Broadcast News

Broadcast News

If the Titanic had been as nimble as a speedboat, it would have skated effortlessly around the iceberg that eventually sent it to the bottom. The image of merrily dodging approaching doom must appeal to the executives at the helms of today's corporate behemoths as they watch product time-to-market cycles shrink and technology reinventing their businesses around them.

Many might welcome the chance to marry the carrying capacity of their financial supertankers with the turning radius of a start-up company. The sort of agile company where the boss can alert his entire staff to a sudden market opportunity simply by raising his voice. Instead, the problem of motivating staff to react to threatening competitive events in real time is a pressing one for companies that have thousands of workers scattered across the country in hundreds of branches.

Banks and insurance companies are among those who are finding the solution by turning to Business TV, commonly abbreviated to BTV. A high-tech megaphone combining television and communication satellites, BTV is a real-time version of the corporate video. It works by sending images from a TV production studio to a satellite transponder which relays the signal to any TV set in its broadcast footprint equipped with the right decoding gear.

King of the Niche

The one-way, "many-see-one" BTV broadcast model doesn't equate to videoconferencing, where small groups in multiple locations see each other via two-way video. Eventually, it might be threatened by live, full-motion video over the Internet, but until that technology matures, BTV will remain king of its niche.

Australian private and public sector entities now broadcast 1500 to 2000 hours of BTV programming annually. That's the equivalent of sitting one company's workforce in front of a TV set 12 hours a day for 117 consecutive days. In fact, BTV customers normally broadcast in 30 to 60 minute chunks at intervals ranging from daily to monthly.

The expenditure needed to outfit a TV studio and the $2000 worth of decoding equipment needed by each receiving TV set are the largest components of BTV costs. By comparison with the $2 million a customer would have to outlay for decoding equipment to cover a network of 1000 branches, the delivery cost of about $1500 an hour for renting a suitable satellite transponder is minimal.

The banking sector is one of BTV's best customers, with both the Commonwealth and National Australia Bank using it regularly. The Victorian and NSW education systems use it, the Department of Social Security has been a BTV customer for six years and Australia Post has held trials. The technology has caught the eye of insurance companies like AMP and has been harnessed for internal use by satellite service suppliers themselves, notably Optus Communications. Other customers range from the Australian Stock Exchange to organisers of one-off public events.

However, not every large financial institution is ready to embrace BTV. Westpac is one bank that rejected the technology after reportedly deciding they would have to make a capital expenditure in the order of $2 to $4 million to implement it across their branch structure.

Raw Immediacy

In terms of competing technologies, BTV's closest rival is the in-house video cartridge. But the raw immediacy of BTV generates "an enormous qualitative difference over producing and distributing in-house videos", says the Commonwealth Bank's corporate relations head, Lyndell Fraser. "We broadcast every morning to our branch sites around the country. To produce and distribute videos in that sort of time would be an incredibly difficult enterprise.

"The strengths we see in BTV lie in the consistency of message it delivers and its topical time frame. If some development involving an initiative from us or a competitor breaks on the evening news, we have the capacity to comment on it the next morning."Besides keeping staff abreast of daily developments, the bank uses BTV for key broadcasts from its managing director to senior executives around the country on occasions such as the release of annual results or significant organisational changes. Entertainingly, BTV has much the same effect on its business audiences that soaps like Neighbours and Baywatch have on the wider TV watching community. In both cases, the audience forms a bond with the stars of the show and recognises them instantly in real life.

"We've found our management team is much better known because of the broadcasts," says CBA's Fraser. "The head of personal banking and other members of the executive team can walk into any branch around the country and be recognised."The NAB decided to join the Commonwealth and tune into BTV last April after nearly 15 years of distributing videos to its staff. "There were a number of issues on which we needed to get the message out to staff quickly," says Haydn Park, NAB's manager, group media and public relations. They ranged from timely business information, such as interest rate changes, to providing a swift corporate perspective on any media criticism of the NAB or the banking industry.

From the TV studio in its head office building, NAB now delivers those messages via satellite to 23,000 staff in 1200 branch offices around Australia instantaneously and simultaneously. Besides news and corporate commentary, the bank uses BTV to launch new products, such as a training aid, and as an interactive channel for responding to staff questions.

