Web TV / IPTV / DTV

Forrester are predicting that (here on Reuters):

"In the video space, iTunes is just a temporary flash while consumers wait for better ways to get video. They're already coming," said Forrester Research analyst James McQuivey, the author of the study, who also called the paid download video market a "dead end."

Forrester estimated that sales growth is not likely to triple or even double in 2008 and beyond, after early adopters and media addicts have already started using the services.

Confusion over different video file formats, difficulties watching downloaded videos on television screens and other technical problems have kept average users from paying for shows online.

However, in (nearly) every other media arena the endgame is a combination of:

- Free Content
- Bundled paid-for content
- Pay as you Go content

Why, oh why, should content over the 'Net be any different?

Undoubtedly Ad funding will increase in the online space, but here's the kicker - the global Ad industry is just not big enough to fund every type of media play out there *once it scales*. In the early days - especially if its cool - the Ads will rush in, but Global Ads are "only" a c $0.5 trillion industry - global Media & Entertainment is c $1.5 trillion already, the $ 1 + trillion Telco industry wants some action too, and loads of other Web 2.0 bizplans are also assuming Adspend comes their way.

We can believe that in the early days, getting going on Ads is a much lower risk play that trying for subs or PAYG - remember soap subsidy drove commercial TV.

But with the best will in the world, that Adspend is going to be mightily thinly spread to Adfund everyone, and with the Ad Inventory glut, if anything prices will drop to levels wher Ads are just not enough except for the most populist sites.

So eventually some of the content will just have to be paid for in other ways, unless you assume Adworld undergoes heroic growth (or TV undergoes desperate underfunding).

In addition, the interests of Advertisers and media audiences are not really aligned, so it is highly likely that some content will just never make it to an Ad supported world - yet there will be, in the global market, enough people who want to see it to make it worth showing.

Also, we suspect there will be people who just don't like Ads, especially if interaction = intrusion, and will be prepared to pay for content that is Ad free.

Or just take it off the 'Net on bitTorrent etc.......is there perhaps an alternative scenario that says people will pay for quality or download for free off "p2p sites, and ignore any site that overdoes the Ads?

We wouldn't write off paid content just yet.....most likely scenario is a mixed industry model

So Last.fm is now going to be Last.tv it would seem. Clearly not an attempt to pump up the value as potential acquirers circle it......the press release says that:

"Last.fm aims eventually to have every music video ever made on the site, from the latest hits to underground obscurities to classics from the past."

The Read/Write team reckon its going to be the MTV of the Web 2.0 world.

When I read that, I immediately thought of Last.fm as the Web 2.0 version of MTV! That certainly seems to be their goal, and good on them for setting their sights so high. The fact they have at least a couple of big labels on board already (EMI and Warner, both of whom already have agreements with Last.fm regarding radio music) and they seem to be in good negotiations with others (Universal and Sony) indicates that it's not an impossible dream. The Web 2.0 age needs a new form of MTV, so why not Last.fm to provide it!

Why not indeed?

Except that MTV itself, MySpace, Bebo, Joost, YouTube ( maybe even eBay after it buys Stumbleupon ) and every other video and audio site no doubt also have half an eye on this market as well....also, we're not convinced that video social networking works the same way as music does, but its impossible to prove that conclusively.

Or is this a sign that internet music audio is getting tougher, and players such as Pandora are starting to eat into the market?

Still, Video is sexy so if you can flaunt it, get it.

We blogged last year about a fairly rudimentary approach one can use for simple WebTV in our articles on MyPCTV - but to put a PC in the TV? Just saw this on GigaOm which adds new fuel:

Earlier this morning, we received the latest report from Arnie Berman, technology strategist for Cowen & Company. He asked an interesting question, which I thought would be something we all should discuss.

This is what he wrote: “In the past, consumers replaced their PC’s every 3 years and their televisions roughly every decade. Is this trend poised to reverse? Hint: Yes.”

We'd agree to a point. Though we found it quite simple to connect a PC to a TV, we are geeks, and many people told us it can't be done - and believe this. More accurately, it can't be done unless you are frigging some device (and know what you are doing), or your TV has a VGA input, or (today, 6 months later) you buy a black box.

But going forward, why would any self respecting consumer goods manufacturer let others have a black box sale when they can put it in the TV? We expect TV makers to make it darn simple to connect a PC to a TV going forward, but to put a whole PC in - we don't think so in the short term.

However, functions from the Set Top Box and PVR are good candidates for absorption - much simpler to engineer in, espacially soince HD and various other major changes (Like analog switchoff) will drive new TV purchases in the next few years.

In addition, the emerging struggle for the Digital Home will have TV makers trying to add functionality to TV's to increase their influence in that environment.

So, in answer to GigaOm's quiz:

Will you replace your TV more often than your PC

- I just watch TV on my PC (22%)
- Probably Not - TV is a TV is a TV (57%)
- Quite likely, since they keep doing new things to TVs (21%)

......we'd vote for the last one over the next few cycles. But to totally reverse to a 10 / 3...no. PC's are just not 10 year stable devices yet.

We'd also note that once you have set up MyPCTV with a remote keyboard and mouse, using the TV as the PC is a pleasant lean back experience (I'm writing this post on it.....)

So a new study by Motorola claims that 45% of Europeans watch some TV Online (here it is on the BBC)

"Viewers across Europe are no longer satisfied with fitting into schedules dictated by broadcasters and are turning to the choice and flexibility offered by TV over the internet,"

said Motorola's Karl Elliott.

Much though we would like to believe this is true, we frankly think this is mainly hype. Online TV is undoubtedly on the rise, and growing rapidly, but it is still from a tiny base.

And it turns out that the small print is that the survey was of broadband households only, and was c 2,500 mainly digerati. Given that European Broadband penetration is about 33%, thats more like 15% in total

And we think that even that overstates it today - define some TV!!

We are some of the most "digital meedja" people we know, and our kids are new media natives....but the number of hours we spend collectively watching TV online can be measured in minutes per week. In fact, watching our "digital native " kids, what we saw is a high consumption of YouTube, BitTorrent etc in the early days, but this decreased over time and now its only really an occasional thing......computer gaming, communicating on social nets / email / IM and playing music seem to be the main functions of the PC.

TV is typically watched via STB and PVR today, which would appear to give "good enough" flexibikity for now

Granted we are not a valid sample size, but we doubt we are outliers on the low end of the confidence curve.

In fact we suspect the distribution of online TV watchers is probably a strong power law distribution - a tiny number of people watch most of the online TV...and we'd bet, like music, that most of it is Pirate TV.

And even if IPTV are included as part of "online" TV, the user bases in the few countries that have full IPTV services are at best a few % of the TV viewing public.

Elliott goes on to say:

"We are witnessing a nation of citizen schedulers who are in control of their entertainment, allowing them to watch what they want, how and when they want it."

What people are turning to are propositions like Netflix and Lovefilm and recording TV on their PVR's right now. As far as online TV is concerned, we believe we are still witnessing a large number of people dabbling with online TV because it is novel.

But hype, like death and taxes, seem to be with us always.

Of course, Motorola - that well known supplier of online TV technology - may be trying to be helpful by seeding the market - and it comes at Joost the right moment !

(Perish the thought that they are trying to make a name for themselves !!!!

But is it helpful?

Over-hyping, disillusion, and then a new reality are the standard patterns of any new technology it would seem. Does the hyping phase help the adoption of new technology, or does it hinder it by sucking money into too early, sub optimal technologies that then muddy the waters for years afterwards.

One thing is for certain...when the industry hypemachine winds up, caveat emptor!