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Oceanic Cable Signs VOD Hotel Deal

Hawaii-based Oceanic Cable, a Time Warner subsidiary, hassigned with SeaChange International to install interactive television services to thehotel market on Waikiki Beach.

Through the company's Guestserve Networks System,SeaChange installed a fiber optic infrastructure that will allow Oceanic to offervideo-on-demand and other services to more than 20,000 area hotel rooms by June.

Oceanic has signed the Ilikai Nikko Hotel, the Halekulaniand Parc Hotel as its first three customers to offer the service.

SeaChange introduced its turnkey interactive video servicelast June through Time Warner Cable of New York City. Greg Grigaitis, movie systemsproduct manager for SeaChange, said the VOD service allows cable operators to successfullytarget the hospitality industry again.

Although there are significantly fewer hotel rooms thanprivate residences across the country, there are some advantages, Grigaitis said.

"It's a nice, large, consolidatedpopulation," he said, with hundreds of subscribers within a single building. And fromthe cable operator's perspective, he added, "it's relatively painless toinstall a system in a single building."

Tom Franeta, president of Guestserve Networks System, saidthat the cost of acquiring a new subscriber under this model "is at bargain basementprices" compared to adding a residential subscriber.

The VOD service uses a digital video server installed atthe cable operator's headend to supply about 30 VOD movies, plus 32-bit Windows-basedcomputer games and interactive services customized for each hotel. SeaChange sells theequipment to cable operators and offers assistance in negotiating deals with hotels.Revenues per room average about $30 a month, the company said.

The turnkey approach was designed to help cable operatorscompete with nationwide services such as LodgeNet and OnCommand, which have offered acombination of satellite-delivered programming and tape-based movies-on-demand.

Grigaitis said that in many cases, a hotel would prefer towork directly with a locally based cable operator that can deliver 24-hour support.

SeaChange also plans to introduce separate VOD technologyfor the residential market, perhaps by the end of this year.