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.