Bernard J. Luskin, President
Philips Interactive Media of America

For the record, I am taking this opportunity to faithfully correct some of the facts as presented in your article ["Is CD-I Already A Flop?," p. 3] of July 1, 1991 in the Focus section of Digital Media.

To begin, when discussing CD-I technology, you indicate that the 68070 is an “old, weird chip” — moreover, “the Green Book specifies that a CD-I player should use a 68000 based microprocessor, the same as used by Apple Computer.” This is not accurate. The 68070 chip is a highly integrated version of the 68000 family and has a number of functions which are especially suitable for consumer products. The CD-I operating system is a real time operating system, something that Apple and IBM cannot claim, regardless of the chip. CD-RTOS (Compact Disc Real Time Operating System) gives CD-I the ability to handle the myriad of concurrent interactive processes and interleaving that occur on a CD-I disc.

With regard to your statement about OptImage, the fact is that although OptImage has been an enormous asset, its success is due in large part to the tool set developed by American Interactive Media (now Philips Interactive Media of America) and turned over to OptImage for refinement. For example, CD-I’s major new run-time engine, “Balboa,” was jointly developed by PIMA and OptImage. From the very start, it was PIMA that took the initiative and made the breakthroughs on platforms and tools.

In another area, several of the references to PIMA’s finances are simply not accurate. For example, your article claims that PIMA spent $250 million on title development. For the record, PIMA has not invested anywhere near that amount and we have more than 150 titles in development.

In regard to PIMA’s relationship with software partners, the claim that PIMA “never need pay a dime of royalties on any CD-based version” because of PIMA’s ownership is inaccurate. While it is true that in most cases we either own or share ownership in title copyrights, this provision has nothing to do with royalties. Royalties are a separate part of the partnership or development contracts and are based on a variety of factors. All of PIMA’s outside developers have royalty provisions and we anticipate that they will soon benefit from them. PIMA’s deals are fair.

In a sidebar article, your colleague Jonathan Seybold predicts that “consumers will not find the titles compelling.” PIMA research and the diverse library of software clearly indicates otherwise. To support this belief, PIMA has already received a variety of distinctions for ground-breaking interactive software programs. Honors ranging from industry awards to educational grants include:

• Treasures of the Smithsonian, a joint CD-I title publication of the Smithsonian Institution and PIMA, received a First Place MUSE Award from the American Association of Museums. The program was “head and shoulders above the competition” in the videodisc category, according to MUSE Awards coordinator Sharon Kayne Chaplock.

• Cartoon Jukebox received a Gold Cindy for first place in the Games and Entertainment Category at the April INFOCOMM Conference in Florida.

• Two Tell Me Why titles received several additional honors at the same conference, including a Special Achievement Award in the “Audio Visual Age Grand Prize ‘90″ competition for the CD Multimedia Category, a Silver Cindy from the Association of Visual Communicators and an IICS mark of Excellence from the International Interactive Communications Society.

• In the educational arena, PIMA, in conjunction with the National Science Teachers Association (NSTA), was recently awarded a $400,000 grant from the National Science Foundation. One of only four grants awarded by the Foundation this year, the program –entitled Disc of Student Performance in Scope, Sequence and Coordination Performance Programs — will enable the NSTA to evaluate its proposed curriculum reform and improve the quality of science education.

On a more personal note, I must wonder why such a negative and speculative view spews forth toward a company which, as you point out in your section on “What AIM’s doing right,”

1. Invents a new technology,
2. Pays independents to develop authoring tools,
3. Contracts with these same independents to produce software products,
4. Liberally shares all the technological and financial support available among its producer community, and,
5. Works tirelessly to piece together the many thousands of elements it takes to assemble a complex new product such as CD-I.

With the above said, I must finally address your point on page four about artistic control. Frankly, before PIMA came into the picture, most independent producers did not know how to make this type of “interactive multimedia” title because of the diversity of the new audio/video assets. They needed both technical support and guidance in the early days. We are proud that PIMA marshalled the most formidable system in the world to make CD-I happen. No company has ever produced so much software, of such high quality, on such a complex technology in such a short period of time.

As a comparison, in the movie business, almost without exception, producers do not have ultimate control or “final cut rights.” In book publishing, every author in the world needs objective editing and every author, I can tell you from personal experience, has his or her feelings hurt and ego bruised from time to time.

We are building an electronic publishing empire for the future. It has been a learning experience, and now we can certainly claim that within the PIMA producer community resides the broadest and most detailed knowledge of this exciting technological format.

CD-I has clearly caught the attention of the industry now and PIMA has become its beacon. In that regard, I am reminded of the words of Donna Fargo when she sang, “You can’t be a beacon if your light don’t shine.”

For the record, Dr. Luskin was shown a copy of the CD-I article before it appeared in print, as an opportunity to correct any errors or misrepresentations contained therein. Also for the record, nowhere does the story say, as Dr. Luskin purports, that “the Green Book specifies that a CD-I player should use a 68000 based microprocessor, the same as used by Apple Computer.” This is indeed inaccurate. — Ed.