On With the Show, This Is It

Baldwin Louie — Mon, 26 Jul 1999 18:00:00 -0400

Jim Banister may not be one of the pirates of Silicon Valley, but he nonetheless cuts a swashbuckling figure. Standing 6 feet 4 inches, sporting a black beard, wearing an earring and favoring open-neck white cotton shirts, Banister certainly looks like a pirate - especially at the wheel of his newly purchased 45-foot yacht, the Koan, named for the paradoxes Zen devotees meditate upon to help them achieve enlightenment.

For the past four years, as executive VP of Warner Bros. Online, Banister has focused on the riddle of Web entertainment. His proposed answer: Entertaindom, Time Warner (TWTC)'s soon-to-be-launched entertainment site.

Banister arrives at his fifth-floor Burbank office for a two-hour interview bearing fries and chicken-breast sandwiches. Earlier that day he suggested moving the interview to the Koan - an idea that got quickly nixed. A far-ranging talker, Banister is hard enough to corral in his landlocked office, let alone amid the distracting expansiveness of the open sea.

As Banister sits down to his fast-food feast, his office looks like a microcosm of Entertaindom: Looney Tunes dolls are everywhere. The Tasmanian Devil rests atop a bookcase. Spiderman is poised on the desktop. Squashed on a shelf of technology and management texts is a fat volume called Suzanne White's The New Astrology. A retro-looking Missile Command game stands in the corner. The office reflects the restless and eclectic mind of this good-natured bad boy of the new-media world.

When entertaindom launches in late August or early October - Time Warner wants to launch either before or after the start of the fall television season in September - the site will be one of five Internet "hubs" replacing Time Warner's ill-fated Pathfinder. Entertaindom, Banister says, will offer consumers a mixture of "service programming," consisting of news, listings and databases and "pure destination programming."

Banister and his boss, Jim Moloshok, promise "great heaps" of video, animation, music and game-based content. "We're not a portal," Banister explains. "We're a cul-de-sac where people come out to play and be entertained."

On the informational side, Entertaindom will feature Driveon.com, a "broadband interactive show" that offers video clips, behind-the-scenes interviews with celebrities and other TV magazine-style offerings. Time Warner's entertainment-news assets, such as Entertainment Weekly and People, are being integrated into Entertaindom, complete with a Java-based ticker that provides breaking news.

On the destination side, Entertaindom is already front-loaded with weeks' worth of short-form entertainment from several outside digital-content companies. The site has announced partnerships with both Macromedia (MACR)'s Shockwave.com and Seattle-based AtomFilms, which will have its own channel on Entertaindom.

Warner Bros Online joined former Universal (UEIC) Studios chief Frank Biondi's WaterView Partners and the London-based Arts Alliance in investing in AtomFilms, which distributes short films over the Internet. Original content offerings will be bolstered by old favorites drawn from Warner Bros.' vast animation, film and TV libraries.

What will separate Entertaindom from its competitors, says Moloshok, is "made-for-online content designed for the mainstream, not for four blocks in SoHo." Banister believes that animated, claymation and live-action shorts are well-suited to the Web, which he dubs "short-attention-span theater."

While the disaster that was Time Warner's now-defunct Pathfinder site does not exactly inspire confidence in this new approach to the Web, some outsiders think that this time, Warner's got the right formula.

Peter Clemente, an analyst with Cyber Dialogue, an Internet research firm, says Warner is ideally positioned to launch an entertainment hub. He says the studio has the two critical components needed for a successful online business: "strong relationships with large communities of consumers and long-standing relationships with advertisers."

In an attempt to leverage both, Warner in January launched AcmeCity, a GeoCities-style online community. The site offers fans of Time Warner properties like the film Wild Wild West or TV shows like Buffy the Vampire Slayer a place where they can make legal use of Time Warner content to create their own fan pages. At last count, the site had 300,000 homesteaders, with 900,000 pages of content.

Banister's vision for online entertainment is a bold and sophisticated one, borrowing from a diverse array of sources to communicate his ideas. In June, he raised eyebrows when he described the Internet to an industry conference as "mutable, nonlinear, interactive, multitasking, community and communications oriented, infinitely deep and mysterious - a bit like the female of our species."

Banister says he was taking a "transcendental view" and not attempting to "genderize" the Web. "This medium requires a capture-nurture approach," he says, "as opposed to the take-what-I-give-you" male mindset more common in television.

Entertaindom is part of a second wave of online entertainment, which includes competitors like Digital Entertainment Network, Silicon Alley's Pseudo Networks and the Comedy Network. The first wave ended with a wave of spectacular failures, when companies like AOL (dossier) and Microsoft (MSFT) decided that entertainment content was far too expensive to produce given the small audiences it attracted.

Online entertainment fizzled, says Macromedia CEO Rob Burgess, because content creators "were using a bunch of old tools designed for print. They put up all this big, honking multimedia and it slowed everything down."

Customers got frustrated and surfed elsewhere. "I continue to be somewhat dubious about the Internet as an entertainment platform," cautions Jupiter analyst Patrick Keane. "In mid-1999 people view their PCs as utility appliances."

