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If AppleTV is 1/3 of the market, who's selling the other 2/3?

Posted on December 12, 2011 by Jeremy Toeman

A few blogs are reporting about Strategy Analytics’ recent claim:

Strategy Analytics projects that the market will reach almost 12 million units globally this year, with Apple alone predicted to sell nearly four million devices.

Wow. Pretty bold claim.  Let’s deconstruct it.  Let’s assume it’s a correct prediction:

AppleTV will sell 4 million units, leaving ~8 million for “the rest”.

what do you mean "and the rest"?

Here are “the rest”: Roku, Western Digital, D-Link (Boxee), and… er… I don’t know, how about Logitech? Maybe a few other smaller players, but nothing you and I are buying in a Best Buy, Target, Walmart or Amazon – the only places that matter at all for moving these kinds of numbers.  Yes, there are some other odds and ends in the bizarre category known as Internet Set Top Boxes, but they aren’t mustering up sufficient sales to count here.

Roku: I’ve heard all sorts of things, but lets use publicly available information: as of last January, Roku hit 1 million devices sold.  I’ll assume they’ve at least doubled that in 2011, possibly as much as tripled, due to new products, more viability, and lower prices.  That said, they are now up against an ever-improving AppleTV product.  Even so, let’s assume they can hold pace against the world’s largest marketing machine for digital lifestyle products, and sell another 3 million units in 2012.

Western Digital: You probably haven’t heard of it, but that little gadget your buddy has for watching photos on his TV is called the WDTV Live, and they’ve sold somewhere in the 1-3 million unit range (I know that’s a big range, but it seems pretty fair based on some poking around).  Not a bad showing for a company known for making hard drives.  But in the presence of both Apple and Roku, it’s a pretty fair bet that they aren’t edging out of third place for future market share.  I’ll again be kind with 1.5 million units sold in 2012.

From these guys, only for your TV. Perfect.

D-Link (Boxee Box): Disclosure: I was a core part of the launch teams for both Boxee and the Boxee Box by D-Link, and wish to see them extremely successful, though I am no longer professionally engaged with either company in any way.  And that said, I don’t think they’re anywhere close in numbers yet, and don’t see them hitting the million unit mark any time soon (specifically in regards to unit sales, this has nothing to do with downloads, active community, or positive thoughts). Optimistic high end prediction in 2012: 750K units.

Logitech: $100 million loss.  Let’s move along shall we?

Have the factory spin up about a bajillion of them, nothing will go wrong.

Everyone else: I’ll generously band them all together, and predict they maybe move 500K units.

Unknown entry by traditional consumer electronics brand: Look, anyone can make a media streamer, in fact you can make an adequate one by buying off the shelf parts and licensing open software platforms.  But even the formerly mighty Sony and the young stalwart Vizio is going to have a tricky road in getting a product out in this category that doesn’t include a full end-to-end solution.  And there just aren’t enough to go around.  Maybe Amazon could have some kind of Kindle Fire: Home Media Edition or something, but something tells me they are still getting their feet wet in hardware and aren’t going to jump too rashly into the space (though I’ve been known to be wrong about Amazon and hardware in the past).  Top guess: 250K units.

Grand Total Units Sold, Highly Optimistic Prediction Mode: 6 million units.  Giving Apple TV, with 4 million sales, a 40% market share.  And that’s me being *quite* optimistic, and I’d wager it’s more like a grand total of 4 for the rest.  Or less.  Giving Apple TV a significantly larger potential – and by the way, it’s not exactly Apple’s strongest product.

But their math was so good!

This whole story just reminds me of the time when I was reviewing an analyst report for the *exact same space* back in 2003 when we had just shipped the HP Digital Media Receiver (the first mainstream Internet Set Top Box, by the way).  This was, by the way, before consumers had Flips or other simple video recording devices, digital cameras were mostly a novelty, and there was no YouTube, Netflix streaming, or pretty much anything else to watch on the darned thing.  But still, the potential!

