EXCLUSIVE INTERVIEW

Elbowing Into the Set-Top Scene: Q&A With Blockbuster CEO Jim Keyes

Blockbuster on Tuesday threw its hat into the increasingly crowded ring of set-top boxes with the announcement of a deal with hardware maker 2Wire. Blockbuster’s system will bring video directly to viewers’ televisions on demand via a broadband Internet connection.

The move follows similar offerings from competitors. The Web-connected hardware comes months after chief rival Netflix came out with a set-top box manufactured by Roku. However, Blockbuster’s system draws video from the Web differently, it charges using a different pay structure, and its catalog will be different from Netflix’s. In fact, Blockbuster’s system more closely resembles that of another company that’s been rattling the DVD rental industry as of late: Apple.

The E-Commerce Times spoke with Blockbuster Chairman and CEO Jim Keyes about the launch of the set-top box and the direction in which the company is headed.

E-Commerce Times: Why is Blockbuster launching OnDemand using 2Wire’s Media Point Digital Player?

Jim Keyes:

First of all, Blockbuster, the new Blockbuster, is very different from the perceptions of the Blockbuster of old. We were Blockbuster Video, which invokes images of VHS video tapes. Really, that was never Blockbuster. Even in the days of VHS tapes, it was about convenience — convenient access to entertainment. And when VHS tapes went away and were replaced by DVDs, Blockbuster was transformed and modified its offering to DVDs. When DVDs became available by mail, Blockbuster transformed again and offered DVDs by mail.

Well, the customer is changing again, and technology is allowing more convenient access to entertainment in many ways. It is perfectly natural for Blockbuster to evolve again — and we have one more time transformed ourselves and our brand into Blockbuster OnDemand to provide the highest level of convenience now — access to thousands of movies from the comfort of your living room.

ECT: How quickly do users have access to their movie? Is it within a few minutes or is there a substantial download time?

Keyes:

Of course, as with all services, it will depend on the bandwidth for your home, but in the average household, faster than it will take to pop your popcorn, your movie will be ready. … We’re using a process called “progressive download.” You might have heard a lot, read a lot, talked a lot about streaming capabilities. Well, we think progressive download is a higher form of streaming for the following reason: It really comes down to quality and a quality viewing experience. The reality is that even if a home has sufficient bandwidth, that streaming requires always-on connectivity. Download needs only a one-time connection. And the challenge with streaming is, if you don’t have that pure continuity and strength of bandwidth, the viewing experience could be everything from a snowy screen to an interrupted movie. …

Another key point of differentiation is the titles. Once again, we’re going after quality versus quantity. You see other services that advertise 20,000 titles, and there are a couple of things here. One is a question of counting. If you count every episode of every television show, you could easily add to your title count. We’re more interested in offering high-quality content and the newest movies, which is very similar to the way people use our stores. About 80 percent of our business is new releases in our stores. We expect the same demand to be there online, so we have the newest releases available on video and on demand. So “Dark Knight,” for example, will be available through Blockbuster OnDemand. For competing subscription services, it could be two to three years before a movie like “Dark Knight” should be available on those boxes.

ECT: So there’s no subscription with Blockbuster OnDemand?

Keyes:

Correct. We’re doing it purely on an a la carte basis. Now we’re offering some unique deals to our customers. For example, they are able to get the box free of charge if they pre-pay for the first 25 movies. So the (US)$99 entry cost is really a prepayment of the first 25 movies, and you get the box for free.

ECT: How long are the movies available? Is it just for a single viewing, or do you have it for a span of time, or [is it] yours in perpetuity?

Keyes:

As with other services, you have the opportunity to buy or rent. To rent the movie, you would pay anywhere from $1.99 to $3.99. You are then able to store that movie for 30 days, and once you begin viewing, you have 24 hours to watch the movie as many times as you like. …

ECT: If you don’t opt for the $99 deal, how much does the device cost?

Keyes:

For this first go-around, that’s the only way we’re going to sell it.

ECT: So with cable, satellite TV and other services like [Verizon] FiOS offering on-demand movie viewing, what stands out for Blockbuster is that you offer newer releases?

Keyes:

We think that long-term, Blockbuster’s pointed advantage will be the quality of content that we have. This is our business. Every other competing service — whether it’s FiOS, Amazon, whether it’s Apple — the aggregation and delivery of movies in the most convenient fashion is not their core business. It’s a sideline. This is our bread and butter. It’s what we do every day, to acquire the best movies and to aggregate the largest library of movies. So the advantage that we have had for years in the store, we expect that to continue as we move into the digital world.

