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Pittman: Cable Is Primed to Lead Internet World

7/23/2000 8:00 PM Eastern

Boston-Consumer convenience and strong brands will drive the new Internet economy, America Online Inc. president Bob Pittman told Cable & Telecommunications Association for Marketing CTAM Summit attendees here last Monday.

Pittman noted that PC and Internet usage have moved well beyond the early adopter phase, which is good news for the cable industry and others charged with marketing online services to consumers.

"With the mass market, we can predict behavior," he said. "No matter what the industry is, brands win and convenience is king."

Although the lines between the TV and the PC continue to blur, Pittman warned cable executives against trying to make convenience-based online services too splashy. People sitting at their desks tend to get mad, he said, "when you seize the screen for 30 seconds," because they want to control their online experience.

Although consumers don't want their TVs to become PCs or their PCs to become TVs, Pittman said, they are starting to ask each of the media to borrow a little from the other.

On a similar note, he suggested that consumers may be willing to have their home stereo systems hooked up to the Internet if it means having access to thousands of tunes at any given time.

Pittman said the cable industry is in a better position than any other industry to take advantage of the new, multibillion-dollar, high-margin Internet economy. Cable already has the distribution, brands, tradition of innovation, financial flexibility and customer relationships to take advantage of data and online services, he maintained.

"It's easier to take an existing business that has all of this and add a catalyst for change rather than growing a new business from scratch," Pittman said. He added that the $50 billion consumer market for data-service providers represents more potential revenues than cable's current video business.

Embedding video with interactive content will also allow cable companies to move beyond selling media time to advertisers and become involved in other parts of the consumer sales process, including information gathering and the sales transaction itself, he said.

And as they connect multiple PCs, televisions and appliances to the Internet, he added, consumers will demand home-networking services.

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