What if Aereo wins its case in the Supreme Court? Certainly both Aereo and the broadcasters are wondering what happens once the case is decided. For Aereo, they have announced in the media that without a Supreme Court victory, their business model will cease to exist. And broadcasters are considering their options as well should they be on the losing side of this argument.
While it is hard to imagine that broadcasters would drop their over the air signal, networks could consider converting to a cable model. Then Aereo would be unable to acquire an over the air feed to retransmit. Broadcasters could also consider selling direct to consumers its own platform of linear and on demand programming via the web. Today, all offer shows and clips streamed through their own website or through Hulu or both. Lastly, its possible that broadcasters will do nothing to alter their signal.
Through cable agreements, some broadcasters offer an authenticated streaming linear feed of their line-up to customers. Cable operators like Comcast might just continue to pay license fees for the simplicity of the delivery of the signal, but would push back hard should broadcasters attempt to sell a streaming model directly. I find it doubtful that cable operators would put together their own antenna farm unless they could justify economically a real cost savings.
If I were to predict an outcome it would be that Aereo wins its Supreme Court ruling. Broadcasters continue to license their signal and a full authenticated TV Everywhere model to cable operators, and so broadcasters continue to use the over the air airwaves. At the end of the day, if broadcasters can show that more consumers are watching their programming, via cable AND Aereo, then they will continue to increase their ad rates and generate more advertising revenue.
And one day, should cord cutting start to take a meaningful bite out of license fee revenue, broadcasters will revisit the cable model and consider transitioning away from the over the air signal and freeing up airwaves back to the FCC for other new opportunities.
Tuesday, April 15, 2014
Monday, April 14, 2014
Everyone Wants To Be A TV Network
If only it were so easy to pick great TV show, all the networks would be winners. NBC would never had lost its dominance with "Must See TV" on Thursday nights and shows like "Hello Larry" would have never made it on the air. But the process of selecting scripts to become TV pilots and pilots to be picked up for series is much more a matter of art than science. And unfortunately, most TV shows that I like and want to watch seem to quickly be cancelled.
Competition for programming has increased and so has the number of outlets. When it was just broadcast, only a limited number of shows could actually find time slots; with the rise of cable TV, number of slots have increased and the audience started to fragment. But it also allowed some edgier programming to slip through and find a significant audience. Shows like HBO's "The Sopranos" and AMC's "Breaking Bad" were discovered and loved. But with the size of the pot, or number of cable networks ever growing, audience size per network kept fragmenting. Some networks have grown their ratings, many have not. And broadcast continues to see eroding share.
The savior for some programming has been technology. From DVDs to DVRs to on-demand, viewers could watch shows whenever they wanted. Two shows competing in the same time slot meant little when both could be seen hours or days later. And now with the growth of streaming media, viewers can catch up with subscriptions to Hulu or Netflix.
Not being content with licensing previously created shows, streaming media has now entered the original content game. Netflix has found success with "House of Cards" and Amazon with shows like "Alpha House". Today we learn that Yahoo also wants to enter the picture with long form TV content. But with more platforms to choose from, the audience continues to fragment further. Capturing a meaningful audience size gets more and more difficult.
The winner in all this is the viewer who now can choose from almost an infinite number of choices. The challenge is in discovering which of the long form content is worth spending time with and which to ignore. Where to find it and how to retrieve it become our goals; discoverability and search. And how can you identify which shows are good and which are dogs? With a couple of networks airing linear programming, measurement was easier to achieve. Now it may be harder to compare, broadcast vs cable vs on demand vs streaming. An ever increasing number of networks and platforms offering an ever increasing amount of original TV shows to an audience trying to find the best stuff.
Which brings me back to picking the best content to create. As broadcasters have been well aware, it is not easy to pick the winners. HBO could have picked "Mad Men" but declined it; AMC thought differently. Making such decisions is a bit of an art and some luck. And as the article in today's NY Times suggests, its a gamble. But Yahoo smells advertising dollars from streaming long form content. And if they pick right, they see financial rewards. That is, if the audience can discover it, like it, and want to keep watching it. Ask the broadcast and cable networks, it isn't easy.
Competition for programming has increased and so has the number of outlets. When it was just broadcast, only a limited number of shows could actually find time slots; with the rise of cable TV, number of slots have increased and the audience started to fragment. But it also allowed some edgier programming to slip through and find a significant audience. Shows like HBO's "The Sopranos" and AMC's "Breaking Bad" were discovered and loved. But with the size of the pot, or number of cable networks ever growing, audience size per network kept fragmenting. Some networks have grown their ratings, many have not. And broadcast continues to see eroding share.
