Before I get into the topic at hand, I want to first commend Google and Youtube. Just read the article “Are Live Sports the Next Frontier for Youtube?” Dang, why didn’t I think of that 15 years ago ??. Oh well. And one more thing. You may be reading today about the problems streaming Youtube and other videos over the AT&T network to an IPad with 3G.
That wouldn’t be a surprise if you read my blog back in January:
“Whats also big is the exclusion of flash. The reason is obvious. No flash. Far less streaming over 3G. Less streaming over 3G means less bandwidth consumed. Less bandwidth consumed means ATT can offer a GREAT price on the 3G data service. I personally have never had problems with the ATT Network. The limits on 3G streaming probably means I wont going forward either. Thats a good thing.”
Sorry, couldn’t resist.
There is an old saying that tends to work today and I expect will work for years to come: ” Follow the money”. In particular, follow where consumers spend their money on new products. It is the ultimate definition of consumer choice. In the word of consumer electronics, consumers have been, and continue to spend their money on brand spanking new HDTVs.
Consumers are adding TVs to their households. According to Nielsen the number of TVs in homes INCREASED in 2009 over the previous year, to 2.93. In addition the percentage of homes with DVRs increased to 34pct. Now what do you want to do when you buy a new big, flat screen TV ? YOU WANT TO WATCH STUFF ON IT ! No one buys an HDTV in order to ignore it.
But wait there is more. Another 35pct and quickly growing have and use VOD from their TV provider.
You know what is AMAZING about VOD ? It gives you thousands of choices and its already connected to your TV. It just works.
You don’t have to buy another box. You don’t have to figure out how to connect it to your TV. You don’t have to stream from another device over your WIFI netork and get all confused about how to pull video from the internet. It just works. That’s what you want when you unbox that great big flat screen TV. You want it to work…. like a TV. Easily. Quickly.
Which is why I don’t understand why so many people think that consumer choice is about having millions of videos available online to watch any time is some big deal. Consumer choice is about having the brand new device on which you just spent hundreds of dollars or more work immediately and just as you expected. It’s about getting the most out of your investment in your new big screen that looks beautiful on your wall.
When you buy a car, you don’t want to have to figure out how to make it work. You don’t want to have to bring someone in to make sure the engine starts, or have to buy some 3rd party device so that you can go full speed or blast the stereo. When you buy that car, you want to jump in the drivers seat, smell that new car smell, be excited when you turn it on, and crank that stereo and roll down the road in your brand new car. You made your choice as a consumer. You spent your money. You want IMMEDIATE GRATIFICATION.
The same applies to big ticket consumer electronics. When you buy that new TV and get it installed on your wall or wherever in your apartment or house, you want to turn that baby on and watch your favorite show, the big fight or concert or put on your favorite video. You want it to look and sound good. It doesn’t matter if you are 20 and living in a dorm or an apartment, or 65 and watching Oprah. It’s a proud moment. You don’t want to have to figure out which 3rd party box or streaming service you can hook up via the internet and then stream to your TV and then find out the video you are streaming looks nothing like the video they had on in the store. You don’t want to tell your buddies not to bump the mouse so it stays full screen. You don’t want to piss off everyone because your screen saver of your dog just came on or have to stop everything and turn your facebook alerts back off because they keep interrupting everything. You dont’ want to scream to your girlfriend/roomie/wife/kids in the other room to stop downloading stuff so you can watch your show without it buffering. You just want it to work.
The beauty of that TV is that you unplugged your set top box from that old piece of shit you used to have and you plugged in your new , beautiful, ready to roll HDTV and it worked great. It worked so great, that you want as much content as you can possibly get , with the best possible picture. So you started saving stuff on your DVR, or if you didn’t have a DVR , you called your TV provider to pay the extra 5 bucks a month. And when you got that new set top box with the DVR, which worked when you plugged it in, you started checking out all the programs and movies they have in the VOD section.
You can save any show you want on to your DVR. You can watch any of thousands of shows , anytime day or night on your BRAND SPANKING NEW HDTV.
I just don’t understand why media pundits think that people are going to want to turn those BRAND SPANKING NEW HDTVs into PC monitors watching internet quality video. It’s a hassle. There is nothing that works out of the box. You have to be your own personal systems integrator and get the right box, figure out how to get content to that box over your in home internet, and then eat up your internet bandwidth in order to watch video that is dumbed down because it takes so much bandwidth. Why ?
That is not consumer choice. That is consumer hassle.
What about the future ?
The number of DVRs, HDTVs and VODs users will continue to expand every year. Every year for the next 10 years we will be discussing the future of internet video and all the great things that could possibly happen.
Remember this. The potential for video over the internet is huge….. and always will be.
The future of TV is TV. That is what consumers want. Consumers have made their choice to spend money on new HDTVs. Why ? Because they want to watch TV.
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I must say I love your site, i know i probably shouldn’t be posting it here but I couldn’t find a place to just talk about the site. Just wondering where I can learn to use wordpress as I want to make my free computer site freeblee.com into a blog.
Comment by freeblee -
I must say I love your site, i know i probably shouldn’t be posting it here but I couldn’t find a place to just talk about the site. Just wondering where I can learn to use wordpress as I want to make my free computer site into a blog.
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here in London on UK television today we’re looking to prove the point. Launching ITV Live – we think the best implementation yet around Social TV – see http://bit.ly/bRrrTZ
game changer for ITV I hope
Dominic
Comment by imagically -
So, in your many to many relationship, it’s your contention that guys like me, that have more than one place to view things both at home and at work, ultimately want to watch? Hey, I’m like Chance the Gardener in that respect, as I like to watch. However, we’re moving into an era where a majority of the people that are watching, also want to participate. Since you claim the previous commenter’s numbers are spurious, I say the same about your 90% figure. It may have been that last century, however, my guess is that as we headlong into this one, that number has gone down.
