Multimedia Monitor, March 1996

Much of the new media attention is split between CD-ROM on the one hand and the Internet on the other. Therefore, I arranged an interview with Janet Wikler, one of the presenters in the conference on CD-ROM/online hybrids. Janet is just completing an in-depth study on the hybridization phenomenon. Janet is president of Wikler and Company, an interactive media business consulting firm, and has a solid record in many aspects of the publishing industry. Most recently, before starting her own consulting business, she served as worldwide group vice president and director of Advanced Media for HarperCollins Publishers, a subsidiary of News Corporation. Prior to that, she was senior vice president and director of Strategic Planning for Simon & Schuster, the publishing arm of Paramount Communications (now owned by Viacom).

MB: Someone told me last evening that CD-ROM is already passé, a technology that will choke on its own glut in the marketplace. Based on your study, what will we see? Hybrid products? Or will we go straight to online delivery as some are predicting?

JW: I don't believe that CD-ROM is finished. The economics suggest that combinations of local and online media will be with us for a very long time, although what is stored locally and what is online may change over time. In the short term, we have to keep an eye on developments such as cable modems, but my study has convinced me that we will see many hybrids in the next few years.

Nonetheless, caution is in order for those considering hybrids as a publishing option. Some see this approach as the solution to the financial and marketing difficulties they are encountering in CD-ROM or online publishing. Unfortunately, it's not easy to take two products that aren't making money and combine them to create one that will!

MB: So what business approach should content providers consider?

JW: Hybrids offer the possibility of multiple revenue sources, and that can be a powerful advantage. CD-ROM and online publishing are two different businesses, however, with very different economic models. Unless you understand the differences and use them to your advantage, you'll probably have trouble making money. It's important to determine where value lies for the consumer and to price accordingly.

Publishers of CD-ROM/online hybrids are trying to combine the advantages of CD-ROM with those of online connectivity. The results can be wonderful, but hybrids also add complexity. As soon as you connect a computer, a CD-ROM, and an online service or site, there are new opportunities for things to go wrong.

MB: How should we be looking at it then?

JW: To a large extent, the CD-ROM versus online debate is about content versus connectivity. It's also about being up-to-the-minute with information. We can place content on the CD-ROM and then download additional content periodically to work with the information on the CD-ROM and update it. Hybrids also let us distribute high-bandwidth content on CD-ROM, with embedded links and programs that let people connect to each other and play, chat, or collaborate in shared multimedia environments.

MB: What did you look at in your study?

JW: I took a broad approach. I looked at products and talked with people who are creating and using them. I also conducted an extensive literature search.

MB: What do you see as the most significant aspect of your findings?

JW: The quest for seamlessness - something that is very difficult to accomplish - is the aspect that first comes to mind. The difficulties are due mostly to the limitations of the typical user's platform. Eight megabytes of RAM just isn't enough. Often you have to close one piece of content or functionality in a hybrid application in order to run another.

MB: What advice would you give someone considering creating a hybrid product?

JW: It doesn't make sense to create hybrid products out of desperation. To do so will "complexify" a business significantly. Furthermore, most CD-ROMs act like products, not services; and once you provide an online site, you are definitely offering a service. This means frequent updating, technical support, and so forth.

MB: Are your clients making the necessary adjustments?

JW: Many are having trouble making the move from product to service. A big mental shift needs to take place. The production-to-market cycle of CD-ROMs, like most products, goes from development, to freeze and manufacture, to marketing. As a service, however, an online offering is never "in the can." When you add customers, your costs go up, rather than down.

MB: Do you see hybrids changing the traditional relationship between producer and consumer?

JW: With hybrids, there is less need for intermediate layers in the distribution channel. Producers can communicate directly with customers, making it easier for them to respond to their needs. While this model presents opportunity, it also implies responsibility, which may involve expenses the producer does not have today - such as the cost of communicating directly, frequently, and individually with customers. q

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