New problems for new media

FOR the third time, the disciples of CD Rom returned to the palm lined streets of Cannes last week to talk about new media at Milia, the annual conference dedicated to all things interactive. But last year was a tough one for the CD Rom industry, and as a result, this year's event had a sombre look and feel and a decided focus on doing business rather than on freewheeling creativity.

Yet if business suits were, surprisingly, the outfit of choice over the five day conference - and multimedia folk are usually famed for being at the flamboyant end of the technology fashion scale - there was still plenty of room for innovation. The Web sites and CD Roms nominated for the annual Milia d'Or Awards at the end of the event demonstrated that developers can do some amazing things with digital bits and a small circle of plastic.

Milia (or Marche International de l'Edition et des Nouveaux Media), attracts publishers, developers, content merchants, and a mixed bag of creative types who come to schmooze, eye the competition, cut deals, snap up new talent, or just lie on the beach in February. Peppered amongst the crowd were a modest number of Irish participants, some of whom took space on the exhibition floor on the Irish Trade Board stall others came to attend the sessions, then walk the floors and network.

The titles of the conference sessions summed up the general mood: "The Winter of Our Disc Content"; "Shouldn't We Be Rich By Now?", "Luring Advertising Online", "Profit on the Web". And in a major shift which reflects the growing sophistication of the Internet, more than half the sessions were pointedly about working on the Web. "Online" is now becoming just as important a multimedia arena as "offline"; the only difficulty is in finding ways of making money with it.

Attendees also spent much timejawing about DVD Rom, or digital video disks, which hold seven times as much material as CD Rom. DVD-Rom is expected to outsell CD-Rom by the year 2000. With that kind of room, developers can greatly increase memory-hogging multimedia elements like video, graphics and sound.

Part of the frustration of multimedia is that, by all accounts, it should be roaring along. According to Julie Schwerin, head of research firm InfoTech, end user expenditure on CD-Rom titles worldwide was over $30 billion last year and is expected to grow by a healthy 30 per cent in 1997. The number of CD-Rom drives installed worldwide has passed 100 million, and Britain and Ireland have over five million drives. Yet the world multimedia industry operated at a net loss in 1996. Consumers are buying more titles, but spending less for them - an average of £25 predicted for Britain in 1997, down from £30 in 1996. Multimedia is labour and cost intensive and margins are narrow as prices fall.

As speaker Nick Donatiello, president and chief executive officer of the research firm Odyssey, noted: "It has not been a great 24 months for content providers in multimedia. A lot of money has been lost and a lot of decisions need to be made. Nonetheless, he made a strong argument for the traditional CDRom, noting that while 20 per cent of US households have PCs with a CD Rom drive, only 14 per cent are linked to the Internet, and of those, surveys show Net usage is actually quite low. "The idea that somehow the CD Rom is a dying technology is totally absurd," he said.

The smartest approach for developers seems to be to opt for both on and offline options. Pepper's Ghost, an 18 month old British development company with its first two projects hot and ready to sell, had one for CDRom and one for the Net. Both use their proprietary 3D go anywhere real time animation for characters who move through the virtual world of a Tex Mex city known as Corazon. In the online game, players can experience anything from a traditional twitch (blast em up)game in Corazon's sleazy underworld to peacefully trying their hands at running a cantina.

Terry Shuttleworth, already billing himself as international marketing manager on his business cards, was cheerfully looking for publishers and venture capitalists. He's attended the previous two Milia events as well: "There's more focus this year," he said. That suited Pepper's Ghost: he felt it brought in the serious talkers rather than the window shoppers to their stand.

On the Irish side, Dublin company Martello Multimedia had its director Mark Leslie on the speakers list, discussing the company's interactive kiosks in a session on multimedia and museums. Leslie has been trying to get to Milia for three years, but business got in the way - "I'm too busy to be here now," he added. But he thought the networking time spent with other session participants in a nearby bistro was satisfyingly productive and hopes to return next year with a trade stand.

Other Irish delegates found the meeting a mixed bag. According to Donald Hickey, director of Cell Media, which produces science oriented CD Roms, Milia was valuable for the networking opportunities it offered, but he felt that publishers were keeping a low profile. Developers instead found themselves making pitches to each other by accident.

A number of Irish developers who have now begun to move into the consumer market were also there seeking publishers and distributors: Pixel Magic, On Screen Interactive, TerraGlyph, and Parcom Media. Parcom's Jerry Foley clinched a deal for the German language market for his golf title, Play Better Golf "Less people wasted your time at the show," he said.

One of the few Internet developers at the show, Gerry McGovern of Dublin company Nua was surprised and somewhat disappointed that while the talk upstairs was constantly about the Net, there was little evidence of it downstairs on the exhibition hall floor. "But the fact that we were one of the few Internet developers there meant we stood out somewhat from the crowd," he added. And Milia remains a must do if only for the contacts: "Meeting six to 10 of the right people makes the trip worthwhile."