Ironic - Netflix Buys DVD.com

After going to such lengths to try to divorce its streaming business from its DVD business, Netflix has decided that it can't do without the DVD association.  So to keep people coming to their Netflix site, they have bought the domain DVD.com.  And to add to the irony, here is the quote from Netflix, "Netflix's recent purchase of DVD.com was reported Friday by Domain Name Wire. In a statement, Netflix said, 'Netflix cares about keeping DVD healthy, and this is just one small investment in keeping DVD healthy.'"  Funny stuff. Netflix and the DVD, together again.

Can RIM And Blackberry Survive?

In the playground game, top of the hill, once you reach the pinnacle you are alone to face others trying to replace you at the top.  For kids, the results tend to not have lasting effects but in the world of big business, once you fall, it is hard to get back to the top.  For those that do, it takes renewed vigor, risk taking, and even some luck.  


RIM and its notable smartphone product line, the Blackberry, were once at the top; today, they have fallen off that perch and may not have the talent or the skills to climb back up.  "BlackBerry's best advantages -- excellent security on its phones and the popular BlackBerry Messenger service -- are no longer enough, he said. Rivals have developed competitive tools."  The Apple iPhone and Google's Android phones have become more preferable by many for both business and personal use.  


I currently possess both an Apple iPhone and a Blackberry Bold 9900.  The iPhone is my personal one; the Blackberry, given by my employer for business.  Where once I preferred the Blackberry, now I find them harder to enjoy.  Too many buttons, both physical and on the screen, and icons that I don't recognize their use till I touch them.  And frankly, once I've embraced the simplicity of Apple products, the harder time I have going back to non Apple products, phones and computers alike.


Will consumers embrace Blackberry again: I personally don't think so.  With the direction that their financials are taking, a massive change would be necessary, but with leadership jumping off, it will only be harder for RIM to get up the mountain on its own. Is RIM a likely target for acquisition?  Perhaps Google may want to consider them but with their pending acquisition of Motorola, the timing may not be right.  Another likely choice could be Microsoft who could use another entry into the smartphone and tablet space.  And of course their is other smartphone makers like LG and Samsung. 


As the Apple and Google fight continues on, and Blackberry sitting on the sidelines, the best course of action may just be an outright sale of the company.

More Sports Cable Networks Really Mean...

Before cable ruled the TV landscape, if you wanted to watch a football, baseball, or other professional sport, you turned to broadcast TV.  Cable networks opened up the platform for more sports to be shown.  That new competition enabled teams to pay more for athletes and soon the costs were passed on to higher TV rights fees. Broadcast initially relied on ad sales to pay the  bills but cable networks allowed license fees to add another revenue lift to the bottom line.  And as costs got higher, so did the networks' license fees.  Now these same professional games are moving off broadcast as more and more networks pop up.  Now there are regional sports networks like MSG, YES, Sportsnet and others, and unique professional sports networks like NFL, Redzone, MLB, and NHL.  And don't forget sports on ESPN - 1,2,3, Golf, Versus (now NBC Sports Net), Speedchannel, Fuel, and others.  So more sports on more sports cable networks really mean more that these cable networks will keep raising license fees and these fees will be passed on as higher cable bills to the consumer.


Where once sports was accessible and free, now it costs more and more to watch as different leagues are available on different channels.  Sports programming has spread out to too many channels and costs rise at a quicker pace.  "'The success of all these networks will depend on the quality of their sports rights,' David Joyce, an analyst at Miller Tabak & Co. in New York, said in an interview. 'There’s been a lot of competition for those rights and that’s driven up costs.'”


More networks means more bidding wars for the top programming.  NBC will be aggressive to make its Golf Channel unit more valuable by pushing better events on the channel; the same will happen with its former Versus network, now called NBC Sports.  And Fox is likely to do the same to make their channels more competitive and more expensive.  And to compete, ESPN, with 3 channels to fill, will have to pay more for the sports that they want to obtain or retain.  


To pay the higher costs, ad rates and yes the license fees to cable operators will only rise.  The fights that we see between sports networks and their parent companies and cable operators will become more nasty and the consumer will see dropped channels eventually come back on the lineup and lead to further increases in our monthly cable bill.  

