Who found Halloween scarier this year – the kids, neighborhood dogs or network Television execs. I’d bet the execs quivered the most – frightened by Mr. Scary himself, Steve Jobs. Nineteen days earlier, Apple’s iTunes Store shocked the industry when it launched TV content sales. By All Hallows Eve, one million TV shows, animated shorts and music videos had been purchased for a penny short of two bucks each. And this with only the Disney/ABC/Pixar family trick or treating.
“Our next challenge is to broaden our content offerings, so that customers can enjoy watching more videos on their computers and new iPods.” Jobs smiled as he said this, anticipating the communications avalanche of network and production execs contacting Apple on All Saints Day.
Already alarmed by ad revenue declines, broadcasters are scrambling for new ways to monetize production. CBS provides audio content to the podcast section of the iTunes store. How long until they join ABC with TV programming? And Microsoft dance partner, NBC whispers its desires to Apple. The two dollar eyeballs promised by iTunes won’t allow them to wait for Redmond’s media download competitor.
Focus on the reality distorting genius of Jobs, however, and you’ll miss the real change taking place. The iTunes video store is merely an example of pull replacing push. Broadcasters and cable companies have pushed content at us for years. We’ve watched some of that content at the pushers’ proscribed times. A few of us have even chosen to time shift that programming with VCRs and PVRs. But the visual portal has remained the TV.
Pull let’s us watch, what we want to watch, where we want to watch it with whatever pixel lighting device we have access to – from our cell phones and PDAs, through our laptops and desktops to the 53” HDTV flat panel screen in our media viewing room. We can pull content from any source – and choose which content display device to push it to. The traditional broadcast model does not work in this new pull controlled marketplace. IPTV does.
Internet Protocol Television – the net as a giant video library with content as small and simple as a local news story or as complex as an international hit movie. We pull the content to the appropriate player. Much of that content will be free, some will be supported by advertising and we will pay a small amount for the rest.
The short term bottleneck is bandwidth – but that is rapidly changing. Companies like Long Island’s Cablevision offer standard downstream bandwidth of 15 Mbs with premium tiers of 30 and 50Mbs. To put that in perspective, my present cable company provides about 1.5MBs. My system would take about four minutes to download a 50 MB file – but less than eight seconds on the fastest Cablevision service. But you won’t be feeding your 53” display with many 50 MB files. However, a DivX encoded HDTV movie could be downloaded to your media player in under thirty minutes – less time than it takes most of us to get to Blockbuster and back. Better encoding and even faster pipes will reduce that time significantly over the course of the next days, weeks and months.
And what will your media player be? Mr. Scary hopes it’ll be his new Intel-powered Mac mini – possibly arriving as soon as Macworld in January. Don’t be surprised if there’s an HDMI connector on the back – so you can hook up 5.1 digital surround audio and high definition digital video to your new HDTV. iTunes will not deliver all the content to your media player – but Jobs will definitely be a major provider of content in the IPTV world – the small videos in his iTunes store are only the first steps.
And one of the stories that may be downloaded is what happened to the quivering broadcast execs from this past Halloween.
UPDATE: It seems the price for a TV show has been cut in half by NBC and CBS – but they won’t be delivered via the web… yet.
Both services launch early next year, with NBC programs distributed through satellite broadcaster DirecTV Group and CBS via cable giant Comcast Corp.
UPDATE 2: It would seem that the fear factor is not helping NBC & CBS execs think clearly. What’s being offered is a "downloan" to DVR (PVR) for one dollar, which for many shows will only be available until the next episode is released – or possibly only for a 24 hour period after the "downloan". From P2PNet:
"This isn’t an acquisition model," USA Today has NBC’s David Zaslav saying. "This is more of a rental model."
The USA Today article continues:
NBC Universal reached similar terms (to CBS’s terms with Comcast) enabling DirecTV to offer new episodes of Law & Order: SVU, Law & Order: CI, The Office, Monk, Surface and Battlestar Galactica.
Hours after they initially air, DirecTV will transmit them to the hard drive in homes that have receivers with the new DirecTV Plus DVR, which the company says will hit the shelves this week.
Viewers will be charged 99 cents to watch an episode as often as they wish for 24 hours. It will be wiped off the hard drive once the next episode of the show airs and cannot be saved on other devices.
Forget archiving the show, and the DRM (Digital Rights Management) stops you from recording it to tape or DVD. At least Apple’s model treats the programs like a music download – you can watch them as often as you want while playing them back on your TV, iPod or computer.