November 30, 2005

ITV Interview: Mike Doyle, President of Comcast Cable's Eastern Division

Mike Doyle is president of Comcast Cable's Eastern Division, whose service area extends from Maine to Delaware, and which has approximately 5.1 million video subscribers. A strong advocate of the need for cable companies to offer localized content, he is also the founder of Comcast's 24-hour cable network, CN8, which offers local news and other regional programming, and reaches around 7.1 million homes in the northeast and mid-Atlantic regions. He recently spoke to [itvt]'s Tracy Swedlow about the Eastern Division's localized VOD offerings (including "CN8 Presents: Candidates on Demand," a service that allowed digital subscribers to access free, on-demand interviews with candidates in last month's New Jersey gubernatorial election), about the division's future plans for localized VOD, about Comcast's newly launched Karaoke On Demand service, and more.

[itvt]: What was the thought process that led to CN8 Presents: Candidates On Demand?

Doyle: I've always felt that there's a lot going on locally that people need to know, but that it's probably the area in which they're least interested or the area that they know least about. So, historically, we've done a lot of candidate and election coverage with Comcast Newsmakers [note: the latter is a series of short interviews with local newsmakers that air at hourly intervals throughout the day, sharing a channel with CNN Headline News] and with our local news channel, CN8. It just seemed that, with VOD, the time had come to push the envelope one step further. My attitude was that this was an interesting gubernatorial race: it had two candidates who were quite strong, and people felt that it was going to be an interesting race--maybe not to the wire, but it was getting more interesting as time wore on. So I felt that we should put coverage of the election on VOD and see if people found it interesting and if it helped get some people to the polls and helped them make their decision. It was really a natural extension of what we do on linear TV with Comcast Newsmakers and CN8. The whole mission of CN8 is to provide local and regional content that, quite frankly, is not covered by the broadcasters in town because of the absolute necessity of their having to get ratings. By offering that local content on VOD, you allow people to view it at a time that is convenient for them.

[itvt]: How many interviews were conducted for Candidates On Demand?

Doyle: We offered the service to all registered candidates and eight accepted. We did one interview per candidate, and the interviews were five minutes in length. We also taped 30-minute interviews with Senator Jon Corzine and Doug Forrester that aired on CN8 and were made available on VOD just before the election.

[itvt]: Did you ask the same questions of each candidate?

Doyle: Here's the design of it: the purpose of the interview was relatively the same for each of the candidates. A pre-meeting was held with each candidate, in which we talked about what the candidate's agenda was, and what they really wanted to get across to the voter. And then the interviewer had the latitude within that context to ask the questions that got that candidate to that place. Because, again, the purpose of this service was to say to a candidate: "If you had five minutes to talk about your platform to a viewer, what would you try to tell them about yourself and what you'd do as a governor." So if somebody's platform was 180 degrees different from somebody else's, naturally you're not going to ask them the same questions. However, the overall mission of the interviews was all the same.

[itvt]: Do you think that Candidates On Demand had any impact on the election?

Doyle: Well, viewers didn't only see Senator Corzine, Doug Forrester and the other candidates on VOD; they also saw them a lot on CN8. Both of them were in CN8's studios on the night before the election. So it's hard to say what impact VOD specifically had on the election. But I definitely think that the combination of our various localized services--Candidates On Demand, CN8, and Comcast Newsmakers--had a significant impact on awareness of the election. Now, obviously I don't think we single-handedly decided the election, because this was one of the most high-spending political races ever. But do I think our services helped make people more aware of the election in New Jersey? Absolutely.

[itvt]: Now, Candidates On Demand was preceded by another high- profile localized VOD offering on your platform, correct?

Doyle: Yes, I would say that the first time that we really saw an example of how strong local content on VOD can have a huge impact on people was when we did our Troop Greetings On Demand service. We enabled the troops serving overseas to say "Hello" to their families and send them holiday wishes using VOD. When we saw the usage figures that came out of that, we were amazed at the numbers, but what was really encouraging was that a lot of people told us afterwards that the service really meant a lot to them. So, when we were planning our election coverage, we said to ourselves, "Well, we're doing these candidate interviews anyway for Comcast Newsmakers and CN8, so why not just extend them and put them on VOD?" We actually plan to make a lot more local content available on VOD in the future.

