Select Committee on European Union Minutes of Evidence

Memorandum by NMTV and

  Network Multimedia Television Ltd (NMTV) is the publisher of, the leading online TV news and recruitment service for IT professionals across Europe. Its vision is to build a next generation media business which delivers Internet-based business news and information products to supersede traditional controlled circulation B2B magazines.

  Recent events such as the merger between Dow Jones and Reuters show that Internet-based services are fast becoming the preferred medium for business information delivery and have already begun to supersede traditional business publications.

THE SILICON.COM BUSINESS MODEL has recalibrated the Internet as a publishing medium to create a sustainable, valuable online business.

  1.  It knows and understands its audience. The way in which was built means it accurately measures (a) who its users are and (b) what these users do on the site. is one of the only online media owners to to this. Independent auditor, ABC//electronic went on record saying that NMTV had delivered the most sophisticated audit ever thanks to its ability to tie rich demographic information to usage.

  As a publisher this has benefits (a) for measuring site/content consumption patterns and (b) from a revenue generating perspective—advertisers know precisely who they are targeting and can measure who has seen their ad. has a huge market lead in that it enables "addressable" and accountable online advertising—a critical need for a business to business advertiser. A recent Forrester Research report commented that it is becoming vital for online advertisers to know precisely who they are communicating with and not just how many individuals are viewing their advertisements.

2.  Personalisation—building a loyal community of users

  Personalisation has been built into from day one enabling it to build a loyal community of users. The benefits of personalising a site include:

    —  fosters loyalty amongst user base;

    —  enables a one-to-one relationship with users;

    —  better understanding of usage patterns and habits;

    —  augments "stickiness" of your site;

    —  enables targeted, one-to-one marketing for advertisers.

  Industry experts believe that personalisation will play an increasingly critical role in online customer acquisition and retention. According to a recent report from Forrester Research (July 1999), companies must face up to the challenge of offering personalised services to users of their websites or risk losing business—"Today's poor personalisers will fail to retain customers".

  Understanding your audience is a key requirement in building a sustainable online community of regular site visitors. All value in terms of possible revenue flows from the community—including sustainable advertising revenues and likely future e-commerce revenues.

3.  Beyond CPM

  NMTV does not sell advertising on the common model of cost per thousand (CPM). focuses on the quality as well as the quantity of its users enabling it to sell exclusive sponsorships and guaranted response-based advertising. Most other online media owners merely sell banners which drive traffic to an advertiser's web site—and they won't be able to give you any information on who has seen your ad or clicked on it.

  Silicon delivers measurable marketing solutions and is the only publisher on the web to guarantee minimum campaign response rates to advertisers. Advertisers can use Silicon to raise brand awareness amongst a tightly defined target audience, whilst also generating qualified sales leads. A recent online advertising campaign for Microsoft generated around 3,000 sales leads in a three month period. Similarly, e-commerce consultants, Quidnunc, advertised on Silicon and received over 1,300 new enquiries.

  In terms of revenue based purely on advertising and sponsorship, Silicon is among the Top 10 UK sites, taking between 5 and 10 per cent of the overall market spend—revenue grew 300 per cent over the last year. This figure assumes current UK online advertising market valuations lie between £20 and £40 million.

  Key revenue streams on are:

    —  Response banners—an industry first. Unlike other forms of banner advertising, which simply deliver impressions to an advertiser's web site, response banners actually deliver qualified sales leads. is unique in the media industry by actually guaranteeing a minimum level of response.

    —  TV Style Advertising—an industry first. In March 1999, Silicon re-launched its daily news section as a TV style feature. To complement this, it pioneered the use of TV style advertising on the web. This enables advertisers to re-use existing creative designed for broadcast TV to be delivered to a 100 per cent targeted audience in an extremely cost effective manner.

    —  Contract e-publishing services—includes creation of Internet TV programmes and creation of promotional microsites for advertisers and sponsors of the site. Recent customers include Microsoft, Nortel and Kyocera. also is in the process of developing its e-commerce offering on the service. Initially this will forcus on working with key industry partners and players to sell valuable information online using as a channel. Qualitative user research has shown that this is a service offering which users would like to see on

4.  The User Experience is designed to solve the problem of information overload for time-starved IT professionals.

  Summary of key user benefits:

    —  personalised experience and e-mail alerts;

    —  relevant content (IT news from a business perspective);

    —  real time content;

    —  TV at the desktop, on demand: compelling and time-saving;

    —  powerful archive searching for research.

