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'Tag' Hopes VOD is It

Switching its moniker to “Tag Networks,” four-year-old gaming proponent TVHead is fielding another round of trials with operators in hopes of availing cable subscribers of games through the video-on-demand platform.

“We're currently in trials and we're hoping we'll have official deployment in Q2,” said Sangita Verma, Tag Networks co-founder and a 16-year veteran of the video-game industry.

Tag, which is eyeing ad-supported and subscription-based offerings, currently has rights to distribute Tetris, Space Invaders, Battleship, Risk, Barney, Thomas the Tank Engine, Bejeweled, Diner Dash, Zuma and Texas Hold 'Em games. The company is also banking on such genre staples as solitaire and backgammon.

The game service would be available through standard set-top boxes and operable via remote control, with no need to purchase extra hardware. “We think it's critical that the community is not tied to a specific device,” said Verma, noting that Tag also is considering Internet and wireless applications.

TRIAL RESULTS

Although Tag executives would not disclose which operator the company is presently testing with or where it expects to launch, the company completed previous trials with Time Warner Cable and overbuilder Grande Communications in Laplace, La., and three markets in Texas, respectively, during 2004 and 2005 — centering only free games and limited advertising — among 15,000 households.

According to Verma, Time Warner did “modest advertising” — the marketing messaging reached about 5% of households — behind the service, yet the cable company achieved 73% penetration.

Of those who used the service, 93% were repeat users. (Time Warner Cable later swapped The Laplace market to Comcast following the cable operators' acquisition of Adelphia Communications.)

Grande trialed the service in San Antonio, Austin and San Marcos, Texas, from November 2004 through January 2005, with Tag securing a household penetration rate of roughly 50% over that span without the benefit of any marketing support, according to Verma. She put the repeat-user rate in each of those markets at about 93%, equivalent to that in the Laplace trial.

Tag's second-quarter launch strategy calls for a dual offering. Verma said that since Tag's demographic ranged from preschoolers to grandparents, the ad-supported tier could appeal to varied marketers, from game companies to packaged goods and automobile dealers.

“When someone subscribes to the service we ask them three questions. We ask them for their gender, year of birth and ZIP code. That makes it much more attractive to advertisers because we are able to send them targets for launching their ads,” Verma said.

As for the premium service, Tag is currently testing it among 30,000 households at $4.95 to $5.95 per month, but she estimates it could carry up to an $8-per-month retail price point at launch.

Verma declined to specify revenue splits for the services, both of which would be deployed on a 30-day trial basis before users would be asked to subscribe.

INTERACTIVE OPTIONS

While Tag's immediate target-demographic is the “casual gamer” — defined as someone who plays games without purchasing expensive systems, as opposed to the “console gamer” — the network has found significant crossover with devotees.

“The best community starts within the household,” said Verma.

She also expects operators will give gamers the option to compete with their cable company's other subscribers.

As for allowing subscribers of different cable companies to play together, Verma said such cross-operator capability is there.

“So far the conversations have not been across operators, they've been within their own systems,” she said.