Las Vegas has long been a place where people come to get married. At last January's Consumer Electronics Show, the massive exhibition held each year in the gambling Mecca, marriage announcements were in abundance. The creators of television shows and the geeks of the Internet are getting hitched.
Even with the Vegas setting, this is largely a tale about two regions of California. Northern California is the home of Google, Apple, and Yahoo!, among others. Southern California is the American entertainment capital, churning out an unending supply of television programming. Executives from both regions have racked up plenty of airline miles talking to each other. As a result, television networks are doing deals to put their broadcasts on the Web, for viewing on a PC or laptop, and more intriguingly, on iPods, Sony PSPs, and cell phones. Some companies are betting you'll want to record your own programs and transfer them yourself. And a few view the Internet as the television carrier medium of the future home, with a thousand different networks carrying original programming not found anywhere else.
That, at least, is the vision. But even on the face of it, this flurry of deals contradict conventional wisdom. Here in the United States, the big transition wasn't supposed to be to smaller screens, but to larger ones, in the form of high definition television. Come February of 2009 (if the date isn't pushed back again) American broadcast television will go entirely digital, with HDTV presumably accounting for a sizeable chunk. Over the last holiday season, HDTV televisions-LCD, plasma, and rear projection-all sold well. Many Americans watched the Superbowl, Academy Awards, and even the president's annual state-of-the-union address in high definition. So would those same Americans really watch much programming on a tiny iPod and cellphone screen?
The entertainment executives are not waiting to find out. They know that the Internet has already shaken up the newspaper and magazines business. They've seen the recording industry driven crazy with free-for-all sharing of MP3 files. With higher bandwidth everywhere and companies like TiVo looking into ways for people to make their own television-to-device recordings, the television industry has made a calculation: sell programming commercial-free for a reasonable price or risk losing that intellectual property to pirates. And-risk losing even more audience share to the spectrum of other entertainment choices, from video games to amateur podcasts to blogs.
iTunes goes video
Not surprisingly, the epicenter of all this activity is Apple's iTunes. Jobs and company were the first to really figure out how to sell audio files on the Web and with video iPods, video programming for sale on iTunes was inevitable. Some of the more prominent deals inked by Apple have been with The Walt Disney Company, which owns both the ABC and ESPN sports television networks. The two companies had been collaborating even before Steve Jobs stood to become the largest individual Disney shareholder through the sale of Pixar.
Apple went into the video business last October with iTunes version 6, which launched with more that 2,000 music videos -including Madonna, U2, Eurythmics, Coldplay and Kayne West--and six short films from Pixar. The company also announced the first of what would become a string of television offerings. Most prominent were Desperate Housewives and Lost, two of the most popular shows on American television, as well as Night Stalker, That's So Raven, and the Suite Life of Zack & Cody. The announcement set the model for much of what followed. Each would sell for $1.
Disney has been careful to hedge its bets, saying it was delivering "content across dozens of multimedia platforms, now including the iTunes Music Store and viewing on the iPod." But what those other multimedia platforms are has not been made clear. So far, Apple and Disney look like a matched pair-especially as they now share Steve Jobs.
A second U.
Google Video Store
Apple's main U.
As with Disney, CBS has been careful not to hint that this is an exclusive deal. "This is yet another exciting platform in which CBS can leverage it's market-leading content to a whole new audience," said Leslie Moonves, who heads CBS Corporation, in a statement. He said the shows would garner "significant new exposure to millions of users who are likely to access this web service and who may not be traditional TV viewers
SONY BMG is also a partner, providing music videos from Christina Aguilera, Beyonce, Kenny Chesney, Destiny's Child, Kelly Clarkson, Alicia Keys, Lil' Flip, Jessica Simpson, Shakira, System of a Down, Switchfoot, and Usher, among others.
Compared to iTunes, the Google Video is more freewheeling-more resembling an auction site like eBay. Anyone with a video camera can contribute, which means that if you are in the right place at the right time, you can become a video producer with your cellphone. And once you upload your video, you set the price and let the market decide: Google imposes no minimum or maximum fees. You also decide whether to include copy protection or not. That choice makes a big difference in terms of portability. Downloaders can view all content from a PC using a proprietary player-Google's equivalent of iTunes and Windows Media Player. But iPod and Sony Playstation Portable owners can only watch non-copy-protected content-a competitive difference that shows the advantage for Apple in controlling both the device and the library service.
