Do You Own A Blu-Ray?

Recently, my son asked me if we were buying a Blu-ray. We currently have quite a collection of standard DVDs in our library, but lately we have been watching a lot of movies on-demand. And for the record, we don't have the hi-def screen either although that is a planned purchase. But a blu-ray player is not.

Our viewing habits have switched and the DVDs become more useful for long car and airplane trips, while VOD has become the first choice for watching at home. And I believe we are not alone. "U.S. consumers have given Blu-ray a lukewarm reception, despite buying an increasing number of high-definition TVs, according to Harris Interactive." Somehow owning content, once an important part of the video experience, has given way to the rental. And immediacy and choice has positioned VOD as a leader.

I also imagine that a stand alone blu-ray player is not the best use of funds. As gaming consoles become a bigger part of the TV experience as well, they also offer blu-ray capabilities. Will they be used for that purpose, perhaps secondarily, as gaming use swells in volume. So what will happen to blu-ray. I imagine overtime, PCs, portable players, HDTVs, etc will all e capable of playing blu-ray and standard DVDs. And standard DVDs, like LPs and cassettes will head into the attic, reminding us once again of simpler days.

Twitter Looking For Revenue Model

Twitter, short messages to tell others what is on your mind, has long been absent an advertising message. For those that like to follow businesses, however, ads are expected. For example, follow Gary Vaynerchuk and Wine Library tweets and receive messages on upcoming specials, free shipping, and other tidbits about wine. In this case Wine Library gains "fans" and a social network to share messages and Twitter the company gets nothing.

If your interest in a product leads to a search for guidance and ultimately a place to buy an item, Twitter might just gain on the handshake. "E-commerce, including links to products and turnkey payment mechanisms, is a likely revenue stream for Twitter, said Todd Chaffee, a Twitter board observer and general partner at Institutional Venture Partners, which has invested in Twitter. That gives us one more hint about how Twitter will make money." But can that generate enough cash flow? I find all the message coming through as too much and my inclination is to turn it off or really filter. I have personally become less of a fan of Twitter. As a Facebook friend of Wine Library to get this same messaging.

For Twitter to make money, they may need to associate an ad message with each Tweet, and that may not be as welcome to its users. As more advertising comes onto its pages, it may just kill this golden goose.

Tivo - What is More Important, Content Or Distribution

For broadband connected Tivos, some great news, Tivo can now upload TV.com content. "TV.com users that have a TiVo Series2 or Series3, TiVo HD or TiVo HD XL DVR, are now able to schedule recordings directly to their DVR via TV.com. To record single episodes or entire seasons of shows users can click the 'Record to TiVo' button on TV.com show pages and the request will be sent directly to their TiVo DVR." Tivo continues to represent a leadership position in the DVR functionality and experience. For Tivo, content is king!

Great news for Tivo fans, but is it ultimately in Tivo's best interest? It seems that this content is the same content CBS and its partners put on cable and over the air. It seems that Tivo ultimately competes with cable as a means to watch your favorite shows. Perhaps Tivo should make more effort to partner with cable and telco as their DVR provider. It would provide an ultimately higher revenue stream and push the VOD/DVR experience through cable as opposed to around it.

Currently, Tivo is expanding its reach with Comcast and Direct TV and in a technology fight with Dish. The more content that Tivo can access directly from the web, the less valuable a cable subscription could become. It becomes a slippery slope as more live content (news, sports, etc) becomes available without a cable box.

Dish Still Trying to Work Around Tivo

Dish owes money to Tivo for using its technology on Dish DVR devices, Court appeals have delayed that payment and allowed Dish to continue to use this technology, and Tivo continues to not get paid. And so Dish is back in court to find another way around this patent infringement in order to continue to allow its DVRs to continue to be used by their customers. Otherwise, Dish has one of two options: 1. Turn off their DVRs and upset their customers until new technology can be deployed, or 2) Pay Tivo for its technology, embrace its patent, and let your customers continue to derive pleasure from their DVRs.

It seems the old adage, "I'd rather fight, than switch" is in play here. For some reason, Dish has a basic issue with Tivo preventing it from coming together to reach a common ground. Some times children simply can't learn to play in the same sandbox and despite how much money it will cost Dish, they would rather fight. For me, I'm holding on to my Tivo stock, cause I expect another windfall.

My Space Lays Off 30% of Staff

The future of media is the internet and the future of communication is social networking. My Space, once the darling of this world, is facing hard economic times and laying off 420 people, "as part of an aggressive restructuring that seeks to make the company smaller and more agile. " What has happened in the three years that Fox and Murdoch picked up this business? How is My Space faltering while Facebook seems to be picking up speed? Perhaps part of the problem might rest with ownership. Facebook remains young, aggressive, standalone while My Space was purchased by an old media company trying to augment its media distribution strategy. Change has been occurring quickly in social networking and Facebook has more successfully adapted while My Space lost its stride.

I have both a My Space and Facebook account but have found myself ignoring My Space and concentrating on Facebook. I liked Facebook's uniformity and structure; I found it easier to navigate. My Space, with all its "skins" and busy graphics became more disjointed and less interesting to use. Mostly, I liked how Facebook aggregated the content of my Friends onto one page as I was more interested in reading what they were doing then what I was posting. What does My Space look like today; I haven't been on in a long time so I can't tell you. They lost me and obviously others, too.

