Prime Time Replay:

Michael C. Wheeler
on MSNBC Desktop Video's venture,
MSNBC Business Video


MsgId: *emedia(1)
Date: Mon Jun 16 20:40:45 EDT 1997
From: OMNI_Moderator At: 168.100.204.58

Welcome to E-Media, OMNI Internet's weekly show on the future of media. Tonight's guest, Michael C. Wheeler, is one of the pioneers of Web journalism. As president of MSNBC Desktop Video, Wheeler is today spearheading one of the most extensive and visionary efforts to merge broadcast journalism with the Internet medium.

MSNBC Business Video, launched jointly by Microsoft and MSNBC, is the first Internet site offering unfiltered coverage of breaking business news events worldwide. The news, offered in the form of streaming audio and video as well as multimedia archives, enables users --in this case, executives, investors, and those at the financial helm-- to be at the site of critical breaking news events without ever leaving their desks. MsgId: *emedia(3)
Date: Mon Jun 16 20:57:56 EDT 1997
From: Michael_Wheeler At: 207.172.73.164

Ready when you are. :)

MsgId: *emedia(4)
Date: Mon Jun 16 20:59:03 EDT 1997
From: OMNI_Moderator At: 168.100.204.58

Great. I'd like this to evolve as a freewheeling dialog, but first, we need some context. Can you tell us a bit about yourself and how you made the journey from traditional broadcast journalism to the Web?
MsgId: *emedia(5)
Date: Mon Jun 16 21:01:33 EDT 1997
From: Michael_Wheeler At: 207.172.73.164

Yes, I grew up in the radio business and went to work at MTV shortly after it launched and then I made my way to the Financial News Network which was sold to CNBC in 1991. At that time, I did the same thing that I did in the early '80s when I went to work at MTV and that was to try to see where technology was going. In the '80s, living in Atlanta, I saw the growth of cable, being in CNN's back yard. In the early '90's, I saw how text and data were converting to digital where things could be searched and retrieved and it wasn't hard to see the conversion of video where it could be searched and retrieved and that it would alter and enhance the way people receive video information.
MsgId: *emedia(6)
Date: Mon Jun 16 21:03:46 EDT 1997
From: OMNI_Moderator At: 168.100.204.58

I'd also like to understand the history of your current effort -- MSNBC Desktop Video. What is the origin and intent of that company, and why is it now publishing over the Internet?
MsgId: *emedia(7)
Date: Mon Jun 16 21:09:58 EDT 1997
From: Michael_Wheeler At: 207.172.73.164

Back when CNBC bought the Financial News Network, they realized that they now had the dominant position in delivering business news over cable TV, but again, what would it mean when people could not only watch a linear stock ticker on CNBC, but also be able to have software that would allow them to create their own ticker, or keep their portfolio, as they can do on a large number of websites today including MSN Investor. So we began to look at software that would allow the audience to access video where they could search and retrieve it the same way they do stock quotes or text news. We developed a analog service that covered events live that we are currently delivering to about 150 financial service firms. The challenge of that is that it's only a linear live service, so if you can't happen to watch an event as it happens, you miss it.

Our cost of installation per desktop is about a thousand dollars. When we looked at the internet as a model, we realized that as code is improved, we could deliver content over the internet and cut our installation costs to zero. People say that video isn't ready for the internet and, for the most part, I don't disagree with that. However, our core audience, corporate America, generally has much higher bandwidth access to the internet, so the throughput that we get on our live feed at 65kb is close to full-motion video, and the quality of the audio, from RealAudio, is very good. So our move to the internet has really been an evolution in being the first business news site and the first news site to exploit audio and video conversion to digital.

MsgId: *emedia(9)
Date: Mon Jun 16 21:13:13 EDT 1997
From: OMNI_Moderator At: 168.100.204.58

I would be most interested in clarifying your use of this medium: You are not merely delivering audio and video over a new transom, you are also delivering something that was never available before. Sure you are lowering cost, and that's terrific. But doesn't the immediacy and interactivity of the Internet enable a totally new, more valuable product, aside from cost?
MsgId: *emedia(10)
Date: Mon Jun 16 21:16:31 EDT 1997
From: Michael_Wheeler At: 207.172.73.164

Yes, but most importantly, by lowering our cost of delivery, we can lower our price point as dramatically as well. The one thing that is unique about our site is that we cover content that no one else has. For example, we go live to news conferences that affect business or the markets and then archive it for 90 days so you can listen in as the press interviews Bill Gates of Microsoft and Brian Roberts of Comcast as they talk about Microsoft's billion dollar investment in Comcast. Or you can hear Alan Greenspan talk about the economy and make your own interpretation about what was said and compare it to what others said. We also interview about 300 chief executive officers each month, so investors who are looking for the next Intel can hear interviews with CEOs and make an early decision about wanting to invest.

