Posts for 'TiVo'

The announcement a couple of weeks ago that YouTube was partnering with TiVo got me to thinking that YouTube is probably the best friend that so called "over-the-top" or "cable bypass" aspirants could have.

As a quick refresher, "over-the-top" and "cable bypass" refer to the emerging category of devices and service providers seeking to bring broadband video to the consumer's TV, but without the involvement of existing video providers such as cable and satellite. Some of these efforts (Apple TV, Vudu and Internet-enabled TVs) are positioned as augmenting incumbent providers, while some (Building B, others) are meant to compete directly.

Today's players share the common trait of being closed, "walled gardens," offering only certain content that they select. This contrasts with the open Internet/broadband model, where users are able to access any content they choose. Many of you know that I have been a strong proponent that open is the winning competitive path for aspiring over-the-top players.

If the over-the-top crowd adopts the open approach, YouTube is their perfect ally; it is the best-known brand name in broadband video, has the largest library of both user-generated and increasingly premium video and has huge loyalty. Positioned properly it could be a killer value proposition for over-the-top players. I've previously argued that Apple missed the boat by not adopting this positioning for Apple TV.

I talked last week with David Eun, VP of content partnerships at Google and Chris Maxcy, head of biz dev for YouTube, and they both made clear that the goal is to morph YouTube from a consumer destination site to a full-fledged video platform distributing video everywhere - devices, mobile, web sites, others. To this end, YouTube recently published an expanded set of APIs to allow 3rd parties to gain easier access to YouTube's content. This of course is great news for over-the-top devices, who should have considerable flexibility for how to incorporate YouTube into their offering. For now TiVo is leading the way in offering YouTube, albeit to a very small audience.

If you were wondering whether YouTube or Google itself will enter the device business, that seems unlikely. David and Chris were clear in saying that devices are not their core competency, and they'll leave it to others to decide how to implement the YouTube APIs and create and test various user experiences. Meanwhile with more premium content flowing into YouTube, its value as an over-the-top partner only increases.

What do you think? Post a comment!

Hurray for TiVo and YouTube, which yesterday announced a partnership to allow certain TiVo users to watch YouTube videos on their TVs. While the actual number of homes which have the right TiVo model and have it connected to broadband numbers under a million, TiVo-YouTube shows there is still hope that the worlds of broadband video and TV will indeed converge.

Some of you will remember that in December '07 I wrote a post entitled "Broadband Video on TV is a Mirage" in which regrettably concluded that the mass availability of broadband video on TVs was nowhere on the horizon. In that post I wrote:

"The minority of consumers who will actually see broadband video on their TVs will either (1) shell out big bucks to buy a broadband appliance such as Vudu or Apple TV, (2) tackle the challenge of connecting their TVs via wireless networks (3) use a device built for another primary purpose, such as Xbox 360 or TiVo, to selectively augment their viewing with broadband-delivered choices or (4) use a service provider that has decided to throw in a few morsels of broadband video."

With the YouTube deal, TiVo continues to deliver on option 3, augmenting an already impressive array of broadband video available on select TiVo models. TiVo enhances its overall reputation for innovation (although still absent resounding market success or profitability), with a particular focus on broadband video. TiVo has previously offered up Amazon Unbox, TiVoCast, Music Choice, Home Movies, etc. Providing access to YouTube, the world's most popular video site, is another notable accomplishment for TiVo.

I continue to believe that whichever company cracks the code on how to deliver wide open broadband video access to the TV - coupled with a strong user experience - is going to hit it big. At the risk of looking too far backward, at the end of 2006 I conjectured that Apple's then still-to-be-launched Apple TV product could be a resounding success if it got the content strategy right (i.e. offering open broadband access and even focusing particularly on easy YouTube access through the device). Instead Apple TV has turned into yet another walled garden and to date has been a market failure. Apple continues to miss the open broadband market opportunity which is sitting right in front of it with a big bulls-eye plainly visible.

The TiVo-YouTube partnership will hopefully have the effect of accelerating the wake up call to other market participants that this gigantic opportunity awaits. Broadband video to the TV is a natural. It simply extends the cable/satellite model of the last 30 years: offering ever more video choices right to the TV.

