Cable-Ready vs. Internet-Ready TVs

Just a few years ago, all the talk was about cable ready TV sets and cablecards to bypass set top boxes and get direct connections from TV to cable programming. But today, those conversations are barely heard; instead, the talk is around TV manufacturers building sets that connect directly to the web. And while they don't bypass cable programming in the process, they certainly minimize their value and exclusivity, enabling content off the web to be sen on the big screen. Today, most of that content (UGC mainly) is poor, but the rise of Hulu, and other sites with broadcast and professional content, bypasses the linear channel and VOD for what I guess can be called WOD (web on demand). And that will change the business model - "Once the average living-room TV can tune in those sites as easily as NBC or Comedy Central, viewers may be hard-pressed to justify paying $80 a month for the few shows or networks they can't stream for free from the Net. And cable and satellite operators may find themselves having to cut rates after having increased them steadily for years."

The other discussion that has been proposed for years by the FCC has been a la carte pricing, enabling the consumer to purchase individual networks, rather than bundles of programming. "The good thing is technology may soon make this debate obsolete. While channels may not be offered a la carte anytime soon, in many cases, the programming on these channels already is. Take TNT—episodes of its original shows The Closer, Saving Grace, Leverage, and the soon-to-premiere Trust Me can all be seen on TNT's website. Other broadcast and cable networks also offer much of their content for free either on their own sites or other sites." The rise of "WOD" programming and networks (Next New Networks, My Damn Channel, etc.) would indicate that any channel can escape the clutches of poor positioning or bundling on a higher priced tier of networks to connect directly to their viewer via a web network.

The biggest obstacle facing a full blown access of networks on the web, whether streaming or on demand, remains the current cable model of subscription. While the niche and newer networks see access as more important than subscriber fees, the mainstay networks would be hard pressed to lose that substantial revenue source. Viacom and Time Warner just renegotiated their agreement for fees at the beginning of the year. And cable operators, seeing more broadband usage from their customers, will most certainly raise their fees to offset a loss in cable revenue.

Web access is a trend that is not going away. What cable nets did to the broadcast model, web nets will certainly do to the cable model. Remember, early cable programming wasn't strong either, but it did get better. So too will web programming.

Let’s Invent an iTunes for News

Not for nothing, but haven't I been saying the same thing in older blogs. Perhaps I have been taking it from the device side, hoping that Apple would devise a Kindle like product with its own special touches; but at the same time, suggesting an ability to subscribe and receive daily or weekly newspapers or magazines downloaded to the device. But to the NYT credit, an iTunes app would enable ownership, not only to the device, but to the PC as well, so that one subscription could be shared and downloaded to other members of the family. Like iTunes does with the iPod, allowing multiple devices to share music and video content. Why shouldn't an iTunes print category do the same thing.

And speaking about Steve Jobs, David Carr writes "Remember that when iTunes began, the music industry was being decimated by file sharing. By coming up with an easy user interface and obtaining the cooperation of a broad swath of music companies, Mr. Jobs helped pull the business off the brink. ... Those of us who are in the newspaper business could not be blamed for hoping that someone like him comes along and ruins our business as well by pulling the same trick: convincing the millions of interested readers who get their news every day free on newspapers sites that it’s time to pay up." Jobs made it okay to purchase content and not simply take it from a P2P site. Now if only Steve Jobs and Apple could pull the same feat with printed content.

Everything to Connect to the Web, But What About Interconnectivity?

As the Consumer Electronics Show comes to an end in 2009, all the buzz seems to be connectivity to the internet, but what about interconnectivity. Does every device need to pull from the web, or will there be networking that remains inside my home. And while it is nice to pull movies off the web to a TV set, there is some content I already own on my PC that I want to move easily as well. For music, home movies, even photos, how can I best network my home to take advantage of this content. Do I need to push all this data first out to the web before getting back to my home. Linking to the web is nice, linking to my own home network is nicer.

And what about the content being generated by my own home. How about the refrigerator pinging me that I need to change the water filter, or keeping a grocery list of items inside that are running low. How about remote connection to my HVAC system so that I can adjust temperatures if I forgot to reset my temperature gauge when away from the house; or pinging me on my cell phone if the alarm goes off. How these devices converge and interact is perhaps an even bigger win for technology in the coming years.

Is Online Video Too Fragmented To Survive?

