I had the honor to present on a “disruptive” topic at the Grow2012 conference last month in Vancouver, and, big surprise, I opted to talk about TV. I decided to take a bit of a departure from many of my typical presentations and focus on the myths and truths (or at least truthiness) about disruption in the TV industry, with a focus on how our mobile lifestyles are changing the way we think about television. Here’s the video (and slides):
Slides:
Quick history lesson. From the birth of TV through the invention of cable TV and the VCR, picture quality was effectively the same. Along came DVD, which doubled the screen resolution to 480p, ooh ahh. Then along came HDTV with 720p. Then 1080i, and now we’ve “settled” on 1080p. Only we haven’t – the next two resolutions are already picked, they’ve been called 4K and 8K by the industry for a while, and just got fancy labels with “Ultra High Definition Television.” And much as I’ve always considered Blu-Ray a loser format, I believe the same fate is in store for UHDTV.
First, the picture quality is virtually imperceptible. I’m pausing for a second as rabid video engineers attempt to tar and feather me, but on a 50″ screen from about 10′ away, 4K looks roughly the same as 1080p – which, while I’m at it, looks roughly the same as 720p. Unless you really really really know what you are doing, and really set up your room properly, and really have the right size TV for the distance from your couch, and really watch the right source material, and really really really – you get it. But for most regular humans watching most regular TV (which, I might add, isn’t even being broadcast in 1080p – what? yes, it’s true – if you are watching TV, you are not watching 1080p. deal with it), your existing HDTV setup probably looks beautiful enough as it is.
Second, even if you can tell the difference, it’s not impressive enough. I distinctly recall watching my first DVD, and I distinctly recall my upgrade to HDTV. Each were monumental shifts in resolution and display quality. It’s reminiscent of upgrading to a retina display iPhone/iPad. But then what? If the next shift upwards doesn’t bring the same “ooh, ahh” moment, it’s a resounding “meh” – and “meh” doesn’t sell new TVs.
Third, it’ll be perfectly timed for “higher quality format fatigue” to set in. As I’ve described above, consumers already finished going to stores to upgrade to get to the promise of “FullHD” – which, again, generally isn’t even being broadcast in FullHD. Going from FullHD to UltraHD is just going to make folks wary, if not pissed. Nobody likes to think their recent investment as worthless, regardless of the plummeting prices of flatscreens. It’s too little, too soon.
Fourth, there won’t be enough content. Whenever 4K sets are available, and I predict it’s coming within 18 months, odds are really low that a corresponding broadcast source or streaming medium will offer 4K videos. Unless a huge back catalog of content is released at the same time, most of which doesn’t even exist at 4K resolution I might add, consumers won’t see a compelling reason to upgrade.
Fifth, streaming won’t support 4K into homes anytime soon, and physical media is dead, which means there’s not going to be 4K content anytime soon. Per above, no content equals dead format, and since we don’t really have the infrastructure in North America to support a wealth of content…
Sixth, and it’s a minor point, but how can you have two different standards with the same name?!?!? Consumers hate that stuff. Quit it!
Much as the MP3 killed high definition audio long before its time, I believe streaming video and a lack of perceptible difference will kill ultra high definition video long before its time. My advice to the industry: slow down, you move too fast. I know you are losing money on just about every TV you sell, and I know that’s not changing anytime soon, but 4K in 2012/2013 is not your answer.
My advice to the industry at large:
ps – sorry for the gross picture. 🙂
pps – to videophiles who want to nitpick with some detail I’m sure I got wrong – please do so constructively!
This is a guest post by Lee Milstein, you can find his bio below.
Thank you very much for taking the time to explain your stance on why I won’t soon be able to subscribe to HBO GO without first becoming a cable customer. To paraphrase your argument, you indicate 3 primary motivations for keeping your service as an add-on and not making a direct consumer offering. Those motivations are:
You’re stance, while rational and understandable is also wrong. Taking each point in turn:
You do have a direct customer relationship today.
You already maintain an active user database on your website, complete with authenticated email registration, and you offer technical support to your users on the same site. So, the issue is not that you LACK consumer touch points, it is that you believe them to be insufficient. I think you’re better off than you realize.
Apple has proven that, with a good enough product, you don’t need free customer support. AppleCare subscriptions or one-time incident fees are required for support for streaming services from Apple, and I’d be willing to bear the same lack of support for you. In fact, NOT offering support may help your cause (more on that later).