Harry Potter vs Katniss Everdeen - Which E-Book Rules

Two great characters, two great book series and movies, and now the comparison extends to the e-books.  With Harry Potter books finally available for download, we can start to compare their e-book sales stats. The big difference is that The Hunger Game series is sold through typical channels while Potter took the unusual route of selling access only from its website.  It may just become the preferred way to sell books without paying huge margins to Amazon, Barnes & Noble, or Apple.  is there really a competition between the two, no.  It's great to see that there are still great stories being written that can appeal to both a young and old audience.

Why Can't My Xbox Be My Set Top Cable Box

Tired of your remote.  Wish you had more control over your screen and how you managed through the endless choices of cable channels and shows.  Perhaps you wish you could use your game controller instead of the remote to navigate and select.  Well, maybe, Comcast has opened the door a little bit toward that full potential.  "The more interesting news is the launch of Comcast’s Xbox Live experience, which will give users the ability to search its video-on-demand service directly from the game console. That follows Comcast’s attempt to expand access to its content on a number of new devices, including the iPad and connected TVs from Samsung."  


A tiny first step indeed, but a step in the right direction.  Of course, it is still missing access to linear channels and DVR capabilities, but one thing at a time.  For a house with multiple TVs, and one TV devoted to the gamer in the family, the Xbox means I could potentially get rid of the set top on that TV.  It is used primarily for  game playing but the added accessibility to on demand programming is nice as long as I don't want to watch a live sports event on that TV. 


For homes with TVs that have multiple boxes attached to it, the Xbox, the DVD player, and the set top, this functionality of on demand programming is not enough to fully lose the set top connection.  Thus this new set of program offerings may be no big deal to current Comcast Cable homes.  Still, it is a first step toward replacing the set top with devices that are better suited for navigating on the TV screen.

TiVo Goes After Motorola And Time Warner Cable

TiVo must be feeling like a champ.  Soon after getting Microsoft to settle with them and with victories against Dish and AT&T under their belt, TiVo has set its sights on two more players, Time Warner Cable and Motorola Mobility.  With cash under their belt from Dish, TiVo may just be prepared for another protracted fight.  Whether these next patent infringement suits go the distance, or like Microsoft, get settled out of court, remains to be seen.  But given the victories coming from previous lawsuits, TWC and Motorola may be better off settling before the legal bills continue to mount.  And who knows, maybe TiVo is using these fights to get  geared up for an eventual lawsuit with Cablevision.

Apple's New iPad, Much To Love

I am an Apple convert.  It started almost a decade ago when we switched the family desktop computer from a Dell to the iMac.  Since then, we have embraced Apple in our home with the purchase of a laptop, iPods of different generations, iPhones, and now the new iPad.  In fact, when I touch a non-Apple product, like my office PC and blackberry, I shudder.

As for the new iPad, it is simply a joy.  While it may simply be an oversized iPod Touch, the screen is a perfect size for reading books, magazines, and news articles.  Game playing is more fun as is viewing photos and videos.   The laptop and iMac are still preferred for school work and other more pressing writing and editing duties, but the iPad is a wonderful edition to the mix.

What I like most is that data, photos, and other pieces of information that I put on one device is easily shared among the others.  For me, the iCloud effortlessly lets me share photos, calendar updates, and more among the family devices.  We share a family iTune account and I would love to learn how our iCloud accounts could be somehow treated as linked within our family.

As more and more consumers embrace the iPad, I am confident that those that haven't already, will switch from PC to Apple.  And as businesses embrace the iPad for their employees, they too will find that it makes more sense to replace their PCs with iMacs and Macbooks too.  And for Apple and its shareholders, that will only mean more good news.

Online Retail Sales Tax Is Coming Quickly

State budgets have relied on sales tax as a means to pay the bills.  But as online retailing has become more and more prevalent, sales tax revenue declines.  States are feeling the effects while consumers have been enjoying the savings.  And as price conscious shoppers, savings of 7 or 8% on big ticket items can be huge.