As I've often said, as amazing as the growth curve has been for broadband video consumption over the last 5 years, even more amazing is that virtually all of this consumption has happened on the computer - a completely parallel world to the traditional TV viewing platform. Nobody could have imagined this level of consumer adoption for a non-TV viewing platform. So then look forward and imagine the possibilities when broadband video and the TV are fused for the masses.

Yesterday TiVo and Comcast announced that their joint service offering, known as "Comcast DVR with TiVo" is now available to Greater Boston residents. The announcement comes almost 3 years since the partnership was announced. Multichannel News recently reported that Comcast has funded $24 million of co-development work to date. I have had the service since late October as part of the beta test, but the companies had asked me to stay mum until its official launch.

The first thing to know about this new service is that it really is familiar, lovable TiVo inside a Motorola cable set-top box. I am a long-time TiVo Series 2 owner, and as best I can tell all of the core TiVo features are available (e.g. Season Pass, Wish List, Suggestions) along with the inimitable TiVo blooping sounds effects. The box has a dual tuner so you can record one show while watching another. The navigation also incorporates all of Comcast's VOD selections, so all linear and VOD programs are considered in your searches. It's an HD-capable box, which can hold 15-20 hours of HD video. The peanut-shaped remote control is virtually unchanged.

What's not included are all the wonderful broadband features (e.g. TiVoCast, Amazon Unbox, Rhapsody, Music Choice, Photos, Home Movies, etc.) and network features (e.g. remote scheduling, whole house service). The absence of broadband content (CNET, The Onion, NY Times, etc.) in particular will be missed. TiVo has gradually been introducing this over the last couple years. I've written a lot about broadband-to-the-TV solutions recently, and TiVo's approach has been very solid. However, Comcast obviously wanted to retain strict control over what video gets pumped into the set-top box. I have discussed this "closed" vs. "open" mindset earlier - hopefully something that will change down the road.

The service itself has mostly worked well. There were some initial hiccups requiring the Comcast service techs to return to the house and for me to call in for service. There are a few small issues that have persisted. These include periodically getting a green screen which requires me to turn the box on and off. I can't continuously lower the volume or change channels by suppressing the appropriate button on the remote control (this is possibly a TV-specific issue). I also find the service just a little less responsive than my Series 2 box - my fingers have had to adjust their muscle memory somewhat when working the familiar remote control. None of these are deal-breakers, but I do intend to have Comcast come out a take a look one of these days.

Comcast has priced the service at $2.95/mo, on top of its plain vanilla DVR service fee of $12.95/mo. I continue to believe that for consumers this proposition makes a lot of sense when compared with buying a standalone Series 3 box. It's a $3 delta over paying the monthly service charge directly to TiVo, but you avoid buying the Series 3 box (about $600 street price around $400) and potential maintenance and obsolescence issues. And it means one less box in your rack. The downside is the missing TiVo features described above.

If Comcast markets the TiVo service aggressively and correctly I think they can shift a lot of current DVR subscribers over plus add plenty of new ones down the road. It's a meaningful competitive advantage for a company caught up in a brutal battle with satellite and telco competitors. For TiVo, which has also done a deal with Cox (and others in the future presumably), it's a great shot at migrating itself out of the hardware business, into software and solutions.

In yesterday's WSJ, Nick Wingfield wrote a lengthy article outlining the 5 key challenges encountered by the myriad devices aimed at bringing broadband video to TVs. He lists them as: consumer resistance to adding another box, complications in setting them up, cost, lack of content and slow downloads.

The article has a generally optimistic tone, posing "solutions" to each of the challenges. You're left with the impression that mass-scale broadband video on TV could actually happen sometime soon.

At the risk of being the "skunk at the picnic," I have recently come to believe that broadband video on TVs is a mirage, tantalizingly close yet in reality nowhere on the horizon. Unless there is some new box or approach I've yet to hear about, I've regrettably concluded that broadband video will be tied to computers, and select mobile devices, for a long time to come.

The minority of consumers who will actually see broadband video on their TVs will either (1) shell out big bucks to buy a broadband appliance such as Vudu or Apple TV, (2) tackle the challenge of connecting their TVs via wireless networks (3) use a device built for another primary purpose, such as Xbox 360 or TiVo, to selectively augment their viewing with broadband-delivered choices or (4) use a service provider that has decided to throw in a few morsels of broadband video.