If indeed it’s accurate.
The bigger issue here is the major content providers are only beginning to realize they need to change their business model, and it may already prove to be too late for them. The good news is, it’s easier to get things done quickly, and efficiently, for guys like me. I feel Mark’s comments stem from the fact that he’s attempting to create something, or maybe he already has, and he’s whining because he’s not the leader of the club that’s made for you and me, since as you know, that will always be, Mickey Mouse.
Comment by Matches Malone -
Exactly where are you coming up with your figures? “Millions of people stream shows and movies everyday” and “Millions of people upgrade their engines and stero systems”?
While people are at work is when they stream video to their PCs. Only kids and geeks who like to just sit in front of their computer do this from home. There are some people who do have a media system hooked up to their TV, but it’s not even close to “millions” has you say. Nor are their millions of people who upgrade their cars. Again, kids do this but not millions. I’ve owned probably 10 different cars in my life and have looked at hundreds, new and used, while looking for my next car and I would say NONE of them have had the engine modified and not even 1% had a custom stereo.
Bottom line is that a majority of the world population want to just turn on the TV and watch it. They want ONE remote, no computer to mess with, no website to hit in order to download a show, etc. They just want to turn it on and watch. If nothings on, they want OnDemand and they don’t want to wait for it to download.
True that people all have different preferences, but what 90% all have in common is how they watch TV. Show selection is different, but how they turn on the TV is really no different.
Comment by hawkman02 -
I think your post has some good points that many people would agree with; however, there are many points that many people will disagree with. Millions of people stream shows and movies from their PCs everyday and are pleased with the picture quality. On the other hand there are also millions of users who think that hooking up a computer to an HDTV is just something too complicated for them to achieve.
The reality of the whole thing is that some people will continue to perfer to stream content from where ever they find it and in what ever quality they can get. The same is true with your analogy about the cars. Millions of people upgrade their engines and stereo systems, but you fail to mention this. The fact is that different people have different preferences and that will remain the fact.
Comment by besttvoptions -
Probably a little too late to be commenting but who cares, I’ve got nothing else better to do right now.
I agree with you Mark. When I’m watching TV on my Panasonic 50″ 1080p Plasma, I just wanna turn it on, use the remote and watch some TV. VOD is awesome and beats the crap out of online streaming video.
There are geeks out there that want to use their 50″ as a monitor. That’s kinda cool from time to time but when I’m on a PC all GD day, the last thing I wanna do when I get home is jump on my PC just to watch TV.
Cubes…what the freak is up with HDNet NOT available via Time Warner Cable???
Comment by hawkman02 -
Except that, for me, House isn’t a Fox show. I’m in the uk where House used to be broadcast on Five, which you can’t get in my street and now it is on Sky which is on satellite.
I could download from Amazon or iTunes if I was in the USA but they won’t let me do it from here. It’s like they want me to bittorrent it.
My prediction:
Producers will sell TV stations the right to broadcast the show but will sell the online download separately. Every show will be available from lots of places, just as every book and DVD is available from lots of stores. The production companies will also sell their own shows direct to fans at the same price but with access to cool extra features.
Google will remember which download service you have accounts with and will list hits from those first. Your cable service is just one of these accounts. Fox won’t get mentioned at all unless you told Google that they are on your cable service and they are about to broadcast House right now!
Google TV is all about Right Now! Enter the name of a show and it will start playing Right Now, downloaded from the net. Google TV will know what was the last episode you watched, what resolution you prefer.
It’s all about Disintermediation. From the production company to you with the least possible friction.
Comment by joeraftery -
Any comment on the Google TV product announced today?
Comment by Rjcc -
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I disagree with this blog because TV is nothing but advertisements now. The quality of content is sub par that cable and satellite companies offer also. Let’s take BBCA for example and how good it was maybe 2 years ago and now they show reruns of terrible shows that were here in america. It’s funny that the consumer has to pay for 600 other channels that may offer 3-4 good shows per week on average across 2 or 3 channels you can get without a subscription.
The bandwidth that is being used to broadcast HD signals over cable or satellite could be used to provide hiccup free internet streams of whatever people would like to watch as opposed to what content the provider offers based on what deals they get with content providers to remain profitable.
The model for internet dominating the TV has been done in korea like GOMTV. They took starcraft, a video game, to the point the networks over in that country had lost advertising dollars and viewers. The networks fought back with government regulation cause money talks but that example shows that maybe not everybody cares about the boring nonsense on cable or satellite tv outside maybe sports which is the only thing keeping companies like your’s alive.
Comment by baarn -
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I’m late to the party… I don’t think it’s as black and white as TV vs Internet.
1. On the internet I’m the editor. I choose from everything and anything. Comcast will not be giving me that choice anytime soon.
2. If people want the best and easiest as is suggested, that piece of shit Motorola box every cable co. sends out will not cut it. If I want the best I need a good HTPC. How long have I been waiting for a new DirecTV or Comcast Tivo? Seems like forever now.
That said, the future to me then points to these new TVs that have HTPC functions built in. YouTube app, a streaming app, etc all built into the TV. That way it’s seamless, but I’m not at the whim of my poorly managed cable co.
Comment by keyrat -
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This is exactly the kind of mindset that will drive people away from cable/satellite in droves. Follow the money? Okay, I’ll bite.
I pay $15 a month to watch what I want, when I want, completely ad free. I used to pay $70+ to sift through mounds of crap programming to record what I wanted to watch (commercials and all) IF it was scheduled to air that week. If I want VOD, I have to pay an additional $4 to $5 to “rent” a movie for 24 hours. I’d willingly pay twice the $15 a month for Netflix if it means more choice and better quality of service.
