• by Ross Fadner , June 14, 2004

ShadowTV is banking on the fact that consumers' migration to broadband will set the precedent for media consumption in the future that is increasingly personalized and on-demand. While the broadcast networks and cable operators have their feet firmly planted on the set-top box, ShadowTV President Joachim Kim believes his company's product will further drive change in media habits.

Currently, ShadowTV provides video clips of TV programming for businesses and consumers. It does so through a searchable database made possible by the closed-caption transcripts of each television program. Currently, NBC is ShadowTV's only major broadcasting licensee for consumers, although Kim notes that ShadowTV is currently in talks with other networks and cable operators.

Despite Kim's hope of luring consumers to his Web-based product, the majority of ShadowTV's business lies in the business-to-business (B2B) sector. "Our primary business serves PR [public relations] agencies, advertisers, and advertising agencies," he says, noting that these companies use ShadowTV as "an auditing service."

Advertisers and PR agencies are able to use ShadowTV to search for their brand to see how their advertisements played, at what time, in what slot, and at what frequency, in addition to seeing if it was mentioned in the news. "To some extent," Kim says, advertisers use the product "to see how their media buyers are performing."

"We work with all major advertising agencies," he adds, mentioning "the three biggest groups" without specifying names. They are: Interpublic Group of Cos., Omnicom Group, and WPP Group. Of ShadowTV's agency business, Kim says 80 percent belongs to big agencies, and the remaining 20 percent belongs to small- to medium-sized enterprises. Of its advertising business, Kim says that roughly 60-75 percent belongs to agencies, and the remaining 25-40 percent belongs to brand marketers.

"Right now our focus and main interest is the B2B side," he says, but notes that consumers will be the focus of the "relaunch" of ShadowTV's consumer product, which currently is tentatively scheduled for September 1. This will feature more content and more browser subscription variations.

Kim says that advertising, while not a part of the initial service, "will play a key role" in the ShadowTV consumer business model--especially "once consumers understand the role advertising plays in the reduction of fees," he says, hinting that the price of ShadowTV will be offset by advertising support in the near future.

ShadowTV expects to roll out an ad model in January 2005. Kim says that the platforms to be sold are currently under discussion, although paid search and video-based advertising are certainties. Regarding the re-purposing of TV ads, Kim says he is uncertain as to whether Internet users will have the patience for a 30-second TV spot, but 15-second spots are "definitely viable." Kim says ShadowTV will also look into offering advertisers audience segments.

ShadowTV runs on a seat model at about $500 per person for businesses with full access to reports and analytics. For consumers, ShadowTV offers basic and premium subscriptions similar to cable TV models. Basic service is between $19.95 and $29.95.

ShadowTV is similar to RSS (Really Simple Syndication or Rich Site Summary) in that RSS feeders filter news content by desired category, but Kim notes that ShadowTV offers more granular targeting than RSS; RSS feeders can't be searched--yet.

"I think [Web-based TV] is the future," says Kim, and he says that the convergence of the Web and television is not a matter of "if," but a matter of "when." He notes that technology is not the main deterrent to progress: "It's about the alignment of content providers, market demand, and industry acceptance."