FOCUS: BUSINESS TV; Business tunes into the small screen

BROADCAST NEWS: As a medium for internal communications, business television makes compelling viewing VIDEO CONFERENCING: The time when PC video phones are as common in the office as fax machines draws nigh CASE STUDIES: Halifax and Unipart realise the value of having immediate access to their viewing audiences

BROADCAST NEWS: As a medium for internal communications, business

television makes compelling viewing

VIDEO CONFERENCING: The time when PC video phones are as common in the

office as fax machines draws nigh

CASE STUDIES: Halifax and Unipart realise the value of having

immediate access to their viewing audiences



Television is the world’s most powerful medium and, as costs fall and

technology develops, major businesses are discovering that it can also

be an effective internal communications tool.



What internal communications initiative could provide more punch than a

chief executive addressing all his world-wide employees live?



One could argue that this will depend on the personality of that chief

executive. Nevertheless the potential impact has not gone unnoticed by

the likes of British Airways and Sainsbury’s, both of whom are planning

major new business television networks this year.



Stephen Watson, managing director of production company CTN (a joint

venture between Burson-Marsteller and ITN) believes 1996 will be the

year that business TV - live or pre-recorded television delivered via

satellite for private business use - finally moves centre stage: ‘The

technology may no longer be new but over the last year Europe’s most

respected companies have turned to the medium as a key tool in the

management of change,’ he says.



During March CTN masterminded an ICI event where incoming chief

executive Charles Miller Smith spoke to more than 3,000 employees across

25 countries. Martin Adeney, head of ICI Group public relations, said:

‘The chief executive was seen by employees from Memphis to Malaysia. Our

entire workforce had an opportunity to hear directly about ICI’s future

plans and strategy.’



There are now more than 200 BTV networks world-wide, including a rapidly

increasing number in Europe. In 1994 there were 29 networks in the UK.

By the end of 1995 there were 42 with a combined value of more than

pounds 15 million. British Airways’ investment in BA-TV alone is

expected to amount to pounds 2 million to pounds 3 million per year.



The signs are that a medium traditionally appealing to large multi-site

companies in the automotive, IT and finance sectors, is also gaining

popularity among new industries and smaller companies.



There’s no doubt that television has big advantages as an internal

communications tool - most notably its immediacy. People are also

accustomed to gleaning a large amount of information from TV in their

daily lives and according to BT the information retention rate is high -

typically 80 per cent.



However the factors that are now really driving the medium arise from

recent technological breakthroughs.



Most important is the development of interactivity. TV can be powerful

enough as a passive medium, but when one can actively involve the

viewing audience its effect is enhanced enormously.



Response systems like One Touch, currently used by satellite provider

Global Access Telecommunication Services, enable viewers to feed their

opinions back to the presenter of a programme. This can be via a touch-

key pad which registers graphically, or a microphone for a phone-in

format.



‘The interaction element is key to the appeal of business television,’

says Sainsbury’s communications resources manager Lisa Baitup.



Sainsbury’s is preparing for the launch JS-TV, a business TV service

which will broadcast regular live and interactive programmes, enabling

staff and senior management to discuss current issues on-air.



JS-TV will soon be available in 362 stores and to 110,000 staff across

the country and chairman David Sainsbury expects to roll-out the medium

to other companies within the group. At a cost of pounds 1 million over

two years, it will make the company the first food retailer in Britain

to set up its own internal TV network, though the other main players are

expected to follow suit shortly.



Phil Govan, business development manager at Global Access acknowledges

viewer response technology as the main driver for new BTV networks.

‘Thousands of key pads are being bought by companies across Europe,

particularly IT firms like Oracle, Microsoft and Compaq,’ he says.



As well as gauging opinions during staff communication, the

interactivity can enable highly effective training and distance learning

programmes.



The other big dynamic in BTV is the advent of digital television.

Previously broadcast in analogue, compressed digital pictures will prove

cheaper to transmit, provide a more consistent picture quality and open

up a new realm of desktop and multi-media opportunities.



BT’s business television division Global Satellite Services (BT GSS)

this month launches what it claims to be Europe’s first digital BTV

service. Division head Richard Aspinall says the aim is to ‘future proof

clients’ investment into the next century’ and ‘increase BT’s satellite

capacity two-fold’.



‘The digital service will result in a 20 per cent saving in airtime

costs and enable us to offer attractive communications solutions

including store and forward and response-type systems,’ adds BT senior

product manager Harry Formosa.



To help existing clients migrate to digital, BT GSS is offering buy-back

options for existing equipment.



Global Access says it is already operating digital networks for Oracle

and Virgin Megastores, while the other main satellite time provider

Maxat Satellite Services offers digital airtime on a bandwidth share

basis to around a dozen clients.



Maxat’s general manager Stuart Baxter says: ‘All new tenders now

consider the digital option, although we find it is currently only cost-

effective to clients if they’re broadcasting regularly and using

multiple applications.



A report in March by Communications Media Associates estimated that a

company would need to be broadcasting 90 hours a year, and to more than

50 sites, to justify a digital network.



