Cable vs. Internet – The Battle for Eyeballs Gets Serious
“Dry land is not a myth. I’ve seen it (Kevin Costner, Waterworld). I don’t know what the big fuss is about. I saw that movie nine times.” – Chip Douglas (The Cable Guy, 1996)
Click Away – A big screen TV, cold beer, bag of chips and the remote and you have a happy man. For many, television is a mild, easy escape from the realities of the day. But a growing number of people exercise all their fingers, surfing for their content. Source – Columbia Pictures
If you wonder why the number of people who are overweight today is on an alarming increase, all you have to do is look closely at TV viewing habits.
We’re watching more content… especially TV.
Across the country, folks are stretched out on the couch with a beverage and empty-calorie snack.
The Council for Research Excellence found:
- The average TV time per day for an individual was 353 minutes (nearly six hours)
- The average computer time was 142 minutes (about 2-3/4 hours)
Add to that the fantastic results turned in by movies this past year, and it’s no wonder your behind is… aaahh, spreading.
For some reason, people love their TVs.
Of course, the tight economy and need for a break in this “always-on-world” may help drive our need for the screen.
According to The Conference Board:
- 107.5 mln LCD TVs sold in 2008
- 135 mln satellite, cable and IPTV subscriptions worldwide
- 55 percent of Americans have HDTVs
- 144 bln digital TVs will sell by 2011
- 25 percent of US households have a DVR/PVR
- 720k HDTVs sold in France in 2 months, preceding Rugby World Cup
- 75 percent of HDTVs sold by 2011 will be LCD TVs
- 84 percent of UK homes have digital television
- 90 percent of HDTV owners are happy with picture quality
- China exported 52.4 mln televisions last year, 42.4 mln domestically
- China to lead the world in IPTV by 2011
- Flat panel TV spending to exceed $140 bln last year
- IPTV video services to generate $26.3 bln by 2011
- Plasma displays to grow 30 percent this year
- Residential video to generate $190 bln worldwide last year
The Cable Guy, Google or the Web folks are chanting, “This is our destiny!”
The cable and Tellywood guys like the Internet because they advertise all their shows there so you turn on your set or go to the movies.
The Internet folks think that as long as you’re on “their” screen, what the heck; stick with them.
They paraphrase The Cable Guy’s own explanation: “Can I be frank? I don’t think you listen to her. I think you tell her what she wants to hear. She wants you to thirst for knowledge about who she is, all the complicated splendor that is women. When your love is truly giving, it will come back to you ten fold.”
1. Most folks don’t like the idea of a computer in their living/family room
2. Tellywood can’t figure out how they’re going to make the same bundle of money they do today with their “10 M sets are tuned to us, there’s 3.5 people per household, that’s who you’re buying” model vs. the Internet’s click, pay, view model.
Just Say No
Internet folks point out that Jobs totally invigorated the music industry with his “i” products/service.
Volume Up, Gross Down – In almost no time at all, the music industry shifted from volumes of discs to volumes of individual songs. The only problem (for the industry) is that it took the control (and profits) out of their hands. Source — RIAA
Really worked for him. Apple is sitting on a $15+ billion cash horde.
So what if the music industry is on life support?
Tellywood will be damned if they’ll put the control of their content in anyone else’s hands… especially Steve’s!
All the pieces are in place with broadband, PCs, HDTV sets and other devices.
Connected Home – HDTV sales jumped the last two years and demand continues to grow as more and more homes have multiple sets. Broadband connectivity and multiple PCs are giving consumers a wider range of entertainment choices without the cable cost. Source — Forrester
For ordinary folks, putting them together isn’t quite there yet.
All we need is:
- Standards-based, open architecture for applications, services
- Infinite content choices that will make broadcast, online content available from anywhere
- Scalable, efficient system management
- An intelligent network that will personalize service to the viewer
Heck, might as well throw world peace into the equation.
Content people are pretty happy with Chip Douglas’ status quo, “I got you the big screen TV, deluxe karaoke machine, and THX quality sound!”
But more households around the globe have broadband Internet service.
Broadband Homes – Broadband service to households has grown rapidly and service is now provided to almost every home in industrial countries. The U.S. still ranks 12th in broadband deployment and is classified as a “developing country” in this area. Source – Gartner
People have begun to discover that there is a lot of great stuff out there to enjoy in Chris Anderson’s Long Tail content concept.
All folks want to do is have more content. You know: broadcast/personal TV, Web browsing, social entertainment, time-shifted and on-demand video, on their big screen set.
In the U.S., everyone is working to deliver a solution. The result is a patchwork of boxes and services – some for the TV, some for the PC, some for the recycle bin.
Telco providers see online, on-demand TV as another opportunity to enhance their growth (income).
With IPTV (iTV is probably already taken) all content is on-demand.
Subscribers like it because they don’t have to do any time-shifting (programming the DVR), waiting for the reruns when you forgot, buying it from iTunes or inviting yourself to your neighbor’s place.
It’s just sitting there waiting for you.
Subscribers agree with Steve Kovacs, “I don’t want you messing with my life!”
Heck, you’re already used to searching and retrieving from the Web, so why not a little TV and Hollywood content as well?
IPTV Growth – While IPTV is slowly gathering steam in the Americas, it is widely used in Europe and the Pacific Basin as the prime source of at-home entertainment. Internet-enabled TVs and the growing comfort of putting (hiding) a PC in the living/family room will help people have their entertainment their way, rather than living by the TV schedule. Source — Infonetics
Cable guys are looking at the trend and saying, “Sounds like heart break to me.”
Even without IPTV subscriptions, a growing number of people are regularly getting their entertainment online.
Internet News, Entertainment – People are increasingly finding that it is faster, easier and cheaper to turn to their PC and the Internet for the types of content they want to watch. With just a little searching and a few clicks, you can find the stuff that interests you. Source — Nielsen
Most simply watch the content on their PC because:
- they missed the show on their TV set
- they can watch anytime
- it’s free
- fewer, shorter ads online
- with a little “research,” they can find old TV shows and stuff that are no longer on the air
We don’t fall to pieces if we have to wait until we miss a show…it’s just empty mind calories anyway.
And, scrounging up, watching things like Johnny Carson, the Rat Pack and George Carlin is… awesome!!!
While the small screen is okay for many folks, there are those brave 21st century adventurers who want to enjoy the great content, cut the cable, enjoy it – all of it – on their big screen TV set.
They take The Cable Guy at his word, “Free cable is the ultimate aphrodisiac.”
And they get more… lots more!
Hey, with cable prices going nowhere but up some of the PC/CE folks might come up with something for us.
Internet connections are appearing on TV sets in the U.S. (people in the EU and Pacific Basin have been enjoying it for years, wondering what’s wrong with folks in the Americas).
Until then, we’ll spend some quality time with the kids watching stuff.
TV Their Way – The younger generations, that grew up with a keyboard in their hands, were quick to find indie video and “ancient” content that had been posted. With TV producers and news programs being quickly put online, it’s the natural place for their entertainment. Adults and boomers have also made the transition. It’s nice to spend quality time with the kids.
They’ve got this Web surfing stuff down pat!
In the distance though, we hear The Cable Guy screaming, “Someone has to save all the other cable boys and girls, someone has to kill the babysitter.”
It’s not our fault we raised really smart kids!!!
Andy Marken is principal of Marken Communications. Contact him at email@example.com