We also have in our archives all the interviews and analyses from CNBC North America, CNBC Asia, and CNBC Europe. Now, people in the United States and Canada are able to see the traditional feed of CNBC, but if they happen to be at work, now they have an opportunity to recall the interviews and analyses that they might have missed. Now, CNBC Europe and CNBC Asia are not available anywhere in the United States for viewing, so subscribers to our web site can get a unique view of the global economy that few others in this country have access to.

So, really for the first time, the average investor or the person interested in business can have access to news conferences and events like presentations to the New York Society of Security Analysts that they never had access to before. For the business person, they now can keep up with competitors and customers as never before. It's important to be able to look at the financial numbers of a company. It's important to be able to read about the history of a company, but when you can combine that with listening to management, it's an unparalled package of information.

MsgId: *emedia(13)
Date: Mon Jun 16 21:23:20 EDT 1997
From: OMNI_Moderator At: 168.100.204.58

I guess it would be economically prohibitive to deliver this abundance of specialized content to large numbers of people if you didn't have the delivery mechanism of the Web. But it seems to me you are also doing something it would be impossible to do, money aside, without the Internet. A couple of weeks ago, I was discussing web journalism with a producer I know at MSN. And she said something I thought was very cogent: We are not simply combining a number of different mediums, but rather creating a new, completely unique medium with a totally new set of requirements and advantages. How does that translate for you. What does the Internet enable you to do that you could do nowhere else? Would it even be possible to deliver this depth of product to so many without the Internet?
MsgId: *emedia(14)
Date: Mon Jun 16 21:26:27 EDT 1997
From: Michael_Wheeler At: 207.172.73.164

It wouldn't be possible to deliver this kind of content where it could be archived and pulled up on demand. This video-on-demand is what used to be called the information highway where full-motion video was going to be delivered to your television on demand -- it has been hyped for the past five years. Our application on the internet won't be able to realistically be delivered to a television set for three to five years. The internet, and more importantly, the development of corporate intranets and high bandwidth to the internet, is what's making all of this possible.
MsgId: *emedia(15)
Date: Mon Jun 16 21:28:27 EDT 1997
From: OMNI_Moderator At: 168.100.204.58

Can you give some specific examples of your coverage? For instance, what were the main stories that you covered today?
MsgId: *emedia(16)
Date: Mon Jun 16 21:35:57 EDT 1997
From: Michael_Wheeler At: 207.172.73.164

We began our day this morning at 3:08 EST with a report from a representative of Bank of America in London talking about the world markets. We then moved on to a wrapup of the Asian markets and then moved to the United States. We brought Stocks to Watch with Joe Kernan from NBC and Morning Call with David Faber. For people interested in small cap companies, we carried presentations from companies such as InaCom, FSI, PRI Automation. We were also live at PC Expo with a presentation from the president of Gateway 2000. We also had a discussion of Intel's Net PC and a presentation by IBM Network Computers division. In the afternoon, we had Treasury Secretary Rubin talking about the economic summit conference that's coming up in the next week. We wrapped up the day with the market wrapup from CNBC's Maria Bartiromo. I left out probably 20 other events that we carried today.
MsgId: *emedia(18)
Date: Mon Jun 16 21:37:57 EDT 1997
From: OMNI_Moderator At: 168.100.204.58

Well, I'm impressed. This is an awesome output. How do you do it? Perhaps you can start by taking us behind the scenes? Where are your production facilities and what are they like? How do your journalists work? And how many people do you need to do all this?
MsgId: *emedia(19)
Date: Mon Jun 16 21:43:29 EDT 1997
From: Michael_Wheeler At: 207.172.73.164

We couldn't do what we do without the backbone of NBC News, CNBC worldwide, and MSNBC. Our production facilities are in Ft. Lee, NJ at the worldwide headquarters of CNBC. There, our assignment editors scan what's going on in the business world, what company news conferences have been scheduled, what important speeches are being made by government officials that could affect the stock market, and what conventions are being held. There we have a staff of 8 multimediaists who turn our live feed, our live web feed, into archives. So a couple of people monitor CNBC worldwide.

We have the good fortune of having 215 affiliates to the NBC television network, so if there's an important news conference in San Francisco or Indianapolis or Atlanta, we have an NBC affiliate who can cover it for us. We also have three people who do nothing but interview CEOs. We attend about 75 - 100 brokerage conferences where a Paine-Webber or Smith-Barney will invite company CEOs to speak to analysts. We either broadcast that presentation, or we do our own one-on-one interview with the CEO after the presentation. In all, we have about 120 events a day that we put on the site live and then archive.