Brick and mortar retailers feel the impact of online; shoppers taste and test the merchandise in the store, then go to the web to purchase without paying the extra sales tax amount.  "A common misconception among Connecticut consumers, lawmakers say, is that Internet transactions are exempt from sales tax. If retailers don't collect and remit the tax back to Revenue Services, consumers are supposed to report and pay it themselves through their annual state income tax filing."  Yet I doubt few people know the law and fewer actually comply by it in Connecticut or other states that have the same rules.


For Amazon and others, a required sales tax would bring total costs of their merchandise closer to their brick and mortar counterparts.  With a narrower price gap, consumers may prefer buying at a store to assure immediate delivery as opposed to waiting a few days for a package to be shipped.  The larger the savings, the longer, I suppose, a consumer is willing to wait.  But state after state are imposing rules requiring collection of sales tax regardless of a physical presence in the state.  And that is exactly the ruling from the Connecticut courts.  So enjoy those savings today for they will surely go away.

Tivo Wins Again

After such a protracted fight with Dish Network, it seems that other companies have figured out that it is better to settle their patent suits rather than fight them in court.  "TiVo reached an agreement with Microsoft under which both sides have agreed to drop their patent-infringement lawsuits against each other, after the DVR company reached a settlement and licensing deal with AT&T, which uses Microsoft's IPTV platform for U-verse TV." Certainly that must mean more revenue for Tivo and more users.  So who is left?  It seems that Verizon and Motorola Mobility (Google) still have unresolved issues.  As they each watch from the sidelines, they may also believe it is better to settle than fight it out and spend extra dollars only to lose the fight, just as Dish did.  A settlement is quicker, easier, and perhaps even less expensive in the long run.


Will more cable companies embrace the Tivo DVR and support it within their set top boxes?  As a user experience, Tivo is preferable to anything else out there.  Hopefully one day more cable operators will license and distribute Tivo.

The Biggest Problem With The Cloud And Streaming Is...

...The cost of sending and receiving content.  Perhaps it makes better sense to download and own once than to continually stream content because of the high costs to stream content.  But as more video content becomes accessible and consumers are using the cloud and web to continuously stream content to their devices, the meter keeps turning.  And with hi def devices and better displays like on the new iPad, the streams of content must send higher amounts of data.  "What many consumers may not realize is the new iPad's faster LTE connection means they will use more data even if they don't change their 3G surfing habits. Take regular video: Verizon estimates that streaming it over an LTE connection runs through 650 megabytes an hour. That's double the amount of data used streaming the same video over a 3G link, because the fatter pipe lets more data through."

We have become used to an all you can eat mentality for communication; unlimited local calls, unlimited texts, one monthly price for constant cable TV access.  The TV set can stay on, even if no one is watching, because it doesn't cost any more to watch.  That doesn't happen with our electric, gas, or even water.  Turn the lights off before you leave the room.  No drips from the faucet please.  But even though streaming access isn't a utility, we are starting to think of it as one.

So on one hand, we are being encouraged to place more things on the cloud and access it when it is needed.  And we are being faced with more and more streaming content through OTT and websites serving up tons of videos.  On the other hand, the costs to physically stream this content could potentially cost us a lot more money.  WIFI speeds may be accessible through our cable providers or from free remote sites like Starbucks and elsewhere, but  they are not fast enough to enable an uninterrupted,  enjoyable experience.  Faster speeds are the benefits being touted by wireless providers.  And companies are hoping for more revenue from their mobile wireless usage packages, but consumers should be wary that the costs could potentially be way too high for their budget.

Subscribers Taking Programming From Telcos Not Cable

Paid Content has shared an interesting chart from their article on Cable Subscription Growth.  While total multi-video subscription grew in 2011, the biggest news was that cable operators saw a smaller than expected loss in Q4 while others saw a smaller than expected increase.  Still, when you look at the numbers, the top cable operators all saw a loss of basic cable subs last year, along with Dish Network; the losses were less than the gains that Verizon FIOS, DirecTv, and AT&T U-Verse achieved in the same period.

Historically, the cable operators have been losing subs for more than a few years now while telco and satellite have been doing a better job of growing subscribers.  Cable operators have been able to manage this loss because telephone and broadband subscription have been growing and the profit margins on these two businesses are higher than cable.  

