Internet TV analysis and Google TV 2.0

Write about... “#AppleTV is coming (again) next week. New-and-improved enough for you?”

Original post: https://teknopolitik.tumblr.com/post/14137519577/internet-tv-analysis-and-google-tv-20

I use to do these types of market analysis when I headed up all the new tech due-diligence at BMG Entertainment back in the day (2000-2003).  I use to meet with companies for a living and write this stuff up daily to send off to the CEO and department heads for review.  I love all things tech and media related.  I watch a lot of TV.  I love good TV, and I love really bad TV that makes it good  TV (The Soup).  Main-stream news media and Entertainment.  I have a fascination for why companies do what they do.. Why they position and posture the way they do.  I’m a strategy guy when it comes down to it.  So here’s my take on what’s happening now, and what will come to be.  I know there are many different opinions on this subject.  So please just accept this as mine (albeit a very thorough one), and not as a challenge of any sorts to “your’s” personally.  Okay, got that out of the way.. Let’s proceed with the analysis.

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I actually just got my OTA Android 3.1 update (from 2.1r1) for my Logitech Revue last night.  Glad to say, the browser that is included appears to be Google Chrome v.11 with Flash Play 10.2 installed.  REAL CHROME!

Now if you didn’t know.. There are many planned Google TV integrations.. I would disregard the latest remarks from Logitiech’s CEO on the losses the company had with the Revue.

https://www.engadget.com/2011/11/11/logitechs-new-ceo-sees-the-failures-of-the-revue-clearly-in-hin/

He’s got some bigger problems on his mind I think and is taking it out on an emerging technology.  I mean, if you were looking for a sure profit, I wouldn’t be the first one to release a TV set top box.  That’s for sure.  So I question this CEOs whole agenda.  He might be on the way out, and need a product scapegoat for why it “went all wrong”.  Who knows.  For one, I can say this.  Here are the usual responses I get from different types of end-users after using my first version Google TV (not the latest update) which wasn’t perfect when it comes to “integrated TV”, but was miles ahead of the last try from Microsoft (I was a WebTV/Direct TV beta tester in 2001) due to just having broadband now.  Apple TV users even tell me they wish their first-gen boxes would do as much.  So that being said, the break down begins:

End User 1 (Early Adaptor and usually fan of All things Google and beta) - Reaction: 

“Where can I buy this!  I want one now.  Should I get a Revue, which box should I get.  When is the new version coming out?”

(as you can imagine.. Sheer joy and nerd excitement over the platform when I mention the word “Marketplace”)

End User 2 (Tech savy, but not overly zealous about having the newest anything.  Usually Apple die hard and loyal customer who values things working well together over beta features) - Reaction: 

“This has a lot more functionality then Apple TV, but lacks the iTunes client I need to listen to my music.  I don’t like that it block Hulu (though there are ways around all the content blocks if researched), but over all, I love the Browser/TV integration, because who doesn’t want to be able to Tweet in realtime with shows while watching them PIP (picture in picture).”

(This end-user obviously has connected the dots, but is not inclined to jump right into the Google world when they have so much money invested in the Apple/iOS environment.  They are willing to buy a GTV box if Apple never bothers to get AppleTV updated with iOS, and/or the new Apple TV Set is not released in a reasonable amount of time.  You know Apple will, so count them in as soon as it’s announced)

End User 3 (Tech hater, and hater of all your gadgets.  Usually your non-techy partner that co-habitates with you) - Reaction:

“How do I get to Facebook?  Can I launch Pandora?  Yes, then I suppose this is okay.”

(Yes, they like the features, but hate any sort of learning curve.  Since the TV works as normal, they usually never need to interface with the box, and when they do its as simple as hitting one button to bring up a search bar/browser bar, or one button to bring them to the apps menu which will allow them to launch Pandora.  Most likely will not buy a box of their own because you went out and bought it already, but would be happy if it were just included on the TV.  Frequently gets annoyed with you “futzin with it” all the time).

