Errands by video may yet catch on in US, `a la French system
New York — ``Why are all these French guys walking around here?'' asks Bernell Wright, director of videotex services at Link Resources, a New York research and consulting firm. ``Because they sense this is their moment.'' In France, videotex is all the rage. It has met with moderate success in corporate America and among computerphiles. But so far, American efforts to deliver videotex to a mass home market have flopped, Knight-Ridder's Viewtron and Times Mirror's Gateway systems being the infamous examples.
That will change if the French have anything to say about it.
(Videotex -- ``ex'' for exchange -- is the generic term for an easy-to-use, two-way information service -- such as electronic banking, shopping, and data bases accessed from home via computer terminals or specially adapted TVs.)
At the annual Videotex Industry Association meeting here this week, the scuttlebutt is that the French may be close to clinching a deal with one or more of the regional telephone holding companies. Other scenarios include a tie with long-distance carriers, such as American Telephone & Telegraph.
``We have been talking with all the Bell companies,'' says Henri J. P. Laban, North American sales manager of Telic-Alcatel, the leading manufacturer of ``Minitels,'' the French videotex terminals. ``Yes, the talks are serious. But we have nothing to announce.''
``We believe the Bell operating companies will make a move in the next three to four months,'' predicts James Monaco, president of Baseline, a New York entertainment data-base firm. Baseline announced this week that it has established a host computer system and software to service what it expects will soon be a huge Minitel network in the United States.
If such a telephone company deal is made, its importance to the videotex industry cannot be overstated. It could provide the expertise and distribution to make a mass-market US videotex system viable, market analysts say. And the French provide a highly successful model to work from.
In France, the Minitel system is sweeping the nation. A durable toaster-size electronic box and tiny keyboard squats next to the phone in nearly 2 million homes and businesses. Indeed, to 10 percent of the French population it has become a household appliance. By the end of next year, ``we expect to have over 3 million Minitels,'' says Fran,coise Blondeau-Seri of Intelematique, the marketing arm of the French Telecommunications Administration. Meanwhile in the US, about one-half of 1 percent of the households use a videotex service.
How did videotex become so big in France?
Videotex was nurtured as part of the Socialist government's high-tech initiative to keep France from falling behind in the new ``information age.'' In 1982, the Postes, T'el'ephones et T'el'egraphes (PTT) started giving urban dwellers a choice between an old-fashioned paper telephone directory and a free electronic one.
As the Minitels spread, this became more than a directory. Or even a data base. It became a communication system. Now the French users avidly call up on-line dating services, chat lines, legal and financial advice, and newspapers, as well as home banking and shopping services. In all, some 3,000 services are available on the Minitel now.
While the terminal is free, the nondirectory services are not. Most cost about $10 an hour. In the US, there is a plethora of independent data-base services, each with its own codes and billing systems. The French recently set up a Kiosque billing system, by which one phone call via the Minitel hooks into 1,000 services. The charge for using one of the services is put right on the phone bill. The national telephone company takes $2.50 and the remaining $7.50 goes to the vendor.
The logic of having a videotex system run by telephone companies, as opposed to independent data-base operators, is compelling. Phone companies have a vested interest in seeing it spread. Videotex usage generates more (and longer) phone calls (the electronic ``yellow pages'' and ``white pages'' account for 50 percent of usage). It also simplifies billing and marketing, as in the Kiosque system.
By giving away the terminals, the French established a large user base quickly. ``They've spent less money giving away the terminals than Knight-Ridder and Times Mirror did on their marketing failures,'' says Mr. Monaco of Baseline. Intelmatique officials say the system has paid for itself in four years instead of the expected five.
There are, however, significant impediments to duplicating the Minitel phenomenon in the US:
It's not a government-subsidized priority. ``The Minitel is part of a several- billion- dollar effort by the French government to give their people something to do in the 21st century and to protect the integrity of the French language in a world dominated by German and English data flow,'' says Mr. Wright at Link.
There's no longer a national US phone system. A national videotex system would probably be split among regional operating companies or the various long-distance carriers. Also, the AT&T breakup agreement now prohibits such value-added services. The first review of the agreement is due in January. The green light for a Minitel-type system is ``unlikely'' in January, Wright says. ``But I think it will happen in the next year or two.''
Competition. In the US, there are already dozens of home computer data bases, with chat lines, billboards, and services similar to those offered on the Minitel in France.
Many of these services are carving out small but profitable videotex niches. Just this week the New York Times introduced New York Pulse, a relatively inexpensive news and home computer banking service for New Yorkers.
At some point, the vaunted Trintex consortium (International Business Machines; CBS; Sears, Roebuck) is expected to weigh in with its videotex project. So far the program has been kept very quiet. Industry analysts speculate that Trintex is biding its time, unwilling to end up like its unsuccessful American and British predecessors.