As to the causes, housing starts, unemployment, and costs of service are all to blame.  As overall subscription has been rising, many argue that cord cutting is not a factor.  But as more and more programming finds itself on the web, consumers may just start to move over to these OTT platforms.  For now there is movement, but within the cable platform from operator to satellite to telco platform.

Free Wireless, Not Quite

Not too many wireless options out there for consumers.  Beyond the telcos and WIFI access from a cable provider, the choices are limited.  The latest marketing push comes from an unlikely source, NetZero, the former dial up company.  The owners of NetZero, United Online, are offering "free" monthly wireless access, but free may be a misnomer.  "The free accounts are limited to 200 megabytes of data per month_ enough for some email and Web surfing, but little else."  The push is on to "upgrade" to data plans that may not be as competitive as other telco plans.  And to take advantage of this "free" offer also requires a cost; a digital antenna or mobile hotspot is needed to access the signal.  That cost can range from $50 and higher.  So free access actually costs some money.  Well the re-emergence of NetZero at least adds another player to the mix.

Busy Week For Apple

It has been a very busy week for Apple and it is only Tuesday.  In 4 days, the new iPad has generated over 3 million sales.  Not reported, the number of new sales of the reduced price iPad 2.  And with sales to start in more countries, the number of iPads sold is expected to continue to rise dramatically. "Apple sold more than 40 million iPad units in 2011, and several analysts expect the number to top 60 million for the current calendar year."  While laptops and desktops get to be shared  among the family, each family member wants to own their own iPad, iPod, and iPhone device.  Brilliant.

Also on Monday came word that Apple was reinstating a dividend that had been stopped after Steve Jobs had re-entered Apple.  Ironic that it comes back to shareholders months after Steve Jobs has passed away.  For Tim Cook, CEO of Apple, it is the right course to return income to shareholders and to reach a new set of institutional investors.   And along with a stock buyback, it is still just a dent in the free cash that Apple carries.  So what will be announced next quarter?  A new iMac, a stock split?  With Apple, there is always the next announcement.

Taking The Video Fight To The Clouds

There's a fight brewing for video purchases and sides are being drawn up.  For Apple, it has always been about the iTune library.  Consumers purchase and download or store in the Apple cloud for use on any device with iTune access.  For the studios, the push has been to maintain the DVD business by augmenting it with the UltraViolet cloud.  And there is Amazon who is designing both their own cloud business as well as building compatibility with UltraViolet.  


Retailers, trying to keep DVD sales alive, are also looking at the best approach to take.  Wal-mart has decided the UltraViolet cloud working with Vudu works best.  "The retail behemoth last week teamed up with five Hollywood studios in an effort to stem the continuing decline in DVD sales."  Vudu customers can take their previously purchased DVDs to Wal-mart and for a minimum fee, gain a digital cloud-based version.  Will Apple try to collaborate with UltraViolet or stay the course through iTunes?

And what does the consumer want?  Is it necessary to own the content anymore when titles are accessible anytime, anywhere, through cloud-based rentals.  Does Netflix and others offer a better rental alternative and should Apple consider building a rental program into their iTune model?  I like the closed architecture approach that has made Apple successful.  At the same time, I believe a rental model could work very well for Apple.  And as far as the DVD business is concerned, with the exception of kid videos that are watched over and over and over again, the rental market accessible on demand will continual to over shadow purchase.

College Students Prefer Digital To Print

Sometimes it takes research to confirm what we already know, students enjoy digital over print for reading.  "The majority of U.S. college students now prefer digital formats whether they’re reading textbooks or “fun” books, according to a new survey from the Pearson (NYSE: PSO) Foundation." 


Technology is embraced more quickly by the younger demo and with that comfort level comes increased satisfaction in consuming more content on them.  The influence of Apple and its line of mobile products continues to fill the consumers' shopping basket. Amazon and Barnes and Noble may be farther behind, but they too recognize the trend and have been pushing forward long before this analysis was conducted.  With today's release of the new iPad and reduced pricing on iPad2, even more devices will be out in the marketplace with consumers ready to use them for reading and watching content.  And Apple's announcement a few months  ago in New York of plans to put college textbooks on the iPad is an important step to gaining an even higher percentage of users in the near future.  


In a couple more years, this same study will most likely indicate that 80% or more of students prefer digital over print.  The change is happening quickly especially as more and more devices are getting into student hands.  

