That’s good news, isn’ it? Even with monies evaporating all over the place, converting dead loans into dead funds, VCs are still investing in online video. NewTeeVee reports some nice numbers: “This year, 29 startups have already received funding, and the average amount is on the upswing, too, to $7.5 million.“
TechCrunch has a pretty interesting write up on this. And of course, it’s not about a settop boxes at all. Think Android For TV, says Erick Schonfeld. Right. Google getting into CE hardware would make as much sense as King Midas getting into copper mining.
Still. With an Android TV, we should finally stop thinking of settop boxes. First of all: what’s an STB anyway?
Now, let’s take a step back. There’s this wonderful new HDTV set you just bought. It probably already has more computing power than NASA needed to put a man on the moon. The descrambling part, well, think CableCard 2.1. You just need a card reader, like the SIM card on a GSM phone. There’s no need for a stupid box to be attached to a smart tv.
And of course, as the history of computing teaches us, the smart tv – if you really want it to become smart – should have something like a nice, stable standardized OS as a foundation. The basics, besides handling all the standard stuff like putting moving images on a screen, would probably be something like
Now. Forget about storage and networks. The really interesting part will be the UI. Why? Well, Google is in the ad business. And the quantum theory of adverising teaches us: an ad nobody looks at does not exist.
Now look at the status quo. In one corner, we’ve got the media sales super giant with a market cap higher than the stratosphere. In the other corner, we’ve got the incumbents: cable MSOs, satellite operators, some DSL, and last but not least: the tv networks and stations. Representing the allocation of the largest piece of global media cake. Backed up with a finely interwoven network of legalese and some well greased, age old business relationships. Don’t try to push some interstitials in between their shows. Because that’s exactly the incumbent’s billion dollar business. And a well protected turf.
So. Where’s your disruptive moment? Your leverage? It’s not that the tv ad sales business is desperately looking for some streamlining.
Now think UI again. And have a look at the Electronic Programming Guides of nowadays: thick as a brick. TV means: you’ve got time to waste, but no screen real estate to do the same. And what does your run of the mill EPG? It wastes your valuable tv-time AND your screen real estate. Instead of waiting for the scrolling listings of the TV Guide on Screen (late 20th century), now (early 21st century) you click, click, click until you might find (or, most likely, not) the craved for nugget of information. Even worse: with all the computing power in your household at its (virtual) finger tips, an EPG stills treats your grandmother with the same relentless indifference as it treats you. For an EPG, The Weather Channel (TWC) comes just after TCM, because it’s spelled like that.
Current EPGs are just plain vanilla displayed data. Not even information, because this would imply some intrinsic value. How comes? It’s a structural problem: “Premium” EPGs, which are slightly better, cost you a premium.
You meaning: the operator. And the question you’re asking yourself (or your market researchers) is: is a better EPG a reason to subscribe? Would it reduce churn? Good question. Your panel won’t be able to answer that. Because they’ve never seen a really good EPG.
Or you meaning, the manufacturer. Mostly trying to keep cost down, down, down. Because if you want to ship units, it’s a really low margin business.
Or you meaning: the consumer. Yes, friends of Tivo, if you’re really good, a company might find some handfuls of consumers, paying a monthly premium. But tv is a mass market. Paying premium is not. Therefore, Tivos are the CE equivalent of a Beemer.
Now how about this. If a well known company offers you (the manufacturer) a piece of software for free (hey, no licensing fees!), which even handles most of the basics things you’re going to have to implement anyway? Maybe you’ll have to add some dollars for hardware. But at least, that’s a business you understand. And it’s still cheaper and it even gives you some leverage with your operator clients. Because it’s not just a better device. There are even some ad revenues the well known company is offering to share with the operator. But wait, there’s more: how about if you (the operator) doesn’t just get a new, incremental business. They’re even throwing in the additional incentive of lowering your cost of operations (it has been nice working with you, Gemstar). And that’s just the beginning.
Sorry. I got carried away a bit. This wouldn’t be Android TV, but Trojan TV. And maybe, you do not even need the operator that hard. As long as you are in the tv and got a net connection. What the heck. As long as your Android powered TV set chats happily ever after with your Android powered cell phone, filling iGoogle with all the behavioral data it needs to serve you the ads you deserve.
If you are a) into soccer (or fussball or football …) and b) own a cam corder (or a mobile which handles a video a bit better than my SE K610i), you’re invited to put your fan video on halbzeit.in, which translates into halftime.in and is our little video sharing site.
Why are we doing this? On YouTube, MyVideo, Sevenload, there’s already tons of fan related material. Sure. But a) we like soccer and b) we want to put the stuff on our tv channels (don’t try this with bootlegged flash encoded video material).
And not to forget c). Yes, on YouLoadMySevenVideo, there are already some trillions of uploaded videos. So your pretty cool fan action will have neighbors like this one.
Is that good News? YouTube Owns 35% of Online Viewers, quotes Mashable a paper of comScore. Yes, that’s good news. And the average online American watches about 158 minutes online videos – per month. That’s good, too. But, to put things in perspective: that’s less than the average American watches tv per day.
First thing I have to say: Bertram and Harald did a phantastic job. This is grand. But unfortunately, I’m a bit in a nitpicking mood.