Further, online payment is an opportunity to partner with players such as Google, Square, Amazon, PayPal and others in what is amounting to one of the most brutal fights in our digital world. For the right deal, any one of them would likely be willing to help you get transactions working. Plus, you have DRM covered as part of the streaming protocol and with very little effort, you can do what Spotify does, allowing only 1 stream to run at a time on the same authenticated account. You already have most of what you need.
The Direct-to-Consumer Opportunity is Big, and not Mutually Exclusive with the MSO offering.
In your letter to MG and in other public statements/posts, you’ve pointed to the 100M cable subscribers (70% of which don’t subscribe to HBO today) compared to only 3M broadband customers as a reason to stick ONLY with your current model. BUT, the broadband subscribers represent a mere fraction of the potential market for HBO GO, and it is a group of users that has been marketed to efficiently for decades.
The real potential customer base includes tablets and smart phones, not just broadband subscribers. With over 25M tablet devices and roughly 400M iPhones/Android phones now on the market, after making some assumptions about geographies, the potential domestic user base is likely to be in the range of 200M subscribers, not 3! That’s twice as large as the cable base, and they’re worth more money to you.
Assuming you get 50% of a subscriber’s monthly payment from cable; that means your 28M subs net you approximately $196M per month in the US (again, let’s leave out your international revenues, which are both substantial and need not be impacted at the outset). If you need to make that whole number with digital subscribers (at the $20 monthly rate suggested in MG’s letter), you need only roughly 10M subscribers to make even money. You can have 1/3 the number of subs for the same receipts! Netflix, even after all of this summer’s hoopla is estimated to have around 20M subscribers and they don’t have the original programming that is the biggest draw for HBO. You can’t do half as well as Netflix? Plus, the cable MSOs have had decades to attract HBO subscribers for you and still haven’t surpassed the 30% mark. What’s going to change? Direct is a much bigger opportunity than you’re suggesting
The MSOs aren’t going anywhere.
But it would be fair to agree with the above and still not be willing to risk guaranteed revenue if indeed the MSO revenue would be put substantially at risk. It wouldn’t be.
There are at least 3 arguments worth highlighting here:
To Be Fair.
But, to be fair, I understand your unwillingness to do it TODAY. You’ve got enough money coming in and your building a large enough stockpile of great original programming to license out if you choose to do so. There’s very little urgency.
I don’t blame you for waiting, but you don’t have to. I’ll sign up today. You’ll make more money and grow your audience. I hope you’ll reconsider.
Thank you,
Lee
We saw your letter yesterday, and wanted to take the time to write you back.
First and foremost we love your content too! Seriously, you write great stuff, and we generally love all of our fans. This is why we’re writing to you. See, the thing you love us for is the great shows we make like Game of Thrones, Entourage, The Sopranos, etc. And we love making them. Some might say our brand is at its strongest in recent memory, as we put out some of the best shows on television (though we’ll give a little head nod to our friends at AMC for their impressive content selections in recent years – we wish we had grabbed Mad Men, but… oops!).
See the thing is, the way we get to make these shows is, candidly, by spending a lot of money on trying to be the best (btw – can you believe it’s been 20 years since “Simply the Best” was our theme? flashbacks!). Our mutually agreed upon favorite Game of Thrones? North of $5 million – just to make the pilot! And the dude writing it hasn’t even finished the whole series yet! This stuff costs a fortune, and, as you’ve probably seen, they can’t all be winners.
We love that you’d spend $19.99 (or more) to pay for our service, and we wish we could have you as a customer. But let’s talk about that for a second. First of all, we don’t have any direct relationship with our fans right now, so when you need customer service, you call Comcast or DirecTV or Cox, etc. So we’d need to get customer service up and running, and that’s pricey, since, as you know, we’d want our service to be top notch.
Next, we have no method of billing you. And sure, we can just do some PayPal or an easy Website transaction, but then we’d also need a full authentication framework (we trust you, MG, but let’s face it – not everyone on the Internet is quite so honest). Today, we just get paid by the cable/satellite companies, and it’s up to them to deal with everything else.
But let’s get to the crux of the issue. There are about 30-40 million Americans who watch HBO shows legally, and we agree, a lot of them would be happy to pay us directly. If we went, as you put it, “cable-optional,” we’d be breaking our existing, mega-million-dollar contracts with our current partners, and from what we’ve seen, they wouldn’t be too happy about that. Second, we don’t really know how they’d change their billing relationship with you or other consumers. Which is going to put a lot of people into a precarious position of having to decide if they really do want to sign up with us and keep paying their cable bill.
