Columbus, Ohio — Come with me on a trip to the heartland of future TV today. Of all the cable systems in operation in America right now, the Qube system best represents 1985 today. It is an amazing prototype of Future TV, an early forerunner of "The New Video Age."
I flew out to Columbus, Ohio one morning after chatting in New York with Roger Smith, a vice-president of Qube's owner, Warner Communications Inc. Qube has been written about in many publications and discussed constantly since the system was inaugurated in 1977. Only recently, American Express bought a 50 percent interest in what is now Warner Amex Cable Communications.
So far, according to Mr. Smith, Warner Amex has spent around $30 million on Qube in the expectation of learning enough from the experience to earn Warner back many millions more in the future.
"Qube in Columbus alone," said Mr. Smith, "will never be profitable. It's a laboratory. At present we are the most experienced company in providing what we think is going to be the nature of cable television, which is two-way interaction.
"Now we are ready to go into Houston, Cincinnati, Pittsburgh (with around 100 channels instead of Qube's 30-going-on-80), and maybe Brooklyn and Queens with very few technological bugs.
"We've done the experimentation with programming and marketing. We made a calculated decision to leapfrog the single-channel subscription service like HBO and jump right into the two-way system, thus allowing time to build a huge, profitable business."
Although he made other points, it was clear that Mr. Smith was not about to reveal many more of the $30 million marketing or programming secrets of Qube. The only way to study Qube, I decided, was to visit Qube and for a while become a Qube subscriber.
So, on to Columbus. . . .
The Qube symbol, a big, colorful three-dimensional cube (the name has no special significance -- it was simply chosen out of thin air, according to Qube old-timers), is visible from the road just outside the center of Columbus.
I caught Qube general manager Larry Wangberg on the run.
What has Qube learned in the four years of its operation?
"We've learned a lot about technology. The two-way technology works and is reliable. We've learned that once people have the system in their homes they like having the chance to participate in programs. We have talk-back TV in public affairs, sports, entertainment. You can see them participating in the NBC show 'Speak Up, America,' where they vote on issues.
"Recently, when we had the Leonard-Duran fight on, our subscribers had the opportunity to score the rounds themselves (they didn't agree with the decision). And there was the game between the Columbus Rams and the Racine Gladiators where our suscribers called the plays for the Rams (who lost, by the way).
"We work in the area of city planning with 11 different communities -- for example we had a kind of town hall 'narrowcast' meeting for Arlington concerning a planning study for which they wanted feedback. [In what is called "narrowcasting," it is possible to feed the program to specific areas only and to receive pushbutton responses from only those same areas.]
"After the initial installation fee (less than $20), the Qube service is $11. 95 per month for which the subscribers get 20 channels at no extra charge. Cable News Network and the children's 'Nickelodeon' channel are free. There is an optional 24-per-day subscription movie channel for $7.95. There are ten channels which offer premium events on a pay-per-event basis, ranging from 25 cents upward. Most of the feature movies are $2 or $2.50. The Leonard-Duran fight was $10.
"At any given time there is generally a choice of three or four events. There's much greater convenience here and a much more diverse offering of events. For example on the 'Live and Learn' channel there may be a program on improving your golf swing or a college credit course in history or a library program on 'War And Peace' where the library will send you the book to read.
"To engage any of these channels you simply touch the button at the bottom of the column and then the particular channel can be engaged by touching any one of the 10 buttons on the side. We're the only system in the world that offers a choice of subscription movies or pay-per-view. [There is an "adult" movie subscription channel but that can be eliminated from the console (control box) when a household subscribes to the system if they so wish.]
"We've got around 30,000 subscribers out of approximately 100,000 households. Those who have Qube spend an average of $6-$9 on the pay-per-view part. So far the most expensive event was the Leonard-Duran fight at $10 per household; second highest were the Ohio State University football games last year at $5 per game" (this year's price is $7.00).
How about the much-heralded two-way services?
"First of all, we offer the opportunity for participatory community programming, talkback TV on a daily basis. The pay-per-view is of course dependent upon the two-way capacity. They must push the button and have three-minutes to change their mind before our computer bills them for it. We electronically poll [scan] the entire system every ten seconds so we know who's watching what and can bill accordingly.