"The perceived missteps are numerous. Some observers say it clung too long to a 'portal strategy,' in which it sought to amass an audience around entertainment content. By contrast, Facebook maintained its focus on features that enhance the social-networking experience, such as the "News Feed" that matches the immediacy of Twitter's staccato updates." How will My Space win back its users; that is what their smaller group will be hard pressed to do. Perhaps Murdoch needs to buy Twitter and incorporate those users back into My Space. And obviously come up with something more innovative and unique that will be exclusive to the My Space experience. Otherwise, this might be the beginning of the end for My Space.

The Death of the TV Business

Great article in Advertising Age called: Sorry, There's No Way to Save the TV Business by Henry Blodget that really reminds us that history tends to repeat itself. Technological change affects businesses and one needs to look no further than the businesses before it to see what will eventually happen to them. Need examples...what the web did to the music industry it is doing to the DVD and video business. The same holds true for distribution.

The article looks at the changing business of newspaper subscription and correctly argues that broadband will do the same to upend the apple cart for cable TV subscription. "After saying all this same stuff for years, the newspaper industry figured out the hard way that, eventually, reality intrudes. You can't stuff the genie back in the bottle. And in the next five to 10 years, the TV industry will figure this out, too." What essentially have been barriers to entry that prevent consumers from seeking content elsewhere, have been lowered such that consumers don't necessarily need to pay as much for their entertainment dollar. "With an internet connection anywhere in the world, you will soon be able to get to almost anything. And not just to your computer -- to your TV."

The death of the TV business is not as the author points out, a question of if; but rather, a question of when. A must read article.

What You Want, When You Want It

Viewers like their On-Demand and the growth rate for usage is staggering. According to Rentrak, "Video-on-demand orders increased 21% last year, with operators processing 3.8 billion VOD orders in 2008 excluding adult programming." And I wouldn't be surprised to hear that DVR growth is also rising at a very health rate. Consumers care about how they use their time and prefer the immediacy of VOD. In less than a decade, VOD has become well accepted and liked.

There was a time though where consumers were hesitant about using VOD on their remote. There seemed to be a concern that any button pressed would result in a purchase. It took a little time to train the consumer that Free On Demand programming was actually free. That is not the case today. According to last year's findings, "91% were free VOD, while 6% were subscription and 3% were transactional." Over time, that fear has dissipated.

And there is still room for more usage and higher growth rates. The VOD features through the set top box are still clunky and laborious to work through. It still takes too many clicks to find what you are looking for and the search feature is prehistoric compared to the web. We like to describe that process of going in and out of categories as "tree and branches." You meander up and back from click to click to go deeper and deeper into categories and occasionally jump out and start from the beginning in order to find your preferred video. Once a new search function is developed, this current process will be quickly forgotten. To me, it is what continues to hold back the further growth and appeal for VOD. But I am assured, a change is a comin!

Hard Liquor On Broadcast

The car and financial services industries are hurting and the broadcast ad dollar is declining so where to go to find new sources of revenue. Where hard liquor was once a no no on broadcast, now its ad budget is as green as anyone elses. "This year, with network advertising revenue off about $250 million, or 4.2 percent, in the first quarter compared to last year, local affiliates are not only accepting hard liquor ads -- they are actively courting the $451 million distilled-spirits advertising business." Watch Simpsons and drink Chivas!

So what's next. Will we once again allow cigarette ads to appear on TV. Perhaps its time for a Lucky Strike! Cause when it comes to greed, anything goes. What happened to the ethical issues that banned hard spirits the first time. Some might argue that the ban was a voluntary one and that cable nets have been advertising hard liquor for a while. Still allowing spirits to advertise on TV simply brings us further down that slippery slope. Perhaps the ad guidelines for TV networks should be ... ANYTHING GOES!

My Cable Networks Are Losing Their Niches

I can appreciate change and I certainly understand that cable networks must continue to evolve in order to grow ratings, viewership, ad dollars, and of course total revenue. At the same time, each should stay true to their core mission or else they all simply start looking like each other. I make this statement because I recently saw an ad announcing that Cartoon Network will have non-animation, reality programming. Yikes! Does that mean that they will change their name to Cartoon and Live Action Network? Certainly it is not a first as they have shown non-animation films on their channel. It may be by, about, and for kids, bit it is not their core mission - cartoons. And why is it being done, broader demographic reach, bigger ratings, more advertising.

But I don't want to put the blame down on Cartoon; truth is, other cable networks have done the same thing, gone outside their core programming genre:

TV Land - theatrical movies
AMC - Modern movies and original TV series
A&E - syndicated TV series
CNBC - repeats of Deal or No Deal and other shows
TLC - reality (non learning) TV shows

The list goes on and on. Each cable network has broadened its niche so that the network today looks nothing like the network of 5 -10 years ago. For example, Bravo went from classical arts to pop art.

Is this a good or bad thing. That is not for me to decide. Clearly, ratings of each of these networks have improved as well over this same period. Broad programming will have more appeal over niche. It is just that cable programmings appeal was that it could provide the niche programming that broadcast lacked. Now, cable has become the new broadcast network source. And where do the niches go now for content; for the moment, that would be the web.