Wednesday, May 5, 2010

TV will soon...DIE!

In listening to episode 7 of the Functional Nerds podcast (just to make sure I didn't blow it, I'm not THAT narcissistic) I had some additional thoughts on the impact of online video portals like Hulu, Youtube, and Netflix. Thinking about how TV will change, I posted a reply to the podcast (copied below). But if you haven't listended yet, go over to episode 7 first and give a listen:
I'm finding listening to myself on the 'cast as a very weird experience. I sound more intelligent and ridiculous then I expected, all at the same time.
In further thought on the subject of Hulu and Youtube, it seems that in the very near future we will see TV die as we know it. As convenient as Tivo and Cable/Satellite On Demand services are on the TV to many, I think the ability to merely choose and click (whenver you want, from a larger library) will win out. Meaning that Netflix, Hulu, Youtube and others will become portals into video-media worlds just like a channel is on TV to a series of programming. As fast as things are moving, I wonder if we'll use Tivo anymore in ten years.
All those built-in network cards to modern TV's will probably become more and more worth while as we turn to the net for our video entertainment. I only hope the great pipelines on the back-end can hold up under the onslaught.
Up until now I think the podcast has been PG rated at its worst, apparently my first appearance was a bad influence and the 'F' word was uttered with blatant Bob Saget vehemence. I thought I behaved myself, but apparently my sheer presence was enough to subvert...very weird.

Your thoughts?


  1. You totally make me want to drop the f-bomb.

    In fact, you're about to see your blog's rating go from PG to R cuz, here it comes:


    I hope you've learned your lesson...

    The TV thing is such an odd bird. I mean, advertisers used to pay the bill - in reality, they still do. Advertisers purchase commercial time during shows. Higher rated shows can ask for more money. They can also make money through product placement - hence 30 Rock did an entire episode talking about Snapple. The advertising $$$ pays for the show. If the advertisers aren't there or aren't willing to pay for commercial time or if there aren't enough of them interested to cover production costs, the show can be canceled. Quickly.

    If that's not enough money, keep in mind that every station is a franchise and pays a franchise fee. There's a deal between the local affiliate and the corp wherein money exchanges hands in order to broadcast the shows that corp puts on the air. The local affiliate can then sell X amount of ad time to the local market as well and make money to cover their costs. This is why affiliate support for shows is very important to the networks.

    Then you have 1st run rights and 2nd run rights and syndication - these things generate income for them as well.

    You also have deals wherein the networks receive money from cable and satelite providers for the rights to broadcast their network feeds (which essentially get passed along to us, the lowly subscribers).

    Costs include: production of the shows, equipment, broadcasting, marketing, music rights, writers, actors, etc.

    Along comes the Internet, iTunes, DvD's & home theaters - and everything changes. Suddenly, advertising dollars aren't enough anymore. Now we need to make more money versus the old model of advertisers and affiliates and charge for what has been to the consumer an essentially 'free' service (unless you subscribed to cable or satelite).

    Where is this all going? Not where you think. I don't think they'll be happy until we're paying a 'per play' fee as in 'every time we watch it we have to pay them' and advertisers will have to pay as well, so they'll make money on the advertising, then again for each person (not family, a per person fee) watching the show and, of course, if you change the channel during the commercial, you will have to pay an additional fee to come back and take up where you left off.

    ...or I could be horribly wrong and everything will become rainbows and sunshine!

    I'm sure that'll frakkin' happen... ;-)


  2. I'm sort of echoing the above here, but I say "follow the money." It's not incredibly lucrative to run services like Hulu, YouTube, or Netflix [Watch Instantly], because someone has to pay for it. Usually advertisers, but people who turn to the internet for their entertainment are far more difficult to advertise to. We tend to be a younger generation, we want things to move quicker, and we're pretty sick of advertisements already.

    In addition, I think the advent of HDTV has actually *saved* television from a grisly death at the hands of the internet. Perhaps it just prolonged the inevitable, but now that Dish & Cable providers can offer visually stunning content combined with their own on-demand services as well as DVR technology, I don't see them going away anytime soon.

    All I really want is "a la carte" television. That way I can get the 5 channels I watch and I don't have to pay for MTV or BET (which I do not watch).

  3. Thanks for your responses guys:

    @Patrick - Oh Frak! You've messed up my rating. Oh dear...

    I see you haven't done ANY research regarding how TV networks make their money. ;-) You paint a dismal picture for how much change has to happen before the new way of things becomes happily accepted by all. What I'm most interested in though is seeing if our back-ends are really up to all that bandwidth. We always hear about how far behind other countries we are, what with all of our legacy wiring, so I certainly wonder. I mean it seems very viable—if it isn't happening already—that you could have ten viewers of a program, and in a few short minutes it could balloon up to millions. How do you handle that changing allotment of resources? It just boggles the mind. Having a subscription model certainly helps parcel out the resources based on increased knowledge of your audience, but I'm sure there are other ways.

