May the Source Be with You

By Christopher Byron

A flood of information arrives at home via computers

For most families, household utilities usually mean electricity, the heating system and a supply of fresh water. But when middle-income New Yorkers next month begin moving into a newly completed 52-unit condominium at 260 West Broadway in Manhattan's Tribeca district, they will find not just sinks, tubs and electrical outlets, but builder-installed computer terminals. The inconspicuous machines, which look like small television sets with a keyboard, are hooked up to a McLean, Va., firm that styles itself an "information utility." Its daunting name: the Source.

The Source and its 12,000 nationwide customers are part of the still small, but explosively growing, new business of consumer data banks. For fees that can amount to as little as a few cents a month, the data banks are using computer technology and telephone lines to provide household subscribers with the opportunity to summon up-to-the-minute information on everything from the action on Wall Street to the best shopping bargains available from brand-name discount houses around the country.

For years major corporations have earned extra income by marketing the sort of research and scientific information that routinely get produced and then filed away in the normal course of business. Data banks buy the information, put it in their own computers and then resell it either to other corporations or perhaps to large research institutes.

One such bank, DIALOG Information Services Inc. of Palo Alto, Calif., buys reports, statistics and doctoral dissertations from some 140 different corporations, universities and even the government. When using the service, a subscriber dials a toll-free 800 number and connects his telephone receiver to a coupler device that links his office computer to the DIALOG computer. He can then transmit queries and receive the answers within seconds. Cost for such services can run as high as $300 an hour, a sum that businesses can afford much more readily than the average individual can.

But the mushrooming popularity of personal computers has now begun to spur the development of data banks specially tailored for individual consumers. The Source, which is a subsidiary of Reader's Digest, offers subscribers everything from financial planning to word processing. Source subscribers can monitor the schedule of current legislative activities in the Congress, check the latest changes in airline schedules and send "electronic mail" to other subscribers by using Source computers as a kind of space-age postal system. Gerald Reinen, a Massachusetts business consultant, reports that not only does he use the Source for business applications at the office but his children use it at home when they want to look up movie reviews.

Another consumer data bank, CompuServe Inc., of Columbus, offers electronic copies of stories in ten major national newspapers, including the Washington Post and the New York Times on the same day that the newspapers hit the stands. Also available is current news from the Associated Press wire service. Through its Microquote data base, CompuServe provides constantly updated information on any of more than 40,000 different stocks, bonds and commodities.

Prices are not cheap. The Source charges customers a one-time sign-up fee of $100, plus a monthly minimum of $10, whether the system is used or not. Additional "online" fees can be anywhere from $4.25 to $30 an hour, depending upon the time of day and the nature of the information requested. CompuServe requires an initial sign-up fee of $19.95, but fees for on-line usage during business hours are higher than the Source's.

Before he can communicate with a data bank, a subscriber needs either a personal computer, which can cost anywhere from $1,500 to $8,000, or one of the much less expensive electronic keyboards that retail in hobby shops for under $400. There is a serious drawback to the keyboards, though. While cheaper to buy, they often wind up being more expensive to use. Reason: keyboards lack computer memory power, and thus can communicate with data banks only at the pace of the human typing information into the machine, which is fairly slow by computer standards.

In contrast, personal computers can be preprogrammed to ask questions before they are ever connected to data banks. Moreover, once connected, via a toll-free call over a household telephone line, the personal computers can transmit requests for data at superfast speeds. This can cut a subscriber's on-line usage from hours to minutes, or even seconds, at a time, resulting in huge savings in monthly bills. Says Marshall Graham, president of the Source: "Our equipment is constantly in operation, but the average bill to our customers is no more than about $25 per month."

Though total subscribers to both the Source and CompuServe now number fewer than 27,000, the Source alone expects to have 20 times that many on-line customers within three years. Meanwhile, a number of other companies, including CBS, Warner Amex, Cox Broadcasting and Time Inc., are working to bring similar services into the home via so-called interactive cable-television systems. Such systems would use a television cable instead of a telephone line to transmit the data, and permit viewers to extract information by means of specially modified television sets equipped with keyboards. Tests are now under way with cable subscribers in San Diego, Columbus, Dallas and elsewhere. Whatever the actual transmission technology, it seems that people are becoming increasingly hungry for the information wizardry that computers are bringing about, especially now that the magic can be brought right into the home.

-- By Christopher Byron.

Reported by Christopher Redman/ Detroit

With reporting by Christopher Redman

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