This too wouldn’t be a problem if we had a really strong feeling about our ability to recoup the investment. See, we make about $4 billion a year right now. Yes, that’s right, four, zero, zero, zero, zero, zero, zero, zero, zero, zero dollars. Oh my is that a lot of zeros.
We’d basically be building a product, from scratch, with no distribution whatsoever (remember we’d have to break all our contracts to be able to run a standalone business, which would put a major crimp in our style of marketing and promotions). And even if our current brands were strong enough to build on, do you think our entire customer base would make the shift? We don’t, even the ones who love our shows. We also don’t think this standalone business would actually get us a larger audience than we have today, which means even less people would get to watch our stuff.
So MG, we’d love to have you as our direct customer, but honestly, we can’t afford you. Can we send you a real crown from the set of the show instead?
-your pals at HBO
ps – just in case its not clear, I don’t really work for HBO, nor would I presume they’d write a letter like this one, nor can I be 100% certain of some data points including subscriber base or ARPU. in other words #satire.
This is a guest post by Anil Podduturi, you can find his bio below.
Gary Myer, who helped found DirectTV, recently penned a guest post for Wired on the future of TV. It comes with a provocative headline: Why Nobody is Challenging the Pay‐TV Providers.
Myer covers a lot of ground in the post, but it’s mostly familiar territory for readers of this blog: Unbundling, linear vs. VOD, social, device ecosystems. After setting the scene with the 40k-foot industry landscape, Myer makes some bold claims about what’s gating television innovation that dramatically oversimplify industry dynamics.
The biggest problem with Myer’s argument is that it ignores the major impediments to progress for both newcomers and incumbents – these include product design in all of its various incarnations, but let’s not forget content rights, content cost structures, and the economic realities of unbundling. It’s not as simple as cracking a new navigational paradigm for on-demand video or acquiring more content.
(For more on the nuances of this industry quagmire, see my Storify from last week capturing a Twitter conversation between Dennis Crowley, Dan Frommer, Hunter Walk, and others, that all started when Dennis’s grandmother couldn’t watch the Pats game in Florida without a $350 DirectTV Sunday Ticket subscription.)
At the end of the day, video services of the future must increase the value of the monthly subscription through a mixture of distribution, content, and user experience, but getting there will require a data-driven approach to the business that embraces platform dynamics and wedges the economics of content in favor of consumers.
This approach should extend to every dimension of the business, including content acquisition. Myer acknowledges that content acquisition is one of the biggest challenges for would-be disruptors. In fact, it’s his hypothesis for why nobody is challenging the pay-TV incumbency:
What’s the Problem
To seriously compete with existing pay‐TV providers, new providers need to offer at least what the existing providers offer, plus added benefits (more content, lower price, superior user experience, etc).
Successful internet‐video providers will offer a comprehensive catalog of à la carte/on‐demand content –- with an intuitive user experience. Existing internet video players are offering only a fraction of the programming of pay‐TV providers and they are securing new content rights haphazardly. If you’re going to compete with the incumbents, why guess what programming is important to your customer by only acquiring rights to selected programs?
Myer says that newcomers shouldn’t guess what programming is important to the customer, and he’s right. But that doesn’t mean the video service of the future should strive for parity in programming. We now live in a world where the best consumer web products have iterated in part because of data – usage data if your product has traction, but how about general industry research like this Nielsen study that tells us the average US home with a cable package receives about 118 channels, but only watches 17 of them.
The way to increase subscription value isn’t by embracing the same content library, but rather by extending the value of the ~14% of content that consumers do access regularly and augmenting that offering with other relevant content and services. To do that, newcomers should leverage actual consumer data signals if they’re fortunate enough to have built a product that can capture them.
"Let me just write em an email, I can explain it all in a simple email!"
Netflix has built a data-driven product, and this is why Reed Hastings got on stage earlier this month at the UBS Media conference to proclaim that he’s the Billy Beane of digital media. “We’re very much the ‘moneyball’ content buyers. We’ll look at, OK, we paid X for something, so how many people watched it?” Netflix is collecting and analyzing viewing data that then informs their content acquisition strategy.