[itvt]: How did you acquire the content for the Troop Greetings service?

Doyle: It was submitted on tape by the Army/Air Force Hometown News Service. We made an arrangement with them, so that tapes of the troop greetings from our coverage areas would be delivered to us. We then edited the tapes, sorted by areas, and added the names and locations of each serviceperson's hometown before placing them on VOD.

[itvt]: And I take it that you're offering the service again this year?

Doyle: Yes. We've done it two years in a row, and this holiday season will be the third time we've done it. I hope that, by now, other cable operators have picked up on the concept, because, when you think about it, it's such a nice thing to do with VOD. Obviously you're not going to be able to set aside a linear channel running troop greetings 24 hours a day, but VOD is the ideal place to put this kind of content.

[itvt]: How has the response been to Troop Greetings On Demand?

Doyle: Last year we had around 50,000 viewings of Troop Greetings On Demand. Now, the service was not intended to generate a lot of usage, but was really designed for friends and family of the troops serving overseas. So when you see that it garnered 50,000 views, you have to think that it was being used not only by friends and family, but by people who were interested in seeing content related to their local community: Troop Greetings is done in a very localized way--you don't have greetings from troops who are from some suburb of Philadelphia going into Northern New Jersey, for example.

[itvt]: And how has the response been to Candidates On Demand?

Doyle: Last month, Candidates On Demand accounted for the majority of the fare in our "Get Local" On Demand category: we did more than 40,000 hits in that category, so most of those hits were for Candidates On Demand. We're actually very pleased about that, considering the fact that there were about two million voters in the election: you have to figure that out of those two million voters, around a million came within a Comcast service area. Then of those million people, probably around 45 percent have a digital box in their home; so that means that you were dealing with around 450,000 to 500,000 digital boxes, and out of that number there were 40,000 orders in the "Get Local" category. So that's pretty good.

[itvt]: What other VOD categories are proving popular?

Doyle: Well, Dating On Demand has turned out to be a very popular category for us: the Eastern Division has had more than 9.4 million views to date for Dating On Demand, which was launched in August, 2004. Another very popular category is Fitness On Demand: we have a whole bunch of health videos and other physical fitness content in that category. It's actually another good example of content that's really well served by VOD: most exercise shows are only on linear TV at certain times of the day--so what happens if you want to work out at three in the afternoon or two in the morning? We have seen 2.7 million Eastern Division views for Fitness On Demand, which launched this year. Karaoke On Demand is also turning out to be very popular.

[itvt]: I understand that Karaoke On Demand was only launched recently. How much traffic has it been garnering?

Doyle: Well, since launching in mid-October it's garnered almost 3 million views nationally and 1.2 million views in the Eastern Division alone--without any significant promotion. What we are finding out is that all kinds of unusual and niche content categories are making it on VOD. Karaoke On Demand and Dating On Demand, clearly, are huge.

[itvt]: What other localized content do you offer on VOD in addition to Candidates On Demand and Troop Greetings On Demand?

Doyle: "Get Local" has at least six new hours of programming added every single day, and we have a full week's worth of shows available at any given time. Today, "Get Local" includes daily news, five-minute news updates, sports, business and entertainment programming, as well as a "Dating On Demand: On a Date" TV show. We also include daily weather forecasts--you'd never think of having a weather forecast on VOD, but it's actually a great way to get it. We also include local specials and series, such as Troop Greetings and a recent Firefighters Memorial special, and will be adding new content frequently.

[itvt]: What other localized content are you looking at offering on- demand in the future?