Keane and others believe that entertainment on the Web will have a better chance to succeed when a higher percentage of American households have broadband connections to the Web. But broadband is rolling out more slowly than many had expected. Jupiter estimates 20 percent of households will have broadband access by 2002.

Banister agrees that consumers will need the broadband experience for online entertainment to take hold.

"Consumers are going to need at least television-quality video to buy into the online entertainment space," he concedes. Nonetheless, Banister's insists that "broadband isn't about pipe; it's about experience." Rather than wait for cable modems, DSL and satellite infrastructure to roll out, he says, Entertaindom will employ a combination of technologies to deliver the broadband experience to consumers today.

While the Entertaindom team is building or acquiring content for broadband households, they will also make use of "pseudo-broadband technologies" like Macromedia's Flash. "There's a miracle occurring on the Web every six months," Banister says. "What was broadband a year ago is something I can now deliver over a much smaller pipe."

Video is the tricky part. Banister worries that even current broadband systems can't deliver the kind of video experience consumers want. The problem is what Banister calls the "Super Bowl effect." Downloads tend to slow up in neighborhoods in which a high percentage of people are streaming video at the same time - just as water pressure supposedly drops during half-time as sports fans run to the bathroom en masse. As a result, "broadband-pipe companies are absolving themselves of responsibility for what is broadband programming," he says. "A lot of them think broadband is just fast Web. They're shying away from video, when they should be running whole hog into that space."

Banister sees an interim solution in something called WebDVD, what he describes as "broadband in your hand." The "fat elements" of video-based Web programming - six to eight week's worth - are baked onto DVD disks and shipped to registered viewers. The disks are the "tickets" that enable consumers to unlock a site and view a seamless video experience in an online environment.

Many people consider the prospects for this kind of klugey solution as dim at best. "You have to realize your audience is still going to be small," says Jupiter's Keane. "You can't ask people to jump through too many hoops. Consumers aren't generally that technologically savvy - especially mainstream consumers who will be the be-all and end-all for a lot of these entertainment sites."

Gary Arlen of Bethesda Md.-based Arlen Communications likes the richness of the DVD experience but worries that the strategy is "at the mercy of something they can't control" - the adoption curve for DVD drives.

Banister maintains that Entertaindom is riding a rapidly rising DVD curve. According to some industry estimates, DVD players will be in as many as 20 million PCs by the end of this year. While CD-ROMs deliver grainy, sub-VHS-quality video and have limited storage capacity, he says, you can fit "two to four hours of beautiful MPEG 2-quality video" on a DVD. Banister adds that early adopters - especially gamers - have already cleared the behavioral hurdles associated with using a disk to unlock sites.

Banister's obsession with the elements of visual experience is rooted in his multifarious career as a physicist, filmmaker, animator and digital archivist. He mixed film and physics courses in high school, shooting a knock-off Star Trek movie in Super 8 titled "When the Clock Struck One" for a class assignment.

"I was Captain Kirk," he recalls. "I should have been Spock, but it was my ego. I had to be Kirk." After college, he got a job as a physicist in the Space Technology Group at TRW.

TRW is where Banister earned a reputation for using guerrilla tactics to promote his technology vision. He discovered that the innovative computer graphics tools used in the company's advertising campaigns ("Tomorrow is taking shape at a company called TRW") weren't available within the company. A junior-grade engineer, he left a message for his division chief, Dan Golden, now the top administrator at NASA. Banister was working in a crowded office when the callback came. "This is Dan Golden," the voice crackled. "Who the fuck is this?" Banister started talking. Three months later, Golden gave him $1 million to set up and run TRW's Engineering Visualization Center.

Banister left TRW in the late 1980s to launch Animated Technologies, a computer-graphics company, which merged with another computer-graphics firm one year later. Beset with "girlfriend troubles" and frustrated with the razor-thin margins and scarcity of talent in the computer- graphics business, he left to begin a "walkabout," his version of the aboriginal rite of passage where boys are sent into the desert. For two years, Banister had no permanent address; he wandered throughout Southeast Asia, Europe and Mexico.

Upon returning to L.A., Banister revived his filmmaking career and soon found himself rollerblading on the Croisette at the 1994 Cannes film festival, where two of his short films were being screened. After Cannes, he accepted a post as director of multimedia and postproduction for Steven Spielberg's Survivors of the Shoah Visual History Foundation.

Banister says he'd intended to spend six months on the Shoah project but ended up staying a year. Spielberg asked him what he planned to do next. "I was thinking of returning to filmmaking," Banister says, "or maybe checking out this multimedia thing." Spielberg offered to arrange some meetings at DreamWorks, which was setting up an interactive division in partnership with Microsoft.

Meanwhile, a Warner executive named Steven Koltai had gotten approval to set up an online unit. Koltai was looking for someone who had both technological credentials with a creative sensibility - a difficult combination to find. He dropped in on Banister at the Shoah lab on the Universal Studios lot. What began as a one-hour meeting turned into a five-hour dialog on the opportunities of the Web.