With the introduction of 3.1 to the Google TV STB all End Users will find increased benefits with the new design, and Marketplace.  It more closely represents the Tablet/Phone UI’s that they are use to.  With movie, tv, game rentals/purchases, Netflix, and cloud connectivity.. I think End User 3 will become much more at ease with the tech.  End User 2 will wait for the AppleTV update that is rumored to be coming.

https://www.slashgear.com/apple-tv-v3-tipped-in-ios-5-1-beta-29198561/

End User 1 will surely be surprised with the update because it basically brings the tablet to the TV.  You can’t imagine the ideas I have flow through my head when it comes to relating broadcast video content with corresponding data from the net.  With the openness of the Android Marketplace.  The reality really is that if you have an idea, know HTML5 or better yet, Native Android Java.. You could build your idea, and deploy it to your Set Top Box with little problems.  Never before in the history of television has the “at home” developer had this sort of access to the STB (set top box) environment which until now has remained locked down and generally never really updated by the cable providers.

Google’s acquisition of Motorola’s STB division and the announcements by Samsung, Sony, LG, and others to begin shipping GoogleTV powered TVs  in the very near future, as well as a number of device manufacturers announcing boxes of their own (Netgear for example) brings more questions to the game.  What will Comcast do? 

https://techcrunch.com/2011/11/21/google-samsung-google-tv/

https://www.businessweek.com/news/2011-11-25/lg-is-said-to-plan-to-debut-google-tv-at-trade-show-in-january.html

https://gigaom.com/video/netgear-google-tv/

Comcast’s Reaction

What’s Comcast’s reaction?  Of course, a massively huge industry-wide initiative to force a standard without the market’s nod.. And it will fail miserably like all initiatives like this do.  Let me introduce to you Comcast’s dream come true, but in reality, its only a dream I think.  Who would ever want Comcast to increase their “Gatekeeper” leverage.  The game now, is to take that away.  Well after they did a trial run in a selected area with a STB powered by Google TV, they realized that they were about to loose their whole business to IP-TV content.  So they, of course said.. We need to do it ourselves.  Let me introduce you to Comcast Infinity Spectrum Beta.

https://www.engadget.com/2011/05/20/comcasts-next-generation-xfinity-spectrum-dvr-shows-off-quad-tu/

Now the thing with Comcast is they are planning on moving from a Set Top Box type integration and instead muscling the CE (consumer electronics) manufactures into pre-installing the “Comcast Connectivity” within the TV set itself.  They feel this is the future of “Connecting to Comcast”.. However, none of the CE manufacturers are willing to hand the keys to the castle over to Comcast when they know that Comcast has exposed itself to itself cannibalizing it’s own business.  They realize they can’t kick off every third-party STB off their broadband networks.  They would make more enemies with their customers then they already have.  They currently are the gatekeepers for all Broadcast media even with Verizon Fios and AT&T U-verse making some in-roads however, their own product Broadband may be the undoing of that.  With bandwidth comes content, and if you theoretically have a monopoly on an entire industry and “rash” moves on controlling the content sources will only bring on anti-trust suits.  So they find themselves in an awkward position to say the least.  Many would point out the Sat providers, but we know how much Landlords are pushing against tenants for having these dishes.  Now a days it seems like you need a written Okay from you Landlord or risk eviction to get a dish installed.  It’s in most leases now, and it’s taken the option away for many, including myself.

Google / Apple TV Leverage

Why?  Well a perfect example I cited before was the way Google TV renders HTML5 content specifically styled for Google TV: https://code.google.com/tv/web/docs/design_for_tv.html

As I stated before, websites like Net-A-Porter, The Onion News Network, as well as YouTube.com’s “Lean Back” experience deliver HTML5 based content in a manner where you feel like you are watching an interactive TV channel.  You wouldn’t notice the difference except for some of the buffering that occurs when you first start up the webApp.   Examples of the Net-A-Porter HTML5 Google TV web app to show how powerful this experience is, and I think when you see this, and realize that it’s “on-demand”.. You will understand why Comcast is freaking out a bit. https://www.youtube.com/watch?v=IiM6C-l3q0U

After seeing that, you can imagine QVC and Home Shopping Networks are also starting to take notice.  Perhaps, starting to panic as traction takes hold.