  Busy IT and business professionals needing to learn what's going on in the world find the daily TV news invaluable. According to one PricewaterhouseCoopers' executive, "The idea that you can spend a couple of minutes listening to an expert on your desktop is spot on."

  Personalised news updates and details of the latest video interviews are sent straight to the viewer's e-mail inbox following the completion of a brief registration process.

TV on the Web

  NMTV believes that the future for delivering mission critical information in a business to business environment is web-based. Internet-based services are already beginning to supersede traditional business publications and are fast becoming the medium of choice for consumption of work-related information.

  A critical format for business information delivery will be video-based and transmitted direct to an executive's desktop. Business users will receive this video based information through their existing and accepted workplace appliance—the PC. NMTV believes that in the home consumers will view Internet-style applications and information through already accepted delivery mechanisms such as the TV.

Why TV at the desktop?

  TV style delivery of business information over the Internet is becoming the preferred way for busy business professionals to consume information. Would you rather read a 1,500 word interview with Bill Gates or watch a 3-minute interview at your desktop? NMTV has conducted extensive research into this and discovered that the majority would rather do the latter.

  Benefits of TV at the desktop include:

    —  It makes it very easy and quick to keep informed.

    —  Users can turn the information on and off as required—i.e. video on demand.

    —  While it is will always be important to have editors and journalists' views, sometimes people want to hear an interviewee speak for themselves without being coloured by a reporter's opinion—TV is the only medium which allows this.

SOME ANSWERS TO YOUR QUESTIONS1  What needs to be done to create confidence and to stimulate e-commerce?

  Confidence can only be created through leading by example. Acceleration and rapid uptake of e-commerce will only happen if:

    —  Governments lead by example developing e-commerce applications for wired government. This could mean creating centres of excellence which are open to business and to consumers alike. It could mean ensuring we have public information kiosks with Internet access in towns and cities, free web access for all schools etc.

    —  Governments need to be seen to be placing e-commerce at the top of the political agenda. A political heavyweight needs to be put in place and actively to work with industry. For example, both government and industry would benefit from regular seminars and thinktanks to stimulate best practice and information exchange;

    —  Create a truly excellent online service and community which is a joint government/industry initiative. This would be a forum to: exchange information and ideas; share best practice and case studies; gain access to reports and information; industry to post questions to government and government to post questions to industry;

    —  Put in place government sponsored industry angels/advisers who can dedicate a proportion of their time to advising businesses of all shapes and sizes on the all of the issues surrounding e-commerce. These must be individuals who have genuine hands-on experience of implementing on online/e-commerce strategies. They should not be affiliated to any one vendor.

2.  Does the EC's draft Action Plan offer a realistic means of promoting e-commerce in the EU?

  It is difficult to give a sensible answer to this without a really detailed understanding of what is being done. However, it is fair to say that industry tends to view government as more of a hindrance to e-commerce than a facilitator. What is required is clear action rather than reports and talking shops. The key issues which need to be addressed are:

    —  Unbundling local loop;

    —  Sensible pricing for high speed internet access;

    —  Free Net access for all schools;

    —  Business advisers as outlined above to help business;

    —  Effective online "hub" to promote all of the above and enable a genuinely free flow of information and advice between government and industry.

3.  Will codes of conduct and co-regulation provide sufficient protection? Is there a case for intervention by national governments and EU?

  On the whole regulation tends to stifle e-commerce.

4.  Do the institutions of national governments, on the one hand, and the European Commission, the Council of Ministers and the European Parliament, on the other, function with sufficient flexibility and coherence to promote the EU's objectives in the field of e-commerce?

  A flat no, I am afraid. Industry does not perceive national governments as acting with flexibility and coherence—instead they are viewed as, apart from a few exceptions, having a very poor understanding of technology and e-commerce and as bureaucratic and obstructive.

Anna Russell

Marketing Director NMTV

18 February 2000

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