Is There Broadband Competition?

With Sprint pulling out from its partnership with LightSquared, it may signal the ultimate end of a possible competitor in the wireless and broadband arena.  With the release of Apple's iPad today, the rise of OTT distribution platforms, and the consumer desire to be mobile and untethered, the choice of wireless and wired providers remains small.

We have the wireless companies, most trying to sell us usage plans that cause us to spend more for connectivity as our consumption rises.  And there are the cable operators, offering wired broadband access coupled with WIFI to authenticated consumers in the communities they serve.  But who else can we turn to for connectivity.  It seems the FCC should be doing more to encourage more competitiveness in what is becoming a vital communication highway.  But by pushing aside LightSquared and recently Dish network's wireless plans, it seems that the FCC does not want competition.

Will broadcast networks give up their portion of the airwaves for wireless or will GPS?  Are there other solutions that will enable free flow of streams with bandwidth constraints?  Ultimately our broadband and wireless devices will not work properly if we have a bottleneck in the flow.

Did Someone Yell Fire (ing) At Cablevision?

It seems it may take more than one hand to start and name all the top Cablevision employees that are "retiring" these days.  Late last year came CEO Tom Rutledge and his right hand man John Bickham.  Recently EVP of marketing, Jonathan Hargis and now EVPs of engineering and operations, Jim Blackly and Kathleen Mayo.  And just to add more fuel to the firing, from their spinoff of MSG comes the Knicks Coach Mike D'Antoni.  Watching the leadership of the ship all jumping overboard, one has to ask is Cablevision about to sink?  What is causing this mass exodus?

Is it because they are all good soldiers, they are retreating with their captain,Tom Rutledge, away from the battle or is it that they don't believe they can prosper under  the re-emergence of Jim Dolan to the day to day operations?  It surely can't be because they know that Cablevision may soon be for sale.  Why leave a possible financial package on the table?  There must be more and my guess is that it is directly based on current leadership.

In any business, the leader sets the agenda, the tone, the culture.  As much as employees try to influence cultural change from the bottom up; ultimately, top down sets the course.  And based on that knowledge, I suspect that the heavy hand of Jim Dolan back into operations, replacing the style and approach of Tom Rutledge, is the cause for the exodus.  Are these resignations or firings; we may not know for sure.  I wouldn't be surprised to eventually here that there may have been a little push.  For now leadership change is in the air at Cablevision and more resignations are likely to follow.

Can Wal-Mart and UltraViolet Save The DVD Industry

The movie industry has enjoyed  a long history of selling  first laser disks, then VHS tapes, and DVDs to consumers seeking to build a personal library of content to watch at a moments notice.  But the rise of on demand and streaming content has made the concept of ownership less necessary.  Add to that the space a video library takes up on bookcases and the idea of ownership on digital devices or in the cloud becomes far more convenient with much less clutter.  And as consumers, there is less of a need to buy a DVD player with the rise of digital access to video content.  


When my kids were younger, we made sure our car had a DVD  player with screens in the backseat to entertain during long trips.  Today, that system is unnecessary.  Instead, we have iPads and iPods to provide that personal entertainment platform.  And they can each watch what they want..  No DVD  required.


But like all of us, we tend to be reluctant to embrace change, preferring to hold onto it as long as possible till it is too decomposed to even recognize it any more.  Do stores even sell VHS tapes anymore?  So how much life is left in the DVD industry and is it time to quicken its death or prolong it through UltraViolet?


Companies like Netflix, Apple, and Amazon are moving forward on a digital only strategy.  But Wal-Mart is still staying the course and working together with UltraViolet to push a dvd/cloud partnership.  " Wal-Mart is launching a disk-to-digital service, aiming to drive adoption of Ultraviolet, and DVD purchases, rather than lower-margin rentals, and to prevent piracy."  As long as consumers are expected to buy a physical DVD, I don't expect it to succeed.  Why buy a disk only to immediately throw it away once the digital copy is accessed.

Can UltraViolet exist post DVD?  With the rise of multiple cloud services and digital being the platform of choice, the movie industry may best be served selling itself to other retailers unless it can come up with a compelling approach to make UltraViolet a better consumer choice.  For now, perhaps it deserves a better brand name.