On that note, in order to even get the limited set of HD channels provided by my cable provider, I had to pay for a bunch of channels that I neither wanted nor watched. Netflix streams nearly everything in HD, and I don’t have to pay more for that experience.
Setting up Netflix to run on my TV was as simple as plugging my XBox 360 HDMI cable to the back of my TV. Despite what you say, cable/satellite boxes are 3rd party devices. Furthermore, I have to have a couple of guys come into my home to install it and set it up, and pay extra for the inconvenience.
For someone in the business of providing content to TV’s, you have a surprising lack of knowledge about streaming from the net. Can my Grandmother setup Netflix to her TV? Probably not, but you can be damn sure that the under 35 crowd can, which is who most television programming is geared for in the first place.
Comment by phfeenikz -
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Maybe I’m old fashioned but I prefer to have the best experience when I watch or listen to something. That might not be the most convenient way but it’s the best way.
There’s only so much time for me to enjoy TV/movies and music so I would prefer to watch a Blu Ray in 1080p 24fps with HD audio than anything cable or sat provides (I’ve not seen sat 1080p but I’m sure it’s compressed well below the bandwidth of Blu Ray). The same is true for audio I’d much rather buy a vinyl LP, sit down and listen on my Clearaudio TT than download something on iTunes to play on an ipod.
There’s a reason people are will to pay top dollar for box seats to a baseball game or concert, it’s because the experience is so much better than the nose bleed seats (I’m sure Mark can back me up on this). Yet people are more than willing to watch or listen to inferior quality streaming services (set-top, VOD, internet, console, whatever) all in the name of convenience.
Not me I’ll gladly get up to turn the record over every 20 minutes. Until these “services” provide the same experience I’ll pass.
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The Future of News Print is …. News Print
Your Think?
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Heres my real world scenario that I believe is closer to being in touch with the mass majority of the PAYING public. We spend $145 a month for cable w/ DVR, internet, netflix, and xbox live. Big deal. Its not a lot of money to have that convenience. Anyone who drops cable and watches content online either doesnt watch sports or doesnt care about picture quality. I didnt buy a 50″ HDTV to have something that looks like VHS quality played on it.
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Mark,
This is one of the first times where I disagree with you, at least to a point. The thing about watching TV over the Internet and wanting your brand new HDTV to work is that all it really takes is one person to show you how to set it up and run it properly. I am no genius when it comes to this stuff, but I know exactly who to call if I decide to buy a PS3 and go that route (which if it wasn’t for live sports I would have done long ago). I have a buddy who doesn’t pay for cable and lives right above a bar. So he is covered for live sporting events and streams/downloads everything else. I am sure many people have this type of friend who could show them how to set up their TV in this fashion. Once you get it working it is great not having to deal with cable companies and having anything you want on demand. Aren’t the number of people that are experts and willing to help others with this stuff only going to increase as time goes on?
Eric
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Mark – I’ve been a big fan of your blog for many years, but I must say I think you’re wrong here on several fronts. Having just sold my company (Episodic) to Google, it’s probably not best for me to comment here, but if you’re ever in Mountain View or San Francisco, I’d love to buy you lunch. I deal with all things content creator at Google/YouTube.
Comment by noaml -
i really am not tracking with this. 5 months ago i canceled my cable subscription because of many of the reasons stated above
prices went up when the intro offer was over (what a model – reward new subscribers and penalize existing ones)
the DVR interface sucked and replacing with tivo meant paying more money to do what my cable box should have done – heck – couldn’t even remove channels that i did not want to EVER watch and or channels I did not have a subscription to – just an idiotic interface
when I returned my equipment to cancel service, no one even bothered to ask why? this floored me – what a business model. waiting for Fios to at least provide some good-old fashioned competition for a monopolistic dinosaur. scary thing is the competition isn’t about making service better but about trying to convince new subscribers they have a better deal.
i bought a $99 roku – plugged it in to power and HDMI – found my wireless internet and bingo with a simple netflix subscription had access to tons of content
is my setup perfect? no there are holes – i’ve sacrificed current content. but it’s the price I paid to be free of the dinosaur and I feel better with much more money in my pocket.
and if i want to watch sports, I can head down to the local sports bar where it is more fun to watch a game anyways and I can order some great food on the money I saved by not paying for cable tv.
now i pay for HS internet $50/month verses $200/month
finally the other elephant in the room is social media – we want our flat panels to be BOTH tvs and computer monitors. so maybe the issue isn’t either or but both-and. the device that is video phone, tv/entertainment, message center, etc . . . and what is simpler than connecting my HDMI cable between tv and laptop? convergence is here and convergence is coming.
Comment by thevinehc -
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Hi Mark-
Congrats on such a provocative topic. 2 things to think about:
-Studios, though now wielding control, could lose it. Just like record labels losing out with MP3s, indie bands, and even artists that have launched their career on YouTube. Perhaps the future of TV and film isn’t solely with large studios.
-Consumers don’t often differentiate between quality and convenience. MP3s are perfect examples—awful fidelity and quality that still transformed a medium and industry.
Chip Dwyer
@chipdwyer
Comment by their -
Mark –
I agree with most of your points. However the reality is – the cable industry so far had no incentive for the innovation, so far they were pretty much monopolies.
Look at the crappy DVR boxes they deliver. The content is good. They have good pipe to the homes but they are just lethargic to innovate and capitalize on what they already have.
Roku/Netflix/Web video is at least trying to bring some innovation to this space which is currently in the stone age. I agree in long term that may not prove to be sustainable business model but people need alternatives, need fresh ideas so that Cable industry can wake up to the smell of coffee and start doing things, which they ignored so far.
This is what Linux did to UNIX/OS landscape. It spurred innovation, nearly broke the monolpolies, brought the prices down. Which is good for the consumer.