Transmission costs should work out at around pounds 900-pounds 950 per

hour for digital television, compared with pounds 1,200-pounds 1,400 per

hour for analogue. And while the capital outlay for digital equipment

will be 10-20 per cent more expensive, hardware costs will continue to

come down.



Hardware, or network infrastructure, costs include the broadcast unit,

satellite dishes, decoders and cabling. They will typically range

between pounds 1000 and pounds 4,000 per site, depending on the

technology used and the locations chosen.



The other main cost that potential users of BTV need to consider is the

‘software’ - or programme production -which could be anything from

pounds 4,000 to pounds 30,000 per programme depending on content and

regularity.



Key factors are whether the broadcast is live or recorded, whether

filming is done on location or in a studio, the type of presenter used

and the level of interactivity needed.



Stephen Watson says many companies employ BTV for a one-off event then

continue to use it. ‘Once established they recognise the crisis

management and distance learning potential. People are comfortable with

television and acclimatise quickly to the BTV medium.’



As well as the larger in-house departments, consultancies are catching

on to strategic benefits of business television. In November last year,

Burson-Marsteller became the first PR agency in the world to set up such

a facility in-house.



Transmitting internal programmes to 16 of its world-wide offices, B-M

also offers the service to its clients for press conferencing purposes.

Successful conferences have recently been broadcast for Sun Alliance and

Bristol Myers Squibb.



Lorraine Mills director of publishing at Paragon Communications said:

‘Although we don’t provide business television to any of our clients at

present, we expect to soon and we’re involved in a pilot scheme with a

leading automotive company.’



‘BTV is a compelling internal communications medium for firms with a

large amount of staff who aren’t office-bound,’ she added.



The future of BTV will be shaped by multi-media applications. As digital

services expand and the number of satellites multiplies, there will be

sufficient bandwidth for companies to communicate a broader spectrum of

image, sound and data.



‘We’re already providing television with CD sound quality to Virgin

Megastores across the country and will soon be using the technology in a

variety of ways that we haven’t even thought of yet,’ enthuses Phil

Govan.



Transmitting television to employees’ desktop PCs has also been long

anticipated. The growth of digital broadcasting makes this a realistic

proposition, with users able to ‘call up’ stored programmes on demand.



British Telecom is currently trialling PC television cards which

facilitate the delivery of BTV to the desktop. It claims this will boost

employees’ productivity as viewing broadcasts from their desks rather

than a central location is less disruptive to work flow. It would also

enable more day-to-day interactivity.



CTN worked with IBM on a 24 hour desktop new service for some time and

is now looking at providing a similar channel via the Internet. But

Watson points out: ‘We’re not waiting for the technology. Desktop TV

will be driven by client demand.’



Stuart Baxter agrees: ‘It’s all about packaging. We’re a couple of

months away from announcing a combined PC, TV card and response system

solution. When BTV can effectively be delivered to the desktop the

medium will undergo a cultural change and become accepted as a more

serious business tool.’



Technology: Streamlined video-conferencing



While the digital revolution continues to blur the divide between BTV

and video-conferencing, there is still a distinction.



Unlike BTV which links multiple sites by satellite, video-conferencing

tends to be two-way active video delivered via telephone lines. Often

used to replicate meetings, it is effectively limited to several sites

and the picture quality, while better than the Max Headroom type

jerkiness of yesteryear, cannot yet match that of satellite-broadcast

images.



However, a combination of technological developments and the spread of

digital telephone infrastructure will inevitably lead to falling prices

and growing business usage.



A survey commissioned earlier this year by multi-media specialist

Creative Labs which looked at UK companies’ attitudes towards video

conferencing revealed that 70 per cent of IT companies will evaluate

video-conferencing products over the next 12 months and more than half

plan to implement at least one VC-based project by 1997.



According to the report the growth will be driven by a desire to cut

travel budgets, the trend towards teleworking (employees linking up from

home), and large sites wishing to improve internal communications.



The last year has also seen the PR industry seriously address the

medium.



Scope Communications is consultant to BT Visual Solutions and uses its

client’s video-conferencing equipment for short term liaison. Scope

employs BT’s PC Videophone to replace daily and weekly update meetings.



‘It’s invaluable when dealing with information which has a short

deadline,’ says Scope’s managing director Mike Hatcliffe, ‘Documents can

also be viewed, edited and approved by both parties at the same time.’



Scope offers journalists access to both its PC Videophone and VC 7000

desktop system as a means of interviewing BT’s customers or personnel

without having to travel long distances.



Holmes and Marchant Counsel managing director Nigel Dickie says he makes

frequent use of video-conferencing with client HJ Heinz.



‘When important issues crop up, we can advise a wide variety of our

client’s personnel simultaneously, and deal with questions at the same

time,’ he says.



In March last year Fleishman-Hillard invested in the ability to link a

dozen of its offices worldwide.



Managing director Barry Leggetter says the technology is used primarily

in servicing international accounts, though it has been used to impress

existing and prospective clients.



