the BBC’s head of interactive programming. “By far the simplest and easiest way for people to vote is through the telephone. What people really like on red button is a content-led service and we can focus on that because we are not under pressure to generate revenue from new services.”

But even the Beeb has pulled red-button services when the take-up hasn’t been there. A case in point was a 2004 red--button trial for additional information behind the BBC Ten O’Clock News, axed after six months because it was not a success with audiences.

Despite that poor response, news in general is still the most popular genre for BBCi’s always-on red-button service, especially the News 24 channel. “I agree with Andy Duncan that we need to look at how audiences react across all the different platforms, from red button to mobile to broadband,” says BBC’s Somerville. “Mobile is a more difficult platform for us to crack because of g page 10

Page 9 g the policy issues around charging and universality, but we have found out that with Spooks, for example, people use the red button in the first 15 minutes or not at all, but they will play the Spooks game on broadband for a lot longer.”

The BBC re-launched the BBC2 website in late February with lots of video content and is also trialling video-on-demand services on its website behind such shows as Child of Our Times and The Human Body. Somerville is focusing on the type of interactive content audiences will want on different platforms, especially with the impending launch of the BBC’s iMP (interactive media player).

She explains: “We have always looked at where the red button was going to add value for audiences, but now we have a lot more technologies. The pioneering red-button experience has brought a huge amount of learning.

“People will still want a choice of courts when they are watching Wimbledon, and they are going to want to participate along with factual programmes and get the karaoke lyrics for The Sound of Music. But there will be other needs and what I call mood states that we are going to be able to meet more effectively through other platforms.”

Advertisers hedge their bets

For commercial broadcasters there is much potential for interactive, red-button applications in betting and advertising. Sky’s second-highest revenue stream after subscription is interactive – beating advertising income.

However, the bulk of the interactive revenue is from SkyBet, which provides betting behind its football games as well as casino-style games. Of the £182m Sky earned from interactive revenues in the six months to December 2005, only £46m was from iTV, including i-advertising and enhanced TV. The rest was from betting.

But it is interactive advertising where Sky and its commercial rivals see big potential for the red button. Sky booked 189 iTV advertising campaigns in 2005, up from 173 in 2004.

“In the future media companies are going to look at how to make campaigns work across a variety of different platforms and red button will be one of them,” says James Baker. “But with a joined-up strategy among all these interactive options there is real scope for growth in interactive ads.”

However, the new head of the joined-up Sky strategy also admits that it is “incumbent on Sky to make the red button experience easier”.

ITV’s new overnight show Quiz Mania – part of its new ITV Play brand – only uses the phone for its interactivity. In fact, the whole ITV Play strategy is about phone-based interactivity, although the new controller of ITV Play, William van Rest (who created Optimistic Network’s participation TV channel, QuizNation, formerly Nation 217) will also be looking at online services.

Beginning as strands of overnight programming on ITV1 and 2, ITV Play’s interactive strategy is clearly based on the commercial broadcaster’s red-button experiences.

In 2005, only 5% of the people who interacted with ITV on Sky used the red button, down from 8% in 2004. In 2005, 60% used the phone and the rest was SMS. “Telephone is still the biggest way people interact with us,” says ITV’s Cook.

Emmerdale set to press red

Although Cook has put the red button under review she says that there are some shows where red button makes real sense. Coronation Street already has red-button capability and Emmerdale is likely to get it later this year.

Taking a lead from the BBC, ITV is also looking at launching always-on iTV applications that sit behind the red button all the time. Cook says that advertisers are very interested in the red button as another way to be part of the channel’s programming: “We have advertisers who are part of programmes as sponsors or advertisers and they want to be part of red button as well.” With the way people use their TVs changing rapidly, and broadcasters moving into mobile and online services, the red button is no longer the centrepiece of the interactive TV experience. How people access interactive services and content is set to become an increasingly lively area later this year: Sky plans to include broadband connection capability with its next set-top boxes and BT’s new hybrid Freeview boxes will also come with a broadband connection.

The capabilities of video-enabled mobile phones will provide broadcasters with another route to their audiences. In this environment, how much a part the red button plays in the future will depend on whether it can keep pace both creatively and commercially with other technologies.