Doyle: Well, we have elections coming up next year, so we're currently identifying the elections that we're going to use VOD to cover. Another thing we're looking at for VOD is local music and other entertainment. Imagine you're in Philadelphia and there's a red-hot local band that's playing venues that hold, say, 1,000 or 1,500 people. We're very interested in cutting deals with those venues, shooting video of these bands, and putting it on VOD. Another thing we're very interested in from a VOD standpoint and that we expect to do more of is coverage of high school sports. There's a lot of interest in high school sports--the local newspaper for the county I live in, which is very widely distributed, has coverage of local sports every day on the front page of its sports section. But most high school sports are played at 3 o'clock in the afternoon on Thursdays. So how many people really have an opportunity to get to a game, and if you were to broadcast a game live, how many people are going to be at home to watch the game? Very few. So we've found that VOD is a really good venue for high school sports. So, to answer your question, I would say you're going to see on VOD a lot of local sports coverage, a lot of local entertainment coverage, the local news, as well as coverage of all the key political races that are coming up next year.

[itvt]: How important is promotion for local VOD offerings? What kinds of promotion are you doing?

Doyle: We take roughly 30 percent of the total inventory that is afforded to us across the 40 plus networks that we insert advertising on, and we use 30 percent of that inventory towards marketing and promotion of our product. We also use the "barker" on our interactive guide, direct marketing, set-top box messages, and public relations outreach and special events.

[itvt]: When you say that you use 30 percent of your inventory towards marketing and promotion of your product, do you mean promotion of your service in general or of VOD specifically?

Doyle: It can be of anything, not specifically of VOD. But I would say that we use roughly 25 percent of that 30 percent for promotion of VOD and CN8.

[itvt]: And how has the response to that promotion been?

Doyle: I think it's been very strong. Our division's service area stretches from Maine to Delaware and we have around 5.1 million video subscribers. Of those 5.1 million video subs, roughly 45% have digital boxes. Last month, we did more than 40 million VOD orders on those digital boxes. And, over a three-month period, 89 percent of digital boxes have placed an order. So the promotion must be working, because there is huge awareness of VOD. If you have 89% of the digital boxes getting into VOD and actually ordering something, that means that people know it's out there and know how to use it. And what we're also finding out is that the people who use it are using it multiple times each month--the average user accesses VOD approximately 18 times per month. Last month Comcast announced that as a company, we surpassed one billion views this year alone.

But the thing about VOD that's interesting is that content can be successful on it, even if it doesn't attract a huge audience. Take the Troop Greetings, for example. As I mentioned, they did 50,000 views in a month where we had a total of, say, 20 million views. But you can't just look at it and say, "Gee, the Troop greetings only garnered 50,000 views, so they weren't very successful." The way you have to look at it is that 50,000 people out there found their way to a category called "Troop Greetings," and that what that meant was that 50,000 people got a lot of value out of something that for us was a really great use of our existing technology, and not all that complicated for us to produce.

I think that you have to look at things like Candidates On Demand in the same way. We are living in a country today where the greatest right you have is the right to vote. It is also the greatest unexercised right-- especially in these off-year elections where you get voter turnouts in horribly low digits. The point is that if we put out something on a VOD basis and 40,000 people find their way to watching it, that means that a large number of people, who otherwise may not have made it to the polls because they didn't feel educated enough on the issues and candidates to vote, had an opportunity to use our service to become more informed.

[itvt]: Are you interested in offering games on your VOD service?

Doyle: Absolutely. But I can't really talk about that at this time.

[itvt]: Will free VOD remain an essential part of Comcast's strategy?

Doyle: Absolutely. Free VOD gives us such a huge competitive advantage over satellite. We're in a highly competitive industry and we've built our platform on the premise that 90 to 95 percent of our content should be free. I don't see us ever charging for our own VOD content, because of the competitive advantage it gives us--more than 40 million VOD orders a month in the Eastern Division alone certainly helps reduce customer churn and increase the overall customer experience and satisfaction. So the kinds of discussions we're having right now about VOD are about how we can make our VOD offering even more robust, how we can add even more value to it. And, as you can see, with VOD we're not just interested in things that are "home runs," so to speak, like Dating On Demand and Karaoke On Demand--we're committed to introducing a wide variety of content and categories, such as Candidates on Demand and Troop Greetings On Demand, to appeal to a broad customer base with varied tastes and interests.

November 30, 2005 at 11:56 PM in Interviews | Permalink