Banister took the job. Koltai also convinced veteran Warner executive Jim Moloshok to head up the unit on at least a part-time basis - he became full-time president of the unit in January. Together with Jeff Winer, VP of planning, development and administration, the three formed a cohesive team. "When you put the three of us together, you get one new-media superhero," Moloshok says.

Like many of its rival operations at the other studios, Warner Bros. Online was originally set up primarily as a marketing operation. But Maria Wilhelm, former deputy editor of Pathfinder, recalls Banister as a "larger than life figure" who wanted to make online "interesting in and of itself, not just tied to an offline movie or TV show."

Figuring out what to do online took longer than expected. "For three years we focused on listening to the consumer," Banister says. One experiment, "Hip Clips," offered consumers "whole entertainment thoughts" and unexpectedly drew millions of pageviews. The line between marketing and pure entertainment was further blurred with the development of brand extensions like Rosie O'Donnell's "Interactive Mondays" on AOL, ERLive.com and Seinfeld.com. But Banister says those early days were "relatively inarticulate in terms of a real entertainment experience," he admits. "We knew the day would come when we'd cross over a technology threshold that would allow us to create really immersive entertainment experiences."

Entertaindom began in the fall of 1997 as a "skunkworks" project. By March 1999, the Warner Bros. team was weeks away from launching when Time Warner CEO Gerald Levin came to Burbank for a demo. "He laughed," Banister says simply.

"We saw some five and 10-minute programs ... just as funny as anything you see on 'Saturday Night Live,'" Levin told an audience at the Variety/Schroders Big Picture Media conference soon afterward. But the launch was put on hold to allow time to integrate Entertaindom into Time Warner's emerging "vertical portal" structure.

Whether Entertaindom catches a ride on the second wave of online entertainment depends in part on Time Warner's ability to overcome its past corporate heavy-handedness on the Web.

"Time Warner is an institution weighed down by its history," one former insider notes. "It's not a company that has been able to move quickly or that embraced the Net with any kind of conviction."

The recent departure of Jake Winebaum from Disney's online unit underscores a key challenge facing large media companies like Time Warner: Matching the kind of wealth-generating opportunities and entrepreneurial environments that can be had in a dot-com company like Yahoo or eBay. Rumors have circulated for months in media circles that Time Warner might spin off its Internet assets to solve that problem and take advantage of the hot Internet IPO market.

Richard Bressler, CEO of Time Warner's Digital Media unit, agrees that the company will have to adapt "as we always have" to attract the best people.

"Clearly part of that is going to be breaking some of the eggs about the way we have compensated people historically," he says. But the bigger issues involve corporate culture. Says one, "The fun and nimbleness of doing these businesses outside of the large media umbrella," says one former insider, "is going to be even harder for them to duplicate than some of the financial/structural issues."

Inevitably rumors have circulated that Banister might follow the lead of Winebaum or former CNN/fn President Lou Dobbs and leave Time Warner for more entrepreneurial pursuits. For the record, Banister says that "money alone is not reason enough for me to give up my passion."

The interview ends about three in the afternoon, as Banister flees to the Marina and the Koan. Over the weekend, he takes the boat on a maiden cruise to Catalina Island, and has the "double good luck" of being escorted by two separate schools of dolphins along the way. Banister is betting that Entertaindom will receive a similarly inspiring reception.

It's a Zen Thing

Given Jim Banister's interest in Eastern mysticism, it seems fitting to summarize his vision for online entertainment in five Zen-like koans:

Koan #1: When is narrow also broad?
Translation: Broadband isn't about pipes, it's about experience.
Solution: Employ "pseudo-broadband" technologies like Flash and "broadband-bridging" technologies like WebDVD to deliver the broadband experience now.

Koan #2: What is the sound of one fan clapping?
Translation: Protect and manage intellectual property.
Solution: AcmeCity is more than just a community-building resource for Warner Bros. Online; it is also a strategy for managing the use of Time Warner intellectual property. WebDVD also doubles as a way to control the distribution of intellectual property, since much of Entertaindom's video content would reside on DVD disks.

Koan #3: When does product become media programming?
Translation: Use exclusivity and cache to build community and commerce.
Solution: The Web needs to embrace the "entertainment business model," based on exclusivity and cache. Rolling Stones tickets are astronomically expensive because a limited number of fans can get into a given concert. Put content in one place that theoretically has 100 percent reach, Banister advises, and "market the hell out of it." He says four things confer cache and exclusivity on the Web: "customer service, personality, sports franchises and entertainment."

Koan #4: What is both passive and active?
Translation: Provide consumers with a spectrum of passive to interactive experiences.
Solution: Critics say few people have the patience to watch a two-hour movie online. Banister believes consumers will kick back for shorter forms of passive entertainment, and then stick around for more interactive pursuits like talking to other people, building personal homepages and playing games.

Koan #5: She is deep and mysterious, yet not human.
Translation: The Web is inherently feminine.
Solution: Banister is fond of pointing out that science can't explain "why teenage girls go to see Titanic seven times." Web companies need to follow the example of eBay, which he feels is successful because it appeals to consumers' right-brain sensibilities.

- J. G.

Correction:
Gerald Levin saw the Entertaindom demo in March 1999.

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