June 4, 2007

Caller ID on Cable: Keep It Simple

TV caller ID won’t change the world — but it may boost the bundle.

By Michael Grebb

When it comes to technology, the temptation is to think big. Let’s squeeze hundreds or even thousands of extra dollars out of each customer annually by making big bets on big concepts. Not that there’s anything wrong with that. But giving customers a little bit of convenience — and charging a couple of bucks a month for it — can also be rewarding.

Consider the case of Denver-based cable competitor WideOpenWest (WOW), which earlier this year conducted a soft launch of a TV caller-ID application from tech vendor Integra5. Other than a blurb on its customer Web portal, WOW hasn’t really marketed the service — and yet it’s experiencing a 1.5% penetration rate among customers. The service is simple: It detects incoming calls and creates display info on the TV screen, so Joe Six-Pack can see whether it’s worth getting off the couch to answer the phone.

WOW competes with Comcast and Time Warner Cable in parts of Illinois, Michigan and Ohio. Should big incumbent MSOs worry about tiny (and easily replicated) bells and whistles like TV caller ID? Of course not. But creating elegantly simple apps in our souped-up, quad-play, bundle-everything-together world shouldn’t be dismissed. It may speak to a constituency of customers who appreciate the little things.

What’s more, WOW charges a small fee for the service on a stand-alone basis, which also bucks recent bundling trends. The preference has been for large, all-inclusive bundles of services. But here, WOW has created a special line item of $2 per month for the service. And because customers must already subscribe to its $73.99 digital cable/VoIP bundle, WOW can still use TV caller ID to lure customers to upgrade their service.

Integra5 has larger ambitions. "TV caller ID is a very simple application," says Integra5 CEO Meredith Flynn-Ripley. "But it’s really just the first step in cross-platform services." Indeed, during the ’07 Cable Show Integra5 was touting its "SMS on TV" and "Email on TV" apps. Each could be offered as a part of a bundle, together in mini-bundles or as a stand-alone add-on. As Flynn-Ripley tells operators: "The next step in bundles has to be incremental services, or you’re going to have a price war."

Perhaps. But MSOs are already moving, with Comcast set to roll out its own caller ID on the TV app within 12-18 months. One thing’s for sure: Flynn-Ripley plans to keep pitching simplicity to anyone who will listen.

Michael Grebb is executive editor of CableFAX Daily. He can be reached at mgrebb@accessintel.com.