The savior for some programming has been technology. From DVDs to DVRs to on-demand, viewers could watch shows whenever they wanted. Two shows competing in the same time slot meant little when both could be seen hours or days later. And now with the growth of streaming media, viewers can catch up with subscriptions to Hulu or Netflix.
Not being content with licensing previously created shows, streaming media has now entered the original content game. Netflix has found success with "House of Cards" and Amazon with shows like "Alpha House". Today we learn that Yahoo also wants to enter the picture with long form TV content. But with more platforms to choose from, the audience continues to fragment further. Capturing a meaningful audience size gets more and more difficult.
The winner in all this is the viewer who now can choose from almost an infinite number of choices. The challenge is in discovering which of the long form content is worth spending time with and which to ignore. Where to find it and how to retrieve it become our goals; discoverability and search. And how can you identify which shows are good and which are dogs? With a couple of networks airing linear programming, measurement was easier to achieve. Now it may be harder to compare, broadcast vs cable vs on demand vs streaming. An ever increasing number of networks and platforms offering an ever increasing amount of original TV shows to an audience trying to find the best stuff.
Which brings me back to picking the best content to create. As broadcasters have been well aware, it is not easy to pick the winners. HBO could have picked "Mad Men" but declined it; AMC thought differently. Making such decisions is a bit of an art and some luck. And as the article in today's NY Times suggests, its a gamble. But Yahoo smells advertising dollars from streaming long form content. And if they pick right, they see financial rewards. That is, if the audience can discover it, like it, and want to keep watching it. Ask the broadcast and cable networks, it isn't easy.
Friday, April 11, 2014
How Much Would You Spend On A Smart Watch?
Wearable technology, like the potential of the Apple iWatch, the Samsung Galaxy Gear, the Pebble, Fitbit, Google Glasses, and more, has both the consumer market and the financial market on edge. It is the next big thing and its development while nascent is expected to explode.
With Apple, many expect that when they finally release their iWatch, its stock price will explode. But given that a "stupid watch", can be had for under 10 bucks, what would you spend for a smart watch? Samsung has priced its Galaxy Gear for around $300 while the Pebble can be found for a little more than $200. Google Glasses, although not a watch, is expected to cost $1,500. And according to today's news, an Apple iWatch could go for over $1000. Other models could cost less, according to the NY Post article, but how much less to justify upgrading to the luxury model.
For early adopters, price will not be an issue for any of these devices. But to get to scale, these prices will definitely go down. Ultimately, consumers will have to see the value that the device brings to justify buying these wearable technologies. And if that demand can be generated, these devices will all become winners.
With Apple, many expect that when they finally release their iWatch, its stock price will explode. But given that a "stupid watch", can be had for under 10 bucks, what would you spend for a smart watch? Samsung has priced its Galaxy Gear for around $300 while the Pebble can be found for a little more than $200. Google Glasses, although not a watch, is expected to cost $1,500. And according to today's news, an Apple iWatch could go for over $1000. Other models could cost less, according to the NY Post article, but how much less to justify upgrading to the luxury model.
For early adopters, price will not be an issue for any of these devices. But to get to scale, these prices will definitely go down. Ultimately, consumers will have to see the value that the device brings to justify buying these wearable technologies. And if that demand can be generated, these devices will all become winners.
Thursday, April 10, 2014
Are We Really Secure?
We seem so surprised. Each time our security efforts are thwarted, we are shocked, think we have fixed the problem, and then find that it happens again and again. Today it is the news that the Heartbleed bug opens up our secure data on sites previously thought impenetrable. From banking to to tax returns, the https lock can be picked. and unfortunately it seems for every piece of security and lock, there is someone able to break it.
Whether it is an internet bug or a teen breaking into the World Trade Center construction site, a closed door is an excuse for someone to try and sneak through it. Airport security seems to continually find holes that allow guns on board and non-violent objects to be confiscated. Even the lock on our house is a lame attempt to prevent someone without a key from opening it. Break-ins happen all too frequently. We only get upset though when it happens to us. Unfortunately, even when we try to protect ourselves, the outcome may not justify the means. Just ask Oscar Pistorius who is claiming in court his use of a gun was to thwart a break in only to discover that he shot his girlfriend instead.
