Screens Merge -- Premium SMS services blossom on TV

RCR Wireless News
It’s hard to imagine, but people are more connected to their television than ever before. Countless TV shows have adopted participation characteristics that make fans interaction with their favorite shows all the more possible — if they so desire.

Premium SMS doesn’t comprise the bulk of these interactions, but it is growing year over year and the companies that manage these transactions are seeing their businesses grow like gangbusters.

“Mobile drives other interactions — initially, with ‘American Idol,’ the toll-free call-ins were the driver,” Telescope Inc. CEO Troy Sample said. “Without the AT&T sponsorship, there was no season two for ‘Idol,’ — it was that simple. Toll-free led the way there for the audience participation. Subsequently, SMS has provided the sizzle and we’ll see this for a range of cross-media applications. We have seen this with year-on-year growth for the SMS interactions; high double-digit growth that is approaching triple-digit growth for SMS for ‘Idol,’ and this is reflecting itself in the broader participation TV market as well.”

New ways to participate

Telescope, which manages the interactive voting components of “American Idol,” managed about 750 million interactions during the first three quarters of 2007 with about 100 million of those initiated by SMS on mobile phones, according to Sample.

“We view premium SMS as one aspect of participation media, one tool that is available to the media partners to utilize,” Sample said. “We launched here in 2002 … and people didn’t know what text-messaging was. In fact, in the first season of ‘American Idol’ there wasn’t even text-messaging at all.”

Premium competition

Sample said Telescope manages more shows than any other company, but they clearly have a major competitor in the interactive TV space, specifically transactions done via premium SMS.

SinglePoint, which focuses primarily on SMS and mobile transactions, said it processed 35 million text-message transactions on interactive TV shows during the third quarter of the year. This out of a total of more than 52 million transactions made by text messages throughout the quarter, according to the company and a report it cited from Nielsen Mobile.

“We’ve been in interactive television really for well over a year and a half. We have put capable and reliable infrastructure behind our interactive television efforts, and what that translates to is a level of assurance for our ITV customers, broadcasters and the studios that is hard to find among our competition,” said Doug Busk, VP of industry relations at SinglePoint, which competes against Telescope and a number of other vendors in the space.

“We’re excited that the level of activity that we’re seeing is being recognized in Nielsen’s report,” said Busk.

Declining to arm wrestle over claims to the highest market share in this fast-changing space, Sample would only say that “SinglePoint and Telescope are leaders in this particular segment.” In fact, Telescope uses Singlepoint for some of its “American Idol” applications, Sample said.

One clear differentiator between the companies, however, is the fact that Telescope likes to call this space “participation TV” while SinglePoint fancies “interactive TV” instead. The Mobile Marketing Association prefers “participation TV,” but nonetheless it makes for fun discussion between all the parties.

Runway to Beltway

SinglePoint, like Telescope, has inked deals with top entertainment media companies. Indeed, the company is currently working on numerous campaigns with the Bravo network, particularly the SMS offerings tied to the station’s hit show, “Project Runway.”

“Viewers can not only act as voters in the winners of the show, which model is going to be best, but they’re picking which haircut is going to be next, they’re picking which stylist is going to be superior, so it’s bringing the viewer that much closer to the television experience,” Busk said.

SinglePoint has also been heavily involved in Sen. Barack Obama’s presidential campaign as he tries to reach supporters through SinglePoint’s text-messaging platform.

“We’re talking, you know, tremendous participation by the audience, and I think a fine example of how politics is going to leverage this medium, as it has others before it like TV, radio and online to drive interaction, to drive loyalty. And nowhere does loyalty matter more and personal experience matter more than politics,” Busk said.

“We’ve seen the number of formats in terms of participation TV continue to grow,” Sample added.

TV show producers are getting more innovative with their campaigns, he said. “I think all good interactivity is built on the producers of the show.”

“I don’t think any producer comes and says ‘let’s do premium SMS,’ ” Sample said. “They say, ‘We want to see more interactivity with our programs.’ ” If it’s not built into the show, it doesn’t work well, he added. Telescope offers a range of participation media tools that it can employ to work best with whatever each show’s format is trying to do, Sample continued.

“We are a multi-channel participation media company,” he said. “If you’re a premium SMS company and that’s all you have to offer that might work in niche programming.”

Looking ahead to next year, Sample sees more branded entertainment deals coming into the space. “I think it’s the growth possibilities and innovations that interest the brands,” he said.