Goodbye, Mom & Pop

1. That Vision Thing

Call them oddballs; call them geniuses--real entrepreneurs see potential where it doesn't yet exist. University of San Francisco business professor Oren Harari, author of Leapfrogging the Competition: Five Giant Steps to Market Leadership (Prima Press), points to Ted Turner as a perfect example. Way back when, Harari says, "Every piece of conventional wisdom said that launching CNN was an insane risk. At that time, the networks owned 90 percent of the market, and every one of them had a news organization. But Turner picked up on some trends that suggested an all-news cable network might be successful. People wanted more news than they were being offered. They wanted a richer breadth of information than they could get. And with more dual-income families out there, people were less likely to change their schedules to watch the news at 6 o'clock or 11 o'clock."

As we now know, Turner was not insane. Not only is CNN a commercial success, but it's also revolutionized the way people get their news all around the world. Not bad for an idea most people would have panned at the outset.

Of course, CNN is not the last good idea of its kind--at least that's the hope of Marc Collins-Rector, 31, co-founder of Digital Entertainment Network (DEN) in Santa Monica, California. Rector made a fortune with a previous venture that he launched in 1991: Bay City, Michigan's Concentric Network, was one of the first online service providers when the Internet was all but unknown. Rector now plans to bring the equivalent of series television to the Net. This spring, DEN will introduce 30 pilot episodes to the Web-surfing public on its site, http://www.den.net. The most popular pilots will become regular series, and--at least in theory--DEN will inaugurate a new era in interactive media.

Like any true entrepreneur, Rector is not operating on a whim. The technology that DEN has developed will allow people with ordinary (even slightly outmoded) personal computers to get good video quality--a critical barrier in Internet broadcasting. On the demographic front, Rector believes a new generation of entertainment seekers (ages 12 to 24) craves relevant programming. To that end, DEN's pilots are "narrowcasted" to niche audiences: A show called Chad's World follows the life of a gay teen; Tales from the EastSide relates to a young Latino audience.

"This is a hip, savvy and hungry audience," says Rector. "We're counting on their readiness and sophistication to receive content that is as unique as they are." Time will tell whether Rector is on target with DEN, but he's been right before. He still recalls the time--back in the early '90s--when a group of investors rejected his concept for Concentric. "Talk by computer?" they asked incredulously. "Young man, why would someone want to communicate by computer when they can pick up the phone?" Rector knew the answer then. Now, so do those shortsighted investors.

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This article was originally published in the May 1999 print edition of Entrepreneur with the headline: Goodbye, Mom & Pop.

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