Netflix, like the Oakland A’s, must apply a data-driven approach because they simply can’t afford to acquire everything they think consumers might want. It’s been reported that Netflix’s streaming content licensing costs will rise from $180 million in 2010 to $2 billion in 2012. Netflix can’t afford to spend another dime or another million on content that doesn’t directly add measurable value to the service.
But at least Netflix is in position to measure value and apply data-driven learning to its product strategy. This brings us to the supply chain of internet-age content distribution, an ecosystem within which Myer says, “companies need to control at least the device and the service.”
It remains to be scene whether this level of control will prove to be a categorical business imperative. Apple and Amazon seem to think so, and have demonstrated success owning their respective hardware and software stacks.
Netflix, on the other hand, is a service provider that understands platform dynamics and how to extract value and meaningful consumption data at the service layer. Netflix not only operates its service across PCs, tablets, gaming consoles, connected TVs, and phones, but has also developed the technical proficiency to optimize that cross-platform device distribution. This allows Netflix to maintain a direct relationship with the consumer and refine its user experience across platforms.
Incumbents like HBO and Showtime have begun to recognize the value of the direct-to-consumer model with their HBO Go and Showtime Anytime streaming services. Competitors like Hulu and YouTube keep investing in direct-to-consumer efforts to drive greater engagement (Hulu Latino, YouTube Channels). Microsoft redesigned the XBox Live Dashboard as a platform for content providers to go direct-to-consumer. Just this past week, we saw the comedian Louis CK pull off an experiment in content distribution, going direct-to-consumer to the tune of $200k and counting in profit.
These direct relationships, and how service providers leverage them to extract data that in turn informs product development, content distribution, and content acquisition will help shape the real future of television at the service layer. No single service will be able to provide a comprehensive offering so long as there is still exclusive, marquee programming and healthy competition in the device ecosystem. However the dust settles, content must stay accessible and affordable for the consumer.
About Anil: Anil Podduturi was most recently VP of Product Strategy at NBCUniversal. Prior to NBC, he led product management at Daylife, MTV Networks, and Microsoft. On Twitter: @anilpodA week ago I announced that Jim Schaff would be taking over active duties at Stage Two, and that I’d be focusing on “other stuff.” Today I’m excited to share the stuff: I am joining the management team of Dijit Media as Chief Product Officer, where I’m responsible for product and marketing (here’s the official update). Not only that, my virtually common law married colleague (business partners for much of the past 14 years) and very close friend Adam Burg is the company’s VP of Business Development.
What???
Last Fall, I gave a presentation at the Set-Top Box Conference in San Jose, and the entire drive back I had a feeling of near elation. Not that I had said anything extremely profound, but it was wrapped up in the feeling of doing something I had a lot of passion for – in this case, discussing the future of television. Over the next few months, I spent a lot of time doing research in the Smart TV (also called Connected TV or Internet TV) space, and started seeing some trends emerge, and realized there were some very interesting business opportunities on the horizon.
Adam and I spent months developing a prototype concept of the vision we had, and went to meet with some of the brightest folks we know in the convergence field. One such bright folk was well-known VC Stewart Alsop, who I’ve known since the late 1990s, who introduced us to Maksim Ioffe, CEO of Dijit. In our very first meeting with Maksim it was clear he shared much of the same industry and product vision and philosophy with Adam and me. I’ll keep this part of the story short, as we’ve all seen this movie before – we ended up agreeing to join the company. And there was much rejoicing (yay).
Why Dijit?
The grand vision of Dijit is to create the ultimate “four screen” (phone, tablet, computer, TV) social entertainment experience, one which seamlessly merges disparate products and platforms and content into one single, easy to use, consumer offering. The company is well on its way, and its first product is an iPhone app that enables a really sophisticated, yet elegantly simple control experience for home media centers. As Maksim put it, “Consumers have 21st-century home entertainment experiences but are stuck with remote controls that haven’t been updated since the 1980s.” The company partnered with Griffin to produce the Beacon, a clever take on the “IR blaster” product, and one that’s already receiving solid reviews (and I haven’t even done anything yet!). This is going to be a very exciting company to be a part of, and I’m thrilled to have such an opportunity.
Reminiscing.