‘We video-conferenced a world-wide credentials pitch six weeks ago

involving six offices including London, New York and Paris,’ he says.



The agency has also carried out a successful press briefing linking its

US head office in St Louis and London, while senior management use it

routinely to replace international meetings.



Finance director Theresa Kelly has calculated that the investment pays

off if a single trans-Atlantic trip is replaced each month. Although

this doesn’t take into account the extra accommodation and executive

time costs involved in international travel.



Barry Leggetter adds: ‘We will use the technology increasingly in new

business, particularly for US multinationals which are signing up to the

technology themselves. I can also see us offering the service to our

clients on a pay-per-view basis.’



Nigel Dickie agrees: ‘I believe that as technology develops and prices

fall, video-conferencing will become an even more essential tool for the

PR consultancies. In the near future PC video phones will be as

commonplace in the office as fax machines or photocopiers.’



Case study: Halifax banks on in-house teams



When the Halifax and Leeds building societies merged last August the new

company set up the largest employee communications BTV network in

Europe.



Halifax had been planning BTV since well before the merger, but the

sudden cultural integration proved to be its first test as the Leeds’

branches were added to the network.



On 2 August, the day after the merger, H-TV was launched with the first

live news programme Halifax Television News. HTN is a 15 minute bulletin

covering company, product and personnel news. It is now broadcast

fortnightly along with a monthly marketing programme Interact and

Activate, a new training programme which is run on an ad hoc basis.



HTN incorporates live phone-ins and while professional anchor presenters

are used, members of the senior management team often address employees

unscripted.



Ralph Pitman Halifax’s internal communications manager says: ‘We were

looking for radical cultural change and TV is a very powerful medium.

Having said that it’s not for the faint hearted. The capital outlay is

very large and production needs to be handled professionally as everyone

thinks they are an expert on TV programme quality’



Each branch has its own satellite dish and decoder, linking 1,850

locations and 33,000 staff. Editorial and production are both handled by

in-house teams, centred around the firm’s specifically designed studio

in the centre of Halifax. It claims to be the only BTV network

controlled and produced totally in-house.



Pitman says the principal business benefit is the ability to reach all

employees simultaneously with no dilution or delay to the message.

Although he does recognise its limitations.



‘We never expected BTV to answer all our communications needs and it

can’t deal with operational information. Its strength lies in

announcements and providing a ‘quick fix’ on an issue.’



There is a hint that criticism of programme quality has come from some

quarters, but Pitman sees H-TV as an overall success and something which

has become an established part of the employees’ working lives.



Halifax broadcast a 25-minute ‘special’ in November to clarify new terms

and conditions for staff and broke the news of the take-over of Clerical

Medical during March this year.



‘The cultural integration has gone well and H-TV has played a big part

as it quickly reaches all parts of the organisation,’ he says.



Following the merger, the company continues to use the medium in its

efforts to improve performance and pave the way for yet more change,

namely its conversion to a plc.



Case study: Unipart revs up its market share



In January vehicle parts firm Unipart claimed a BTV world first - a live

satellite conference using the Internet for feedback.



Under group chief executive John Neill’s enlightened leadership Unipart,

which broke away from the former British Leyland in the 1970s, has

undergone a cultural revolution.



Neill has championed internal communications in the development of

Unipart and says its strategy has helped it ‘tap the creative potential

of our people to sustain change in a fast changing world.’.



The company has been using video since 1983. The top team at Unipart

was so convinced of the value of internal communications that it created

an independent consultancy Complete Communications to handle cultural

change, including broadcast production.



In 1989, concerns over time and cost stimulated Unipart to replace its

annual national conference with a satellite broadcast.



Creative director of Complete Communications Mike Black says: ‘The

experiment went well. We could reach a wider audience in a much shorter

time period. Thereafter the annual BTV conference ‘Shaping the Future’

became the norm.’



For 1996 Unipart had decided to put a new proposition to its customers -

the creation of a new generation of independent garages coupled to the

branding and marketing of Unipart.



‘To indicate our commitment to a shared destiny, we decided to seek the

opinion of every Unipart Car Care Centre ‘present’ at the January

conference,’ says Frank Hemsworth managing director of Unipart

International.



‘Shaping the Future - Interactive’ saw 5,000 people in 34 locations

across the UK take part in a real time dialogue, live on air.



Seven months’ planning came to fruition on 17 January with a broadcast

from the National Motor Museum at Beaulieu in Hampshire. The conference

employed 200 technicians and two satellites for almost 20 hours.



Unipart used IML’s newly developed Internet modem system and handsets to

collect viewers opinions and relay them to a computer at the broadcast

site. Here they were collated, and displayed graphically to the

audience.



Presenter Nick Ross was able to compare the results with a national

survey carried out by Unipart on the same day. The responses to Ross’

subsequent questions to the audience were received via the Internet and

displayed on screen - within 10 seconds.



Frank Hemsworth says: ‘It gave our audience a real hand in shaping

business strategy. A measure of success is that we used to have a small

share in the independent motor trade’s business. Now we’re looking at

the lion’s share.’



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