A few events bring us to question if we are witnesses of TV turning point – TV quo vadis (where are you going)? I don’t intend to paint a complete landscape, instead I am picking hastily a few facts to probe the weight of existence of such turning point at the present.
The changes are multiple, at one end the user experience, others being the technology, the distribution of content and nonetheless a massive change of the business model.
I think that I have enough examples of experiences that attempted to change the TV as we know it today. To enumerate just a few of them like WebTV, AppleTV, TiVO, all these past experiences shaped the subsequent product definitions and prepared users for the next gadgets. And more recently we see an extraordinary attempt: this time Google TV. Although I am not seeing Google platform as the unique contender still it is interesting to watch the entire phenomena of emerging innovative TV platform.
Let’s probe some of the facts.
Last year Intel bombastically claimed “Future is TV-shaped, says Intel” when announcing its push into the TV business of its CE4100 device; if you want t0 check an overview of Intel’s architecture read “Intel’s Atom heads for digital TVs, STBs“.
This week (more precise on May 20th 2010) I found out that Google launches smart TV service, and I don’t think this is a fade marketing campaign. It seems to me it is a serious attempt to bring change and make a profit out of it. It is not a single player, it is a team of corporations with multiple competencies that allied in deploying a profitable solution.
Let’s take a look at some of the Google’s declarations: “There is no better medium to reach a wider and broader audience than TV” (for Google advertising business); “We can make your TV into a games console, a photo viewer or a music player“. The TVs and boxes will also use Android and will rely on an Intel microprocessor, with the partnership of Sony TV manufactures, LG peripherals and STB. A critical editorial of the Engadget on Google TV highlights the shortcomings of the demo, which somehow it’s not surprising considering the lack of knowledge of some partners in the TV domain. It is important to highlight the distribution of the content over the Internet. Not a totally novel idea, it is impressive to see the alignment and massive value proposition for a TV product; although specifications are not fully disclosed yet, something will soon emerge. It is interesting to follow the announcement (all of them issued on March 20 2010) – Google and DISH Network collaborate to develop integrated multichannel TV and web platform.
We should not forget the observers which might play their role in the future in determining the deployment success: Reuters records “CBS Corp (CBS.N), for one, is keeping an eye on Google TV. “As content owners we applaud innovation,” said Zander Lurie, senior vice president of strategic development at CBS.
“On the business model side, we are more prudent about how we evaluate new technologies and how deep we dive in,” he said.”“
Google TV is not the only recent announcement, recently TiVo and Technicolor Team Up to Offer Integrated PVR Solution: “As the convergence of linear television and broadband continues to take hold, operators need to deploy advanced television solutions that are cost efficient and ready for rapid deployment”; “As one of the leading set-top box providers in the world, operators were increasingly looking to Technicolor to help address this need. To manage this, we selected TiVo’s truly comprehensive solution for marrying TV and Internet content within a single, user-friendly and intuitive interface. TiVo’s vast understanding of what television viewers want, coupled with our expertise in manufacturing hardware and the platform porting work we are now doing, will be a major advantage for operators looking to leapfrog the competition.”
The idea that I want to emphasize is that something is changing in TV business. Competitors are numerous and it is hard to tell if Google TV partnership will be successful or adopted by the market, I concur with Barton Crockett quoted by Reuters “even if Google TV fails, someone will figure this out”.
The demo has shortcomings which I see as mere results of a complex problem to solve. I am not interested further to explore what those are, instead I prefer looking into potentials of this offer.
Players Interests and their Roles
Let’s try to understand some of the players interests in this Google TV and the part they play:
- Google is in the advertising business and it is looking for additional channels of distribution other than desktops, therefore it is targeting also TV for further expansion. Furthermore Google is a also a content provider with its YouTube. Its overall weight allows Google to sponsor emergent ecosystems. Nevertheless Google provides the Android software platform to attract business partners and software developers. Android platform is Google’s honey pot promising free and rapid development. Google requires traction to reach TV also.