Our attempt at security, whether through the internet, at the airport, in our home, or at a commercial site mainly stop non-criminal individuals from even considering the possibility of committing a crime. For those that want to break-in, there always seems that if there is a will, there is a way. So why all the surprise to learn that the internet continues to attract "hackers" seeking the next challenge to solve. The discovery of the Heartbleed bug is not shocking, it was only inevitable. Higher walls will be constructed, more guards will be hired, bigger safes will be built, but no matter what security is created, there will always be folks seeking to undermine the system. Are we really secure; not so much.
So why security at all? Frankly to make it as hard as possible for those seeking to commit such crimes to succeed. Our hope is that we can keep the numbers as low as possible so that the vast majority of us are safe and secure. There is no 100% security solution but clearly something is always better than nothing.
Whether it is an internet bug or a teen breaking into the World Trade Center construction site, a closed door is an excuse for someone to try and sneak through it. Airport security seems to continually find holes that allow guns on board and non-violent objects to be confiscated. Even the lock on our house is a lame attempt to prevent someone without a key from opening it. Break-ins happen all too frequently. We only get upset though when it happens to us. Unfortunately, even when we try to protect ourselves, the outcome may not justify the means. Just ask Oscar Pistorius who is claiming in court his use of a gun was to thwart a break in only to discover that he shot his girlfriend instead.
Our attempt at security, whether through the internet, at the airport, in our home, or at a commercial site mainly stop non-criminal individuals from even considering the possibility of committing a crime. For those that want to break-in, there always seems that if there is a will, there is a way. So why all the surprise to learn that the internet continues to attract "hackers" seeking the next challenge to solve. The discovery of the Heartbleed bug is not shocking, it was only inevitable. Higher walls will be constructed, more guards will be hired, bigger safes will be built, but no matter what security is created, there will always be folks seeking to undermine the system. Are we really secure; not so much.
So why security at all? Frankly to make it as hard as possible for those seeking to commit such crimes to succeed. Our hope is that we can keep the numbers as low as possible so that the vast majority of us are safe and secure. There is no 100% security solution but clearly something is always better than nothing.
Wednesday, April 9, 2014
Weather Channel and DirecTV Kiss And Make Up
It seems that DirecTV and Weather Channel both needed each other. Despite the drop of the network 3 months ago and the launch of a competitive weather service, DirecTV still felt the pressure to relaunch The Weather Channel. It came with a price cut and concessions on programming of the network, as well as TV Everywhere access, but a deal got done. So my question is why?
I question the deal not because Weather Channel doesn't offer programming that appeals to a weather minded audience, but that it could be easily replaced with another channel called Weather Nation and consumers could still access weather content online. Also when weather becomes the news, all the news channels carry weather reports. So why did DirecTV negotiate a renewal agreement? Here are the possibilities:
1) DirecTV was feeling pressure from consumers for the drop of the network and consumers were dropping DirecTV for alternative cable service.
2) The Weather Channel's minority owner NBC Universal was involved behind the scenes and some leverage was used for negotiation.
3) The launch of the morning weather show starring Sam Champion, although not a rating winner, demonstrated important and unique programming that DirecTV felt compelled to carry.
4) The need for added value to its subscribers with an agreement that gave DirecTV users access to content inside and outside the home on mobile devices.
5) The deal was so cheap and came with "marketing incentives" to help the bottom line.
Any or all of these reasons may have been the rationale for The Weather Channel relaunching on DirecTV. Regardless, subscribers will once again get access to their programming.
I question the deal not because Weather Channel doesn't offer programming that appeals to a weather minded audience, but that it could be easily replaced with another channel called Weather Nation and consumers could still access weather content online. Also when weather becomes the news, all the news channels carry weather reports. So why did DirecTV negotiate a renewal agreement? Here are the possibilities:
1) DirecTV was feeling pressure from consumers for the drop of the network and consumers were dropping DirecTV for alternative cable service.
2) The Weather Channel's minority owner NBC Universal was involved behind the scenes and some leverage was used for negotiation.
3) The launch of the morning weather show starring Sam Champion, although not a rating winner, demonstrated important and unique programming that DirecTV felt compelled to carry.
4) The need for added value to its subscribers with an agreement that gave DirecTV users access to content inside and outside the home on mobile devices.
5) The deal was so cheap and came with "marketing incentives" to help the bottom line.
Any or all of these reasons may have been the rationale for The Weather Channel relaunching on DirecTV. Regardless, subscribers will once again get access to their programming.
