Montreal: ubi is a multimedia television consortium with an I-Way mission to change the face of direct marketing in Quebec.

In phase one of a two-year installation program, set to start this fall, the consortium is investing $36 million in in-home equipment and another $64 million in fiber-optic cable in a 33,000-home test region in the central Quebec cities of Chicoutimi and Jonquiere.

ubi will be available on a no-fee basis and accessed via tv sets and infrared remote controls. In a word, ubi is an interactive and transactional multimedia network delivered via bidirectional fiber-optic cable.

If technologically ubi is a synthesized reinvention of existing media, its raison d’etre is, of course, commercial. Its promoters call it a powerful new marketing and communications tool for corporate and institutional interests seeking a transactional, direct-to-home edge in the distribution of products and services.

Sylvie Lalande, ubi ceo, downplays the ‘revolutionary transformation’ hype often associated with the subject. ubi is multimedia television, not multimedia pc. The ubi perspective sees transactional services as only the latest ingredient in a medium which has evolved technologically for more than 20 years – from black-and-white pictures to color to digital tv.

ubi’s seven-year program in Quebec calls for an investment of $750 million plus additional cable expansion costs undertaken by cable tv company Videotron. The plan is to expand ubi to Quebec City and Montreal starting in 1997, with complete coverage in 1.5 million Quebec homes by 2002.

The ubi package includes a wide range of cable tv services, including near video-on-demand, interactive tv and specialized services such as the downloading of games, videotex, subtitling and parental-control mechanisms.

The transactional package includes home shopping, direct marketing, interactive advertising, business directories, classified advertising, electronic catalogues and e-mail, home education, government services, banking and financial services, information services, home automation and energy management, and the downloading of software into computers and game devices.

As it stands, ubi’s empowered commercial partnership group (ubi consortium members and their equity participation are: Groupe Videotron, 20%; Hydro-Quebec, 20%; Canada Post Corporation, 19%; Loto-Quebec, 11%; Videoway Communications, 10%; National Bank of Canada, 10%; and The Hearst Corporation, 10%.) added to its fast-track installation schedule, arguably makes it North America’s premiere tv-based I-Way test site.

The only slightly comparable effort underway is a Time-Warner interactive tv test project in 4,000 homes in Orlando, Florida.

Unlike ubi, which is marketing- and service-driven, the Time-Warner program is driven by technology, says Pierre Dion, sales and marketing vice-president at Videoway Multimedia. And while the u.s. experiment will deliver ppv, home shopping and video-on-demand, its longer term commercial application is undermined by a $4,000 price tag on the equipment used in the home. The video-on-demand servers are particularly expensive, says Dion.

ubi’s appeal – to its partners and the 173 companies and agencies which have stated their intention to provide services – is that it is a commercial operation, even in its initial phase. Its financial feasibility is based on critical-mass penetration, a subscriber base representing 80% of the population, and the low cost of the in-home platform – a digital video terminal, an alphanumeric remote control for tv and ubi service use, a personal identification number keypad, a small printer linked to the terminal, and a smart card – estimated to be in the $600 to $700 range.

Furthermore, Lalande says ubi will not keep client files and will not bill consumers; service suppliers and cable operators will be billed and make up the main source of financing for the infrastructure.

Daniel Melchers, vice-president and general manager, Hearst Interactive Canada, says ubi has ‘the right attributes’ to make it a viable business undertaking, rather than a ‘laboratory experiment.’ He says being tv-based gives it better penetration than pc-based multimedia, and it has sufficient ‘critical mass’ to attract a strong mix of commercial and institutional providers.

This spring, Dion says ubi will establish ‘production school sites’ in Montreal, Toronto and Chicoutimi.

Dion says producers, as many as two dozen people, will be invited to attend sessions, and in some cases take examinations, with the goal of becoming authorized ubi multimedia producers. He adds the schools are necessary because ‘there is no existing expertise in multimedia tv production, because it doesn’t exist yet.’

Service providers will have the option of producing content in-house or using an accredited producer. Training includes information on as yet undetermined production and broadcast standards, and multimedia and interactive production techniques.

At this point, 200 experts on computers, engineering, financing, multimedia and marketing are working directly on the ubi system. Dion has a staff of 35 in Montreal while ubi’s commercial agent in Toronto, Videoway Multimedia Ontario, has a staff of 25.

Videoway Multimedia is currently producing ‘generic demos.’

Lalande characterizes ubi as ‘an enabling instrument’ for advertisers.

ubi provides an infrastructure which adds value to traditional image advertising by providing more detailed information on products and services, and by providing the technology to advance the marketing in the direction of a completed transaction.

‘I’m really convinced mass media will always be there. ubi needs mass media, it’s the mass-marketing approach that will change,’ says Dion.

Multimedia tv production on behalf of an automobile manufacturer on the ubi system is likely to look something like this: a multimedia catalogue accessed via a posted ubi automobile menu option, as well as via traditional 30-second tv spots which invite viewers to press a key to obtain the catalogue.

The service provider may then receive a database list of new catalogue users who can be further pitched via e-mail. The e-mail message, signaled in-home when a red light opens on the set-top box, advances the direct marketing process using known selling techniques.

The design of the ubi subscriber interface has the benefit of Videoway’s experience with some 230,000 Quebec subscribers.

As for hardware, ubi’s set-top box is being developed by ibm, the consortium’s technological partner. The set-top brain center is the PowerPC Chip developed by ibm, Apple and Motorola.

The main ubi infrastructure consists of ibm’s transactional server, effectively ubi’s switching system, the National Bank payment server, and the Canada Post postal server, the system’s main addressing resource.

In the future, as cable operators other than Videotron introduce the multimedia system, they’ll pay a royalty fee to ubi for the use of equipment, says Dion.

New cable operators buying into ubi will provide channel capacity as well as assume responsibility for the installation of in-home equipment. ubi will finance the cost of the equipment, to be leased to operators in Quebec at a cost of $2.50 per month per home, as operators leverage added revenues from the system’s transaction-based services.