McDonald’s forthcoming in-restaurant TV channel will break new ground in building business-to-consumer relationships, one of its developers said.

The McDonald’s Channel, a digital out-of-home network, will be tested in about 650 company-owned and franchisee-operated McDonald’s restaurants in southern and central California beginning this quarter, said Lee Edmondson, chief executive of ChannelPort Communications LLC, which is developing the channel. It stems from an initial trial at 25 locations begun more than two years ago.

Edmondson recently spoke with Nation’s Restaurant News about the channel’s business model and its content plans.

What can you tell me about the business model for the McDonald’s Channel and the relationship between McDonald’s and ChannelPort?

The key is that these screens can add to the [guest] experience, and they can add to the brand and McDonald’s, and other brands can tell a different story in this environment than they could on traditional television and on the Internet. We found that there was a significant interest in all kinds of stories if they were done in a much more subtle way … if we were story telling, as opposed to advertising.

It is clearly not intended to be something for McDonald’s to chat away at its customer … In fact, the minute and a half McDonald’s will use will probably be story lines about what they are doing at Ronald McDonald House Charities, or … “How do you make a Big Mac.”

How will the McDonald’s Channel make money?

There are approximately eight minutes of traditional advertising available in an hour, which is about half of what you’d see typically on cable TV … What we’re moving towards in our business model is to give large brands — like a Coke, like a Visa, like an AT&T — an opportunity to think about this television channel in a different way and think about being in the content business and entertaining the customer and being much more subtle with the specific brand engagement.

It also gives us a tremendous opportunity to work with the [movie] studios in their green band [approved for all audiences] trailers and in their longer form trailers. So rather than a 30-second trailer that you might see on network TV, on the McDonald’s Channel, you might see two minutes or even longer.

How will McDonald’s convince advertisers that such advertising will yield results for them?

It will begin with faith and evolve towards metrics. We will be investing a significant amount of resources to build these metrics and provide analytics. I think we will develop a very compelling story and the quantitative data will validate that story.