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ENVIRONMENT, COMMUNICATION, INFORMATION TECHNOLOGY AND THE ARTS
31/05/2000
Broadcasting Services Amendment (Digital Television and Datacasting) Bill 2000

CHAIR —Welcome. The committee has before it submission No. 9, which it has authorised to be published. Do you wish to make any alterations or additions to your submission?

Mr Lloyd Jones —No, we do not.

CHAIR —Would you like to make a brief opening statement? I believe you have a video.

Mr Lloyd Jones —We do have a short video which we think may help give an understanding of the type of business that we are currently engaged in and how we hope to use datacasting to develop this business further in the years ahead.

A video was then shown

CHAIR —Very good. You are right; it did explain a lot about what you do.

Mr Lloyd Jones —I have several additional points I would like to make, if I may. TVSN is a listed company, as we stated. We employ 142 people primarily in the functions of buying, managing our logistics, television production and, of course, customer service. We are carried on Foxtel, Austar and Optus. We are a little different from most of the other channels in that we pay for that carriage on those channels. We have a slightly different relationship with Prime where we actually go out and buy airtime on the Prime network.

Our other business partner is Australia Post. We have had a longstanding relationship with them for many years and they handle all of our deliveries Australia-wide. We have set, and they have achieved, extremely high standards of service which see that we can make a delivery within five to seven days anywhere in Australia from the date of purchase. We usually achieve substantially better than that, but that is the maximum that we look for from them.

We have commissioned research and we have some of that available that bears out some of the points that I am about to make. Customers find the live programming that we put to air to be primarily informative and it helps them make an informed purchase decision. We look for a long-term relationship with our customers. That is borne out by the fact that over 80 per cent of any given day's transactions come from repeat customers. We back up our belief that we sell nothing but the highest quality merchandise by giving a 30-day, no questions asked money-back guarantee.

In addition, some 12 months ago we prepared a code of practice that we submitted to the ABA outlining how we react and interreact with our customers and if they ever have any query or cause for complaint how we will deal with that. I am very pleased to report that I do not think there has ever been a question to the ABA about anything to do with TVSN's performance or the performance of any of the merchandise that we sell through the channel.

As you could see from the video, TVSN is on the cutting edge of a number of new technologies. We have been using the free-to-air networks, cable and satellite to get to our customers. We are increasingly using the Internet. We are currently using narrowband Internet, but we are in discussions with a number of broadband Internet providers and obviously datacasting is the next logical step for us in being able to reach a wider Australian audience. TVSN wishes to ensure that we will not be restricted in our ability to gain access to that wider market through the use of datacasting.

TVSN already interacts with over 70,000 Australian homes, using the telephone, the Internet and an ability to order through the IVR system, which is a touch tone phone system. It was only introduced some six weeks ago and already 45 per cent of our orders are being processed through this new technology. That shows just how quickly Australians will take up new technology when they see it as being beneficial to them.

We obviously believe that having access to datacasting and to enhanced services will allow us to better serve our customers in the months and years ahead. Datacasting is the logical next step that we, as e-commerce retailers, would like to take in the future. I would like to thank you for the opportunity to appear here. Mr Frame and I are happy to answer any questions that you may have.

Senator MARK BISHOP —You are essentially a home shopping network?

Mr Frame —That is correct.

Senator MARK BISHOP —Isn't that covered by the category B classification that is permitted under datacasting?

Mr Frame —That is correct.

Senator MARK BISHOP —So the bill expressly allows you to be a datacaster.

Mr Frame —Yes.

Senator MARK BISHOP —So you are not denied coverage under the bill in any way.

Mr Frame —We wish to ensure that we do have that availability to participate. That is part of why we are here, and that is why we have a submission.

Senator MARK BISHOP —When I read the category B classification, I had presumed that it covered companies like yours.

Senator BOURNE —Following on from that, would what you can see on the pay TV channels be substantially available to you to datacast on a datacasting channel, in that format?

Mr Lloyd Jones —In that format and also, hopefully, in an enhanced format.

Senator BOURNE —Okay. So you would be looking at a different sort of interactivity, with back channels and things like that?

Mr Lloyd Jones —Obviously, we are producing 24 hours a day right now, which we could datacast straightaway. Enhanced services would be something like selling a statue of Don Bradman during the tea break of a cricket match, and that would open up an opportunity for a wider audience to see the kind of merchandise that we have.

Senator BOURNE —I see. So you would be using that capacity on another channel that was showing the cricket match.

Mr Lloyd Jones —Potentially, yes.

Senator BOURNE —Are you also looking at different sorts of interactivity with back channels and things like that, or do you want to just keep using the phone, as you are doing at the moment?

Mr Lloyd Jones —We are currently in discussions with Austar about doing that through the open TV system that they are developing at the present time. Obviously, they need to have a return path on top of their digital boxes to be able to do that. So it is our intention to develop interactive programming so that one may not even have to pick up a telephone to place an order, but just use the remote control.

Senator BOURNE —You are speaking to someone who nearly bought a vase just because I was flipping through. I do not know that that is a good idea, but still—

Mr Lloyd Jones —It is a wonderful idea.

Mr Frame —We looked at using whatever technology there is available, as was covered by Charles earlier, that we could utilise from the telephone through to interactivity through to your computer. It is the ability for people to access the system to make the most careful decision on the potential purchase that they can and give them the best information possible.

Senator BOURNE —It is interesting too that you say 45 per cent of your phone orders are just by touching the buttons, which is pretty indicative that people like newer, faster, easier ways of doing things—they are looking for something new and different.

Mr Lloyd Jones —They do. In fact, we hit a high just recently. We had a sale that we ran from midnight to dawn, and it hit 65 per cent during those hours, which we were pretty amazed with.

Senator BOURNE —I must not watch the TV between midnight and dawn.

Mr Lloyd Jones —There are a lot of people out there, and if the bargains are good enough they will stay up.

Senator BOURNE —Thank you.

CHAIR —Amazing. I must say I have watched you on Foxtel in Perth, and here we are. I noticed, looking at your most usual products, there always seem to be presenters showing jewellery, and I see they are one of your most favoured items. That explains why that happens so much. As Senator Bishop has said, I think that your service is allowed under the datacasting categories, so I do not think we have any further questions for you, unless there are any other issues you wish to raise.

Mr Lloyd Jones —No, we thank you for the opportunity to appear.

CHAIR —Thank you for providing your interesting submission and video.

[7.55 p.m.]