Gemstar-TV Guide News:

–Teams with Comcast Spotlight on Study of EPG Viewing Habits
–New Deals with Sony, Polaroid, Cox, CZCATV, So-net, Atlantic Broadband
–Begins Patent-Infringement Litigation against Toshiba

EPG developer/interactive TV programmer, Gemstar-TV Guide (which is in the process of being acquired by Macrovision–see article in this issue), recently teamed with Comcast Spotlight, the cable MSO’s advertising sales arm, to commission a national research study by Lieberman Research Worldwide of TV viewers’ engagement with EPG’s. According to the companies, the study–which they claim is the first major study of its kind to be released into the market in the past five years (note: the study, which was conducted from June 12th through July 20th, was based on a "nationally representative" sample of 1,612 respondents, including Comcast EPG viewers, TV Guide Interactive viewers, and viewers with a consumer-electronics EPG)–shows that EPG’s are "considered a necessity for viewing and a valuable medium for entertainment marketers."

Among the study’s findings:

• Around 80% of users of Gemstar-TV Guide’s widely deployed i-Guide EPG always use their EPG to find out what to watch, and feel it is a necessity for their viewing experience.
• i-Guide users agree that their EPG makes them aware of programs they didn’t know about, is the best information source about TV programs, and enhances their overall viewing experience.
• The "vast majority" of i-Guide users pull up their EPG when they first sit down to watch TV, when a new program begins, during commercial breaks, and when they’re bored with what they’re watching.
• A quarter of i-Guide users pull up their EPG every or almost every time a commercial comes on.
• Two-thirds of TV viewers decide what to watch after they sit down to watch.
• 65% of viewers pull up their EPG, while watching a program, in order to see what programming is available on other channels.
• Around 25% of viewers use their EPG’s to check for shows airing later in the week.
• 85% of i-Guide users report turning to the EPG when a commercial comes on.
• Half of i-Guide users report noticing ads on their EPG at least once a week.
• Half of i-Guide users who report noticing EPG ads say they have clicked on an ad, and a fifth say they click on the ads at least once a week.
• Two-fifths of i-Guide users who notice EPG ads recall seeing an ad for a specific TV program or sporting event.
• Around 70% of those who recalled an ad for a TV program say they actually went on to watch the program.
• Around 40% who recalled seeing a movie or pay-per-view event advertised, went on to order it.

In a prepared statement, Comcast Spotlight general manager, Hank Oster, favorably compared consumer engagement with EPG advertising to consumer engagement with online banner ads: "IPG’s have come of age as an ad medium," he said. "They now have the substantiation and support points to show they’ve become portals to television and a true point of purchase positioning for advertisers. In contrast to the relatively low level of engagement that banner ads elicit online, these results show that a high percentage of consumers notice and take action on IPG ads. Our digital cable customers want to be guided through the myriad of choice we offer them, and entertainment marketers especially can help guide them with banner ads that provide quick and easy access to linear and on-demand programming."

In other Gemstar-TV Guide news:

• The company has signed a deal with Sony USA that will see the latter integrating TV Guide On Screen, Gemstar’s EPG for US consumer electronics devices (note: the EPG, which provides continually updated program listings, requires no subscription or phone connection on the part of the end-user), into its primary line of television products. According to Gemstar, Sony USA is its first partner to employ "hybrid integration," meaning that the Gemstar EPG will be build directly into Sony’s custom user interface and be made immediately available for consumer use. The companies say that their new agreement builds on existing licensing agreements between them that cover the US, Japanese and European CE markets; and that it represents "a natural transition to future Gemstar/Sony discussions" relating to My TV Guide, Gemstar’s suite of cross-platform guidance solutions. "This new IPG licensing agreement with Sony and the hybrid integration they plan to employ illustrates how Gemstar-TV Guide is creating additional growth avenues for our navigation technology while preserving a manufacturer’s unique interface for a positive viewing experience," Thomas Carson, president of North American IPG’s at Gemstar-TV Guide, said in a prepared statement. "As we evolve our offering to help consumers manage an ever-complex TV landscape, we will stay focused on cementing a leading market position for our brand, technology and intellectual property in wide-reaching geographies and with a range of partners."
• The company has signed a multi-year EPG product license agreement with Polaroid Labs. The agreement gives Polaroid the right to incorporate Gemstar’s EPG’s–including its newest EPG product, Data Loader–into certain of its DVR’s and digital televisions. Polaroid is the first consumer electronics manufacturer to deploy Data Loader, a version of Gemstar’s EPG that allows end-users to customize its graphical user interface. Polaroid will begin incorporating the Data Loader EPG into its DVR products early this year, and the companies say that they are "committed to looking for opportunities to include the IPG in a range of Polaroid’s TV products."
• The company has expanded its relationship with MSO Cox Communications, via a new, multi-year deal that includes product agreements covering the native Passport EPG’s of Gemstar-subsidiary, Aptiv, as well as an OCAP version of Passport (note: Passport is currently deployed on Cox’s Motorola-based systems, and the MSO says it plans to begin deploying it on its Scientific-Atlanta set-top boxes early this year), and certain features offered by Gemstar’s My TV Guide offering, including remote record. The deal also sees Gemstar granting Cox an EPG patent license. "We are happy to extend our long relationship with Cox through this new agreement," Tom Carson, president of Gemstar’s North American Interactive Program Guide Group, said in a prepared statement. "The Passport IPG solution makes sense for Cox as it will allow them a seamless transition to a single-source IPG solution throughout their systems. We’re also happy that our new agreement includes select My TV Guide features and services, like remote record, which Cox may begin to deploy in the months ahead." According to Cox, a key factor in its selection of the Passport EPG was the latter’s support for interactive TV and VOD: "We chose Gemstar’s Passport and Echo IPG because it provides an excellent user interface for our customers’ use, especially with video-on-demand," Steve Necessary, Cox’s VP of video strategy and product management, said in a prepared statement. "This is critically important today and will be even more so in the future, as our video services become increasingly interactive. This will enable all of our customers to benefit from the same user interface and take advantage of similar applications across disparate set-top box hardware environments."
• The company has entered the Chinese EPG market via a multi-year deal with Changzhou Broadcast & Television Information Network Co. (CZCATV), a cable operator that has around a million analog subscribers in the city of Changzhou. The deal will see CZCATV incorporating Gemstar’s EPG products and services into its new digital cable service. Ching Hai Technology, a Shanghai-based distributor of digital hardware and software to Chinese cable operators and consumer electronics and set-top box manufacturers, will work with CZCATV to handle client management, data collection, technical support and integration of the EPG (which is based on Gemstar’s G-Guide product) into the operator’s systems.
• The company has signed a multi-year EPG license agreement with Japan’s So-net Entertainment Corp., covering the latter’s TV program navigation and online video portal, TV Ohkoku, which features Gemstar’s G-Guide EPG. So-net, which was founded in 1995 by Sony Corp., Sony Music Entertainment Japan, and Sony Finance International, launched TV Ohkoku in June, 2006. According to Gemstar, Interactive Program Guide, Inc., its joint-venture with Dentsu and Tokyo News Services, worked with So-net to develop a syndicated version of the G-Guide for the TV Ohkoku site. The new version of the G-Guide went live November 1st.
• The company has signed a long-term multi-service agreement with top-15 cable operator, Atlantic Broadband. The deal will see the latter deploying Gemstar’s i-Guide EPG on Motorola set-top boxes; expanding its distribution of the company’s horseracing channel, TVG; launching its TV Guide SPOT VOD service; and launching its online guide application, Listings2Go (part of My TV Guide), on its Web site. (Note: in other Atlantic Broadband news, the operator recently launched Blue Highways TV as a free VOD service. Blue Highways specializes in content that showcases "the people, stories, traditions and music of America.")
• The company has convinced three German consumer electronics companies–Loewe Opta, Metz-Werke, and Kathrein-Werke–to sign multi-year EPG patent license agreements. The agreements give the companies the rights to use Gemstar’s intellectual property in their television sets, recorder and set-top boxes, deployed in Germany and the rest of Europe.
• The company says that its subsidiary, StarSight Telecast, has filed a patent-infringement lawsuit in the Tokyo District Court against Toshiba. StarSight Telecast alleges that Toshiba is infringing on one of its Japanese patents that describes techniques for providing EPG’s and for controlling recordings from EPG’s. Gemstar claims to have almost 200 issued patents and pending applications in Japan, which cover its G-Guide EPG. "We have endeavored to license Toshiba as a commercial partner for their sales of consumer electronic devices in Japan that use IPG’s covered by our patents, but to date, negotiations have shown no meaningful progress," Akitaka Nishimura, president of Gemstar Multimedia Ltd. Japan, said in a prepared statement. "While we have always worked cooperatively with all industry participants in the Japan market, we ultimately have a responsibility to our shareholders, employees, licensees and other stakeholders to protect the value of our intellectual property."
• The company has promoted Samir Armaly from SVP to EVP of intellectual property and licensing. It says that the promotion "reflects the important role Mr. Armaly plays in leading the company’s efforts to build, manage and commercialize its worldwide patent portfolio." Armaly, who reports to Gemstar’s general counsel, Stephen H. Kay, is responsible for overseeing the company’s patent portfolio and patent- licensing program. He joined the company’s legal department in 2001, though he previously served as an outside attorney for the company, when he worked at Christie, Parker & Hale and at O’Melveny & Myers. He received his law degree from UC Berkeley’s Boalt Hall.

Originally published January 14, 2008 in Issue 7.58A
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