The business model may have contributed to the Google Video launch running into trouble. Google admitted that it was tough for viewers to find some of the most highly touted shows, including CSI: Crime Scene Investigator and Survivor. "We made a big mistake," said Google vice president Marissa Mayer in a Los Angeles Times interview. "You can't come out and launch a product like Google Video and say CSI and Survivor are there when they are not on the home page."
This misstep may be a result of Google's corporate culture. Whereas Apple polishes its products to a shiny gloss before releasing them, Google is better known for putting beta services online that can stay that way for years on end, improving them slowly without pretending that they are complete. Google has always been able to count on the indulgence of its techno-savvy audience to ignore the bugs and wait for the revisions before drawing any conclusions. But the consumer market is more fickle-and that's where all of these services are hoping to play. Ease-of-use is an Apple staple, so it's not surprising that Apple's easy navigation and consistent pricing has become the service to beat.
TiVo: record it yourself
At this writing, the one major U.
This quiet initiative could have large implications. Broadcasters have already been driven to fits by the ability of TiVo and other digital recorders to "zap" commercials. The phenomenon is widespread enough so that some producers are selling product placements-essentially writing in a commercial, subtly or not, into the program itself. If TiVo makes it easy enough to record and transfer programming to your iPod, will people still be willing to pay for episodes? So far, such transfers still require some technical sophistication. You must install a TiVo client on your computer and the DVR itself must be networked-probably via 802.
Coming to your PC: original programming
While most of the buzz has involved moving television programming to portable devices, there is another possibility: posting original programming to the Web, thereby making the Internet a true alternative to conventional cable and over-the-air broadcasts. Not much has been done here, for the obvious reason that the big audiences are still used to watching television programming on their television-not their PC. But there is some movement.
Yahoo! has also been thinking in this direction. The company, which is based in the Silicon Valley, has an office in the trendy oceanside city of Santa Monica, thereby straddling the North-South California divide. Yahoo! executives are also familiar with both cultures. The company's 's chairman, Terry Semel, spent 24 years at Warner Bros., where he was chairman and co-chief executive officer. Lloyd Braun, who heads Yahoo! Media Group, was chairman of ABC Entertainment Television Group, part of Walt Disney Company. Clearly, the company is signaling that it wants to be thought of as more than just a content aggregator.
Yahoo has made some interesting moves in this direction. During CES, the company launched Yahoo! Go, which will allow viewers to move content from a personal computer, including the Web, to a television. The service will include Internet search capability, photo images-including those stored on Yahoo!'s Flickr site, and the ability to locate movies on a digital movie recorder. The service seems to be at the heart of what Semel and others have long been looking for, the long awaited convergence between television and Internet programming. In the past, the industry figured that such convergence would be provided by cable companies, but that may prove to be only partially true. Whether broadband is via cable or DSL, the ultimate provider may be the company that aggregates the content-signing the deals and putting it in one easy-to-navigate place. That's where Yahoo! might come in. "You're not going to have 1,000 channels. You'll have an unlimited number of channels," Semel told The New York Times last September.
In that same article, Lloyd Braun made the point that Yahoo! has had no way of turning a creative idea into an actual show. That's not surprising because the portal side of the Internet business has been about gathering content, not producing it. "At ABC if I had an idea like Lost, the moment we decided to do it we knew the process to take it to the writers and get a pilot. Here none of that exists. The whole infrastructure has to be created." And that appears to be what Semel and Braun are trying to do.
AOL is also thinking in terms of original programming, striking a deal with Mark Burnett Productions to develop a reality treasure hunt show that will air exclusively on AOL.
But all of this is experimental and visionary-with a huge potential upside but daunting odds against success. Even as computers have become standard equipment in American households, they rarely enter the living room or media room or wherever else Americans slouch on a couch to watch television. So far, the three screens-television, PC, and iPod-remain in different places for different purposes, and convergence remains a dream.
Sidebar: Where's Microsoft?
With this blizzard of activity, one might well wonder what Microsoft has planned.