Comment by snl35 -
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Mark –
I love reading your blogs because of the provocative thoughts you put out there. In the grand scheme of things, this one is pretty tame however. Suggesting the future of TV is TV is one thing. But what you should really be talking about is how the future of the Internet is…TV.
To this day, TV’s killer app is its user interface. you tune in to a channel, and the pixels do amazing things. For all of the hype of Internet video, it has yet to replicate three things TV does well: content form and quality, content monetization and user interface.
The question of what protocols and infrastructure are used to deliver content to a screen, while important, are less important than the question of what form factor the content takes, how it gets monetized, and what form factor the user interface will take. And herein, the better product (TV) will inevitably win.
TV will not start to look more like the internet. Rather internet video will start to look more like TV. The new Tivo box, rudimentary as it may be, aims squarely at this problem, as do the updated user interfaces integrated into TV sets themselves.
Love the blog. Follow it closely.
Comment by arkasengupta -
Hi Mark. Good points. While I agree with some of the comments that TV needs improved guides and services, there’s still no better device for the continuous delivery of premium content. And in terms of the Internet vs. TV, aren’t we really talking about the digital revolution that’s transforming absolutely everything? People talk about the Internet killing TV. I know first hand that it’s in fact the opposite. In a very real way the Internet — or more accurately the digital revolution and Internet protocols — is transforming TV with financially and technically scalable solutions. It’s arrogant for a business sector to think they alone can harness the power of digital technology, no less network dynamics of which TV Networks were the first real manifestation. Lastly, to learn more about why TV is ripe for transformation, not doomed for death, your readers might enjoy this article by Bill Gurley.
http://www.businessinsider.com/heres-how-the-tv-business-actually-works-and-why-its-going-to-take-longer-than-you-think-to-disrupt-it-2010-4
Ellen
Comment by ellendudar -
yes internet video is in the early adopter phase. But newsflash, a service like Hulu won’t remain free if it starts cutting into revenues derived from cable, satellite and broadcast.
IT’s already said that Hulu makes no money. And a few high profile shows have been pulled from it. DailyShow and Colbert for starters.
And if Hulu ain’t free there goes the whole reason the young single geek bothers to run cables across their living room from their laptop.
Netflix is great and cheap, but remains the equivalent of a $1 theatre that streams old shows that have had first and second runs elsewhere. And guess what? If it gets desirable enough prices will go up because content providers will need more money.
In other words I say the early adopter phase is the reason these things are cheap. And cheap is the reason most are experimenting with them. Cheap will go away if these things become the norm. And satellite and cable will look better.
Comment by trip1ex -
You title your post “the future of TV” and then make arguments based on the present. The internet as a person’s primary source for video entertainment is in the VERY early adopter stage. I do it, I dropped cable a couple of months ago and don’t miss it at all. The points you make are true FOR TODAY. The boxee box hasn’t even been released yet, and even when it does, it’s not simple enough for the mainstream. We’ve still got 5-10 years of the “cable era” left but it’ll go away eventually.
Comment by mateo2 -
Re: Robert Sandie comments:
Market penetration of FIOS is minimal and it will be that way for awhile;
Tivo is perennially on deathwatch;
Sony hasn’t brought any compelling “Internet Video” anything to market yet;
DivX TV… the tech part is relatively easy, getting the content is hard;
NetFlix is probably the only company with the capability to extend its business model to compete with TV but, once again, will content producers bite and is there enough money in the NetFlix business model for them? It’s great for long tail but is it good for “short tail”;
Pilot Series = ???
I’m the last to agree with Cuban on most things but waving around a lot of flashy tech and startups that haven’t proven yet to be particularly profitable isn’t a great way to sell your point. Great “shock and awe” value until someone looks at your points in detail. I don’t see a great business case there.
Comment by sinisterx -
Now Robert Sandie has the most reasonable counter-argument on here! Love it.
Comment by ianbell330 -
I usually relate to what you say but this is just wrong.
The future of TV is the internet and TV.
In case you missed these signs of the times:
Verizon FIOS – using internet protocol to deliver to the TV.
Tivo – now supporting video podcasts
Sony Bravia – supporting “Internet Video” both branding and tech supports this.
DivX TV – going to be on multiple devices in TVs.
NetFlix – instant watch (using internet protocal) is generating lowest churn and highest # of subscribers Netflix has had
Pilot Series – now being tested on the internet instead of TV
Stay reasonable Mark!
Comment by sandieman -
Incredibly enough, I agree with you. However, increases in service fees for satellite and cable may end up killing the goose that lays the golden eggs. The cost for content from Big Cable and its satellite brethren may spur innovations in delivering content via the Internet that may actually one day threaten their business model. Improvements in HTPC technology on the hardware and software front is lowering the bar for people to find their content online. It isn’t a flood yet but it’s gone from a trickle to a steady stream. For the first time, I intend to get my content via the Internet and an HTPC rather than through a cable or satellite box. Granted, I have over a decade of IT experience but I feel like the headaches associated to HTPCs has finally dropped to the point that the cost benefits exceed the maintenance hassle. Because of the virtual monopolies of cable and satellite service providers, there is little price pressure and, with little competition from the Internet for comparable content, they can jack up prices with little fear. But you know what they say… necessity is the mother of invention. I think many people are beginning to think that they may be paying too much for cable and satellite service. When a few more smart people get that idea someone may actually figure out a way for Internet content to compete more favorably with TV from a user experience standpoint. It may not happen in the very near future but the gouging can’t go on forever.
Comment by sinisterx -
There is a few very important facts that the majority seems to be overlooking. One is, as Mark said people want their instant gratification. They do not want to spend extra time and energy pondering the perplexities of new technology and how it works after they have spent hundreds of dollars if not more on their new technologies. The majority of people, whether they are young, old, smart, or not yearn to have their brand new tv work correctly right out of the box. Another fact is that the majority of consumers, unlike most people that read or comment on this blog, are not “techies” and have an average intellect. They might not understand streaming internet to a television to watch what they want to anytime they want to, whereas they do understand the simplicities of how to use a dvr as it has become somewhat of a norm in our society.