"We've been experimenting in many areas -- market research in product design, programming, and print ads. We've had market researchers come in and hold up covers of magazines and ask our subscribers for their input."
The shopping services have been used occasionally for book sales, etc., but wholesale use of the two-way services for just about every consumer sales pitch has not yet come to pass.
Says Mr. Wangberg: "We're in the entertainment, education and polling business already and now we are also getting into the home security business. For an initial installation fee of about $450, with variations, and a monthly fee of about $15, Warner will provide home fire, burglary and emergency medical alarm services. However these prices as well as all others in this article are subject to daily change.
"But underlying everything is service to the consumer. We have just announced a new service -- information retrieval in the home. With the co-operation of the Columbus Dispatch and Compu-Serve, our subscribers will have an Atari [also Warner Communication] computer terminal in their homes and they'll have access to various data bases.
Ultimately, we want to work with local libraries in the same way. You push a button for the kind of news or information you want and it comes in on your screen. With a print- out if you so wish, too. Now, that's not going to happen overnight but I see it only a few years down the road.
"Beyond that we are developing in-home shopping, in-home banking, energy-load management. But those services are not yet available to consumers. They will be soon."
What does Mr. Wangberg believe is the ultimate use of two-way cable? For voting, perhaps? I suggest that some citizens might consider it valid punishment if the yes and no buttons were wired with an electric charge so that if a politician asks for response he would get shocked into understanding when 10,000 electrically-charged "no" buttons buzzed him into reality -- sort of the ultimate "Gong Show."
Mr. Wangberg smiles but shakes his head. "I don't envision voting by Qube. I see it as a way for the citizen to be involved in the key public affairs issues concerning him. The way we look at our contribution to community involvement is to compare our polling to the number of people you would get out to city hall. Very few! Wem sometimes get thousands of families. That's democracy!"
Whether that is really participatory democracy or merely a new technological form of elitism is bound to become questionable. With only the input and the opinions of a few thousand families able to afford Qube (or other high-cost systems) the matter becomes worrisome to future TV's social critics concerned with the effect of cable television on our society.
Later, in talking to Qube's senior vice president, Miklos Korodi, who is now probably one of the world's leading technical expert on two-way cable systems, I asked about the invasion-of-privacy problem which so many people worry about.
Mr. Korodi is in charge of new developments like the burglar alarm system. He laughed: "If somebody wanted to bug your house, the telephone line is already there, easy to utilize. It is very difficult to tap a cable. Certainly we keep records of what people watch so we can bill them -- but your credit card companies and your social-security number already contain personal information easily accessible to snoopers."
His view is pointedly contradicted by consumer advocates and others who fear the development of cable and other systems which involve a sophisticated invasion of privacy never before encountered. (The third article in this series explores this issue in more detail.)
After fire and burglary alarm systems, what does Mr. Korodi feel will evolve from the Qube experiment?
"Heating and air conditioning, energy management for the home is what we are looking into right now. There are many other things we could be involved in, but we have decided to concentrate on one or two and do them first and best."
Then Mr. Korodi revealed the key to the whole Qube operation: "Our subscribers are really our best research and development group because they tell us what they are willing to pay for by actually paying for it. I believe that the interact services will represent the major profitable enterprise for us.
"Entertainment is a luxury but those services are a necessity. Revenues from consumer services may out-accelerate entertainment by a good margin of three to one soon.
"I think that in this business you'll see a change comparable to the difference between a hot-air balloon and a jet plane. I think it is going to be the most explosive growth in our economic history. Everything from huge envelope screens that you will hang on your wall (Sony is now offering these) to hard-copy printouts of data, video discs, and cassettes -- everything. And I think it will all be in the next ten years.
"I'd say that cable subscribers of the past ten years have been part of the experimentation. But, at this point, it's going to be uphill for them."
So, according to this cable veteran, the American cable subscriber has unknowingly, perhaps unwillingly, been paying much of the bill for the development of what will eventually turn out to be a multibillion-dollar industry for which he himself is the customer and in which he may share the pleasures but not the profits.