Judging from the activity at last January's Computer Electronics Show, the answer seems to be: not much yet. The company's digital rights management system and media player are part of a new video download service, called Vongo, from Starz Entertainment Group. The company has a deal with DirectTV that will eventually allow programming from the satellite company to play on a PC, compatible portable device, and the Xbox 360. There are rumors that the company will launch its own online store and create its own devices.
But below the radar, Microsoft is also involved something potentially bigger. The company is one of several involved with IPTV-Internet protocol television. As such, Microsoft TV IPTV Edition software represents an alternative way to deliver television programming, using network packets instead of a dedicated, persistent connection. The scheme calls for a live broadcast feed to be compressed, gathered on a servers, and sent over an IP network. A settop box then converts it into an analog or digital signal. The advantages, at least in principle, are huge. If you can create a successful one-to-one unicast model, then, in theory, the larger the server storage, the more programming you can offer. For independent producers, IPTV holds the distant promise of providing a new way to reach their audience. For subscribers, the programs are viewable on that massive plasma television they bought for the Superbowl.
Microsoft is touting its Windows Media platform as the one-stop shop for interested broadband providers. Two-way communication also provides other tricks-like enabling the subscribers to become their own technical directors during sporting events, switching between cameras. Other companies touting IPTV include Cisco, which acquired Scientific-Atlanta, which is known for its settop boxes-in order to stay on top of the market. Cisco's Mike Volpi has said that the current leaders are Japan, Korea, and some parts of Western Europe. Here in the U.
When Americans get fed up with the cable companies, they install a satellite dish and add yet more channels. The question is: are there enough subscribers that can be peeled off from cable and satellite to make the IPTV investment pay off? American telcos, who already are faced with low-cost competition rates from voice over IP services, may at least have found an IP scheme that works in their favor. Now they'll have to see whether the promise pays off.
Sidebar: Video on Cellphones
MobiTV, a northern California company, is trying to do for cellphones what iTunes and Google are doing for mobile devices. The company has signed deals both with television networks and wireless providers, then done the technical work to turn cellphones into tiny TVS. Programming includes shows from MSNBC, Discovery Channel, CNET, Fashion TV, and MLB.
Ben Feinman, MobiTV director of product management, says that the company is currently doing unicasting: the subscriber makes a request and MobiTV delivers the program. The alternative is multicasting-a one-to-many signal that is more comparable to a television broadcast. Long term, he says, "we believe that both delivery technologies are extremely useful and valuable." Unicast offers more content while multicasting uses bandwidth more efficiently. "So maybe the top 10 or 15 channels could be delivered via multicast, the rest delivered over unicasting."
Feinman does not pretend that watching a cell phone is like watching a TV. Not only is screen size smaller, but the frames-per-second are fewer: 5 to 15 is typical, depending on the device and available bandwidth. "We have a technology that allows us to vary the data rate based on the available bandwidth." On some low-end phones, the service looks more like a slide show, changing at one to two frames per second. Porting is a challenge. "We have a very large development team that does nothing but bang out versions of our service for all the different handsets," Feinman says. "Even within the same family of handsets you have a lot of differences. It starts to get complicated very quickly."
As for the future, Feinman says that the company is looking at the possibility of incorporating the service with a settop box, the ability to purchase premium channels, as well as to increase the frame rate.
Meanwhile, the LCD screens themselves are getting more video-friendly. One big reason is the built-in camera on many cell phones, which demands a brighter, clearer image than mere text. "We're improving the picture quality and reducing its package thickness," says Joe Virginia, vice president of Samsung's LCD business in the Americas. Resolutions and aspect ratios are shifting from QQVGA (128x160 pixels) to WideVGA (640x 480). Displayable colors are moving from 362,000 to 16.
Samsung is also tackling the problem of watching video outside. Virginia says that early LCDs were designed primarily for indoor viewing, delivering just one percent maximum reflectance, "meaning, you aren't going to see much of the transmitted light from the back to the front of the panel." The company has announced what it calls SR (super reflective) LCD technology to raise reflectance up to 12 percent. SR LCD substitutes silver for aluminum for reflectance, and uses a new lens to better concentrate light. The screen is also illuminated partially from the front, rather than entirely from the rear. The square LCD measures 1.