As Mark said, “the future of tv is tv.” I myself use netflix to watch movies on my tv. Even though it is nice being able to do this, alas I am limited on what I can view based upon what they offer. Other services such as HULU are the same way, which is why it is nice having tv received thru satellite. The future for TV is not going to be taken over by internet anytime in the near future. We must pay attention to the average consumer, who enjoys TV that offers easy instant gratification.
Comment by jmelang -
Just about everybody I know who came home with a “BRAND SPANKING NEW HDTV” had the same problem: they weren’t paying the upcharged for HDTV so they had to get a new box installed. Guess what? Most of them didn’t even know until I told them that there was a difference. Sure they all see the difference in a big way once you do the box upgrade, but don’t say that the cable / sat companies are so positioned for the HD upgrade. It’s a painful process for 90% of the people if they don’t pay somebody to manage the process for them.
I’ve been getting the majority of my shows online for some time now and the experience of not having to know when a show was on and getting them in a nice 720p format with no commercials beats the crap out of cable / sat. A 30 minute show downloads in about 80 seconds. The only problem is live sports and some of the leagues have already figured it out. If only the NFL would drop DirecTV…
Comment by joeplace -
Sympathetic to the argument, but the problem has been raised by mavfan1980 and the Pingback from The Future of TV:
It would and could be true RIGHT NOW–seal the deal, never have to worry that the Internet would be competition–if the set-top boxes were enabled to be fully-functional.
But that hasn’t happened, and until it does, people are going to get just as comfortable using their Wii or some other non-TV delivery device to expand their choices.
The natural monopoly, the first mover, the guys with the Competitive Advantage are not exploiting their position, or we wouldn’t even be having this conversation. (In fact, Comcast just purchased a Content Provider with a [lousy but extant] Internet presence. So they know what the Value Proposition of the Future is–they just haven’t been willing to leverage the possibilities.
Enable the standard cable set-top box to do all of the things it is built to do–check your manual, folks; what do you think “some features may not be enabled by your cable company” means?–and people who are using the Internet for viewing will shift to their television, at least when they are home. And they will carry that TV-capable content with them on those mobile devices and realise how lousy the livestreaming option really is.
But until the set top box can be used to its full capacity, the Internet will be available while the television isn’t. And the “convenience” argument that should win the day flips on its head.
It’s VHS v. Beta again: higher quality picture lost to convenience then. (Yes, there was the Apple mistake as well–not licensing so that others could make the tape hurt Beta. But mostly it was that Beta offered 30 minutes and VHS gave you two hours for the same price.)
Why do you believe this time will necessarily be different?
Comment by klhoughton -
Mark, you read too much into my previous post. I didn’t dedicate my computer to be a set top box, that’s your first mistake. Which leads to the rest of your spurious comments thereafter. Thanks for replying to my comment.
To review, Sturgeon’s Law is fully in place, and The Law!!! will continue to create new and unique opportunities for people create and share their own content. Oh, I just remembered, where’s the lawsuit against Google, YouTube, et al? You once predicted that the YouTube purchase was doomed to failure. I don’t see that happening anytime soon, either.
Comment by Matches Malone -
Mark,
I agree that the cable model has worked very well and should be the winning model in the future. Consumers want content on demand. That’s undeniable. But its interesting to note that the cable industry doesn’t have a viable business model either to get the content companies to play ball and put all their content on demand. Cable wants to give it away free as well. That doesn’t work for the content companies and is why you don’t see next day VOD and full seasons. Additonally the UI is horrible, digital stb monthly fees are too high and it’s only available on the tv. Cable shouldn’t let anyone into the conversation of content delivery but they are.
Comment by bigvongo -
My Brand New Samsung is equipped with Internet@TV. It plays youtube out of the box via a widget. I can also Tweet. No STB needed. My smart card fits in the back of the TV.
Google is about to cut a deal with Sony, Logitech, Intel and probably Samsung. Out-of-the-box TV with web integration powered by Android and Chrome with an Open Source development community building all kinds of new widgets, apps, addons et al.
Or an STB for under 200 bucks that turns your TV into the above. Google will push ‘Connected TV’ into the zeitgeist.
Mark. You are one step behind.
http://www.appmarket.tv/manifesto
http://www.agoramedia.co.uk/blog/
Comment by Expathos -
Mark, the arguments I’ve seen you using are mostly lies used to exploit peoples fears of computers:
Nearly every HDTV has a VGA input to connect to a computer. How is this difficult?
A 1-2 year old computer is plenty fast enough to stream, and be used as a dedicated box. A quick trip to the local university and I can buy such a computer with OS for $75. Compare this with the cable provider box I would pay $10 per month for and I am saving.
Navigation is far simpler on a computer than the cable provider box. To find a show on my former cable provider VOD box, I must navigate headings like “Prime Time” or “Cutting Edge” to get to the network heading, then the show heading, then the episode heading, then the show summary, then answer yes to wanting to watch, all this with a poorly responsive remote, and about 5 seconds between each page to load. To watch a show on Hulu, I go to the Hulu website, type the name of the show in the search box, the show page loads and a list of episodes appear before me, I can scroll over the episode names to get a summary and click on the episode to begin viewing.
Many people (mostly baby boomers) have a strong fear of computers and think they are difficult learn and use. My father calls someone to come over and turn my mother’s computer off when she leaves it on. This is not because it is difficult to turn off a computer, it is because he has heard computers are difficult to learn.
