Warner Communications Inc., GTE Corp. and, most likely, Bank of America are planning a home information and entertainment project that would for the first time offer consumers full two-way video services, communications industry sources said today.
Preliminary plans are to test the project during the first half of 1984 on a Warner Amex Cable Communications cable television system in Pittsburgh in conjunction with a subsidiary of what then will be Bell Atlantic Corp., according to Mark Kriss, a senior analyst at the Yankee Group, a Boston consulting firm.
Bell Atlantic is the holding company that will include the Chesapeake & Potomac Telephone Cos. and Bell of Pennsylvania after American Telephone & Telegraph Co. divests itself of local phone companies, an event now scheduled for Jan. 1.
Several things are unique about the plan. First, it will allow subscribers to use their phones to call a central number to request full or moving video images transmitted from video discs over cable to the home. Two-way cable systems have previously permitted viewers to obtain certain screens of data or individual graphics but have not yet been developed to the point where so-called "full video" has been made available on demand.
In addition to being able to deliver shopping and banking services, the previously secret effort, known as Warner Electronic Home Services, also will be able to provide subscribers with films and other entertainment offerings when desired.
The project was first developed by Warner Amex, but was transferred to Warner Communications last spring, apparently after American Express Co., Warner's partner in the cable company, became more interested in internally developing its financial services strategy. The financial services giant reportedly also wanted to work on its own technological experiments.
Warner Communications has been trying to line up participants in the venture, and so far GTE is the most certain candidate to join. But the company's efforts to recruit retail, financial services and other home technology-oriented concerns has been hampered by Warner's bottom-line and management problems.
Queried today about the Warner project, Ron Ramseyer, national catalogue advertising manager for the nation's largest retailer, Sears, Roebuck & Co., said his company has developed a video disc catalogue that could be compatible with the Warner project and that his company has been "approached" about joining the Warner group. Sears has not made a decision on the proposal, he said.
Although negotiations are continuing, a spokesman for Bank of America confirmed late today that the giant San Francisco bank, the nation's second largest, is seriously considering participating in the Warner project.
Public disclosure of the project comes on the eve of the launch of the nation's first commercial home information project. That effort, a joint videotex venture involving Knight-Ridder Newspapers and AT&T, is beginning this week in South Florida. Under the videotex plan, consumers will be asked to purchase keyboards and a connecting box to hook into television sets for $600 apiece and will be able to choose from more than two million pages of data as well as shopping and banking services.
That service, to be marketed as Viewtron, will be distributed over telephone lines. Although the system will provide a test of consumers' appetites for home information, it will not, however, permit subscribers to call up moving pictures such as television and movies, a major limitation of the videotex service often cited by analysts.
"On the surface, the prospects for this kind of service," Kriss said, referring to the Warner venture, "are much better than those for Viewtron."
A spokesman for GTE said the company does not comment on ongoing negotiations, and Warner spokesmen similarly refused substantive comment. "We're talking to four or five other companies," said a Warner official.