    @T.D. - Yes, I've never been a fan of getting stuck with oodles of extra channels, and as a result have never subscribed to Cable/Dish/etc. My family at times have, but not me. I found the extra channels, were just extra channels to click through to the network channels. Sure there was the occasional good content on, but it was just too far and few between. Granted it seems that the Sci-Fi channel might have harbored some hits I missed out on over the years, but it seems the new SyFy channel has less to miss out on. As Patrick has noted to no end as he has kicked that old horse to death and far, far, FAR beyond ;-).

    As to the providers of enhanced TV content out there, I don't know. I wonder how much we are increasing our consumption of it (but that was a temporary jump, if there even was a jump). I'm sure the rollout of digital TV has upped the use, but I think between TV and internet, internet connection wins out on value. As a result it seems that people will slowly pay more and more for internet and less and less for their TV. And once they're online and enjoying Freemium video services, they may very well get roped into paying for one, then maybe two, and then what happens to the Cable connection? I'm sure it will take some time, but I think we're all moving towards that day, when we'll be watching internet TV on the TV. Kind of funny, but who knows, maybe WebTV will make a comeback then. Where did they go anyways?

    Hello? WebTV? Are you out there? Hmm, no response. I guess not...


  4. WebTV was purchased by Microsoft, that should pretty much say it all.

    I think, for Internet services, something entirely new will need to come along before they really start majorly stealing viewers from traditional TV. Someone will have to take a risk, go out on a limb, and have it succeed. I haven't seen anything radical yet by Hulu and the like, so I'm waiting to see what happens. My wife is a great test case; she enjoys regular TV, has started to use Watch Instantly on the comp, but generally doesn't like to watch things on the comp. I, on the other hand, just prefer to download it. Have for years.

    This is a very interesting discussion you've brought up. It reminds me, somewhat, of my Telecommunications class in college (way back in 2003) when we started talking about how broadband would change not just the content, but how a person could deliver content. My professor was anxious to see people start their own TV "stations," and I think with YouTube we're not far off.

  5. Really? Did they change the name to LiveTV?

    I agree things need to change, but I think we'll get there fast. Maybe. One of the biggest issues I think is making sure there is no lag and avoiding choppy video.

    We watch all of our TV on the web (though its not that much). We had a 3 Mbps connection then upgraded recently to 6, thinking that sporadic video issues may have been from occasionally maxing out our connection; but now I feel certain the problem was on the other end of the line and not ours. If you look ten years ago, I was on dial-up, and most people I knew were at the most on a slow DSL speed of maybe 1 Mbps. Seems like most people I know now are on DSL/Cable of around our speed, if not more. It seems the backend is/would have to be improving their speeds even faster. So hopefully choppy video will be a thing of the past someday soon. As to increasing viewership, I think, 'If they build it, they will come.' aptly applies.

    Yes, with Youtube's new pay model, it certainly gives people more opportunity to create their own channels. What new (or horrible) content we will see I can only imagine. Come to think about it, I rarely see choppy, laggy video on Youtube, though the quality is often much lower than Hulu or one of the networks like ABC. Hmm...that reminds me, I can not recall any video issues with Maybe it is an ABC/Hulu thing, or maybe nobody watches CBS online. I wonder...

  6. They probably did change the name... everything with MS is "Live" which is incredibly annoying. Live email, Live messenger. I was far happier with Hotmail before MSN bought it. It used to go to the inbox when you logged in, rather than some idiotic status page. But, hey, that's why I use Gmail now.

    Things have been changing, though. If you look even in the last 5 years at what has become popular, I think people are actually migrating to mobile content rather than sitting at a computer (or even a semi-bulky laptop). If we could integrate wi-fi with our mobile devices WHILE we're mobile, the possibilities would be kind of limitless. Full highspeed connections would take away the power of network television, though, since neither the news coverage nor the sports coverage (their bread and butter, respectively) could be completely pre-empted by any roaming teenager with a camera phone and a speaking voice. This is [one reason] why things move slowly, I think.

    My connection speed has doubled since I moved off cable and onto DSL. More reliable service and customer service, too. If Comcast doesn't get off its ass, so to speak, it's going to revert to *just* being a TV provider, and not even a good one at that. Coax is going the way of the dodo; the future lies in fiber and (more importantly) wireless, and the company who jumps on board with those is going to pave the way for the next generation of content-seekers.

    CBS never has any shows that I care for. They're too family-friendly, or just plain terrible. FOX is the other direction, and I haven't watched anything on that network in years either. NBC and ABC currently have content I care about, but at the moment we are sans-TV because of the move. The only things my TV displays now are Netflix movies and PS3 games, but I'll be hooking up my Wii soon enough.

  7. Well, however it goes, it will be interesting to see how it plays out.

    My Wii serves as our main portal to watching Netflix on my TV. Works pretty well, but whenever it has to stop and buffer I wonder how much nicer it would be to use a PS3 for the purpose with greater memory... Really Nintendo, what were you thinking?


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