I still recall the early days at Mediabolic, where we enabled networked home entertainment solutions that interfaced with legacy, analog consumer electronics devices (yes, we were networking the living room in an era where there were virtually no HDTVs, no YouTube, no Pandora, and no… iPod!). At Mediabolic I learned what it takes to design and build embedded entertainment devices, to work with consumer electronics manufacturers, and the deep set of challenges surrounding the connected home industry (fun trivia: I heard the phrase “this is THE year of the digital home” every single year starting in 2001 – possibly earlier). It was a great experience, and key people from that team now work at amazing companies like Netflix, Rovi Corp (Rovi acquired Mediabolic in 2007), etc.
At Sling Media I had the unique opportunity to work for and with some outstanding individuals, not to mention the position of being tasked with figuring out how to deliver the perfect “living room experience” – only over the Internet. The company’s CEO, Blake Krikorian, taught me the meaning of focusing on every detail and nuance, remaining truly innovative, and keeping the consumer’s wants and needs in the forefront of every product decision. I also had to learn the ins and outs of social media, back in the era before it was called “social media,” where “the bloggers” were a special, hard to understand subset of humanity (or, as I rapidly learned, just cool people). We accomplished a great success building the Slingbox, and I’m proud of the product, the team, and the experience.
Over the past four years at Stage Two, I’ve had tremendous exposure to startups, big companies, CEOs, visionaries, the media, and managing a great team. We literally put companies like Boxee, Bug Labs, and Pogoplug on the map, and have also had the chance to work for well-established firms like Electronic Arts, Best Buy, and VUDU (now Wal-Mart). I’ve learned from entrepreneurs like Jim Lanzone (now president of CBS Interactive), Peter Semmelhack (Bug Labs), David McIntosh (Redux), Rahim Fazal (Involver) and so many others (I’ll write another post in the next little while chock full of shout-outs). I’ve redesigned product experiences for dozens of products, and created marketing/PR/social media campaigns for dozens more, and had the pleasure to work with great teams along the way.
The Future.
And now I’m taking all of the above, and putting it to work at one place. Welcome to Dijit.
I don’t have cable. But I watch a lot of TV.
For my birthday I got a Roku and after tooling around with it for a couple of weeks, I cut the cable cord, much to the wife’s chagrin. Then, last Christmas, I found under the tree an AppleTV (although it is small enough it could have gone in the stocking.)
AppleTV and Roku essentially inhabit the same space. Both are around (or under) $100, both are solely media streaming devices and, unlike the mythical GoogleTV or the enigmatic Boxee, neither offer web access.
So with no methodology and no experience in product reviews, here is my official, unauthorized, David-vs-Goliath head-to-head streaming media device smackdown. In one corner, Apple, the single greatest human accomplishment in the history of the universe; the company that proves Intelligent Design is real. And in the other corner, Roku, which means “six” in Japanese.
Design
OK, this isn’t really fair because this is where Apple has always excelled. When I first got my Roku, I thought it was a pretty slick device. Black plastic, pleasing angles and the size of a turkey club sandwich (hold the mayo). Then I unwrapped the AppleTV and…. My God you’re beautiful! So small, so sleek…
I looked at my Roku, what is that hideous oversized slab of a streaming device currently attached to my TV?
Point: Apple
UX
I won’t even go there. Apple’s is amazing… Roku’s has always sucked.
Point: Apple
Content
So this is where it gets interesting. The gateway drug for both of these is Netflix and Pandora, which are both awesome services and the reasons why the sun still shines in my world. But what’s there beyond that?
With Roku, yes there is MLB if you like baseball (I don’t) and HuluPlus if you’re able to figure out why you would want it (I can’t). Where Roku really shines is access to all the weirdo webTV shows on Koldcast, Blip.TV, Revision3 and so on. You have to really like web-only TV and fortunately, I do. The wife doesn’t so I end up watching a lot of it by myself. You can also watch Al Jazeera streaming live on Roku in the event you need more proof as to how f-ed up the world is.
With Apple TV, your channel flipping will lead you to YouTube or to all the various audio and video podcasts on iTunes. That may sound lame, but it really isn’t. There is a ton of great stuff there and most of it is pretty bite-sized. So in 3-5 minute increments you can flip from news to comedy to movie trailers… unless you land on the “This American Life” podcast, in which case you’re stuck on the couch listening to your TV for an hour.
Winner of this round? I’m going to give it to Roku. I love all the cheese that webTV has to offer. My big complaint is again the UX… it is hard to find content and then to remember which channel it is on if you want to go back to it.
