2010: A year to get on the right track
Richard Bullwinkle, chief evangelist for Rovi Corporation, looks at how new and emerging technologies and services will develop over the coming year.
Looking back at 2009 we were optimistic that the advances in home entertainment would allow users greater freedom and rejuvenate profits for content creators and technology providers.
And while there was a great deal of discussion and optimism on this topic, it didn’t go exactly as planned in 2009. While in Europe, particularly in Britain, we saw a great deal of content become available online from local content creators through the iPlayer, and news circulated that Canvas is moving forward, we experienced the opposite in the US. Television companies tightened their stranglehold on content. Online aggregators, including multi-service operators (MSOs), made little progress in getting the content online. And the movie companies held on to their release windows, with most still putting online download at the very end of the release schedule.
The question for 2010 is… is there still hope?
Technology companies and media aggregators are standing by, excitedly waiting for the content owners to permit them to make easy, convenient and profit-generating products. They will be going back to the negotiating table to try again. And with the progress that Digital Entertainment Content Ecosystem (DECE) has made in the last year, there are glimmers of new hope. While the details may reveal many devils to contend with, the DECE’s current direction would be positive step forward for the consumers.
The cable companies have also started to dabble with content over the internet with TV Anywhere, but we’ll need to wait to see where they go from here.
The Death of the “Friday Night Movie Box”
One trend that we will start to see manifest itself in 2010 is the death of the single service movie box. Perhaps it is a blessing in disguise. Products like Vudu and AppleTV saw weakening sales throughout the year as the game system, and even some connected TVs, offered multiple services without the need for an extra box. Consumers are becoming more disenchanted with the box that sits idly during the week, only to be perused when the family gather for a movie on Friday night. Roku has reacted to this by offering multiple content services, not just the original Netflix.
We expect to see other devices move in this direction and offer a variety of recurring content, including last season’s television content, as well as any movie a consumer might fancy. If only new television content were available…
In the mean time, the technology companies have found other ways to amuse themselves and generate consumer demand. And in 2010 we’ll see some new innovations and trends start to take hold.
The year of 3D TV? Maybe? Maybe not
We’re seeing a lot of hype on 3D continue from 2009 to 2010. Mitsubishi claims their 3D TV model shows profit, and the other manufacturers are eager to bring new 3D models to market. Much like the Blu-ray vs HD-DVD wars, consumers don’t know if they want passive glasses technology, or the more expensive active glasses. If they buy 3D systems, will the content come? And if they can’t find their TV’s remote control in the couch, how will they find their 3D glasses? There may be resolution on some of these issues in 2010.
Thin is in, and low-power is better
Consumers will love the new bright LED panels that are thinner than their wallets, especially at high refresh rates. The poor economy pushed many consumers to look for ways to reduce their monthly power spend. Look for almost all CE manufacturers to focus a bit more attention to power consumption and “vampire power” in 2010.
Games – The new entertainment
Both action and casual gaming are on the rise. Modern Warfare II set records in 2009, sending game makers into a frenzy trying to capitalise on consumer demand. With the continued growth of the Wii, casual gaming is also cutting into entertainment spending. We’ll see more of this in 2010.
Applications (or “apps”) are all the rage
But perhaps the most surprising and exciting take away from 2009 for content services, CE manufacturers, and even cable and satellite providers, is the realisation that consumers want to configure their own use-cases for products. It started with the availability of more than 100,000 apps for the iPhone. Consumers love to put their own favorite apps on their personal device. No two iPhones are alike. While one person chooses BBC news, another chooses Fox. One chooses Facebook, and another chooses MySpace.
This new trend has changed manufacturers’ perspectives. They are seeing that each of these apps has its own interface, creating a wild cacophony of colors and heuristics… and users love them! What we’re starting to see through the popularity of apps is that consumers are associating the interface with services, and not the device. This provides greater freedom to the device maker to open up their devices to allow personalisation. To continue to meet the demand for the latest hot app, and the implied requirement for constant updates to the apps, devices will become connected to the internet faster than we had expected.
Some CE companies are nervous about customisation and user configuration because it could create new issues of support and the infrastructure isn’t set-up to handle and direct the consumer to the right services.
The hesitation leaves a marvelous opportunity for the cable and satellite companies. As they are in the business of shipping boxes as rarely as possible and updating the services fast enough to prevent churn and keep customers happy, the app environment is just right for them. New channels have been added year after year for decades, and if they look at the apps and customisation as a form of channel, they are perfectly set in their deployment and recurring revenue businesses to capitalise on app world. And while the TV-over-internet problem festers, cable and satellite have more opportunity than ever to delight their customers.
2010 – The Year of…
In short, 2010 will show a continued march towards moving content from physical media to the cloud – this march will sometimes feel a bit like trying to cross Russia in winter. Consumers want their content everywhere, and content owners want to make it easy, but they’re not willing to do so until they’re certain revenue will remain. Consumer electronics manufacturers are ready to try new things to entice their customers to purchase again, and they are learning about how to make more money from the customers they already have. And even the service providers are looking for ways to meet the increasing demand from consumers to have access to new services and a wider range of content.