The analyst predicted hundreds of thousands of “streaming video boxes” sold in 2003.  The only snag was, we were literally the only game in town, and we had predicted tens of thousands at best.  When I spoke with the analysts, they said they predicted several years forward, based on consumer interest, to arrive at several million units a year.  Then, they backtracked it into 2003 and, boom, hundreds of thousands.  What could possibly go wrong with this kind of logic?

They sold literally dozens of them

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Posted in General | Tags: analyst, Apple, apple tv, appletv, boxee, d-link, digital media receiver, fail, google tv, HP, internet set top box, internet tv, logitech, predictions, roku, streaming media, wdtv, wdtv live, western digital | 2 Comments |

They Pulled Me Back In! I’m Joining Dijit Media as Chief Product Officer

Posted on June 23, 2011 by Jeremy Toeman

A 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.

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Posted in Convergence, Gadgets, General, Video/Music/Media | Tags: adam burg, best buy, blake krikorian, boxee, bug labs, Connected TV, Convergence, dijit, dijit media, electronic arts, four screen, internet tv, Jeremy Toeman, jim lanzone, macrovision, maksim ioffe, mediabolic, Netflix, OTT, over the top, pogoplug, remote control, rovi, set top box, sling media, slingbox, smart tv, social media, Stage Two, stewart alsop, vudu | 5 Comments |

Roku vs AppleTV smackdown

Posted on March 22, 2011 by Ron Piovesan

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.

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Posted in Gadgets, Video/Music/Media | Tags: Apple, apple tv, boxee, google tv, internet tv, Netflix, pandora, roku | 6 Comments |

New TEDTalks iPad app is good – here's how to make it great

Posted on October 14, 2010 by Jeremy Toeman

I was thrilled to discover the new TEDTalks app for my iPad this morning, and quickly installed and liked much of the experience.  There they are, over 700 amazing Talks to listen to.  This is particularly sweet for me as I watch a TEDTalk on my iPad virtually every morning whilst on the bus to the office, currently obtained through the suboptimal process of subscribing to the podcast in iTunes, and syncing to the iPad.  And if I may slide for a moment here, I can’t believe in 2010 there’s still anything that has to “sync” via a wire.  But I digress, back to TED.

In just a few minutes of use I quickly realized the app was content-rich, but not feature-rich.  While the “Inspire Me” feature is extremely well done (it’s all about length of video – this is a key realization most entertainment/content people need to clue in on), I felt it was otherwise a little flat. In fact, it’s not going to be very useful for my personal needs, and I’m concerned that’ll be true for others as well.  So in my support of TED, and by the way – I genuinely believe that if all people watched TED Talks the world would actually be a better place – I thought I’d quickly jot out the notes to make it better for users such as myself.

  1. Add search
    The browse works great, but there’s no search.  So when I see a tweet from a friend about a given TED Talk, I can’t find it without browsing for it.  And, to boot, I need to know the category/tag that applies to the talk to find it.  While we’re at it, make search by keyword and author too.
  2. Add alphabetical browsing
    Per above, at present you need to know how the Talk is categorized to find it.  Personally, I’d like to find something just by browsing a list of titles.
  3. Add sharing features
    At the end of virtually every TEDTalk, I want to share it with someone, whether a peer, my team, a friend or family member, or the entire world on Twitter.  Add simple “tweet this” and “like this” and “email a link to this” TEDTalk to every clip.  Also, the link should probably share the YouTube or TED.com version of the clip.
  4. Add a history/watched list
    Once I’ve watched a few dozen videos, I find it hard to remember if I’ve seen one, or hard to remember the exact title of one if I want to reshare it.  A simple history feature is essential.  And in the would-be-nice category?  Show me “You Watched this on MMDDYY” on the video preview page if I come back to it.  Also, add a “mark viewed” feature along the way, in case I’ve watched the Talk on another platform.
  5. Incorporate social features
    Since everyone’s busy “liking” everything else via Facebook these days, would be great to see in a video profile page that friends of mine have liked something.
  6. Add download controls
    Once I begin a download, there appears no way to delete the download, queue for later, or otherwise manage whats going on.
  7. Add more “cool views”
    Timelines. Maps. Duration.  etc.
  8. Integrate with other platforms
    There’s the TED site, YouTube, the iPad app, a forthcoming iPhone app, a Boxee app, the iTunes podcast, and I’m sure more to come.  Assume I am using more than one method to consume the content, then allow me to integrate from one to the other.  In other words, let me favorite something on your site, then see that on my iPad app.