Now, that all being said, that was before the Android Marketplace launched on Google TV 2.0.  Last night I spent 5 hours watching Al Jeezer through their free Android App for Google TV.  I now can watch content that Comcast deems unacceptable and at times.. For political reasons.. Un-American.  I feel I can make that decision for myself and do not care for Comcast to push their political/moral corporate agenda on me or my family.  Therefore, now you see how they have exposed themselves to being completely nullified when it comes to TV content distribution.  Especially when HBO GO app and others hit the Marketplace which is entirely realistic since HBO is owned by AOL/Time Warner.  AOLHD has an app already as well which delivers Huffpost video in a broadcast channel like from made.  Except, you no longer have to rely on your DVR.  Content is in the cloud.. You have “Live” content and you have “on-demand” content, simple as that.  Most important though.. Comcast isn’t controlling what you choose to watch or view.

Comcast’s Leverage

Comcast is fighting this battle in every way possible.  First, with their recent acquisition of one of the LARGEST content providers on this planet, NBC.  Also, with new plans to throttle down bandwidth on 3rd party set-top boxes.  All which will first be somewhat successful, but will eventually push customers away as more options emerge from the Internet.  Comcast I believe is going to try and buy their way to winning this whole game, however.. If they do.. We are basically one nation all watching one company, getting all our information from one source, from their network.  Not a pretty picture of the future of you ask me, and not the right side of the equation to be on with the current social unrest surrounding the idea of “corporatocracy” and other mega-merger conglomerations which have consolidated broadcasting powering into a small few.  This is why we are seeing an explosion of new media outlets online.  With Current and AOL leading the charge to marry the worlds together.

The question is.  Will the Digital TV market follow precisely in the footsteps of Digital Music.  Most likely not.  Many stupid mistakes were made by the labels, and the labels learned the hard way.  When all your brick and mortars disappear you control nothing, and the consumer now controls you.  The music labels did the stupidest thing ever.  Rather then leveraging their power together, they fought amongst themselves.  All while cannibalizing their own content by continuing to release Cds.  Then rather then forcing themselves to change, they tried to change the consumer.  Without them knowing.  This lead to many lawsuits and irreparable damage that killed the entire industry.  To give you an example of how much the music industry shrank.  When I was at BMG we were valued at 16.8b dollars.  We were one of 5 major’s that made up of Universal, Sony, Emi, Time Warner, and BMG.  Now, BMG was eaten up by Sony, EMI went into receivership and it’s catalog was sold off.  The entire industry as a whole now is only worth 22.1b at last check.  That’s not a way to win.  They didn’t listen to the suggestions, and were making decisions according to old market rules.  I don’t see the video content providers making the same mistakes.  In many cases, the people running these companies are the very people that tanked the music industry in the last decade.  They can’t afford to make the same mistake twice.

International Content and Territory Distribution

Don’t even get me started on the opportunities for viewing “International” content.  A lot of programs we watch on TV here are derived from originals from the UK or English versions of France’s Canal.  The most famous being the Office, and a lot of the “Discovery Channel” and “Nat Geo” content are actually syndicated from BBC albeit we see it 6 months later.  The reason for this is because traditionally content providers divvied up the distribution pie with each other by territory.  That’s why a Sony labeled product in the past may have been distributed in Germany by BMG Distribution.  That still leaves numerous other English based media companies to expand their distribution to the States without having to jump through the Comcast licensing hoops like BBC America has.  They only have one channel on Comcast.  Why is that?  Why is it that they have to syndicate through other outlets in the US and are then held to standards they are otherwise free and clear of in their own countries?

We are already seeing this with Torrents.  Sites like UK Nova and TheBox are very heavily trafficked Torrent Trackers for British Based TV only.  I mean if you like PBS science shows, you are going to love British TV.  They have nights dedicated to really long and well produced shows on topics ranging from “Theoretical Particle Physics” to some of the best “Rockumentary” styled documentaries, and don’t get me started on the sociology documentaries.  It’s challenging television, and often niche.  Everything the US market hates because it deems it “unprofitable”.  This is TV that just isn’t shown on US broadcast channels unless it has been picked up by PBS or one of the other “Entertainment Science” channels.  The US has always had an Entertainment leaning when it comes to Broadcast television programming, Why?  Because it makes money.  The UK on the other hand.. Different rules, different market.  I mean, just to give you an example.  The UK started up BBC Open University in the 70’s which was probably some of the stalest TV lectures you have ever watched in your life, but because it was on at night.. Ended up educating drunk people on Algebra and Science after the pub for years, and had record ratings.  It also spawned the UK computer revolution with the Sinclair home computer by offering the computer by mail to students, and programming classes on the TV.  All while I was too busy trying to beat Pac-man on my Atari 2600.  Which is a joke in itself.