Those of you with good memories will remember that in a Broadband Directions newsletter at the end of 2007 I wrote bullishly about Apple TV's ability to become the breakout convergence device, if only Apple opened up the box to all broadband content. Instead Apple has kept the box closed, available for iTunes downloads and selected YouTube videos. Consequently it has been a flop.

To help explain why products succeed or not, I tend to reach for Prof. Clayton Christensen's abiding lesson that people "hire" products to do "jobs" they have to be done. In other words, products that meet the buyer's true desires are the ones that succeed.

For me, the "job" that consumers increasingly want "done" is to be presented with an integrated, easy-to-access service (not just a new box) that offers all video programming they value in an on-demand manner and priced appropriately. That's a tall order, but ultimately one which will drive wide-spread success of any new product in this space.

Some of the possibilities include TiVo, which believes in this "seamless" philosophy, though it is still dependent on current service providers (cable, satellite, telco) to deliver programming. ICTV has a very interesting approach, though it is also reliant on existing service providers. Building B is taking a bold approach that seems to meet the full test for success, though it's still too early to know whether they can successfully execute on their vision.

But hodge-podge, costly broadband appliances just create new inconveniences while only partially addressing true consumer needs. As a result, they're not going to find a broad market. And so, barring some other new innovation, most of the world will still be watching broadband video on their computers and some mobile devices for a long time to come.

It's funny how often I'll be talking to someone and they will casually start interchanging the terms "IPTV" and "broadband video/online video/Internet TV".

The fact that many people, including some that are actually well-informed, continue doing so is a reminder of how nascent these delivery platforms still are, and how common terms of use and understandings have yet to be established.

Yet it's important to clarify that there are differences and they do matter. While some of the backend IP transport technology is common between IPTV and broadband video, the front end technology, business models and content approaches are quite different.

In presentations I do, I distinguish that, to me at least, "IPTV" refers to the video rollouts now being pursued by large telcos (AT&T, etc.) here in the U.S. and internationally. These use IPTV-enabled set-top boxes which deliver video as IP packets right to the box, where they are converted to analog video to be visible to the viewer. IPTV set tops have more capabilities and features than traditional MPEG set-tops, and telcos are trying this as a point of differentiation.

However, at a fundamental level, receiving IPTV-based video service is akin to subscribing to traditional cable TV - there are still multi-channel tiers the consumer subscribes to. And IPTV is a closed "walled garden" paradigm - video only gets onto the box if a "carriage" deal has been signed with the service provider (AT&T, etc.). IPTV can be viewed as an evolutionary, next-gen technology upgrade to existing video distribution business models.

On the other hand, broadband video/online video/Internet TV (whatever term you prefer) is more of a revolutionary approach because it is an "open" model, just like the Internet itself. In the broadband world, there's no set-top box "control point" governing what's accessible by consumers. As with the Internet, anyone can post video, define a URL and quickly have video available to anyone with a broadband connection.

The catch is that today, displaying broadband-delivered video on a TV set is not straightforward, because most TVs are not connected to a broadband network. There are many solutions trying to solve this problem such as AppleTV, Microsoft Media Extender, Xbox, Internet-enabled TVs from Sony and others, networked TiVo boxes, etc. Each has its pros and cons, and while I believe eventually watching broadband video on your TV will be easy, that day is still some time off.

As many of you are aware, Comcast has been on the cusp of kicking off this trial for some time now, which will let real users experience the joys of TiVo software running inside a Comcast digital set-top box. This will mark a milestone for Comcast in delivering a better user experience than the generic DVR feature that it and other cable operators rolled out a couple of years ago.

After hosting Jeff Klugman, TiVo's Senior VP, GM of its Service Provider and Advertising Engineering Division for a "fireside chat" at a cable industry conference last July, I became very bullish on the opportunity for TiVo to transform itself through these cable deals into a software and services powerhouse. In other words, long-term getting out of the high-cost, low-margin consumer device business.

Running a successful trial with Comcast is all-important to TiVo and they've been working for 2 years on this integration. Success will likely mean wide rollouts with Comcast, followed by #3 operator Cox (with whom TiVo already has a deal), and then others no doubt to follow. I'll be keeping you posted on my experience when I get the box. If it works as advertised it's going to be a killer device.