I think the “1.0” version of the app is probably pretty decent for most people.  If you have even a few free minutes and an Internet connection and want to get inspired, this app will certainly do the trick.  Hopefully these ideas can help inspire team TED to take it just a bit further!

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Posted in Product Reviews, Video/Music/Media | Tags: boxee, content, features, ipad, iphone, itunes, podcast, recommendations, TED, TED Talks, UI/UX, usability | Leave a comment |

Rooting for Roku

Posted on September 23, 2010 by Ron Piovesan

Hello,

I’m a longtime fan of LiveDigitally but a first time contributor. Jeremy has been kind enough to invite me to write for the blog whenever the mood strikes and today seemed like the perfect day for my inaugural post.

Picking up on previous posts on what makes a great Google TV or Boxee app, I thought I’d jump in with some thoughts of my own on one of my favorite devices, the Roku box.

I got my Roku about four months ago and I love it, I really do. It gives me about 75% of the content I would want on my TV, which was enough to get me to “cut the cord” and cancel my cable subscription. So for the past few months, Roku has been my rocket ship to the TV universe.

I haven’t seen Roku’s latest offerings, but here are some thoughts on what I have seen and heard about their current boxes:

  1. Roku wins universal praise for its ease and setup, but not so much fanfare for its UI; I can’t disagree. The box is dead-simple to set-up and use, which is great. But the UI is uninspired and doesn’t really encourage you to really delve in to what is on offer
  2. Another piece of high praise is reliability, my box hardly ever flakes and we put it through the ringer. It is hard-wired into my router so I can’t vouch for the wifi capability, which appears to be improved in the new boxes launched today
  3. Content: At the outset, Roku was essentially a Netflix box. That was great a year-or-so ago but now, everyone and their brother is a Netflix box. Roku has some nifty content like MLB, Pandora, Amazon and a few others, but they need to continue to expand with more mainstream stuff.  Apple has Netflix and just scored ABC and FOX. It isn’t a huge leap forward, but it may be enough to peel off Roku users.
  4. Developer community: Related to the content problem, I know from some developer friends that Roku isn’t the easiest platform to develop on. Obviously this is a problem as competitors, both large and small have strong developer communities. Difficult development platform=difficult to get the choice apps/content.

Some of the pet peeves that are missing from my current box have been addressed by the new ones, the biggest being previously a lack of USB. With my current XR, I don’t have USB to view my own content, which is frustrating. Happily, that has been solved with the XDS

But even as it evolves, Roku is firmly staking ground in the low-end market, which I think is a good move.

The big battle around media-streaming boxes will be around price/performance; Google TV seems to be on the highest end, with estimates that their box will be in the $200-$300 range, Boxee is next at under $200, with Apple TV and Roku coming in at the sub $100 range.

GoogleTV and Boxee promise a more active experience, with more features, web surfing  etc., but also with a more complicated remote/UI. AppleTV and Roku look to be more of lean-back experience of just watching content via a simple remote/UI.

My money is on the lean-back experience, which I think is more viable for the short term. A simple box that lets people access most of the content they want will be the gateway drug to media-streaming boxes. Boxee and Google TV look/sound great on paper, but I wonder if they may be too complex too early in the lifecycle of this product segment.

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Posted in Gadgets, Product Reviews, Video/Music/Media, Web/Internet | Tags: apple tv, boxee, google tv, internet set top box, internet tv, media streaming, roku | 3 Comments |

How-to: Make a Better Boxee Box App

Posted on September 17, 2010 by Jeremy Toeman

In part 2 of our series on how to make better ten foot user experiences for PC/TV/Internet convergence devices, we take a look at Boxee Box apps.  The Boxee downloadable app for Windows/Mac/Linux is pretty popular, and has apps from tons of different sources.  In the Boxee Box by D-Link (full disclosure: I have a professional relationship with them, which has nothing to do with this post), however, the usage model is probably going to be quite different than the computer-based download.  The user experience for the embedded environment, plus a remote with limited (though very cool) keyboard, and no mouse interaction, combined with a changing user demographic, means a different way to think about apps is required.  Hopefully a lot of app developers are realizing these differences, and beginning to update their apps in advance of the product launch this fall.  If not, here are some tips to help get you going!

