Evaluation of Interactive Digital TV Commerce Using the AHP Approach

Evaluation of Interactive Digital TV Commerce Using the AHP Approach

Koong Lin (Tainan National University of the Arts, Taiwan), Chad Lin (Curtin University of Technology, Australia) and Chyi-Lin Shen (Hua Yuan Management Services Co. Ltd., Taiwan)
DOI: 10.4018/978-1-60566-014-1.ch066
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Abstract

The popularity of interactive digital television (IDTV) has been increasing rapidly over the last few years and is likely to be the growth star of the future. According to Forrester Research, more than 10% of Europeans are now using interactive digital television (IDTV) services (Jennings, 2004). Indeed, the introduction of IDTV in the diffusion of television has brought about many benefits to the customers (e.g., more TV channels) (Buhalis & Licata, 2002). The proliferation of IDTV has also given customers easier access to products and services. Nevertheless, according to Pagani (2003), this has a profound effect on the market outlook for the existing TV operators. Although IDTV contributes many benefits to the quality and the transmission of the TV channels for the customers, it has also resulted in fierce market competition and decreased profit margins for the TV industry as a whole. Therefore, the industry needs to look for new ways to utilize the technology to be competitive. However, organizations often encounter challenges and problems when implementing new information technology (IT) (Lin, Pervan, & McDermid, 2005). For instance, organizations are likely to face uncertainties when assessing the new adopted IT (Lin & Pervan, 2003) such as IDTV. Moreover, very few studies have carried out proper examination and evaluation of how the TV industry as a whole conducts its business using IDTV (i.e., IDTV commerce). Thus, the objective of this short article is to establish a decision analysis mechanism that can assist the TV operators in adopting IDTV as their commerce platform. A survey was employed to investigate and identify the key issues for adopting IDTV commerce by TV operators. The analytic hierarchy process (AHP) methodology was used to analyze the IDTV adoption decision processes of these TV operators. The AHP methodology was developed by Saaty (1980) to reflect the way people actually think, and it continues to be the most highly regarded and widely used decision-making theory (Lin et al., 2005). One contribution of the short article is that our results indicate that the three most important adoption drivers for implementation IDTV as a commerce platform are: (1) the operational capability for the IDTV services; (2) the innovation and strategy execution capabilities; and (3) the level of maturity in technological development. Finally, most respondents indicate that the adoption of IDTV commerce should be fully operated and managed in-house, rather than outsourced (partial or total outsourcing).
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Introduction

The popularity of interactive digital television (IDTV) has been increasing rapidly over the last few years and is likely to be the growth star of the future. According to Forrester Research, more than 10% of Europeans are now using interactive digital television (IDTV) services (Jennings, 2004). Indeed, the introduction of IDTV in the diffusion of television has brought about many benefits to the customers (e.g., more TV channels) (Buhalis & Licata, 2002). The proliferation of IDTV has also given customers easier access to products and services. Nevertheless, according to Pagani (2003), this has a profound effect on the market outlook for the existing TV operators. Although IDTV contributes many benefits to the quality and the transmission of the TV channels for the customers, it has also resulted in fierce market competition and decreased profit margins for the TV industry as a whole. Therefore, the industry needs to look for new ways to utilize the technology to be competitive.

However, organizations often encounter challenges and problems when implementing new information technology (IT) (Lin, Pervan, & McDermid, 2005). For instance, organizations are likely to face uncertainties when assessing the new adopted IT (Lin & Pervan, 2003) such as IDTV. Moreover, very few studies have carried out proper examination and evaluation of how the TV industry as a whole conducts its business using IDTV (i.e., IDTV commerce). Thus, the objective of this short article is to establish a decision analysis mechanism that can assist the TV operators in adopting IDTV as their commerce platform. A survey was employed to investigate and identify the key issues for adopting IDTV commerce by TV operators. The analytic hierarchy process (AHP) methodology was used to analyze the IDTV adoption decision processes of these TV operators. The AHP methodology was developed by Saaty (1980) to reflect the way people actually think, and it continues to be the most highly regarded and widely used decision-making theory (Lin et al., 2005). One contribution of the short article is that our results indicate that the three most important adoption drivers for implementation IDTV as a commerce platform are: (1) the operational capability for the IDTV services; (2) the innovation and strategy execution capabilities; and (3) the level of maturity in technological development. Finally, most respondents indicate that the adoption of IDTV commerce should be fully operated and managed in-house, rather than outsourced (partial or total outsourcing).

Key Terms in this Chapter

Analytic Hierarchy Process (AHP): A process that transforms a complicated problem into a hierarchical structure.

Digital Television (DTV): A new technology for receiving and sending digital TV signals. DTV digitalizes the processes of program production, image processing, encoding, signal emitting, and transmission.

Set Top Box (STB): A critical component for users to receive digital television signals on traditional TV sets. STBs provide the users with capabilities for implementing interactive television applications.

IDTV Commerce: A specific kind of TV commerce using TV sets and other related equipments with interactive services.

TV Shopping: The most popular form of TV commerce.

TV Commerce: In general, all the transactional behaviors via TV can be called TV commerce. This occurs over the medium of the television. TV commerce allows you to purchase goods and services that you view through your TV.

IDTV: Interactive TV is a DTV extended technology. IDTV focuses on the interactive functions and services, including user-friendly interfaces, VOD, EPG, PVR, and so forth.

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