Randy Hargrove, Blockbuster corporate PR: That’s not to say that this set-top box will be our only entry, right Jim?

Keyes: Right, we will have other offerings expanded from this capability. We’ll be able to put the same capability into a Blu-ray player. We’ll go into DVRs (digital video recorders), game consoles, etc., just as others are doing to make the same capability available through other devices.

ECT: I’m glad you mentioned that, because the top of the TV seems to be getting really crowded.

Keyes:

We’ll be able to fix that. I think one of the most natural solutions is the same capability put into a Blu-ray player. The reason that is going to be an excellent feature — and we’ll have that capability by the first quarter next year — basically you unplug your old DVD player and plug in your new Blu-ray player.

For the foreseeable future, the practical limitations of bandwidth are going to make it very difficult for anyone to deliver Blu-ray-quality high-definition content digitally. We think using the store for your Blu-ray, or our online service to get Blu-ray by mail, combined with the added convenience of being able to pull up standard- or high-definition — if you’re willing to wait the extra download time — on your box, we think the natural combination will let the stores and the technology complement each other. …

ECT: This isn’t the start of an effort to shift to a strictly online model?

Keyes:

No, not at all. Again, the strategy of Blockbuster is convenient access to media entertainment. What you find is that different use occasions call for different methods of delivery. … So whatever your convenience needs for entertainment, you’ll be able to turn to Blockbuster. The advantage, though, that I have as a customer, if I have one account, I don’t have to keep pulling out my credit card. I don’t have to keep subscribing to different services. If I want media entertainment — movies or games — I go one place — Blockbuster. They know who I am, whether I’m online, in the store or a subscriber by mail.

It’s an advantage no one else has. You can’t go down to your Netflix store and exchange a movie if you wanted to see something else. You can go to your Apple store, but you can’t get a movie. So this is a very different approach that leverages the Blockbuster brand across all channels of distribution.

And an important element of the OnDemand offering is that now we have completed the offering, with Blockbuster able to go in-store, by mail, vending and kiosks, download to your PC and now finally at home.

ECT: Do you have plans to roll all these up into a single subscription service?

Keyes:

Perhaps over time. We are looking at subscription offerings, but candidly, the vast majority of our customers prefer new releases, and while we think subscription packages will be interesting, they will through necessity, because of the studio requirements for different windows, those will be older movies. And we think that subscription will lend itself … to perhaps kids’ movies and other specific genres, but we are more excited about the demand for a la carte capabilities.

Leave a Comment

Please sign in to post or reply to a comment. New users create a free account.

Related Stories

CRM Buyer Channels

EXCLUSIVE INTERVIEW

Metaverse Marketing Offers New Approach To Utilizing Customer Data

In Neal Stephenson’s popular 1992 sci-fi novel “Snow Crash” the author introduced the term metaverse to portray a futuristic world where people interacted in virtual 3D worlds using avatars. While his avatar-laced society is a familiar playing field for virtual game fans, few others but forward-looking marketers envisioned much usefulness in the realities of e-commerce.

That is, until now. Facebook CEO Mark Zuckerberg turned the M-word into a vibrant new name for his now rebranded metaverse company, Meta.

Since the “Snow Crash” novel craze, the metaverse term described multi-user, persistent virtual worlds that incorporate social interaction. The game Second Life, which launched in 2003, was the first metaverse to achieve meaningful user adoption, according to Wendell Lansford, co-founder and CEO of MarTech firm Wyng. Multiplayer online games and platforms, like Minecraft, Roblox and Fortnight, may also be considered as variations of a metaverse.

“Today, the term metaverse describes shared environments that bring together aspects of social media, virtual, and augmented reality, multiplayer online games, and cryptocurrencies to create immersive, digital experiences that both reflect and bridge to the physical world,” Lansford told the E-Commerce Times.

New Frontier for E-Marketing

The metaverse is a digital universe where people as avatars live, play, interact, and work. In the virtual community of the game Second Life, many users work full-time jobs creating and selling digital goods.

That concept of bringing shared environments together gives new life to some tired old marketing strategies. It also suggests exactly where Facebook and the marketing industry plan to go. To borrow a “Star Trek” slogan, it’s a place where no advertisers have gone before.

