7 Feb 2014

The Idiot Box

No points for saying that TV continues to remain the most widely used electronic gadget ever. It may surprise some that TV was the first official display for many of the generation one home computers. There are close to 1.5 Billion TV households worldwide. And this number is growing at a steady pace. Assuming an average of 4 people in a home, TV reaches almost 6 Billion people. More than rail and road network. The wide spread adoption of TV has two main drivers - a) simple to use and b) content in local languages. Both of these are still a long way for computers and smart phones. In essence, TV has gone where no technology has gone before.

Over last 90 years of TV history, there are consistent innovations in this space. In terms of the display box, we have come a long way from black and white cathode ray tube to back lit LEDs. On the back-end we have many competing technologies. Free to air through antenna is still a viable option. Cable and satellite is still growing. The VCRs and DVD players are very important for those who don’t have high speed internet or places where internet is paid on data usage basis. In developed world they are gradually fading away in favor of smarter devices such as Apple TV and Roku.

Despite its reach, TV remains a dumb consumption device. There is a huge opportunity in making it intelligent though all roads are blocked by non-availability of high speed internet. In addition, smart devices need to figure out simpler interface and local content. Coupled with sheer market size is huge advertising revenue, that makes it a perfect target for disruption. No wonder, Apple is interested in TV (and living room). Before Apple, Microsoft has tried its hand on this segment and failed. Google is invested in this apace as well as ton of niche players,sweating day and night to get a piece of this pie. Success so far is miniscule if not elusive.

My hopes are pinned on Apple for couple of reasons. One, Apple can really make simple interfaces. Two they have the financial muscle to rally content providers. They have a track record of doing this in music (with iPod and iTunes), and in smart phones by rallying the carriers and developers. TV ,however, is a much bigger scale and lot harder to crack.

Apple also has a history of executing a long term, carefully planned, strategy. With gradual launch of products that build on predecessor’s success, driving innovation on many levels such as software, hardware, content and developer eco-system. And most importantly the brand. Not to mention the cult following.

Starting with hobby Apple TV, here are some of the hints that could potentially lead to TV revolution in next 5 to 10 years.

Really simple remote

Despite all the efforts of cable providers and TV manufacturers , remote is still too complicated for an average consumer. I read a survey somewhere that 90 % of people use remote only for changing channels and volume control. Less than 30 % could change TV brightness. Cable remote is even more complicated. And multiple remotes are a nightmare. Apple TV remote is not perfect but a generation ahead from any of the remote seen thus far.

Bringing Siri to TV.

As Siri gets multilingual, voice is a perfect solution for running the TV. Again, Siri still has many years of work to pick up non-native English accent. Other languages and dialects are far away in future.

Touch ID

As high speed internet reaches a critical mass in TV connectivity, Lot more Apps will switch to TV. TV is a better place for shopping just because whole family can shop together. Perfect enabler is touch ID to authenticate you. Touch ID makes more sense on TV remote than on smartphone.

FaceTime conferencing

Imagine a video conferencing capability in every living room. A TV with a powerful camera and microphone can greatly change how people communicate. Business side potential is huge.

Gaming Platform

Given most of the revenue generating apps on app store are games, it is quite possible to bundle the games and TV content under one stretegy. In my mind, it would be a mistake becuse serious gaming is a whole different world. But Nintendo has shown that segmentation is possible against PS3 and Xbox.

Update Jan 2017

Apple and Google TV story is still disappointing, though Apple has forked tvOS as a separate development branch of iOS.They also poached a Timothy D. Twerdahl from Amazon fireTV but their strategy appears backwards. It appears that Apple is taking a long hard look at the potential margins in harware play for TV. And consumer appetite for another smart device. Apple is making another mistake in pivoting Apple TV as a smart home center as well. Typically extending the scope of a device, leads to longer lead time.

Roku has brought many products to the market with limited success. They are stymied by the limited back-end such as content and apps. Their remote, though, not as beautiful as Apple TV, is much more functional.

The surprising entry in this space is Amazon. Amazon didn’t get much traction in smartphone or tablets market but they are dominating the TV and music space with prime membership. Alexa is a powerful ally. FireTV remote is simple but somewhat tricky. They also need to simplify fireTV interface. It is still geeky from TV standpoint.

CBS all access, CBS News, Bloomberg and HBO Now have joined the ranks of Netflix and Hulu plus as essential smart TV apps. YouTube continues to dominate. Twitter has launched an app. It shows days top stories through moments. I think Twitter has a major role to play in this new TV paradigm. GoPro content is another inspiring source. Both Twitter and GoPro need more investments. In terms of content, independent producers are still sticking with YouTube. Among the opensource projects, Kodi (XBMC) app can be ported on fireTV. Kodi has a complicated content provisioning model that is beyond average user.