We not only produce this archive material, but we also provide links to sites that the multimediaists might think are relevant to our audio and video event. For example, we may take a company presentation and provide a link not only to the company site, but also to a profile of the company at NASDAQ.com. We also have links with a number of other third-party text and data providers. Our content, for instance, is distributed on Bloomberg terminals. So without the infrastructure that we have, it would be cost-prohibitive to cover the amount of content we do. For example, in Washington, we have 42 different camera locations that are all linked back by fiber to our assignment desk.

MsgId: *emedia(22)
Date: Mon Jun 16 21:48:49 EDT 1997
From: OMNI_Moderator At: 168.100.204.58

Perhaps I've missed something out there -- but it sounds to me like this is the largest effort anywhere to deliver UNIQUE broadcast journalism content over the web -- and the web ONLY. Even MSNBC and CNN may not have as much content produces specifically for new media.
MsgId: *emedia(23)
Date: Mon Jun 16 21:51:45 EDT 1997
From: Michael_Wheeler At: 207.172.73.164

RealAudio tells us we are the largest user of RealAudio in the world. We have now more than 7000 events in our archives. We don't know of any other site that has made such an extensive use of streaming audio and video. We were also fortunate that Microsoft developed a product called NetShow which allows us to transport all of this content in a streaming format. When we did our research for the development of this service, one of the main complaints from users was that they would not tolerate long downloads, so the breakthrough of being able to deliver streaming audio and video really was what allowed us to get all of this content to the user.

When we researched this service over the last three years, our customers said that there were really six design points that we had to meet. One is that they wanted to see things live from the primary source so they could make the decision about what was said. Second, they said we can't sit around and watch television all day, so we need to find a way to make content available on demand. Third, they said we want to be able to search and be alerted when there's something important. Long before people were talking about pointcast, we developed a push-pull method where we push our alerts and then the user pulls the content off our server.

The fourth design point was that we integrate with existing text and data providers wherever possible so that we didn't send a flood of raw information but rather was able to put it in context with text and data. The legendary American investor Warren Buffet says there are three elements to a smart business decision -- one, you need to look at the numbers, being data, two, you need to understand the history of the company, the text, and three, you have to know company management. What we do is bring company management to the desktop.

The fifth design point was that we have to create a technical infrastructure that would work on today's corporate intranets, which meant operating within 10Mb Ethernets and 46 PCs. Thus, the importance of the low-bandwidth streaming of audio and video from NetShow and RealAudio. The sixth and final design point was that it had to be browser-based because that was the paradigm that companies were going to.

MsgId: *emedia(28)
Date: Mon Jun 16 22:01:06 EDT 1997
From: OMNI_Moderator At: 168.100.204.58

All this brings to mine the issue of your OWN business model -- the very thing, after all, that makes your expansive content possible. With so many sites on the Internet struggling for a workable business model, your formula seems to make remarkable common sense. I know our time is limited, but I hope you can address this issue and then one final question.
MsgId: *emedia(29)
Date: Mon Jun 16 22:02:21 EDT 1997
From: Michael_Wheeler At: 207.172.73.164

We charge $24.95 per month per user, and then within the corporate environment, we discount that for multiple users.
MsgId: *emedia(30)
Date: Mon Jun 16 22:05:25 EDT 1997
From: OMNI_Moderator At: 168.100.204.58

Yes, I guess that's value in a nutshell. Who can afford NOT to subscribe? My final question is this: In the beginning, the web seemed to be an eden for the small entrepreneur. But as your effort seems to indicate, the critical mass of resources required for success may be great, indeed. Will new media, like old media, ultimately be "owned" by those who can afford large investments and the ability to hang in there for the long haul?
MsgId: *emedia(31)
Date: Mon Jun 16 22:08:18 EDT 1997
From: Michael_Wheeler At: 207.172.73.164

That's a difficult question. When you're talking about news content, the infrastructure is certainly important. One of the reasons that we've been able to joint venture with so many text and data partners is because audio and video for them is so costly to gather. However, when it comes to other areas that are more dependent on the creative process, the internet is the perfect vehicle for entrepreneurs. The Motley Fools is a wonderful example of how the internet and services like America Online can build powerful personalities that can afford to operate on a shoestring budget.
MsgId: *emedia(32)
Date: Mon Jun 16 22:12:47 EDT 1997
From: OMNI_Moderator At: 168.100.204.58

Yes, I guess the Internet presents many avenues for success. That's what makes it so exciting. Well, I could go on for hours, but our time is up. Thank you, Michael Wheeler, for a fascinating hour +. For those who haven't seen the MSNBC Business Video site, don't miss it. The URL is http://www.businessvideo.msnbc.com/. Michael, we look forward to watching you forge the future of broadcast journalism online.
MsgId: *emedia(33)
Date: Mon Jun 16 22:14:04 EDT 1997
From: Michael_Wheeler At: 207.172.73.164

Thanks! And if you want to contact us, the e-mail address is info@desktop.nbc.com and our phone number is 1(800) 663-4NBC. Good night!


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