Having spoken long enough with Qube executives, I ask to be allowed into a Qube subscriber home. A home is found which will allow me in. Already this family has been publicized in a sports magazine which reported on its neighborly behavior during the screening of the $10-per-household Leonard-Duran fight.
On an upper-middle-class, tree-lined side street here, in a comfortable single-family home with a well-groomed garden, I meet the Morris Beja family.
Professor Beja teaches English at Ohio State University. He has a wife, a 17 -year-old-son, and a 13-year-old daughter. Not a typical American family by any means, but, then, are any Qube subscribers "typical?" And that, in turn, brings up the question: Is there any "typical" American family anywhere?
The Beja family has subscribed to Qube for about a year and Professor Beja says that TV viewing in the household has escalated much less than he originally feared.
Has the family of Professor Beja taken advantage of many of the two-way services available on Qube?
"Well, no . . . although we do occasionally push the button for a movie which we must pay for. My wife, in particular, likes one connected to the public library. You press a button months ahead and the library sends you a book to read with postage to return it. And when that program comes around, you can give your opinion of the book through the button and decide on which book to read next time. It works very nicely.
"I don't usually take much part in the surveys, although my wife does. She's more interested in local productions like 'Columbus Alive,' and she will use the buttons while watching.
"The most expensive thing we ever watched was the Leonard-Duran fight, which was $10 and we had friends in. But otherwise we don't use the Pay TV buttons very much. Last month we watched one movie for $2, 'The Frisco Kid.'
"One of the best things about Qube is that you don't have to watch any advertising. If it's a channel with commercials, we can just push the button to another channel for a while."
"The most I get out of Qube is what I would get out of any cable system -- better reception."
What convinced Professor Beja to subscribe?
"Family pressures. Everybody else was more eager than I was. I resisted because I was afraid that I would like it a lot -- too much.
"But it hasn't changed our family life very much. I'd say that it doesn't make a vast difference. It is different, and the potential is there for it to be very, very different. But I really haven't noticed any difference."
How about the interactive aspects?
"My wife uses the interactive much more than I do and I think she would be especially receptive to shopping and banking services. Maybe I would too."
Professor Beja's son admits that he might watch more pay TV sports if he didn't have to pay for it at the end of the month, and the professor explains that he holds the bills down by making it clear that if only one person wants to watch something which costs a fee, that person must be prepared to pay for it when the monthly bill comes in.
But, it is apparent that without proper supervision by the head of the family , the Beja bill -- and the bills of larger families with less parental supervision -- monthly charges could easily reach into the hundreds of dollars despite the official Qube attempts to minimize the average costs.
Does Professor Beja have any fears about the privacy he is sacrificing by having his viewing habits constantly scanned?What if the country were to go through a new McCarthy era, would the professor worry about snooping?
"I've wondered about that. It is a little uncanny. They know exactly what you are watching. I like the ability to press a button and get what I want right in the house. But of course one gives all sorts of opinions in the surveys -- do you believe in premarital sex, capital punishment, and all those things.
"One has to assume that they are not going to misuse that information. If I had reason to believe that trust had been violated, I'd obviously be very concerned and would certainly cancel the service. It could be I don't think enough about it, or we just don't live in that kind of situation these days. I hope I won't ever have to stop pushing buttons for that sort of reason. I tend to make my views known to the world when I have them. I would hope that Qube never causes me to be afraid to push buttons. Perhaps I shouldm think more about it."
One hopes that Professor Beja as well as Qube will continue to think more about that.
Meantime, Warner Amex chairman Gustave M. Hauser, ponders future cable within the framework of Future TV. "What we are realizing," he tells me, "is that cable, which we already know has this gigantic capacity to deliver information, appears to be them vehicle for the future delivery as well of education, entertainment, news, data, video or any other form of material.
"What we are seeing is the evolution from an era of over-the-air broadcast transmission to the delivery by subscription pay TV of specialized information which will transcend entertainment alone. And all of this will happen almost immediately.
"Qube is just our name for interactive services of all kinds. Future subscribers will have access to whatever information and services they find attractive."
And can manage to pay for.
Next: Network TV's answer