Tuesday, April 8, 2014
Cutting The Telephone Cord
With all the discussion centered around households cutting the cord to their cable service in favor of OTT services, we sometimes overlook the fact that households are cutting the proverbial telephone cord as well. In fact, the drop in landline phones is huge. "Nearly 40% of U.S. households now have no landline phone, and there are more wireless devices than people." With the rise of cellular, there is no reason to share a house phone when people can call or text or email you directly on your mobile device.
Verizon and AT&T have both moved faster into the wireless space especially as they manage the competition from cable with IP enabled landline phone sevice. No longer is copper the backbone of the house; most likely it is coaxial cable or fiber. And as the WSJ indicates, the push is on by these telco heavyweights to "cut the cord" from copper and embrace an IP driven world. "The new technology also is far less regulated." That brings up a whole new set of issues in connectivity between platforms.
And AT&T envisions a whole new way to connect customers. "AT&T wants new and existing customers to eventually use broadband service, mobile phones or a conventional phone that connects to a router-like box. The box plugs into an electrical outlet and zaps signals to a cellphone tower." No more copper, no more switching technology. But change is not always easy to accomplish and many are naturally wary. Ultimately, the challenges mentioned in the article will be managed.
We are moving in an IP direction with mobile and wireless key elements in this change. Government regulation may be behind but it will surely catch up. And given the cost efficiencies, there seems nothing to stop AT&T, Verizon and other telcos to move away from wired copper to the home in favor of new communication platforms.
Verizon and AT&T have both moved faster into the wireless space especially as they manage the competition from cable with IP enabled landline phone sevice. No longer is copper the backbone of the house; most likely it is coaxial cable or fiber. And as the WSJ indicates, the push is on by these telco heavyweights to "cut the cord" from copper and embrace an IP driven world. "The new technology also is far less regulated." That brings up a whole new set of issues in connectivity between platforms.
And AT&T envisions a whole new way to connect customers. "AT&T wants new and existing customers to eventually use broadband service, mobile phones or a conventional phone that connects to a router-like box. The box plugs into an electrical outlet and zaps signals to a cellphone tower." No more copper, no more switching technology. But change is not always easy to accomplish and many are naturally wary. Ultimately, the challenges mentioned in the article will be managed.
We are moving in an IP direction with mobile and wireless key elements in this change. Government regulation may be behind but it will surely catch up. And given the cost efficiencies, there seems nothing to stop AT&T, Verizon and other telcos to move away from wired copper to the home in favor of new communication platforms.
Monday, April 7, 2014
Where Should Apple Invest?
Today's NY Times ask the question, what should Apple do with over $150 billion in cash. While Amazon is building a competitive OTT box and Google is releasing Google Glasses and building driverless cars, Apple has yet to announce its next new business. We wait patiently for news about a wearable device or big screen TV, but since Steve Jobs' death, the "next big thing" has not yet come.
So what should Apple do, according to author Nick Bilton. he considers an investment in Tesla as a possibility or the acquisition of a cellular company like Sprint or T Mobile or both. And while content and distribution seem to best work hand in hand, Comcast will face its own uphill battle to acquire Time Warner Cable and stake its claim as the preeminent cable, broadband, and content company (NBCUniversal) in the land.
Most of us expect Apple to update its Apple TV box and to finally release a wearable divide, most likely to be called an iWatch. But what about Apple partnering with Liberty Media and its investments around the world in cable including Charter Cable and DirecTv. Or should Apple go even further and buy AT&T. Why not buy TiVo and adapt is box to accept iTunes and Airplay. The question on everyone's mind is what will the next device be that has the Apple brand attached to it.
Apple has a large chest of free cash ready to invest. And while sitting on it is a defensive use for future uncertainty, Apple has be an innovator. Yet lately, that innovation has lapsed and will continue to wait and see whether its future is one of new growth or retaining value.
So what should Apple do, according to author Nick Bilton. he considers an investment in Tesla as a possibility or the acquisition of a cellular company like Sprint or T Mobile or both. And while content and distribution seem to best work hand in hand, Comcast will face its own uphill battle to acquire Time Warner Cable and stake its claim as the preeminent cable, broadband, and content company (NBCUniversal) in the land.
Most of us expect Apple to update its Apple TV box and to finally release a wearable divide, most likely to be called an iWatch. But what about Apple partnering with Liberty Media and its investments around the world in cable including Charter Cable and DirecTv. Or should Apple go even further and buy AT&T. Why not buy TiVo and adapt is box to accept iTunes and Airplay. The question on everyone's mind is what will the next device be that has the Apple brand attached to it.