- Logitech and Sony are traditionally integrators/providers of TV or STB devices, and they are interested in filling their pipeline with new products. Historically Logitech was targeting PC peripherals, with TV emerging as a new target now, having more peripherals for it will facilitate to increase usage for it. With Sony targeting premium market share with its futuristic products, I am not sure if anything has changed in their plans.
- Intel is a traditional manufacturer of CPU ASIC and its current PC market is hardly sufficient to maintain or even provide the growth anymore. There are an increasing number of features to be integrated in the hardware (like video, 3D Gfx) while keeping the cost reasonable. There is huge computation power and capabilities to what was for the previous decade TV solutions. Intel is fighting for its reputation competing with ARM and its partners (TI, Qualcomm, ST, … ). It is advantageous for the software developing process purposes to skip the cross-compilation step (as it might be for ARM). The reason is that this will bring more and even cheaper software developers to participate in building applications for this platform, although having the Android virtual machine waters down some of this advantage. A TV / STB might not have the power consumption constraints of the mobile and therefore ARM’s perceived power consumption performance advantage is fading in TV.
- Dish Network might be worried by the Torrent phenomena, a cannibalizing competitor of its market. It’s current base of customers which needs to keep it content. With its applications and services, Dish Network provides the reach for this future platform of the users .
- Adobe partnered vigorously with Google to prove its Flash technology is nothing what Apple is complaining about. More devices carrying this technology there will bring more revenue for Adobe as well.
However, all these announced partnership will not preclude others to jump in, like more ASIC manufacturers, more TV and STB vendors, and more content providers.
Ideas are great, technology is great but all of this is not sufficient. It is necessary to come-up with business models that bring together an ecosystem to have the ideas, technology deployable and finally distributed to the masses of users. Today is easier to have a change as the TV business might end being in a crisis similar to what we see for published or music business. There is eagerness of certain companies to pursue new products as their past portfolio is drying, others because their business model is not actual anymore and some are just expanding their reach.
Consumers are evolving in their level of expectation, they are more aware of their expectations, more knowledgeable and more curious to explore new TV usage. The user is more active in his selection and he is not always happy with the content broadcasted, and with what is paying for it. We see the emergence of new providers like Hulu and Netflix because consumers mood is changing.
What would be needed to be possible to become successful? There might be a couple reasons.
Large partnership is required to push major change of technology usage to the market. It is not possible for a single company to pursue such major change because of the hegh level of complexities and perhaps it is not allowed by the rest of the traditionally ecosystem to have a single company reaping the entire outcome.
First of all better technology are supporting more complex features at lower costs. There are many off the shelf components that could become the basis for a platform, it is a commoditization period. Google will bring commoditization into the TV which eventually would bring some more change into traditionally closed TV and STB platforms and this will pose tremendous pressure to current market players way of operating. There will be more features, more components, more players and collaborators, more competencies and nonetheless more services.
It is an interesting time for TV and we are witnesses of its transformation. What aspects I missed or I am being wrong about?
- Television: Reports of My Death are Greatly Exaggerated
- Google launches smart TV service
- Google and Partners Seek TV Foothold
- Google TV
- Editorial: Engadget on Google TV
- RPT-Google tries where others failed: shaking up TV biz
- Google Introduces Google TV, New Android OS
- Industry Leaders Announce Open Platform to Bring Web to TV
- Sony and Google Establish Strategic Alliance to Deliver Cloud-based Products and Services
- Google and DISH Network collaborate to develop integrated multichannel TV and web platform
- Google, Dish Network Reportedly Test Android-Based Satellite TV
- Google TV turns on at I/O: runs Android and Flash, partnered with Sony, Logitech, and Intel
- Sony Internet TV, DISH first with Google TV this fall; Adobe, Logitech and others along for the ride
- Intel announces Atom CE4100 for insanely powerful cable boxes and Blu-ray players
- Logitech’s Google TV companion box includes smartphone apps
- Logitech Google TV Box Embarrasses Apple TV
- TiVo and Technicolor Team Up to Offer Integrated PVR Solution
- TiVo Redesigns Search Function, Wants to be the ‘Google of TV’
- Future is TV-shaped, says Intel
- Intel’s Atom heads for digital TVs, STBs