A recessionary economy, lower ad spending, and too many viewing options hurting the entire industry. In the good ole days, the choices for ad spending were limited - print, radio, TV. And inside each of these buckets were limited choices; for TV a handful of broadcast channels, for print, a handful of newspapers and magazines, and for radio, AM or FM stations. Today, technology has lowered the barriers to entry in each of these arenas as well as enable new sources of content distribution to emerge. In TV, there are many cable, VOD, and now internet streaming choices; In radio, the rise of satellite with SiriusXM and internet radio. And in print, the internet has hurt the printed product. But the ad dollars may not have grown as quickly as the players and getting your "fair share" of the media buy is harder and harder. In addition, by lowering the barrier to entry, technology has dealt a heavy blow to the subscription model. Where companies have enjoyed two streams of revenue, the adage why buy the cow if the milk is free comes to mind; why buy a subscription if it is free to view, read, or hear somewhere else.

This proliferation of content has created what many call the "long tail", scratching away at the mainstays and developing niches and even "sub" niches of categories. And while there is literally something for everyone to read, hear, or watch, these content specialty stores may be too limited in the long run to survive. "BitGravity CEO Perry Wu said time was already up for many of the smaller online video development and distribution studios: 'We work with hundreds of content companies and to be honest, many of them won’t survive.'" The classic product/industry life cycle theory says that eventually it will move from fragmented back to fewer, meaningful, larger segments over time. And if advertising isn't paying the bills, these smaller content creators will either merge or die.

Another popular maxim is that the big fish will eat the little fish and perhaps that is what the industry expects to happen. Already broadcast companies like CBS, NBC, ABC, and Fox have acquired cable networks and websites. Cablevision and Fox own newspapers; Magazine publishers are building web portals. It seems their is more consolidation to come. But is it aggregating fast enough and are these big box companies using their advertising arms to sell across platforms or are they not synergized and find themselves believing that each arm should sell advertising independently of its other pieces.

So is it already too fragmented? Yes. Cable Operators have watched the many become the few and independent cable networks are purchased by the bigger companies. Magazines are closing and newspapers are replacing print with online editions. How much more growth is in new entrants to the internet stream or will innovation start coming from inside the existing big fish. Hey, Hulu came from NBC and Fox to challenge You Tube. I can assure you this, it's going to be an interesting ride.

Vizio Connected HDTVs

"Everybody is launching networked TVs it seems, but Vizio's 'Connected HDTV' sounds killer: Built-in 802.11n Wi-Fi, with every service you'd want: Amazon, Blockbuster and Netflix VOD, Pandora, Flickr, Rhapsody, plus any other Yahoo widget. Not there, you notice is Hulu. BUT, Vizio says they're in 'deep talks' with them. So Hulu, directly integrated into your TV, looks likely." So another device that connects to the web. Is the Vizio Tru2way compatible also so that it can work without another "converter box" next to it? Or is Vizio trying to create a model to eliminate cable subscription? Not true, according to their release. "VIZIO’s “Connected HDTV” Platform is designed to compliment TV viewing. At a single touch of the VIZIO customized remote control, viewers can access their favorite Internet content from the easy to navigate on screen display, without interrupting the TV program they are viewing. " Unfortunately, the other thing missing is a discussion about a Cablecard. And so while their new remote with qwerty keyboard looks cool, it may have to still share the coffee table with the tradition universal remote.

We seem to be box happy with gaming consoles and dvd players attached to our TVs as well. Can my shelf hold a Wii, PS3, XBox, Blu-ray, Mototola or S-A converter box. Or will it crash under the sheer weight. And while it is nice to hear about a "connected platform", does that connection extend to my own home computer? The average consumer seeks a solution where it is plug and play ready, interactive and interoperable, talking easily to the various devices in the home, and managed wirelessly from a single remote or mobile device. Connecting to the web is nice, but the Xbox and Roku and other devices do that already.

Markey: Feb. 17 DTV Date May Have To Move

There is a digital coupon shortage. Many people, mainly those without cable, aren't thinking about or prepared for the digital conversion. Advertising messages in the beginning were confusing, so that cable customers without a set top box thought they needed to put converter boxes on every TV. And many fingers are being pointed.

Now a major consumer advocate, "Consumers Union (CU) late Wednesday asked the heads of the congressional committees with telecommunications oversight, as well as the current and future administrations, to consider delaying the Feb. 17, 2009 transition date." And Congress may be listening as Ed Markey, the Democratic Representative from Massachusetts and new chairman of the House Energy and Commerce Committee is looking hard at pushing back the February 17 date.