Intel Wants To Enter The Cable Distribution Field

Google wants to sell its Motorola set top box business; Cisco wants to sell its S-A set top box business as well. And Apple wants to build a TV set to manage TV content without a box.  Now comes Intel with its own plan to build a box and its own web-based cable TV platform.  The end of EBIF technology perhaps and the rise of web based applications.


"The entry of Intel -- with its large bankroll -- into over-the-top video would add another potentially serious competitor to traditional pay-TV services, as consumers face a growing number of options for receiving video content over broadband from the likes of Netflix, Apple, Amazon.com and others." There sure is a lot of change in the cable landscape occurring these days.  But what each of these companies, Intel included, lacks, is the wireless platform to run it.


Cable built there TV business first and now the pipeline used is capable of delivering TV, internet, and phone. And customers rely on this pipeline for the web.  So what broadband stream will Intel and others use to get content through their box and onto the screen?  And what will the access cost be to the consumer?  Because if the cost for buying access on top of the course for an Intel box is higher than traditional cable, customers may be reluctant to switch.  


The other concern for Intel, Apple and others will be the cost to acquire content.  Cable operators enjoy best, lowest rates because of the number of subs they cover.  For start ups to traditional cable programming, their license costs per sub will most likely be higher.  And  that will not help them to bring a competitive offer to the consumer.  


For those two reasons, lack of a broadband pipeline and higher costs for acquiring content, may be what ultimately stops them from competing effectively.  The solution, for Intel and others, may be to work with cable operators, and not to compete.  For now, all we can do is sit back and watch.

Movies - Own, Rent, Subscribe, Watch With Ads - Many Choices

Theatrical films have been enormously impacted by the web.  Not so long ago there were clear and easy windows in which a newly released film would exist.  Start in the theater and then a year later find itself available for purchase on VHS.  Wait another  few months and the movie made itself to a pay service like HBO or Showtime, and then finally it hit commercial TV, with commercials finally inserted into it. Depending on how likely we wanted to watch the movie, we may have watched in the movies and then waited for its TV airing to see it again; or we missed the theatrical run, rented from Blockbuster, and enjoyed it for a week before returning it.  Old favorite films like Godfather or Star Wars would capture our attention each time they returned on the air.

Today the windows are far shorter and harder to distinguish.  Theatrical films can show up as DVDs just a few months later and find themselves available to rent on demand.  Cable networks sometimes bid more for a film so that it bypasses Pay TV and hits the air much sooner.  And the creation of digital copies and cloud ownership means that exclusivity windows become harder to enforce.  "New technologies, like iCloud, are making these conflicts more obvious, pressuring traditional media businesses to rewrite their agreements. Movie studios want consumers to buy more digital-movie downloads as DVD sales shrink and digital rental and subscription services, from which studios earn less, gain traction."  

Even the notion of the cloud has gotten fuzzy.  Apple has its cloud, Amazon a different cloud, and the movie studios are trying to rollout their own through UltraViolet.  At the end of the day, the consumer only cares about where they can find a movie and how effortless it can be to view it.  If they want to buy it, they will; if they want to rent it, they will seek out that option.  If they want to watch it with commercials because it is there at the moment ready to watch, they will do that too.  And while the pay channels may seem to be most affected, they have not been blindsided.  They have been seeing this trend for a while and it has been their motivation ( as well as Netflix), to diversify into original programming, in order to remain competitive and ahead of the problem.

Broadcast Networks Don't Want To Be Free

Broadcast networks, ABC, CBS, Fox, and NBC, would like to have the FCC change its rules and allow cable operators to encrypt their signals.  They together argue that enabling encryption will actually improve the delivery of their signals and improve innovation of digital content delivery.  And for the cable operator, it would reduce bandwidth issues and improve security.  But is it also good for the consumer?

"Critics of the rule change contend that putting MSOs on parity with other providers by allowing basic-tier encryption would force consumers to rent set-tops and limit choice, because they would no longer be able to receive "clear QAM" digital TV."  Still, it is all about serving content to authenticated consumers.  As long as broadcast networks also offer over the air, digital signals, then these channels can still be fully accessed by non cable subscribers.  In an ideal world, all broadcast channels would have a web presence, enabling a live linear feed of its programming to any consumer via the internet. Content that is geographically limited, like NFL football games, may need to be blocked, but typical network programming should be accessible and available regardless of a cable subscription or not.