The online shopping world will become an exciting place. Facebook’s name change as a business force may well carve a place out of the metaverse. Suddenly, metaverse has generated a huge buzz over the potential benefits that this 3D shared environment has to offer.

This new metaverse frontier of digital development may well have unparalleled advantages for enterprising technology enthusiasts. The metaverse concept may well be the driving force to take e-commerce marketing to the next level. But many people are questioning how it could be used.

Zero-Party Data

Digital relationships between brands and consumers and the risk/reward strategies of third-party data have shifted immensely in recent years. As marketers begrudgingly shift away from the practice, the rise of the metaverse presents a unique opportunity for brands to start fresh and employ new privacy-first initiatives.

Being that each user in the metaverse is an authorized user, both brands and consumers are empowered to get the value exchange they want. In exchange for certain coupons, digital goods or access to areas, brands can ensure they are collecting data that was shared with explicit consent.

This eliminates guesswork from both sides. If done correctly, it has the chance to change how we look at data forever, noted Lansford.

Lansford’s company Wyng is positioned to help companies and their customers successfully co-exist with effective online interaction strategies. Wyng uses API-powered infrastructure for zero-party data (ZPD).

Zero-party data is all the consent-based, personal context data that customers share to improve their experience with brands. It gives customers transparency and control over their profiles and builds trust. The process involves personalizing experiences in real time across channels.

Discussing Business in the Metaverse

The E-Commerce Times discussed with Lansford how metaverse technology will impact brands and their customers.

E-Commerce Times: How is the metaverse different than what is non-metaverse?

Wendell Lansford: Think of the non-metaverse as today’s internet as exemplified by Facebook, Google, Amazon, Netflix, Spotify, and any web or e-commerce site.

Metaverse environments, on the other hand, run in parallel to today’s internet. It works much like multiplayer online games. Compared to today’s internet, emerging metaverse environments will offer richer experiences where the virtual and physical worlds converge, and the experience of interacting with others approximates real life.

Is the metaverse concept strictly aligned with e-commerce — meaning doing business over the internet — or does it have connections to other industries, too?

Lansford: In addition to e-commerce, metaverse technologies will have applications in a range of industries. These include entertainment, gaming, social media, education, fitness, travel, real estate, and marketing and advertising.

For example, one popular application today is watching movies (and chatting) with remote friends in a shared virtual theater.

As another example, in November, a plot of virtual real estate in Decentraland (a popular crypto-powered metaverse environment) sold for $2.43 million. The land, purchased by Metaverse Group, will be developed to facilitate fashion shows and commerce within the exploding digital fashion industry.

Fair value exchange (FVE) is a key element of business in metaverse. How is the importance of FVE instead of not shorting consumers in data exchanges a new concept?

Lansford: In the past, brands have primarily collected data about consumers by purchasing data from data aggregators/brokers (i.e., third-party data) or by tracking consumers’ clicks, searches, and purchases on a brand-owned website or mobile app (i.e., first-party data). These ways of collecting data happen behind the scenes, typically without the consumer having any knowledge of the data being collected.

As a result of privacy regulations and privacy-aware consumers, brands are now investing in zero-party data. This is data that consumers knowingly and intentionally share with a brand in exchange for something of value, like a personalized recommendation, loyalty points, and/or a coupon. Consumers will share their data with a brand they trust when the brand makes it worth their while.

How can brands gather zero-party data in the metaverse?

Lansford: The only way to gather zero-party data is by asking for it. On the web, brands ask for zero-party data via micro experiences like guided shopping quizzes, next-best questions, surveys, polls, sign-up forms, and conversational chatbots.

These same techniques can be adapted to the metaverse, but with richer interfaces. The metaverse also opens new possibilities for asking for zero-party data.

For example, imagine a virtual store with a knowledgeable shopkeeper who is there to help customers by engaging them in conversation. The shopkeeping gets to know customers’ personal needs, preferences, goals, and interests (again, zero-party data). Then, with the customers’ permission, the retailer uses that data to provide a more personalized experience with the brand.

Moreover, NFTs or non-fungible tokens, open up new possibilities for value exchange in the metaverse. They can be redeemed for real goods on a brand’s site or in a physical store.

Closing Thoughts

Metaverse commerce is in its early days, with lots of innovation and improvements still to come, Lansford observed. However, the multiplayer online gaming market offers an analogy for virtual worlds and e-commerce coming together.