Let’s start with some of the basic assumptions. The assumed basic cost structure for a free tv network doesn’t make too much sense. Yes, the key areas are right: content licensing/production, marketing, and distribution. But distribution is not a variable. At least not, if you need national reach. The more coverage you want, the more you pay. Let’s just assume that German mega broadcaster RTL pays annually about 12 million Euros to reach its tv audience. 9live has almost the same distribution. And therefore pays about the same amount of money. The big difference: RTL has renevnues of round about 2 billion Euros. 9live makes about 60 millions.
This has of course serious implications. The cost of distribution limits the access to the public (as do the technical limitations, e.g. available spectrum). It’s called mass media, because you need the masses to watch (or interact, as it’s the case with 9live). Otherwise, you’re going to be out of business pretty fast.
Pay tv is kind of different. Essentially, as a channel operator you have to convince a gate keeper, that the he should shoulder the cost of distribution, against a revenue share. Joost seems to aim to become some kind of funny in between. A gate keeper for a p2p -based distribution of free tv.
Both approaches pose quite serious barriers of entry. That’s why one of the key factors in tv 2.0 is the lowering of the cost of entry. With web based distribution, you can reach an international audience for zilch. Hey, that’s a start.
Now, what’s going on with this audience? As a side note: tv networks (as most traditional media players) do not like Google. But the media sales organizations of tv networks do not (yet) feel the sting of Google’s AdSense. Yes, Google is a juggernaut. But the bauty of the text ad system has been, that Google found a whole new pot of gold. Google isn’t making it’s billions with the handful of mega brands, that fill the koffers of the tv networks. That’s why traditional media is much more scared of bud.tv and the likes. If the media buyers become audience aggregators of their own … As it turns out, it’s not that easy. Especially, because as a media buyer, you’re buying into consistency of reach. Ventures like bud.tv are, like any new media brand, a risky thing. And don’t forget: one of the heaviest spender in media is media itself.
But back to tv 2.0. OK, web based video lowers the barrier of entry. That’s good. The same reasoning applies to the cost of production. Not because of the web, but because the hard- and software for video production and editing is finally approaching zero. This applies to all areas. With my own company, we’re deploying professional broadcast playouts into cable headends. Unthinkable a couple of years ago. same with professional video editing. HDTV cameras. Post production and 3D animation. You name it.
This is good. But still: producing a video is still quite some effort. Will “moving images replace HTML pages”? Never ever. Producing a video is too much effort for the producer. And, for most parts, watching a video takes is too much equally. Why? Video is a linear medium. You can scan a written page in light speed. Speed watching isn’t that easy.
OK. Enough nitpickin’. Bertram and Harald are of course right. TV is going to change. The means of access to video content are changing. Channels as the main organizers of content access will have to change.
The funny thing is: we really don’t know, what tv really is. Do we define tv by content. Most likely not. Otherwise, we wouldn’t make a difference between tv and DVD. Do we define tv as a technology? That’s probably a bit closer.
It’s tv, if it’s broadcasted and displyed on a tv set. But how about PVRs? With video and DVD, we distinguish between a solid media and ethereal broadcast receptions. PVRs are a virtual broadcast.
tv reception itself won’t change that much. Why? tv is a linerar medium. If it’s good, you watch. If not, you switch. Or tune off. That’s all the interacton you ever need.
What going to change is how you find and access content.
The main difference between tv (as is) and tv (2.0) is the enhanced on Demand factor: on Demand with an URL. Because the URL opens up all other means of access, business models, and social feature you can imagine.
Ain’t that smart: Hey!Spread gives you video uploads to multiple destinations. Currently, it’s YouTube, Google Video, DailyMotion, Blip, Metacafe, Photobucket, Yahoo Video, MySpace, and Putfile. Local heroes like Sevenload aree left out (for now). As the nice folks of Particles explain: Spreading videos is something extremely boring and time consuming. Oh so true. And sometimes, it’s even true for watching videos.
The new TV is a lot more social. Really. That’s why every new fancy-schmancy TV client (yep, forget about tv sets) is adding Instant Messaging to its services. Joost has got it. Microsoft’s XBox for IPTV has got it. Just watch the show and chat it up. Way cool, isn’t it? Or, maybe not.
Fair enough: IM’ing whilst watching Lost not only sounds kinda convincing. It’s happening anyway. But on completely separated devices. You watch the show on your tv set. Your logorrhoea is restricted to your PC. XBox and Joost are putting everything into one basket. Nice. But troublesome.
Think screen real estate: PAL and NTSC tubes have about the same resolution as a 1994 PC, interlace the picture, and if you want to make static text really readable, you have to use billboard like type sizes.
Think privacy: watching tv at its best is shared watching, not Lonelyguy57 vegging on his couch (just me and my Bud). IM (usually) is a more private endeavour. Do you really want to open up you IM account to everybody whose just happening to hang around with you? And whose the one who’s going to use the keyboard?
Think usage: the not so well hidden secret is is how people are watching it. Because they’re not watching. My late grandmother’s viewing habits might be a good example for how people tend to use tv. I guess sometimes she really switched channels, but usually she didn’t care anyway as long as the loudspeaker was turned up to Iron Maiden/MotÃ¶rhead-levels (as you might guess, she was a little bit hard of hearing).
Because TV, like radio, is mostly used as a background noise generator. It pushes tidbits of information, entertainment, and you name it onto a blaring, flickering device somewhere in your living room. Sometimes it triggers a reaction, and you’ll have a look. But mostly, you don’t watch tv, you use it.