Straight Talk from Sony Broadband's Susskind

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Emily Susskind is the person responsible for making sense of the links between Sony Corp.'s wide array of content and personal technology in a broadband world. She's a former Salomon Brothers executive who in 1996 joined Howard Stringer at Tele-TV— the ill-fated telephone-company video consortium — and reunited with him two years later at Sony.
In February 2000, she was named EVP, interactive services at Sony Corp. and president of Sony's Broadband Services Co., which oversees the consumer-electronics powerhouse's broadband and interactive initiatives. In this electronic-mail Q&A session, Susskind talks about Sony's plans to marry content, technology and broadband going forward. An edited transcript follows:

MCN: Do you need to own last-mile connectivity, like AOL Time Warner Inc.? Vivendi Universal S.A. is getting in bed with EchoStar Communications Corp., and Viacom Inc. (through CBS and Paramount) and News Corp. (through Fox) both have TV stations. As broadband proliferates, how does that affect the equation?

Emily Susskind: Clearly, the companies that own the last mile have a great deal of control in the deployment of broadband. However, these companies also need compelling content to offer to their subscribers. Sony is in a unique position, because we are the only company that develops cutting-edge technologies, bridges the relationship between content and technology, creates content and is in the forefront of the networked home. We are always looking to add value to the consumer experience.

MCN: You've got many straight-to-the-consumer content initiatives, like Movielink. You don't own a broadcast network or
many cable networks. Does the fact that you don't have networks to protect make it easier for you to think in terms of cable or Internet video-on-demand or subscription VOD packages?

Susskind:
We depend on a number of distribution and packaging arrangements for our content, which are all important to us. While we are open to exploring new distribution scenarios, we care about our existing business models.

MCN: How do you size up TiVo Inc., ReplayTV and the digital video recorder phenomenon?

Susskind:
It is clear that consumers like the PVR [personal video recorder] experience. It is still a developing category and one that holds a great deal of promise. I believe that you are going to see a lot of innovation in this area.

MCN:What have you learned from your interactive-TV work with Game Show Network and WebTV, as well as your Internet forays in those areas? Where does that business go from here?

Susskind:
As we continue to experiment with interactive TV, it is becoming more and more clear that the PC experience and the TV experience should remain separate. For example, people do not want to do their computing on TV, and they don't make the computer their first choice for movie viewing.

But interactive TV does hold great promise. The most valuable components are personalization and on-demand viewing, such as time-shifting and access to a library of viewing options. Viewers have a large appetite for personalized and niche content. Additionally, guide and navigation functions are extremely important. We are also beginning to experiment with new models for interactive content and communication.

MCN: Let's go to the technology side. How will Sony play in the home-networking space? (The Red Herring
reports that Sony has developed a prototype home-storage system capable of handling 450 hours of digital video, 1,500 CDs and 600,000 high-resolution images that could be networked to various home devices.)

Susskind:
One scenario we envision is that a consumer would have multiple TVs in one household, networked together. The TV could serve as a point of contact for many activities, as long as these activities do not intrude on the viewing/entertainment experience. The network could provide enhanced or ancillary viewing information and an interactive program guide. Additionally, the TV could serve as a repository for phone and e-mail messages.

MCN: On the content side, what are your
major initiatives? I'd imagine one big headache you have to grapple with is encoding and storage costs across various transport technologies like Internet protocol or MPEG (Moving Picture Expert Group). What's going on there, from your perspective?

Susskind:
Bandwidth and quality-of-service are crucial issues for digital distribution for both wireline and wireless [services]. These issues are much more significant than encoding and storage.

MCN: You've got a set-top box deployed with Cablevision Systems Corp. Any hopes to expand that effort to other MSOs, or will you wait for the retail market to develop?

Susskind:
As you mentioned, we are currently working with Cablevision, and are delivering next-generation software and a new user interface to them in March. While we have not announced plans with any other MSOs, we are always exploring many different relationships at any time. We are also continuing to monitor the development of standards in this area.

MCN: Do you have a favorite in the Microsoft Corp./America Online battle? You battle AOL in many content areas and Microsoft in the gaming space. You're also partnered with Real Networks.

Susskind:
Sony is a large and diverse company, and we work with a variety of other companies. In the past we have partnered with Microsoft, we currently have an agreement with AOL and we have partnered with Real Networks.

We're not in the business of taking sides. We are in the business of providing the very best consumer experience possible, and we are open to working with any company that will help us achieve that goal.

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