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New Strategy Is Combining TV and Internet Capabilities

In 1998, Brian Kent came to the conclusion that a Web development company couldn’t make money by just charging a high hourly rate.

What he wanted to do was convert the company he co-founded with his wife, Karen Morgan, into a family of Internet enterprises.

Others at San Diego-based Inspired Arts Digital Media Group wanted something different.

So, Kent left the firm at the end of 1998 due to “philosophical differences” over the direction of the company. Inspired Arts would survive until this March, when it closed its doors permanently.

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After a six-month sabbatical, Kent and Morgan decided to fulfill their dream to launch a string of interactive media companies , TravelPlanet.TV, MaxBandwidth Network and San Diego Media Inc.

“I was completely convinced that I didn’t want to be a traditional Web developer,” Kent said.

– Counting On Future

Broadband Expansion

What Kent is relying on for the success of his new companies is the expansion of broadband, the high-speed transmission of data that has made the promise of the convergence of television and the computer a reality.

Kent said having fast Internet access but having to utilize existing Web sites is like having a Maserati and being forced to drive 25 mph.

That’s because the Web sites today are optimized for slower modems, he said.

With broadband, “You can actually have some content worth creating,” Kent said.

One of Kent’s start-ups, TravelPlanet.TV, has been reborn as a convergence company. The company, originally called TravelPlanet.com, was first launched in 1999 as an international Web portal that sold exotic goods from all over the globe.

Kent raised some money but not enough to fully deploy the TravelPlanet site. Realistically, he needed $40 million.

“The venture capitalists went from business-to-consumers to business-to-business to market collapse,” Kent said. “The VCs aren’t sure what they should be funding right now. So we shifted what we were doing.”

– Shifting Direction To

Catch Investors’ Eyes

That shift includes bringing TravelPlanet goods and services to TV and the Internet. The firm’s focus is to integrate the power of interactive TV and always-on broadband Internet connections to provide the next-generation of media-enhanced shopping and adventure travel. TravelPlanet.TV is currently working on an interactive TV pilot, called “Adventure Shopping.” The interactive firm will also offer global financial services and a TravelPlanet credit card.

San Diego Media will help convert existing content and create new, next-generation content for interactive TV.

While TravelPlanet still has a long way to go before actually turning a profit, Kent is confident TravelPlanet will prosper. (Carlsbad-based Digital Outpost recently made a “six-figure” investment in TravelPlanet.)

Kent said being flexible and moving with technology’s fast pace is critical to survival in tomorrow’s marketplace.

“At Inspired Arts, I had to keep shifting our focus so we could stay a leader,” he recalled. “I always like to play three to four years ahead.”

– Playing Ahead

In The Game

As he looks ahead now, Kent sees interactive TV as being the sweet spot of the Internet by 2003. He quoted former hockey star Wayne Gretzky, who said, “If you want to win the hockey game, you don’t go where the hockey puck is, you go where it’s going to be.”

The same advice, Kent said, applies to the Internet.

“For a while, people thought convergence would be on their PCs,” Kent said. “It really is going to be on your TV.”

He said in order to compete against giants like AT & T; Corp. and Time Warner, interactive companies need to have sufficient resources to survive.

“How can you expect a company that wasn’t able to make money during the last technology change to make money now?” Kent said. “Everybody was betting on this never-ending boom. That’s why we needed $40 million for TravelPlanet.

“Companies that can’t attract those kinds of resources will go away. Others will just have to be very innovative in order to compete. A lot of them will also be acquired.”

– Rounding Out The

Complete Package

At the beginning of the Internet revolution in the mid- to late-1990s, a lot of Internet companies were funded just because they were on the Internet, Kent said.

“But they didn’t have a good management team, and they didn’t have a good business plan,” he said. “I think those days are over. Now you better have a very innovative business plan, and a clear ability to differentiate yourself.”

Kent said he is building his small cluster of companies with the help of a strong management team, which includes Ronald J. Monark, retired president and CEO of Mitchell International, Inc., an international electronics firm; Michael Maslow, an accomplished film and video producer of several corporate films, commercials and adventure travel programs, such as the award-winning series, “The Challengers;” Mark Holmes, a business and communications marketing specialist; and Michael Howard, a financial management expert.

Kent knows he has a long way to go, but he is ready for the wild ride through cyberspace and beyond.

“What we want to do now is take all the lessons we learned and apply them to our new companies.”

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