While digital converters cost less than an iPod, Congress does not want to force its citizens to purchase; the coupon could offset the entire price of a low end converter. But with problems moving out enough coupons and the transition date less than 6 weeks away, it is my guess that this delay will occur. But will it be 1 month, 6 months, or a year? "Consumers Union has suggested a move of four months or so, according to a CNBC interview with CU senior counsel Chris Murray, the other signature on the CU letter. Murray told CNBC that he thought there was a 'reasonably good chance' that Congress would push the date back four months or so. "

Will New Media Kill The New York Times Print Edition

Every new year brings new predictions and one making the rounds is that heavy debt structures on the N.Y. Times could be the final straw come mid year. Certainly they are trying to sell some assets, including their share of the Boston Red Sox, but is it and front page advertising enough to save this old grey lady. Atlantic Monthly doesn't think so. "It’s certainly plausible. Earnings reports released by the New York Times Company in October indicate that drastic measures will have to be taken over the next five months or the paper will default on some $400million in debt. With more than $1billion in debt already on the books, only $46million in cash reserves as of October, and no clear way to tap into the capital markets (the company’s debt was recently reduced to junk status), the paper’s future doesn’t look good."

But does bankruptcy mean stoppage. Not necessarily. Bankruptcy is a do-over and may enable the Times and other papers like it to reinvent themselves into a leaner, meaner, more profitable news organization again. Consumers do read the Times and other web sites aggregate its content. Its the subscription model that is changing as content is simply accessed and not purchased. Can the Times save its subscription model by utilizing new technology - would electronic distribution on Kindle, iPhone, Sony Reader and others in a readable form be convenient enough for consumers to purchase. Or does content need to be made exclusive, with more controls to limit its availability without subscription. Or will advertising rates need to increase to offset subscription losses.

And so the predictions..."Regardless of what happens over the next few months, The Times is destined for significant and traumatic change. At some point soon—sooner than most of us think—the print edition, and with it The Times as we know it, will no longer exist. And it will likely have plenty of company. In December, the Fitch Ratings service, which monitors the health of media companies, predicted a widespread newspaper die-off: 'Fitch believes more newspapers and news paper groups will default, be shut down and be liquidated in 2009 and several cities could go without a daily print newspaper by 2010.'” A sad day indeed when the print newspaper no longer exists; let's hope that electronic subscriptions, with ergonomically designed readers to provide a satisfying reading experience, enables these news organizations to survive and thrive.

N.Y. Times' Cover Ads Go For Big Bucks

Why is this a surprise, especially this article in the N.Y. Post. Last year, the Wall Street Journal was first to put ads on their front page. In fact, the WSJ is owned by Murdoch who also owns the Post. Unfortunately, it is a necessary means for survival as other papers including USA Today have already known. As subscriptions and revenue drop, new opportunities are needed to engage the audience. Will we perhaps one day have ads inside articles, I hope not. Can you just imagine reading the paper on President Obama and in the middle of the article see "...and President Obama, sipping a Diet Coke, that refreshing taste!, in his cabinet meeting announced new reforms...". Product placement inside print content, perhaps the last straw, but it follows the same type of in-program content that TV shows utilize today. Its why Simon drinks Coke on American Idol every week. As newspapers seek new avenues of advertising, the front page becomes the pre-roll of print. And at "$75,000 on weekdays and $100,000 on Sundays, according to several ad buyers who asked to remain unnamed" the return is profitable.

Blu-Ray Struggles With Uncertain Prospects

The Consumer Electronics Show is here for another year with glimpses of future technology promises. And in the world of DVD players, Blu-Ray came out the winner over HD DVD, but will it be a long lasting victory or a mere blip in an ever changing entertainment landscape. Is the pace of change so fast that streaming media will replace Blu-Ray even before it gets to enjoy its victory?

As a pack rat, I have a habit of collecting and holding on to things. But recently, I have come to realize that I can download music and "own" it without buying the CD. I very rarely buy one, with the last one being as a gift for my daughter. As I get into this habit of downloading, I can see myself moving in that direction with DVDs. As a family, we tend to check out first what is on VOD before going into our DVD selection. As the internet opens up to potentially a larger selection, how we search for movies and what content is "recommended" to us, has appeal. At the same time, should I decide to buy it, I want the ability to download the best quality movie to burn on my own DVD. And as flash drives become more commonplace to capture this content and share it on other devices - a portable dvd player, PC, cellphone, or my car's dvd system, I will prefer the advantage of the flash drive's smaller size to that of the DVD. That, in addition to being less likely to be scratched or damaged with repeated play, appeals to me.

"One reason is that discs of all kinds may become obsolete as a new wave of digital media services starts to flow into the living room. On Monday, for example, the Korean television maker LG Electronics plans to announce a new line of high-definition televisions that connect directly to the Internet with no set-top box required. The televisions will be able to play movies and television shows from online video-on-demand services, including Netflix." While it sounds great that LG is coming up with TVs that connect directly to the web, it is more important that this feature also allows for download as well. Until then, other devices like Blu-ray DVDs, XBox, PS3, Roku and others may have the leg up, especially if they allow me to save and share my purchases.