As baby boomers continue to age and their percentage of the consumer populations wain, content providers will have to adapt to a more educated consumer base. I’m not saying that the internet will replace cable, but if cable doesn’t get more user friendly equipment, it may.
Comment by caffeinebuz -
“One dell $500 laptop
One HD projector and screen from ebay ($600)
One subscription to mlb.tv ($20 a month)
Access to the BBC iPLayer (OK, so this is cheating, but it’s the killer app).
Netflix ($8.99 a month)
20Mb/s Broadband ($50 a month)”
That doesn’t replace cable though.
It’s alternative programming. Great for a tiny goofy subset of the viewing public who hunch over their noisy laptops which sit on the coffee table with cords running out from it across the living room floor of their apartment.
Let’s face it. Folks like this were never really cable customers in the first place.
Comment by trip1ex -
Mark,
You deserve credit for putting your opinions out there; however, I think this post follows a familiar pattern: Say a bunch of true things, and them pivot to attacking a straw man to make your point.
Yes, it’s hard to hook up a PC to a TV, at least for most people, but you are completely ignoring the fact that OTT doesn’t have to be hard. In the end, the two may have nothing to do with one another.
Here’s some truths: TV has to be easy for consumers. OTT can be easy. A lot of people in the TV business make a ton of money, essentially by being middle men. Many of those same people are complete schmuckasauruses. OTT could potentially cut those guys out. Given the foregoing, it’s my opinion that the market is ripe for disruption.
From MC> No straw man at all. Let me give you another truth: Managing the wireless or wired network inside your house to support multiple TVs, multiple types of devices (gaming boxes, roku, whatever) and getting the performance you need to make the applications work well AND to stream your video where you want it without it buffering and slowing down your house will not be easy
Jimmydada
Comment by jimmydada -
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Does anyone want to buy a 12 month old 42″ HD enabled TV? It’s not been switched on for three months and we certainly have no compelling reason to do so. My very non teccy girlfriend drove the revolution in our house.
One dell $500 laptop
One HD projector and screen from ebay ($600)
One subscription to mlb.tv ($20 a month)
Access to the BBC iPLayer (OK, so this is cheating, but it’s the killer app).
Netflix ($8.99 a month)
20Mb/s Broadband ($50 a month)
No complexity at all – it just works. She even moves the projector about if we have company or fancy a change, which you can’t do with a TV.
Certainly for us Mark, your view has little resonance. OK we are blessed with a decent 20Mb/s Internet connection and without that you’re not going to get the same outstanding quality as mlb.tv ‘nextdef’ and the BBC HD streams provides. But it’s there and it can only get easier.
Ian
Comment by ianwild -
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Totally agree that few want to put up with the hassle of internet video and getting it on your TV. And that too many aren’t being forthright in their internet tv vs cable comparisons. CAble TV is very simple straight forward 10′ interface living room experience.
I do think cable companies are half dinosaur though. The other half Ma Bell.
If they opened up parts of their networks we’d see a better consumer experience.
The set top box and/or DVR come to mind. The cable tv remote. The tv Guide. etc.
IT’s a shtty interface experience compared to ATV, Tivo, etc. It takes so long for improvements to be made.
That’s where cable could drop the ball. Their stubbornness to absolutely control their networks could come back to bite them in the ass.
Look at Ma Bell. We had to rent phones from ATT back in the day. You had no other choice.
You got 1 phone.
This all changed around the time Ma Bell, aka ATT was broken up. It went from rent a phone from ATT to shopping at ATT stores (only stores that carried phones were ATT stores for awhile,) to phones being made by anyone and everyone and being sold in any store. Which scenario do you think customers preferred?
It’s this type of change cable companies need to embrace. They have been absolutely reluctant to do so despite congress passing legislation for them to do so. (afaik we were supposed to have the ability to buy set top boxes at Best Buy by now manufactured by various competing manufacturers.)
In the end this defensive must protect our monopoly attitude will hurt them. Bandwidth will get great enough. The interface/experience stuff on the internet side will be too good. And eventually when push comes to shove, the trickle will turn on and eventually a flood of content providers will cross lines and give internet delivery companies carte blanche to distribute their product.
Comment by trip1ex -
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ianbell330 said “What is the rationale behind your thinking? Should cable companies give you content and free technology in the form of HD DVR’s? How do they make money?
I didn’t say it should be free. My point is that if I’m going to be paying a premium for a dvr in perpetuity, then I want a premium user experience. Otherwise I want competition and other, better value, choices.
Your cell phone analogy doesn’t hold up because the cable providers are subsidizing nothing; they are just raking in huge profits off of hardware rental. I would gladly pay for the set top box rather than renting it as it would be much cheaper in the long run.
Cable companies don’t let you back up your shows because they want to lock you in to their service only and put up a barrier to switching services (and if your bill every goes late you can’t even access what’s on your DVR!) Also most cable companies are multi-media conglomerates who own studios, channels, dvd publishers, like Time Warner…why let you back it up when they can sell it to you 4 more times? Tivo can track what’s recorded and does sell that information, if Nielsen can’t figure it out.
We need set-top boxes open to competition. A better analogy is the ebook situation developing on iPad/iPhone. You can buy via Apple’s iBooks, but also via Kindle and probably soon Google’s coming ebookstore. Only one way to purchase pay-per-view = monopoly. No choice means higher prices.
Comment by sirdonic -
@sirdonic
“And DVR set top boxes supplied by cable companies actually end up costing us MORE than our HDTVs over their life span (~$20/mo=$240/yr) which makes that consumer choice just as if not more important.”
What is the rationale behind your thinking? Should cable companies give you content and free technology in the form of HD DVR’s? How do they make money?
Look at it this way, most cell phone providers charge more per month, per line than a cable company does to provide your house with content. Plus cell phone companies lock you into a 2-year contract. Don’t like the contract? Then pay for the phone (which is not cheap either).