Xbox and Sony?

How will Xbox work into all of this.  I am not sure.. I am sure Microsoft will build off their Windows platform a new version of WebTV, and Sony.. They are caught in the middle.  Being such a huge company, and a company I am somewhat familiar with because of my past work with BMG Entertainment as Manager of New Technology (they bought us in the end which put an end to my employment there).. I know that Sony is so huge that the right hand usually doesn’t know what the left hand is doing. They will either land on the right space, or mess it up horribly and fall back on Play Station and try again like they always do.  But who knows because the new Google TV update now includes USB device support.  Games will soon be appearing and its only a matter of time before both Google TV / Apple TV becomes the low-cost alternatives to Xbox and Playstation.  Directly competing with Nintendo and bringing a whole new audience to gaming just as the “Motion Sensing” games have done for the Gaming Industry in general.

Everyone is waiting for a P90x App for their TV.  Cha-ching!

CE Manufacturer ‘Connected TV’ Solutions

As for the Samsung and other “manufacturer” connected TV solutions.  They are all very nice attempts, but you are never going to have a massive amount of developers for these platforms.  None really work on a “Write once, run on many” principle when it comes to development.  Not to mention, have you ever gotten a Keyboard when you bought your TV?  No, and who wants to type a Facebook status update one character at a time via standard remote.  It’s pointless.  They know they can spend their money in much better ways, and just license a platform.  Sony was smart enough to start off with Google TV.  Whether they stick with it or come up with something internally that someone champions successfully inside Sony is to be seen.. But I wouldn’t be surprised if this happened.  Sony is a global company that doesn’t necessarily take in consideration the US Market when considering it’s Global strategy.  They may well address this issue by territory as they have in the past with their Consumer Electronics division.  Releasing its “best-intent” for that specific marketplace.  These are usually the Sony items that are marketed locally globally, but not necessarily in the USA.  For example.  Sony’s Ebook Readers and in the way distant past, and the MiniDisc which had huge amounts of traction everywhere in the world except the USA.

My Conclusion

So that’s it for now.. I am sure if you look online you can find more about this.. And probably many other “opinions” and viewpoints on the matter.  I think I land on the side that Apple and Google will be happy to split this pie, rather then secede the entire market to the established Cable/Broadcast industry.  While many get caught up in the whole Apple vs Google thing.. I think you gotta look at it this way.  "Keep your friends close, and your enemies closer".  Apple and Google have too much to loose to the old established distribution chains.  They want it, and now that Comcast owns many of the content providers that supply it with content.. They have way too much licensing leverage.  They will attempt to strong arm Google and Apple into pay huge fees for content in order to keep their business’ viable.  On the other hand, I think Apple and Google are well positioned financially to endure the initial losses and look at this whole thing as a loss lead that take them both the next level.. Get the old Gate Keeper out of the way.. In with the new.  Before it was Microsoft.. Now its Cable/Comcast.  Once they are done with Comcast, they will then turn on each other.  Comcast is the common enemy.  Not a good place to be when you are up against 2 of the most powerful and wealthy companies in the world.  Apple and Google.

Internet TV is finally poised to begin stripping away the strangle-hold Comcast and other Broadcast Media providers have had on content providers and consumers.  Their reign is slowly crumbling because this can’t be stopped.  Information wants to be free (in a sense that, free to move across networks unhindered by gatekeepers) and people want a choice.  Google, Apple, and Roku are giving people that choice.  In America, the market decides the standard, and albeit sometimes, and usually is a bumpy ride to that standard.. Once that standard is set.. It’s set.  Look how Apple made out with the music industry because they couldn’t come up with their own services that covered “all catalogs” in fear of Anti-trust violations.  They ended up with a 10 year lock on the entire Digital Music industry.  Only now, is Google beginning to challenge them with the release of Google Music and Android Phones.

Perhaps this is why you are seeing the sudden thrust of Internet policy in congress that once again goes straight to the heart of the whole debacle.  What is intellectual property, and who has the rights to what.  I don’t have the answers to that question.  So I think this is the proper place to end.

Hope you made it this far, thanks for reading.