“[Last year] for example, nearly 20 million people visited a two-week Gucci exhibit, where they could purchase limited-edition Gucci accessories for their avatars,” he said.

Jack M. Germain has been an ECT News Network reporter since 2003. His main areas of focus are enterprise IT, Linux and open-source technologies. He is an esteemed reviewer of Linux distros and other open-source software. In addition, Jack extensively covers business technology and privacy issues, as well as developments in e-commerce and consumer electronics. Email Jack.

Leave a Comment

Please sign in to post or reply to a comment. New users create a free account.

Related Stories
EXCLUSIVE INTERVIEW

Remote Work Transformation Calls for Prioritizing Employee Tech Choices

Image Credit: Lenovo

The global remote work revolution the pandemic caused has accelerated and reinforced the need for companies to prioritize the employee experience. This necessity includes providing tech equipment and consumer products from select retailers via a “choose your own device” (CYOD) reimbursement program.

That is the view from two top suppliers of computers and other electronic devices. Lenovo-Intel research found that a solid majority (72 percent) of employees feel that their employers need to focus more on listening to workers to get clarity on their tech needs. That response ranks in the top three things companies should do to improve the employee experience. 

The Lenovo and Intel study, “Empowering Employees Through Technology Can Supercharge Returns,” is now one year old. But companies still face the ongoing challenges of outfitting their remote workforce with the technical tools they need to work away from the physical office productively, suggested Stefan Engel, Lenovo’s vice president and general manager of Visuals Business.

TechNewsWorld discussed the implications of remote workers’ technical support needs with Engel, who sits in the catbird’s seat in seeing how employers are responding to the realities of the high-tech survey.

TechNewsWorld: How is the shift in meeting employees’ WFH priorities impacting companies?

Stefan Engel: The remote work revolution has put employees more in control of their work technology devices than ever before. We found that improving the employee experience, starting with the tech they provide to employees, is more important than previously anticipated.

Both IT departments and employees agree that satisfaction with their work technology has a direct impact on improving employee satisfaction.

This shift has certainly propelled monitor design forward to becoming the center of communication, interacting with all kinds of devices, not just PCs and laptops, but also mobile phones and gaming consoles, basically anything that can benefit from a fully-actualized visual experience.

How widespread is the remote working demand?

Engel: I saw a recent Gartner survey that noted about one in 10 companies that planned to reopen their offices in the third quarter of 2021 have now pushed back their reopening date to sometime in the fourth quarter.

According to Lenovo’s own customer surveys, 90 percent of businesses plan to keep a hybrid model in place where at least some of the workforce is remote. Workers have grown accustomed to flexibility over the last 19 months and have shown that productivity can be maintained regardless of location.

That increased productivity brings new levels of screen time both day and night. Modern modular technology has become key to keeping employees satisfied with their tech options by allowing for personalization.

Modular options include ergonomic stands that lift, tilt, pivot, and swivel to let workers customize their home setup to best suit their needs, or monitor webcams designed for hybrid work with features like a smart traffic light showing colleagues or family members when a user is “busy” in a conference call.

Is this WFH movement driving new purchases or just moving equipment to the workers’ locations?

Engel: From the same survey Lenovo conducted with Intel, 84 percent of employers are upgrading devices, software, and services as part of employee engagement initiatives to improve team engagement and satisfaction.

The pandemic placed greater emphasis on employees using an at-home monitor to expand the screen real estate of their laptop, making their set-up more productive for working with data and graphics.

This resulted in a large uptick of PC monitor shipments in 2021 according to IDC and other industry researchers. Monitor technology is evolving rapidly. Employers should think about replacement after approximately three years to keep work productivity at high levels. It is also worth it for talent retention according to several employee satisfaction studies.

What other tech concerns did the survey indicate?

Engel: Half of employees still say they are frustrated with their PC hardware and software experience. It is evident that technologies are instrumental in driving employee productivity and engagement. Part of what is making this work is the adoption of video calling and collaboration software.

remote employee working on notebook

Image Credit: Lenovo


Potential exists to bridge these two groups and improve employee experience and satisfaction by making new up-to-date purchases, refreshing cycles, and remotely integrating hardware and software.