The reason why cable companies do not let you backup your shows, or watch them on your cell phone etc, is not because they don’t want you to have that technology, it’s because the system literally will not let them. Nielson will not be able to track viewers if the cable companies do this. It all come back to the entire ecosystem, which the cable companies are just a part of. You have ratings to deal with, affiliates, advertisers etc.
It’s all bigger than most people know. Internet TV is sooo in it’s infancy, and the YouTubes of the world are scrambling for eye balls. Once they get the viewers, you can bet your butt they will be controlling everything you watch – and you will be paying for it too. Just watch how Hulu is evolving, don’t be surprised if they are subscription based soon too.
Comment by ianbell330 -
I’d agree with you Mark except that current set top boxes are generally terrible and it’s the INTERFACE THAT MATTERS MOST to most people. If the cable companies opened them up to real OS designers who understood user interface, then you’d definitely be right. As it is now, the jury is still out. The cable companies may monopolize themselves out of a passive audience that finally gets too frustrated with paying too much for too little.
Many people would prefer to be able to choose their own box to connect to their HDTV. People want to control their DVR content, make it backup-able, portable (transfer to mobile device), and to be able to increase the hard drive space, etc. With the exception of live sports and a few other live events, the future of TV is all about on-demand– through time shifting, and location shifting.
You said that “Consumer choice is about having the brand new device on which you just spent hundreds of dollars or more work immediately and just as you expected.”
I agree, but I apply that standard to the set top boxes as well as to the big screen. And DVR set top boxes supplied by cable companies actually end up costing us MORE than our HDTVs over their life span (~$20/mo=$240/yr) which makes that consumer choice just as if not more important.
Comment by sirdonic -
@fearsomefinance:
1. I don’t think free is necessarily the issue. Netflix is growing by leaps and bounds and has a pay subscription model.
2. The big change in the last year that has seen people moving off of cable is not bittorrent. It’s the multitude of outlets for that content that are legitimate – iTunes, Hulu, Netflix, and the networks’ own sites & apps.
Comment by Noah -
If you removed ‘free’ from internet tv, I think tons of people would come back to conventional cable/satellite. A crackdown on bittorrent would have people flocking back.
Comment by fearsomefinance -
Pingback: The Future of TV: Five Lessons for Mark Cuban
I agree that TV has its own place in the world. I don’t think the internet will take over the place of TV, but internet is expanding and gaining popularity as people become more familiar. Most of the time when I want to relax, I’m not going to go to Hulu and try to stream a video. It’s too much of a pain. Instead, I sit down and turn on the TV.
Comment by jamakmfg -
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I agree with your sentiment Mark, but not the reality. You talk about getting a new TV, plugging it in, and it just working. Well sorry, that’s not the way it works for many of us. Compare these use cases:
Buy TV, plug in TV to cable box, realize that cable box hasn’t been fully upgraded, call cable company, wait four days for service appointment, wait at home for four hours for service appointment, get TV box replaced and up & running, browse channels trying to figure out which one has the movies (this is Time Warner Cable in NYC, no “on demand” button!), find Channel 1000, browse screen after screen (no search function), forget what you wanted to watch (no queue or save functions), then realize there are several other channels of On Demand, browse to Channel 1001, 1002, 1003, repeat this process for each of them, give up, go to DVR, turn on GLEE from this week, discover that the first 3 minutes of the show are missing because American Idol “ran long” and the DVR couldn’t figure that out since it doesn’t record GLEE, it records whatever runs from 9:00pm to 10:00pm on channel 0004, give up on GLEE, think about watching Comedy Central (hell, it’s not 10:56pm and the daily show is coming on soon), remember the three digit channel code for “Comedy Central” (745), and now watch that.
OR
Buy TV, plug in Airport Express to same powerstrip, plug ethernet cable into TV, launch Netflix, manage my Queue from my iPhone, play movie or TV show, wonder whether I’ll be able to get HULU next week or the week after…
If TV wants to stay relevant then the Cable operators need to do a ground-up rethink of the interface design for their systems. Just because something is better quality (which TV is) doesn’t mean it wins the war. (I’m looking at you Beta…) TV, and in particular the cable operators, are their own worst enemy at the moment. When TWC in NYC refused to continue licensing their old operating system and went with a kludgy, poorly implemented system of their own making last year they turned off tens of thousands of users who are happily jumping ship every day.
Comment by Noah -
This is nothing more than a marketing post given Cuban’s role in HDNet. He’s trying to prop up a dying way of accessing content.
From MC> You have it backwards. I started HDNet and HDNet Movies because The Future of TV is TV. The only things dying are the dreams and bank accounts of people who think the internet is going to replace the TV.
Comment by Michael Ritter -
I am not so concerned with the new TV’s as I am with what we do with the old ones. Do not recycle these with a company that dumps them overseas. Find an e-Steward recycler. http://www.ban.org If you want to become an e-recycler and do all the certification—find AQA international. http://www.aqainternational.com Do not dump your old sets people. We are better than that!
Comment by dgillan -
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if you are relying on US consumer spending…..where is the US consumer going to get his/her money from? there are still no savings. the private credit market (i.e. outside of govt deficit spending) continues to contract.
Comment by kidmercury -
So, to review, according to your copyright notice below, you own this comment? I don’t think so….
But I digress.
Your logic is flawed, Mark. What if my set top box IS my computer, and I connect the HDTV directly to it? I’ll go one further, what if I connect my BRAND SPANKING NEW HDTV directly to the net? The tech is already there, and if America doesn’t have it, they soon will.
And another thing, most of the stuff on TV, meaning the networks, is crap. Pure and simple. More people are actually turning off their TV’s, to create their own content online, or at least watch others’. I completely agree with Jeff in this regard….
