Our son has it tougher than we did growing up. Oh sure he's got his content wherever, whenever he wants. But we had power. We had juice! We had the first colour TV in the neighbourhood.
The best looking gals wanted to be seen with us. The meanest dudes on campus protected us.
Our son? All he's got is a notebook...smartphone...iPod...3-4 4GB Store 'n Gos...250GB USB HD... broadband iNet connection...Wii...PS3...DSLR camera...
No HDTV set in his room...Gawd forbid!
He wants something intelligent...he wants his notebook connected so he can watch "select" HD shows. He wants all of the special, unique, oblique, even high def video that is available on the net. Today, content is content.
If something is on the Tube when we're home...we watch it. If the time isn't right...we miss it. Big deal! Sure we could ask the kid to program the DVR but we're not stooping to that level. Fortunately, there's no need.
Most of the TV content you want to watch is already available on the Web...just find it, watch it. That simple! You know the good ol' stuff - Hogan's Heroes, Have Gun, Wonder Woman, Dr. Who, Jerico, Wonder Woman...
The wife even found that her HGTV episodes are on the Web. Hey...we may cancel our cable service.
For the industry, there's good news/bad news about TV over the Internet. All of the Tellywood players are putting their content out there. They just can't figure out how to make a buck...
They face the same problem The Office's character who said, "That's the thing I bought myself. I'm really psyched to use it. Maybe I should've taken the iPod. Oh, shoot!"
The old ad formula doesn't work on the Internet. On TV you have gross rating points for shows.
On the Web you've got specific viewers. True they don't know if you're a dog but it takes a lot of opt-ins to make up the $4.5 billion networks and shows rake in from ads.
Don't get us wrong. TV is still hot:
- 102.5 mln LCD TVs will be sold in 2008
- 105 mln satellite, cable and IPTV subscriptions worldwide
- 13.7% of Americans have HDTVs
- 144 bln digital TVs will be sold by 2011
- 720k HDTVs sold in France in 2 months preceding Rugby World Cup
- 84% of UK homes have digital television
- 85% of HDTV owners are happy with picture quality
- China to exported 38.6 mln televisions in 2007, sold 38.3 mln for their domestic market
- Flat panel TV spending exceeded $100 bln in 2007
The Olympics stimulated the purchase of a lot of HDTV sets.
But the dual-pipe approach of adding net delivery pulled in millions of viewers around the globe.
- video services will generate $26.3 bln by 2011
- China will lead the world in IPTV by 2011
- In the US, top states with IPTV interest: Hawaii, New Jersey, North Dakota
Delivering the Olympics over the Internet only reinforced its place for information and entertainment.
Millions of people watched everything, anything, anytime. They weren't forced to watch the events when the network, station, advertiser dictated.
People found there was a whole world of video on the Web - past and present, personal and professional content.
Once you find you have a real choice, it's impossible to go back!
The walled broadcast/cable garden is disappearing.
One network executive who got the message repeated The Office's Jim Halpert's comments..."I want to clamp Michael's *face* in a George Foreman grill."
The Conference Board has found that nearly 20% of U.S. Internet households watch TV online. By 2011 it is estimated that there will be 200 million broadband users and 183 million (91%) will watch online videos of all kinds and that's big bucks! How hot is the potential market?
Everyone wants a piece of the action - Amazon, Sony, Netflix, Apple, Hulu, Microsoft - including the cable companies, networks, studios and even the new start-ups that have the "winning" content management/delivery schemes.
More content. Infinite channels.
What they don't have is "inventory!"
Tellywood is digging in the very back of the closet for content to offer up for consumption.
The old powerhouse series are back - StarTrek, MacGyver, The A-Team, I Dream of Jeanie, Dean Martin Show... anything... everything.
It's all good. Still it isn't enough. Bypassing the walled-garden guards, independent producers are realising they can get music video and movie audience exposure without worshiping at the hallowed Tellywood doors. Creative hopefuls who weren't tapped at the Tribeca, Toronto, Sundance, Vancouver, Minneapolis, Paris, London and other film festivals around the globe aren't going home in defeat.
There are VOD, content management/distribution, IPTV (62 M subscribers WW by 2012 - eMarketer) and other video service providers eager to increase their inventory offerings and share in the proceeds - paid viewing or advertising supported.
People are turning on their computers and using the Internet for their video entertainment according to an IBM study because of:
- better content selection - 46%
- updated, fresher content - 25%
- trustworthiness - 24%
- faster downloading, streaming - 23%
- friends go there - 21%
- hipper, current environment - 12%
People across the age spectrum have found that their computer is more entertaining than their TV. We would expect online entertainment viewing to be dominated by kids but surprisingly Gen-Xers, Boomers and Matures are all turning off their regular program to enjoy online content.
Online entertainment is becoming so inviting, interesting and entertaining; more folks are undertaking the challenge of connecting their PC to their big screen TV (we paid to have it done).
We watched some of our shows on our laptop system and then on our big screen TV. Because of over pixelization, some things just look better on the big screen.
Right now there's more smoke than flames surrounding IPTV and content over the Internet but everyone industry can feel the heat of the consumers' enthusiasm.
There are currently about 288 million TV viewers in the U.S. and 189 million Internet users. At the same time there are 112 million TV households and 80 million Internet households.
TV households will increase to 118 million by 2012 and Internet households 20 about 100 million.
Television still has a decent lead. But online video viewing will substantially suck viewers from their conventional entertainment habits, thus lowering the ad value.
A growing number of consumers around the globe are seriously considering cutting loose their cable/satellite TV service for the Internet and IPTV.
What's not to prefer?
- content on your schedule instead of theirs
- advertising that seems to be better integrated and less intrusive with Internet video
- real broadband service to the home
Sure some will stick with cable/satellite that seems to have the attitude of The Office's Michael Scott, "This is an environment of welcoming, and you should just get the hell outta here."
Feel the move
Tellywood and the cable/satellite folks know that regardless of the content there is a viewing shift coming. They will be a part of it. They just can't figure out what to do with all of the network schedulers that will be idled by the anytime viewers.
Downsizing doesn't bother management too much. They're used to cutting, shuffling, replacing at the blink of a viewer's eyes. They just aren't certain how to turn digital pennies into huge dollars. Effective monetization is a tricky job.
If you figure how to do that not just one show...one digital stream...one network...but the whole online content industry you'll have lots of friends.