Reliability
So here’s the knock-out blow… this goes to Roku. Yes, it is close, but Roku wins it. I found a better picture and fewer artifacts when streaming from Roku. Also, surprisingly, AppleTV hung up and crashed more than the Roku did. Not by a long shot, mind you, but enough to notice.
Final Verdict
If you like design, UX and more mainstream content, you’ll love AppleTV.
But this is my smackdown and I’m giving the prize to Roku. They’ve got the edge in reliability and I love the goofy webTV access… but that is just me.
Peter Kafka has a new
article up at AllThingsD that proclaims Netflix is “crushing the digital movie competition.” In fact, according to new market research, Netflix controls 61% of the digital movie space. That means 6 out of every ten movies streamed is via Netflix.
The next closest competitor, Comcast, controls only 8% of the market.
As NPR reported yesterday, companies such as Amazon and Facebook are looking for ways to compete in online video. Quoting from that article:
“You know, it’s pretty unusual for the world to let you run away with a couple of billion dollars of revenue and a large market cap without testing the waters,” says Ted Sarandos, the chief content officer at Netflix.
Netflix showed astounding growth last year, and has over 20 million customers. As more people stream content, expect competition in this space to intensify in the coming months.
Last week I had the opportunity to speak at the Over-The-Top TV Conference and wanted to quickly share some of my experiences at OTTCON.
Overall, it was an enjoyable experience with many knowledgeable industry experts in attendance. My talk on how the Connected TV space has changed in the last 6 months went well and was written up by Ken Pyle at the Viodi View. His article is worth a read, and discusses many trends in the Smart TV space, including the rise of the second screen. Quoting from his piece:
There are kinks with two-screen interactions that need to be ironed out, as pointed out by Jeremy Toeman of Stage Two. He cited the example of the use-case where multiple people are watching television and the one, whose smart phone is controlling the program, goes to the bathroom, effectively taking the remote control with him. Similarly, who is the master, when multiple people are trying to control the second screen from their respective personal media devices? This could portend a new generation of “remote control wars”.
Jeremy Toeman also gave designers some good tips, including:
* Lean back means “passive experience”.
* 2nd screen should have all the text heavy comments.
* People don’t want to log-in or have passwords on their televisions.Toeman’s updated his predictions for losers and winners in his session. He cited the big service providers, TV manufacturers and content owners as being among the winners. He suggested that the biggest winner would be the consumer, provided the new features that the over-the-top approach unleashes are not overwhelming.
I couldn’t have said it better myself. Thanks to everyone who attended the Over-The-Top TV Conference and shared their passion for the next generation of TV.
A recent bipartisan survey 
found that “69 Percent of Voters Oppose Congressional Elimination of Government Funding for Public Broadcasting.” Even those voters who support general budget cuts believe that PBS has value and should still be funded.
Voters across the political spectrum [are] opposed to such a cut, including 83% of Democrats, 69% of Independents, and 56% of Republicans. More than two-thirds (68%) of voters say that Congressional budget cutters should “find other places in the budget to save money.”
I support and enjoy PBS and believe that there is a place in our budget for quality, public broadcasting. After all, the company that brought us Sesame Street and Mr. Rogers deserves our tax dollars. No matter what your politics are, I think we can agree that PBS is really smart TV.
Starting today, 
Amazon Prime customers can take advantage of the company’s new, unlimited video streaming service. Amazon Prime Instant Video is free, with a few caveats. Quoting from Engadget:
This is only for paid Prime subscribers, so if you’re a college student or the like with a free membership you’re sadly out of luck. Also it’s US only at this point.
Of course, comparisons to Netflix are inevitable here. Early reports say that Amazon’s catalog of titles is comparable to Netflix, while the quality of Prime’s video has been so-so. Prime Instant Video will have some ground to make up if it wants to compete toe-to-toe with the market leader.
Amazon streaming is missing from a few key set-top boxes, including video game consoles and TiVo.
There are 180 million current generation video game consoles on the market, and they all offer Netflix. So that means that Netflix is in more components, has a larger content library and offers higher quality video.
Which is not to say that Amazon is DOA. Not by a long shot.
It would be interesting to know what the goal of Prime Instant Video is. Do Bezos and company want more people to pay for Prime shipping, or is this offer aimed at getting people used to watching videos on Amazon and – later – purchasing media from their ecosystem?
Amazon can assemble a formidable library of content. They don’t need the same titles as Netflix, but the shows and movies need to be compelling. To win here they need to offer a blend of new releases and older classics (think TNT shows and the kind of programming you chill out with on a Sunday afternoon). Expect the library to mature as the service does.
