BLAZING A MONEY TRAIL TOWARD INTERACTIVITY

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LOS ANGELES-The buck starts here.

At New Media Expo, talk about creating a boom market overshadowed the technology.

"This is a proverbial zero billion dollar business going to a zero trillion dollar business," Robert Carberry, VP-technology at Blockbuster Entertainment Corp., said in his keynote address.

Mr. Carberry cautioned that significant revenues in the consumer market for interactive media are several years away.

"One of the biggest fallacies is `If you build it, they will come,'*" he said. "People get caught up in the technology and not the services it will provide" (see related story.

Stephen Case, president-ceo of America Online, cautioned in a second keynote speech that media and advertisers must consider the social implications.

"The challenge is not technological but cultural," Mr. Case told a diverse audience of technology developers, ad agency people, Hollywood creative types and online groupies. "If you miss this community aspect [of people enjoying the social contact of interactive media], you probably will miss this new medium."

Market impediments were much discussed at the show, which promoters said drew more than 15,000 people.

Mr. Case noted 96% of U.S. households don't use computer online services. And only 41% of U.S. adults have even heard of interactive TV, according to a study done late last year by Fairfield Research, Lincoln, Neb.

For advertisers, the options are growing. Among the interactive ad projects seen or discussed at the show:

Intouch Group is starting to sell interactive ads on sophisticated compact disc listening stations in record stores. Cost: 10 cents an impression. Nike and Coca-Cola Co. are testing the concept; when consumers choose a rap song, a 10-second commercial appears for a Nike basketball shoe.

NTN Communications, an interactive service that allows bar and restaurant patrons to play along with sports and game shows, is beginning to sell local and regional ads. NTN is currently in 1,600 locations in the U.S. and Canada, and expects to be in 3,000 by yearend. President Pat Downs said NTN has already signed new national advertisers including American Express Co. and General Motors Corp.

GTE Main Street, an interactive premium cable TV network test running in Boston, San Diego and Cerritos, Calif., is starting a major push for advertisers, said FredThompson, president-chief operating officer of Kerr Kelly Thompson, a Greenwich, Conn., marketing communications company.

Viacom International is in the early stages of selling ads for an interactive TV trial on an existing Viacom-owned cable system in Castro Valley, Calif. Advertising won't start till early 1995, said Virginia Smith, program development manager-interactive services for Viacom partner AT&T.

Ad sales are being headed by Susan Feinberg, VP-interactive media advertising sales, MTV Networks.

Ms. Smith said AT&T wants to link upcoming separate interactive TV trials it's conducting with Viacom, GTE and Pacific Telesis.

Messrs. Carberry and Case stressed that advertisers must use fresh approaches on new media.

Central marketing tenets such as image advertising, Mr. Case said, won't translate well to new media. He said advertising on the information highway will be less intrusive, more informative and carry a renewed focus on two-way communications.

One interactive product that has already emerged is the pornographic CD-ROM. Of the more than 100 companies exhibiting at the show, at least 10 were pitching "adult" CD-ROMs.

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