For example, an upgraded external monitor that supports high refresh rates and is connected to your PC can leverage the enhanced color performance of HDR 10 brought to life by the latest Windows 11 OS experience — certainly an improvement to your day in front of a screen.

What impact on data security does the remote workforce pose?

Engel: Data security and the feeling of still having control with employees working primarily outside of an office are top of mind for IT decision-makers when considering digital transformation solutions.

Malicious attacks targeting businesses moving their critical functions to the cloud are on the rise, as are attempts to exploit human vulnerabilities via phishing and ransomware, which have increased 11 percent and six percent respectively in 2021, according to Verizon.

Besides security software, one way employers can protect their remote workers is by encouraging them to use their physical shutter when not on camera as an added protection to user privacy.

A new feature I really love is the presence detection sensor that detects if a human being is in front of the monitor. If not, it goes to sleep mode to ensure privacy from prying eyes as well as potentially reducing your home’s power bill.

What other options are employers providing to remote staff?

Engel: As we near the second year of primarily remote work, employers are encouraging their staff to design their at-home workspace smarter than before; where they can easily switch between their workstation and laptop with a single keyboard and mouse combination for a more intuitive user experience.

We have seen several models used to equip/update the workplace at home around the world, all of which are better than companies just leaving their remote employees high and dry.

Here are a few examples:

  • Full free choice: The company reimburses employees fully, often with a max cap per item;
  • Flat amount reimbursement: This approach often leads to the user choosing a standard monitor that skimps on important features, like natural low blue light, in an effort to save money;
  • Preferred list offered: Companies provide a short list of approved monitors that employees may purchase to be eligible for reimbursement, which is a win-win because it caters to the employee’s needs while ensuring that the company is considering the impacts of a healthy work environment;
  • Delivering equipment: Companies make the selection and ship the monitor to the employee’s home.

What equipment baseline do remote workers need?

Engel: Day-to-day remote collaboration requires tailored technology that can improve video calls and even large online meetings, meet the unique needs of businesses, individuals or classrooms, and keep IT costs manageable.

Our user insights point to advancements in flexible modular tech, including enabled high-definition cameras and better device privacy and manageability. Our users also want monitors that feature high-performance displays, ergonomic capabilities, one-cable docking solution, easier video collaboration, smart software management applications, and built-in natural low blue light technology.

What are the priorities that ITDMs want for strategic IT integration?

Engel: IT decision-makers can better improve employee engagement and business outcomes by realigning investments, focusing on PC devices, and involving employees in technology decisions.

Create employee investment in your company’s digital transformation. Listening to employee feedback can go a long way towards establishing the hybrid security, software, and device framework with which IT decision-makers are tasked.

One thing that is different now is that the responsibility for meeting rooms or collaboration spaces in offices and conference centers moved from the care of facilities management to the IT department due to all the smarter technology and influx of high-tech devices. I predict this will soon become the standard for most offices.

How can OEMs address this remote technology divide?

Engel: OEMs must recognize the new realities employees face with remote work and provide technology that can not only help boost and maintain productivity at home, but also keep their work from home space minimal and organized. Organizations can improve employee experience by providing a choice in flexible with mobile and modular technology that adapts to employees’ working style from no matter where they choose to work.

Any final thoughts on how remote working is changing employer options?

Engel: I was struck by one of the study’s takeaways for IT decision-makers. It advises IT to also prioritize tech investments that focus on stated employee needs, such as building a strong ecosystem of PC devices, data security, and exploring easy-to-use collaboration tools.

In large organizations, it is common to have employee advocates working behind the scenes making sure that the long-term health and well-being of employees is factored into any equipment purchases. But this same level of compromise happens less often at smaller companies, or when people are left to buy equipment on their own as part of a company reimbursement program.

I think it is important for IT decision makers, employees, and managers to consider an issue that is just below the surface of all these connected devices. That is blue light emissions from digital displays.

Companies are starting to ask the right questions on behalf of their employees, but much more education is needed to make eye health part of the broader conversation when considering new equipment purchases.

Jack M. Germain has been an ECT News Network reporter since 2003. His main areas of focus are enterprise IT, Linux and open-source technologies. He is an esteemed reviewer of Linux distros and other open-source software. In addition, Jack extensively covers business technology and privacy issues, as well as developments in e-commerce and consumer electronics. Email Jack.

Leave a Comment

Please sign in to post or reply to a comment. New users create a free account.

More by Jack M. Germain
More in IT Leadership