Apple has a large chest of free cash ready to invest. And while sitting on it is a defensive use for future uncertainty, Apple has be an innovator. Yet lately, that innovation has lapsed and will continue to wait and see whether its future is one of new growth or retaining value.
Thursday, April 3, 2014
Picking Your Next Streaming OTT TV Box
With the release of Amazon's new OTT box, Amazon Fire TV, it joins a competitive group that includes Apple TV, Google's Chromecast, Roku 3, Smart TVs, and TiVo's Roamio. So which one to choose or should we still wait for the next release. Some are speculating that Apple is getting ready to announce and release its next Apple TV box. But if you are in the market now, Mashable has a nice list of the differences among the major brands.
For me, the differentiation that most matters is the content that can be streamed from the device. If your world revolves around your iTunes library, than Apple TV offers that exclusively. If it is about access to Netflix, then all the devices offer that app. Amazon's new product tries to differentiate through other technical approaches including more memory, a unique search and recommendation engine, and a remote with voice search.
For all these devices, the fact is that consumers want to not only stream to their mobile devices but to their big screen TVs too. Competition and innovation will continue to follow these streaming devices but at the end of the day, the one with the best, exclusive, and most valuable content will ultimately win.
For me, the differentiation that most matters is the content that can be streamed from the device. If your world revolves around your iTunes library, than Apple TV offers that exclusively. If it is about access to Netflix, then all the devices offer that app. Amazon's new product tries to differentiate through other technical approaches including more memory, a unique search and recommendation engine, and a remote with voice search.
For all these devices, the fact is that consumers want to not only stream to their mobile devices but to their big screen TVs too. Competition and innovation will continue to follow these streaming devices but at the end of the day, the one with the best, exclusive, and most valuable content will ultimately win.
Broadband Has A "Need For Speed"
We expect that when we pick up the telephone that it is immediately ready to make a call. We expect that when we turn on the TV, that a TV show appears. We expect when we flick on the light switch, that electricity immediately comes on and our lamp turns on. Yet when we sit in front of our computer or tablet, we must wait for our web page to refresh. Sure it comes on and the wait may be a few seconds (or longer), but we continue to wait. Add more devices to the stream, and delay time mounts.
If this is you, then you are not alone. The speed is only as fast as the internet connection that you have and coaxial cable to the home has its limitations. As Tom Cruise said in the movie Top Gun, we have a need for speed. Today's best wired choice is optical fiber but that is not how most of the US is wired for broadband. "The United States ranks in 14th place behind countries like Sweden, Japan, South Korea, Romania and Macau in fiber connectivity." In fact, " only 7.7 percent of broadband subscribers have optical fiber connections, the fastest and highest quality available."
The capital costs to update our infrastructure must be enormous and the cable companies may have little motivation to invest unless they can gain a bigger return. Google is investing in a few markets and Verizon FIOS as well. Our only other hope is wireless broadband although the speed may not match as well to a wired fiber connection.
Unfortunately for all that the US has accomplished, broadband speed does not rank us high in the world. How then can we ramp up our connectivity speed without costing consumers an arm and a leg? It may just take a quantum leap in building new processes for refresh and load that can handle packets of data that are only getting more and more heavy. Till then, we can only watch and wait as the little wheel tells us our content is loading and will be ready shortly.
If this is you, then you are not alone. The speed is only as fast as the internet connection that you have and coaxial cable to the home has its limitations. As Tom Cruise said in the movie Top Gun, we have a need for speed. Today's best wired choice is optical fiber but that is not how most of the US is wired for broadband. "The United States ranks in 14th place behind countries like Sweden, Japan, South Korea, Romania and Macau in fiber connectivity." In fact, " only 7.7 percent of broadband subscribers have optical fiber connections, the fastest and highest quality available."
The capital costs to update our infrastructure must be enormous and the cable companies may have little motivation to invest unless they can gain a bigger return. Google is investing in a few markets and Verizon FIOS as well. Our only other hope is wireless broadband although the speed may not match as well to a wired fiber connection.
Unfortunately for all that the US has accomplished, broadband speed does not rank us high in the world. How then can we ramp up our connectivity speed without costing consumers an arm and a leg? It may just take a quantum leap in building new processes for refresh and load that can handle packets of data that are only getting more and more heavy. Till then, we can only watch and wait as the little wheel tells us our content is loading and will be ready shortly.
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