Amazon could also white label Prime Instant Video and let other content providers offer their videos over the Prime streaming media center. The troubled Blockbuster brand could find new life here as a streaming only service (although at this point we’re not even sure if Blockbuster knows what streaming video is).
Finally, Amazon needs to get on as many pieces of hardware as they can. If people can only use Prime Instant Video on their desktop, it will have limited value. One of the first goals needs to be getting on gaming consoles, mobile devices and televisions. Again, this is an attainable goal, especially for Amazon.
I have always maintained that there can be more than one “winner” in the streaming media wars and there is certainly room for Amazon’s service to grow alongside Netflix. While the two services will probably compete for some customers, one does not have to lose for the other to win. It is clear, though, that the stakes of the online distribution game have just been raised.
Warning: Spoilers Ahead (for real).
For a time, twist endings, surprise cameos or cliff hangers were shocking secrets that were not discussed in the media. Psycho ads even asked movie goers to “not give away the ending.” Ah, that was nice.
Then, around the time of “The Crying Game” and later “The Sixth Sense,” people and media began to publicize clever plot twists (in my opinion the “big secret” of The Crying Game was that it was a pretty lousy movie). This lead to an environment where viewers went in to movies aware that there was going to be a “shocking twist ending.” On the small screen, virtually every show seems to end with “scenes from the next episode” as if we viewers need some teaser just to watch the following week’s episode (heightened to its worst moment ever by having Heroes show a preview of a scene later in the same episode during a commercial break – like I was about to change the channel, but ooh, cool, now I won’t just to see that little gem. come on.).
Now, with the rise of real time media, it seems that no secret is safe anymore. CNN Showbiz recently tweeted that Ricky Gervais will make a surprise cameo in “The Office” later this season. The blog post mentions a “top-secret cameo, which was shot in September.”
Awesome. Now I know it’s coming. No spoiler warning. Nothing in the headline that hints at a secret that is getting ruined. Just a leaked secret that can not be unseen.
If I am already an Office fan, viewing that tweet, blog post or headline made my experience with that show worse. I know that the “secret” cameo is coming so the surprise and delight that would accompany an uncredited, unspoiled cameo by Gervais is gone. If I am not a fan of the show then I have no reaction to the headline. It is just news (sort of), as opposed to a leaked secret.
The bottom line is that there is no upside to broadcasting spoilers as news with no warnings attached that tell people what is coming. Sure, some small segment of fans or potential viewers will be gratified by the news, but the large majority of other fans and casual observers will either be spoiled, upset or indifferent. In my opinion, treating audiences this way is, in a word, disrespectful, as if we are just so flippant that the only way we can possibly like your content is by knowing what’s coming. Some of us just like you for what you are, not what you will be.
Another example of real time media and spoilers comes up frequently in sports. Readers of this blog know that I am a big hockey fan and support the Montreal Canadiens (Go Habs!). Living on the West coast means I watch all games timeshifted, and have done so for over a decade. At first I just had to ignore my family calling me after/during big games – that was easy. Over the past couple of years they’ve learned (somewhat) not to text me either until the next day. But between the terrible UX surrounding the otherwise awesome NHL Gamecenter Live (Web and iPad app both default to showing scores, not hiding them) and the official Twitter accounts for the teams and sports services, I have to close multiple windows just to avoid getting score updates!
It is easy to point fingers at Twitter and say that real time media and 24-7 micro-broadcasting has erased our right to be surprised by films, television and sports. But I don’t see this as a technology issue. This is a personal issue. Why do so many people have the desire to spoil things? We all should reexamine our Netiquette in this regard. How can we live spoiler free in a media saturated world? The answer is not more tech (a top of mind easy solution is the creation of spoiler accounts (ex: @CanadiensMTL and @CanadiensMTLScores) and spoiler free accounts for social TV clients, or splitting up fans by time zones). The answer, for me, at least, is more conscientious communication when it comes to disclosing spoilers, secrets and plot twists (the first rule of Fight Club is…).
I think this issue is sure to grow and gain more media attention with the rise of social TV. For instance, how do you avoid a twist ending or a season-finale cliff hanger on the west coast if all of Twitter is sending out the the ending as soon as it airs back east? Expect even more on this topic as Connected TVs take off and “Social TV” heads toward the mainstream.