October 27, 2003

Before there was the Web, there was Viewtron.

Twenty years ago on Oct. 30, Knight Ridder and the American Telephone and Telegraph Company launched in Miami one of the boldest experiments in new media: a U.S. consumer videotext service.

For many of you reading this on the Web, videotext is an unknown communication service. Or if you know about it, it is a historical anomaly, something akin to CB radio. And if you don’t know about Citizen’s Band radio, don’t even ask.

Viewtron, even to white-haired veterans of technology, was a strange method of sharing news and information. Before one could read the first screen of data (it was called a “frame” of data) Viewtron required of its initial customers:

  • A dedicated keyboard/terminal that could only be used for the videotext service. This equipment cost $600 to $900; later, as personal computing caught on, Viewtron would try to sell its services via IBM, Apple, or Commodore PCs.

  • A television set to display the color images, which took time to load or paint

  • A monthly subscription fee of $12 (the first month was free)

  • A phone line to send information back to a central computer, for which the consumer initially paid $1 an hour

Viewtron’s dream was very similar to the dreams of news media publishers today: new ways of communicating with customers and new ways of selling services to advertisers. The promise to consumers was that they would have a new way to get news and information, shop, bank, and communicate online.

Interestingly Viewtron got many of its content offerings right. Some examples:

  • Getting news from the Miami Herald or The New York Times the night before the paper hit your doorstep. Or accessing the Associated Press.

  • Looking up airline schedules from the Official Airline Guide (OAG).

  • Accessing bank account information, although many customers would drop this feature after trying it.

  • Ordering a meal via an online menu.

A year after launch, Knight Ridder president Jim Batten told security analysts that the company was “encouraged” that technology companies would develop low-cost videotext terminals. Viewtron had 2,700 subscribers at that point. The cost to Knight Ridder in 1984 was about $17 million.

Looming large on the horizon was the personal computer. The multi-purpose PC made the videotext terminal out of date and expensive. By 1985, Viewdata, the subsidiary of Knight Ridder and AT&T, was selling software to allow personal computers to connect to the Viewtron database of content.

This connection to the Viewtron content database was at either 300 or 1,200 baud modem. Subscribers paid $13.20 per hour (subscription fee and phone line combined). All of this made Viewtron look much like the early online services such as CompuServe or The Source. And, unlike those commercial sources, Viewtron with its Associated Press connection, had lots of news and information available.

So why didn’t it work? Did Knight Ridder pull out too soon? I wonder what the interactive media industry would look like today if Knight Ridder and other videotext pioneers, such as Times Mirror, had stayed the course. Would these pioneers have learned more about consumer needs and wants so they could have developed the services that they now offer on the Web?

That’s the promise and problem of being a pioneer. You have to know when to keep going and when to quit.

There was a lot of promise and hope about videotext. Listen to this exuberant quote from Viewdata Corp. vice president, Norman Morrison: “We’re at the beginning of home information technology. The whole world is watching South Florida. We are dancing naked on the stage of history.”

That quote came from a story in The Washington Post (Oct. 23, 1983) by Merrill Brown. Yes, the same Merrill Brown who went on to build MSNBC into one of the best news websites and later went to Real Networks.

I’m sure there was also that promise of e-commerce riches that propelled videotext pioneers. Brown’s Washington Post story referenced a Booz Allen & Hamilton Inc. study predicting that “by the middle of the 1990s, the home information systems market would be a $10 billion business and electronic retailing will become a $50 billion to $60 billion field.”

It was the right idea; wrong decade. It was too hard to predict when this form of this technology would take hold. It took almost 20 years from the 1983 launch of Viewtron for U.S. online-retail spending to total $70 billion.

Knight Ridder invested six years of research and more than $50 million dollars on its videotext project. The company closed Viewtron services after two and a half years (March 31, 1986). Times Mirror closed its service, called Gateway, about the same time. And while a few other videotext services lingered for a few more years, most were gone by the late 1980s.

Viewtron was a bold attempt to change the rules of getting information to the consumer.For all its faults, there were important lessons learned from Viewtron. It was a bold attempt to change the rules of getting information to the consumer. It provided a glimmer as to the changing nature of how consumers get and use information.

Batten, Knight Ridder president, in a 1982 Editor and Publisher interview, said, “Viewtron could lead to ‘a funny kind of blurring between news and advertising.'” He is quoted as saying that Knight Ridder was calling this “transactional advertising.” That is the foundational model that supports many of today’s successful newspaper websites — the enhanced classified services.

Ultimately, Viewtron was probably the wrong technology at the wrong time. Even the online services — such as Prodigy, CompuServe, and America Online — were better suited to the multi-tasking needs of consumers. But it took time and the development of the low-cost personal computer to propel those services into the mainstream.

What may be more important about Viewtron is the conversation it started in the newspaper industry about the future of the communications business. There were many conference sessions devoted to exploring this frontier. Viewtron helped position, even in a negative way, much of the current thinking about the Internet for newspaper executives. Some became more cautious. Others decided that the Viewtron failure was a lesson to be built upon.

I strongly believe that George Santayana got it right when he said “those who cannot remember the past are condemned to repeat it.” So that we might not repeat all of the painful lessons of videotext, I have convened a “virtual roundtable” (by e-mail) of Viewtron alumni and asked them what they learned from their experiences. >>Click here to read more

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Howard has been in journalism for 40 years. His resume includes positions with the Chicago Tribune, The New York Times, the San Francisco Chronicle and…
Howard Finberg

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