  1. Avoid Input Fields At All Costs
  2. Create Consistent Remote Interaction
  3. There is no Back Button
  4. Make it Move!
  5. Redirect for Account Creation
  6. Include a “Sit Back and Watch” Mode
  7. Your Boxee Box App CANNOT Be “Your Website Only Way Bigger”
  8. Keep Your Menus Visible When Needed!
  9. Your App Needs a Social Life
  10. HD is Pretty

Click here for the details.

Click here for the Top 10 Tips to make a better Google TV Site.

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Posted in Convergence, Guides | Tags: apps, boxee, boxee box, boxee box by d-link, product experience, ten foot UI, UI/UX | 1 Comment |

Excited About Judging pre-CES i-Stage Event!

Posted on August 12, 2010 by Jeremy Toeman

It’s been official since a tweet last week, but the i-stage website was updated today to reveal this year’s judges/mentors, and I’m extremely excited to have my name in the list.  Other judges this year are Richard MacManus (founder of ReadWriteWeb) and Frank Gruber (founder of TECH Cocktail), and previous judges have included Blake Krikorian (my boss and mentor at Sling Media, currently living mostly off the grid), Ryan Block (founder of GDGT, former editor-in-chief at Engadget), Natali Del Conte (CNET), Ross Levinsohn (Fuse Capital), Jeff Pulver (involved in pretty much everything), and more!  Needless to say, I’m honored to have my name in this list of esteemed technologists!

This is neither my first foray with i-stage nor first judging with CES.  Last year I was a judge for the prestigious Innovations awards.  Two years ago I was working with team Boxee when they went to, and subsequently won, the inaugural i-stage event!  This plus the three “best of CES” awards I’ve been involved in, and I’d say I’m quite excited about being on the other side of things this year!

We haven’t seen this year’s list of contestants (still two days to enter), but I’m excited to see what’s up-and-coming in gadget land (especially since I like to think I’m already involved with most of the new stuff – so this makes it even more intriguing).  I’ll put together some thoughts and recommendations on what contestants should (and should not) do to increase their odds at winning (and while cash is nice (kidding!!!!), I’m more interested in impressive technology and great product experiences).

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Posted in Gadgets, General | Tags: award, boxee, bug labs, ces, competition, i-stage, judge, mediabolic, mentor, sling media, slingbox, win | Leave a comment |

Why the Mac Mini is not, at all, an Apple TV

Posted on June 16, 2010 by Jeremy Toeman

Lots of musing yesterday that the new Mac Mini is a “Apple TV in disguise.”  It’s not.  Here’s why:

  1. Price
    There’s a world of difference between seven hundred and one or two or even three hundred dollars.  This is even more the case in the icing room as opposed to the ipad or mobile devices, where theres no precedent or parallel for the product.  Further people evaluate living room stuff extremely differently, and seven hundo is like buying two xbox 360s.  Too much.  In fact, you can truly skip the entire rest of this piece, since this price is an utter non-starter for this discussion.
  2. But what about HDMI?
    Just because the product has hdmi doesn’t mke it a living room product.  Sure front row or Boxee will have that effect, but there’s a radical difference between a purposeful and incidental use case for a device like this.  Hdmi is there because it’s replaced dvi as the digital video standard, and because a huge screen does make a beautiful monitor.  An interconnect does not alone a product make, otherwise I’d be comparing the Mac Mini to a router because it has an Ethernet port.
  3. Software
    Per the above comment, today it’s front row or nothing, from apple direct.  Yes, users can download Boxee or plex, but to think consumers en masse will throw down seven hundred dollars for this solution is way off the mark.  For that purpose, they’d just buy an apple tv, or a roku or a wdtv, etc.
  4. But what about New Software?
    Okay, it’s fairly naive of me to say the future of this scenario is the existing version of front row.  Obviously they’ll rev it, and lets assume the rev is solid.  Per all the above points, it doesn’t matter how much better it is.  It’s not about a “better experience” when we are talking the price point.
  5. The Apple Way
    Apple makes products with high margins, mass appeal, and excellent software.  A seven hundred dollar apple tv is only one of those things, and at best can get to two.  Why would they make such a bizarre strategy shift here?  It’s not, at all, the apple way.  Far from it.
  6. Consumers and boxes
    Most consumers don’t buy extra boxes for their living rooms.  They buy TVs, game consoles, and media playback devices (the cheapest of the bunch).  When they do buy add ons, they tend to be under $300, such as the slingbox, roku, or wdtv.  In these cases, the value add for the price point is clear.  So looking at the new Mac mini from the lens of ‘what new content or services does this bring to the living room?’ the answer is practically nil.
  7. Consumers and content
    Cable tv (and by that i include satellite and other existing offerings) is, on average, pretty good.  The average American has access to tons of content, both on broadcast and on demand systems, not to mention whatever they are dvring.  Throw in a dvd player and a game console, and the content universe is quite outstanding.  The quantity of people who truly want to throw away their existing stuff is really really small.  Its not to say there isn’t room to add in more, but its not seven hundred dollars worth more in any consumers’ eyes. For a box that expensive to earn a spot in the living room, it must supplant existing content offerings in such a way that consumers clearly perceive the value.  So not only is a brand new software package a requirement, but a massive increase in content, especially free content, is as well.

But What If?

If apple discontinued the apple tv line, this would have a shift, but only a minor one.  In that scenario, I’d imagine the opportunity truly shines for google tv products and the Boxee box by dlink (full disclosure: I consult with dlink), as they will offer similar value propositions but at steeply discounted prices.  And unlike the comparisons between the iPad and the janky tablet rivals, these other products are far more likely to show promise and value.  Still doesn’t add up.
And now for something completely different.
A man talking about the same topic, in video form:

Watch live video from Jeremy Toeman on Justin.tv

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Posted in Convergence | Tags: Apple, apple tv, boxee, dlink, hdmi, mac mini, roku, wdtv | 6 Comments |

Thinking about Googling my TV

Posted on March 19, 2010 by Jeremy Toeman

Google, Intel, and Sony have apparently teamed up (and Logitech too) to develop an Android-based platform for interactive television. Let me start my post with some important background points and disclosure:

  • I was a cofounder of Mediabolic, a startup who built a platform for connected devices.  While there I designed about a dozen “convergence” products (one won a best-of-CES award), and the company eventually got acquired by Macrovision.
  • I was an early employee at Sling Media, where I was responsible for developing the Slingbox (another best-of-CES award).
  • I once interviewed at Google for a position in a “google TV” role, but didn’t feel it was a really great fit for me personally (not to mention the commute).
  • I am currently involved with Boxee.TV, a startup in a highly-related field. There is some amount of overlap here, though that is in no way related to this blog post.
  • I’ve also worked with VUDU, Clicker.com, DivX, and others on “future of TV” systems, services, and products.
  • I was on the original working group committees for UPnP (AV) as well as DLNA (even before it was called that).

Through the above experiences, I have seen a lot of failure and some success in the “connected TV” space.  But mostly failure.

It’s a space where techies dream, entrepreneurs try, and companies fail. The list of failed convergence companies is notably longer than the list of successes. It’s a field where even Apple, the current king of the world when it comes to entertainment technology, can’t get a reasonable foothold in the home.

Most of the failure is due to deeply entrenched systems heavily controlled by huge corporations with little interest or need to innovate.  While we can yell and scream about how bad a job the Cable/Satellite companies are doing at future planning, the blunt reality is it’s hard to argue that it’s necessitated.  These megacorporations can drag their feet, and deploy mediocre DVRs and HD services, and consumers (for the most part) are satisfied with their experiences.  Further, due to their current business structures, the concept of opening up the market to third-party devices, content, services, or applications is not just daunting, but likely unprofitable.

