Mag Rack Says It's Learning

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Mag Rack — the video-on-demand service defined by its original niche content — has grown up a lot in its first year.

Born from the Rainbow Media Group family of programming networks, Mag Rack has more than tripled its offerings since it launched Sept. 28, 2001, tinkering with a programming model which posits that niche programming can have mass appeal.

The service — a portfolio of "video magazines" offering special-interest programming topics ranging from motorcycles to Shakespeare to weddings — has provided cable operators with unique programming that isn't available on direct-broadcast satellite.

More important, it appears to have taught cable operators and subscribers the notion — and the value — of free on-demand content.

When VOD emerged a year ago, movies and premium services dominated the discussions.

"We saw a very different opportunity, to fill in the holes in an operator's programming lineup with a service that was designed exclusively for the VOD platform," said MagRack executive vice president and general manager Matt Strauss.

The notion that the platform could be used to "educate people and upsell them to other revenue opportunities" was a side benefit, Strauss said.

But that idea has grown more important in the past year. When Mag Rack launched, cable operators weren't talking about free on-demand content to drive VOD usage.

Since then, FOD has become central to cable's plan to show the value of VOD and drive up digital penetration.

Mag Rack launched on systems owned by Rainbow parent Cablevision Systems Corp. last year. But it gained legitimacy in the past few months, after Charter Communications Inc. and Insight Communications Co. signed on.

"Mag Rack is part of our digital gateway," said Insight president Kim Kelly. "We love Mag Rack. It's a great product."

Charter plans to use Mag Rack as a keystone of its FOD service, alongside music videos, local content and other programming.

Early results

Early returns from Cablevision users are promising, according to Strauss. Some 48 percent of the suburban New York City MSO's iO: Interactive Optimum subscribers watched some Mag Rack content in February. By August, that number shot up to 87 percent, Strauss said.

Mag Rack launched with 10 areas of content; that number has increased to 33. Earlier this year, when Mag Rack had 22 titles, the company surveyed subscribers and found that 70 percent said the service addressed areas of interest to them.

Some 60 percent of respondents said Mag Rack added value to their digital subscription.

"Mag Rack also is getting people comfortable with the technology," Strauss said. "Sixty-three percent use the VCR functionality. We embed in programming reminders on pausing, rewinding and fast-forwarding."

What doesn't work gets retooled or discarded. Mag Rack's bridal category wasn't generating much usage, so the company revised it, using editors from Condé Nast Publications Inc.'s Bride's
magazine. The category then shot up to the top five, Strauss said.

In May, vegetarian and self-help areas were deleted, replaced entries on yoga, dogs and "Your Next Car." Usage in May shot up 57 percent from the previous month.

All told, about 10 percent of all usage on Cablevision's VOD platform is Mag Rack-related, Strauss said.

"We're constantly looking to improve the mix," he said. "We're still the only service designed for VOD. We have the ability to provide unique content that can be baked into the digital package."

The Insight and Charter launches are scheduled for the next two months, and Strauss hopes to have another major MSO signed by year's end. The new launches will make Mag Rack available to more than 1.5 million subscribers.

New interface

Those subscribers will see a new Mag Rack interface that allows viewers to scroll through all categories once they hit the bottom of the opening screen. The old interface required them to hit a time-consuming "more" button, he said.

"Fly-out" windows were added to showcase Mag Rack magazines in six categories: home and family, leisure and arts, science and nature, sports and fitness, wheels and wings, and mind and body.

"You can also sort alphabetically," Strauss said.

Mag Rack also is testing icons to denote which content is new and which programming is broken into "chapters," similar to DVD functionality.

"The interface is one of the biggest challenges facing the cable industry," Strauss said. "The driving principle should be ease of use. We want to be the ultimate on-demand service for special interests, and we want to drive usage."

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