If the future of TV is TV, as you state, then give me something entertaining to watch. The networks aren’t really doing that right now.
From MC> If your computer is your set top box, you just wasted a lot of money dedicating your computer to be a set top box. Even worse, you are going to saturate your in home network and possibly the last mile internet connection you have to receive video from the internet that has been dumbed down in quality in order to avoid buffering. Despite this dumbing down, you still face buffering and the interruption of your content.
And as far as the argument that the only good stuff is User Generated Content. I wouldnt suggest making investments based on that premise. Its cost a lot of people a lot of money. Only a few aggregators will make money in content. Aggregators as in the internet equivalents of TV networks
Comment by Matches Malone -
Every year I watch TV for one or two days. Just in case. Just in case TV programming doesn’t still completely suck.
And every year I say “Maybe next year.”
That’s a problem for TV.
Also, as more and more little guys put out video content out on the internet (not on YouTube, but by building email subscriber lists) the wide open community of online video delivery can discover what the market wants very fast. And what the market wants is always changing.
You may be right though. Not everyone is like me, so maybe the thirst for a different type of content than TV provides is rare.
Comment by Jeff Nabers -
There’s One. Fundamental. Problem.
TV content is getting worse and worse.
Every month I look at cable and think, “I am not getting value from this. The things I do watch make me dumber, not smarter.”
Every educational network, save PBS, has managed to turn itself into yet another reality television station.
The news stations aren’t.
The local channels look better via antenna. Video on Demand randomly misses episodes. The cable’s VOD interface is horrible, and the DVR interface is worse.
Perhaps HDNet is better. Our cable company doesn’t carry it in our area.
People are turning to internet video, and to torrents, because cable provides a poor consumer experience.
We are fed up with substandard content and a substandard experience.
Comment by ebiester -
The irony in your post Mark, is that it would appear that the majority of your readers are the very geeks that would ditch TV in favor of internet video. The funny part is that for some reason they all seem to think that by voicing their opinion and disagreeing with you that you will be impressed with their answer.
I couldn’t agree with you more by the way. For some reason, the majority of the dolts in the Silicon Valley (which make up >1% of the U.S. Population) seem to think that 99% of the people out there are ready to ditch their TV in favor of an iPad and internet video. Time to get real folks. Most people have no clue what an iPad, or Boxee is, or would even consider sitting in front of their computer to watch an episode of LOST on a 23″ monitor when they could be in front of a 42″ HDTV and with a nice sound system. Add integrated Netflix to the HDTV and VOD from their cable provider and they are good to go. What else would they need?
Boxee is dead and so is any other set top box company that thinks they will be able to pry users away from the cable companies. Nothing is stopping Comcast or DirecTV from adding more movies to their VOD service, or from Netflix being built into game consoles or TVs themselves. What could Boxee even offer people? What can YouTube even think of bringing into the family room that people would want to watch on a big screen? Whatever the Boxees of the world think they can do, the cable companies can do better, faster and more profitably. They already have paying customers, affiliates and a business model.
Trust me, I love technology more than most people, but I am also a realist. If technology doesn’t offer something better for cheaper and is dirt simple to use, people are not going to buy it. There are a million rule books out there on this.
Comment by ianbell330 -
Right you are Mark.. However, there will always consumers like me that cannot afford to pay or will not pay those providers for services like DVR or VOD but still demand similar functionality. I use my DVD recorder to capture Movies and Sporting events and yes it was a pain setting up properly, but in the end I save $$. And for VOD, I use Netflix and it was also a chore to set up properly, because my PC is used to stream the signal to my TV via a 20ft Hdmi cable. IMO, the future of TV is a TV that is plugged into the internet. If it is connected to a network, it should be able do everything a Sling Player could do as well as everything a DVR can do. The set top box would not be necessary if this TV also had a web browser built in allowing one to view services from Youtube or Netfix at anytime. I’d buy one in a heartbeat.
Comment by worldbfree4me -
A good point, except the DVRs that come with cable TV are TERRIBLE. I’ve never seen less response, buggier, more annoying hardware and software than my cable box. It’s not a convenient, sexy, well-designed experience that it could and should be (this is Comcast).
It’s a pity because TiVo was really good, but most people (myself included) aren’t going to bother setting it up if the cable company doesn’t sell it directly, for exactly the reasons you describe.
Comment by jboutelle -
You have as much right to be wrong as anyone else Mark. I just cancelled my cable as I get my movies via netflix streaming or discs and television via hulu, the ABC app on my iPad and the netflix app for that too. I watch NBA and MLB streaming
Your always talk about bandwidth being a restraint. I remember when online video refreshed every minute and now I can stream quality video to a 46″ monitor(ok I said monitor just to tweak you) Bandwidth will continue to increase and TV makers will keep adding more abilities to connect online and make it easier too
You sound a little like Jack Valenti testifying to Congress that the VHS was going destroy Hollywood.
I realize it’s in your self interest to promote the status quo because of HDNet. Stream it online and I’ll check it out. I’m never going to pay cable or satellite again for compressed HD signals when I can get a better signal with a $15 antenna.
From MC> You arent going to pay cable or sat for compressed HD, yet you pay Netflix for HD that makes what you get from cable or sat look like the best signal in the world. And yes bandwidth will increase. But the demand for that bandwidth will increase faster, meaning that the bandwidth available to you for continuous streaming could decline.
And what happens when you decide that you dont want to pay for both mobile internet and fixed line internet ?
Comment by mavfan1980 -
I basically agree with you Mark. For me, the clincher for “TV as the future of TV” is live HD sporting events. It is one thing to make enough time to download and deal with the hassles of internet video to watch your favorite shows delayed, and this may work well for some people. But there is no way to replace a live HD NBA or NFL game with internet quality video.
Comment by therealmavsfan -