When I consider the opportunity in the digital home, I am convinced it cannot come about by directly competing with traditional broadcast models. Broadcast TV, and all the services with it, are generally easy to use, convenient to pay for, and effectively “good enough” for most people – making “better than current TV” offerings a significant challenge to bring to market.  Historically, the only thing to attract the attention of consumers beyond their existing entertainment solutions are:

  • Transformative content playback experiences. From VCR to DVD was one example, and from standard definition to HDTV is another.  The key word here is transformative – it can’t just be “better quality”, as evidenced by virtually all other introduced formats and technologies based around content.
  • Notably difference content offerings. Again, moving up to HDTV-enabled set-top boxes was a natural flow, game consoles are the other shining example of a successful category.  Boxes that simply deliver “more of the same” or “stuff you can get elsewhere, now get it here (e.g. digital pictures)” are typically not big hits.  Consumers have to see some kind of service that’s worth the extra money.

Everything else has failed to make a dent.  Most “Internet Set Top Boxes” have been, and will be failures.  The typical logic that brings these products to market goes something like “consumers are about to cut the cables for their Internet content, and really hate watching it on their computers.”  The evidence behind this claim?  It’s in the same folder with the WMD evidence the government started a war for (zing!).

I’m very curious as to the potential from Google, Intel, and Sony.  Intel has wanted in on the “connected TV” for a long time (disclosure: they were an investor in Mediabolic), and has never really executed very well.  It’s not to say they can’t, but it’s safe to say the space is far far away from their core DNA.  Sony too has stumbled frequently in this space (here’s their version of a convergence device). Logitech? See Sony. And then there’s Google.

Part of me thinks Google believes that all devices are effectively the same, and their (limited) success in the phone market implies opportunity in the TV market.  Another part of me thinks Google is just so big they take on any sector they see opportunity in.  But most of me thinks Google wants to get firmly entrenched in the biggest advertising market there is – television.  And as hard as doing phones might be, doing TV boxes is much much harder.  Here’s why:

  • Phones play highly restricted media types.  Converged TV devices are expected to play all media types.  This topic alone is probably worthy of a blog post, but trust me when I say – it’s hard.
  • Consumers buy new phones on a recurring basis (multiple times a year in some countries). Consumers replace TVs infrequently, and buy TV “accessory” devices only a couple of times per decade. While the market is huge, it’s hard to get new devices into the home.
  • Carriers are motivated to push new devices and services into the hands of their customers, it’s part of their business model.  TV service providers are not motivated to do so (as discussed above).
  • As much as phones are “closed systems”, a manufacturer is able to purchase equipment and get a device certified and get it on the network without too much involvement by a carrier.  While the path is actually similar (CableCard Tru2Way certification), the realities for both the manufacturer and, more importantly, consumer are much much worse.
  • Again, as stated above, consumers are generally dissatisfied with their phones (a problem unlikely to go away) and are excited about new ones.  Consumers literally dread changing equipment in their living room – even us geeky dads with cool quadrophonic sound.

Now with all that said, I’m truly excited about the future of converged entertainment in (and out) of the home. I remain mostly cynical about seeing any real change anytime soon.  I think there are a few companies who have built the right foundation to make some inroads, but I’m hoping everyone involved is prepared to win their “realist” and “slow and steady wins the race”  badges over the next few years-to-decade (or longer).  Can Google be the catalyst of change, or will they just be the next in the long list of companies who tried and missed the mark?

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Posted in Convergence | Tags: android, Apple, boxee, clicker, Convergence, digital home, divx, dlna, intel, internet set top box, internet tv, logitech, mediabolic, set top boxes, sling media, slingbox, sony, TV, upnp, vudu | 12 Comments |

About

Jeremy Toeman is a seasoned Product leader with over 20 years experience in the convergence of digital media, mobile entertainment, social entertainment, smart TV and consumer technology. Prior ventures and projects include CNET, Viggle/Dijit/Nextguide, Sling Media, VUDU, Clicker, DivX, Rovi, Mediabolic, Boxee, and many other consumer technology companies. This blog represents his personal opinion and outlook on things.

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