Should Apple Buy Barnes & Noble?

UPDATE:  Former Cablevision chief financial officer Mike Huseby is the new CFO of  Barnes and Noble. There has been some suggestion that his expertise is in spinning off and selling companies.  He was involved with Cablesvision's spin off of MSG and AMC.  Whether his role is to get the company ready for sale or for growth remains to be seen.


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The recent announcement of the new iPad from Apple and constant wondering what Apple's next steps might be, pose an interesting speculation, should Apple buy Barnes & Noble.  What would Apple get?  How about a retail presence on over 600 college campuses.  Over 700 retail stores around the country.  Additional access to content publishers, the Nook e-reader, and greater impressions and presence in the marketplace.

If Apple truly releases its own TV set, it would likely want to sell them within their own retail environment.  B&N could be that retailer.  And if any company could transition a book retailer into a major digital player, it is Apple. The idea may be out of box, but isn't that what Apple is known for.

Netflix - Can't Beat Em, Then Join Em

It seems that Netflix has made a decision that TV Everywhere means also getting onto the cable platform.  Now CEO Reed Hastings is going the route of being added as potentially a subscription on demand choice on the cable line-up.  Similar to HBO or Showtime, but without a linear line-up attached  to it.  For cable consumers seeking more content, Netflix could provide a low cost addition, or simply be duplicated with what is already being offered by the cable operator.  Ultimately, Netflix's differentiation, like that of its pay TV rivals, will be in the original programming it is building to offer.

Does this move help to increase the distribution of Netflix?  I'd like to know what percentage of Netflix customers are also cable subscribers?  Is Netflix truly missing a potential audience or is it that the consumer likes that Netflix is a la carte and not tied into a cable subscription?  Pay cable subscription is already crowded with HBO, Showtime, Starz, and Epix.  It is hard to imagine that there is more to gain to try and be the fifth wheel.  Being outside the cable box with more maneuverability may just be the differentiating factor that keeps Netflix strong.

Another Cable Box Could Bite The Dust

Have we all seen the news where the father shoots his daughter's laptop?  Well now it seems the two largest set top box manufacturers want to kill off their set top box business.  First Cisco announced its plans to rid itself of its S-A boxes, now Google announces that it will also rid itself of the Motorola set top box business.  "Google is looking to unload the set-top box business it will inherit from Motorola Mobility even before it closes on the $12.5 billion acquisition, The Post has learned. ... And at least two other smaller cable-box players, Pace and Thomson’s Technicolor, are also expected to test the marketplace by putting their businesses on the block, sources said. Once the main conduit to the couch, the clunky cable box is viewed in many circles as an obstacle to a newer generation of software and devices capable of integrating TV and the Web."

Consumers have long hated how poorly the cable box managed accessibility, search, and channel surfing.  Latency issues, clunky interface, unfriendly, the set top box was hated even before the internet showed that there were faster, easier, and smarter ways to find, search, view, and even share videos.  The loss of the traditional set top box might just enable cable operators to seek out means to better integrate their service with other devices that are also internet connected.  Tivo, Roku, Apple, XBox and even TV manufacturers themselves all come to mind.

Will cable operators see the light and work closer with these other companies or will they decide to partner up again and buy up the S-A or Motorola set top businesses?  Frankly not a smart move but one that may be considered.  But if history is any guide, just ask Canoe Ventures, a set top box partnership will only delay the inevitable.

Cable VOD Could Be Much Better

Today's Paid Content article offers great insight into cable's problem with VOD.  While streaming content flourishes, cable VOD remains underutilized and lacking its full revenue potential.  "Simply put, at a time when consumers are actively sampling on-demand programming streamed via the internet, they aren’t exploring the VOD options that exist on the cable services embedded in their living rooms." 