Elusive Cost Benefits

Attempting a rigorous cost-benefit analysis with BTV is an elusive exercise. As with creation of video cartridges, there is a cost of production and distribution that can be quantified. The value of its education and training facets can be estimated as well. Also on the plus side, BTV can generate savings by displacing paper to some extent, The NAB, for example, has reduced the frequency of its staff magazine from monthly to quarterly because of BTV, according to Park. But the real benefits of BTV appear to be more psychological than physical and correspondingly hard to pin down in monetary terms.

Because of its immediacy and because staff must come together to view a broadcast, BTV's customers believe it fosters a sense of corporate loyalty and teamwork. Making members of a far-flung impersonal business empire feel like part of a big, happy family is no mean feat. Certainly it evades the usual formula for calculating its worth in dollars and cents. However, for huge corporations with widely scattered staff, that factor can be literally worth its weight in diamonds.

"One of the old principles was management by walking around. In small organisations, your senior executives are always visible. That breeds a sense of company culture that is lacking in organisations grown so large its executives are faceless," says the NAB's Park.

On one level, the savings generated by BTV might be equated to the time and money costs of sending senior executives on a cross-country road show by chartered jet to present the human face of management. On another level, the benefits accruing to an organisation because of employee morale and team spirit are largely incalculable. And assessing the role BTV plays in encouraging that morale and spirit is a subjective enterprise. What the banks do know is that 95 per cent of their staff watch the BTV broadcasts.

"We do research and regular feed back sessions for each program," Park says.

"We also download and record the broadcasts to play them back to part-time and temporary staff."The live element of BTV and the discipline associated with staff sitting together to watch it at the same time are the two key characteristics that give the technology more punch than store-and-forward video cartridges. That's the view of Paul Mullen, chief executive of Mediasat, an independent broadcast TV facility that competes against Telstra and Optus to supply BTV services over satellite.

From Mediasat's studio it can put live TV programs out over satellite links that give it access to all of Australia and New Zealand. Alternatively, it can splice programs into a satellite link direct from the studios of its customers.

Either way, Mediasat charges around $1450 an hour for end-to-end carriage of the signal, with discounts available for customers buying large slices of time.

Considering the cost of producing a 20-minute broadcast quality TV program can hit $40,000, BTV's delivery costs are "almost irrelevant", Mullen argues.

Even so, the good news is that costs are falling because of a number of reasons. For one thing, Optus' monopoly on satellite services over Australia ended with the arrival of telecomms deregulation around the middle of 1997. As a result of competition, it has dropped its asking price for raw satellite time by more than 50 per cent in some cases, Mullen says.

Perhaps more importantly, Australia has made the shift from analogue to digital TV technology, a move that has had a dramatic impact on BTV delivery costs.

Digital technology can pack 10 TV channels into the same bandwidth occupied by one or two analog channels. Since an entire satellite transponder was needed to handle two analog channels, the bandwidth savings ushered in by digital technology will translate directly into lower transponder rental costs. No new customers are even considering analog and existing analog clients, such as the Commonwealth Bank, are currently looking at switching to digital.

In Australia, the bulk of the video compression equipment required to feed a satellite signal through a TV set is supplied by the company Scientific-Atlanta. Andrew King, regional sales manager for the satellite TV network division of Scientific-Atlanta and one of the pioneers of the domestic satellite industry, says customers going to digital TV gain in two areas. One is the lower unit cost generated by being able to cram at least 10 digital signals per transponder. As well, satellite operators have been freed to be more flexible in how they split their bandwidth up for sale because digital TV uses less bandwidth.

"With digital technology, more people are starting to look seriously at broadcast because we now can offer broadcast data services with error rates comparable to terrestrial lines, King says. That will appeal to organisations who need to do database or pricing updates to large numbers of widely dispersed sites, he suggests.

Mediasat recently conducted a pilot project for Australia Post that focused on a weekly program beamed into its mail centres and retail shops. Part of the pilot involved measuring audience reaction which according to Mullen showed 85 per cent acceptance of the broadcasts among Australia Post employees. Those in the pilot said they enjoyed their jobs more because the programs left them better informed about what was going on in the organisation.

According to Mullen, the future of BTV in Australia depends on cultural attitudes more than dollars. "The cost of delivery by satellite has never been expensive. What has to happen is a cultural change in which people are convinced it is a better means of delivery."

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