The reasons are obvious.  First, there is less current content.  Shows that premiere on linear channels are slow to populate on VOD.  Second, search remains slow and clunky.  The interactive menu guide looks more like a Prodigy dial up window screen and lacks any ease of use, especially against today's internet streaming guides.  Third, any advertising is more intrusive than interesting.  Pop up ads cover the screen and are hard to dismiss.  And lastly, box issues cause latency, freezing, and interruptions.  Put all together, it creates a poor user experience.  For me, my on demand TV viewing is helped by the DVR; still it requires proactive work to record in advance of the show airing. 

Can VOD be fixed?  As the web has built a friendly system to access and view, consumers are seeking ways to access and stream to their connected devices.  Apple's future announcement could throw another wrench into the current cable VOD problem.  Perhaps the fix is for cable to truly embrace web streaming of its VOD library.  Better search, faster speeds, recommendations, can all help.  And as far as revenue growth, more targeted advertising that doesn't overly clutter the show that is being watched.

Measuring TV Viewership Much More Complicated

Ahhh...the good old days of TV ratings.  Send out a survey books, ask households to tell demographic information about themselves, and to recall the shows they watched and who in the family watched them.  Mail back the form, aggregate and analyze the sample data, and predict what the whole nation watched.  Add phone call sampling to the mix and get a quicker sense which shows were watched.  But today it is no longer that simple.
Today there are a ton more viewing choices, linear views on broadcast or cable, DVR views, and On-demand views.  Households watch shows no longer live, but also hours, days and perhaps even weeks later.  They watch on televisions, computers, tablets, and smartphones.  And as each view is a digital click, they can be measured and analyzed.  And because all these devices affect ratings, their order and popularity can continue to shift. 

As for advertisers paying to get their commercials viewed with content, there are limitations.  "Total popularity does not perfectly correlate with profitability, however, since the networks all agree to sell ad time based on a metric called “C3.” It measures the average viewing of the commercials within a show within three days of the first broadcast, so it excludes people who wait to watch Wednesday’s “Modern Family” until Sunday or Monday."  Certainly the push is on to extend the time period, but until then, advertisers can consider  those extra views bonused; unless of course, that  impression is simply built into the price of the spot. 

The data may more accurately tell who has the TV on.  Whether they paid attention to the spot remains to be seen.  Certainly, the more creative the commercial, the more likely there will be buzz and views around it.  The Super Bowl ads certainly demonstrate that.       

Cellular And Broadband Want Usage-Based Pricing

AT&T wants to charge consumption of wireless usage; Time Warner Cable and others want to institute usage-based pricing for their broadband platform.  The all-you-can-eat buffet of streaming large files may be going away sooner than later as cellular and cable companies look for growing their connection revenue stream.  "While the way cable companies price and package products is changing, so will the way they are marketed, he (Glenn Britt, TWC CEO) added, especially broadband."  But the streaming pipeline is seen by the consumer as a commodity. 

Few can tell you just how fast one pipe is from the other; they simply can enable access or they can't.  And fewer still want to watch their meter every day to see how much they have consumed and how much is left in the month before they are penalized.  We have left the days where we looked at every long distance phone call and opted for a monthly unlimited price for all nationwide calls.  Asked to pay what we stream for broadband consumption seems a step backwards and one that will be met with heavy consumer dissatisfaction.

Apple Is Cheap

Interesting video on why Apple may still be a good cheap investment.

How High Can Apple Shares Go?

For those investors that bought Apple, and those that wish they did, the question being asked remains, how much is Apple worth. In the last year, it has traded for as low as $310 dollars per share and today at a high of $545. Today's article asks the question, how high can Apple reach with the figure of $1000 per share being the pinnacle to attain.

With an iPad 3 possible announcement next week and talk of Apple TV, Apple has a lot of products in the pipeline. It also has a huge cash reserve, and buzz regarding a possible dividend to shareholders. All this talk must make investors salivate. I like the fact that all products point to the iTune and App Store. And the simplicity of working with products is enhanced through connectivity through the cloud. Thus owners of iPads or iPhones will want to add an iMac to their home so as to take advantage of its easy sharing of data. An Apple consumer owns more than one of its products, consumes from its online store, and is slowly adding more devices and more connectivity in the home and among the family members.

Apple shares could certainoly hit a bump in the road, but as they have survived through a bad economic period of history and the death of its visionary, Steve Jobs, the future outlook appears brighter and more profitable.