Google Everywhere: Android Meets “Dancing With the Stars”?

We finally abandoned the Blackberry in favor of an Android phone. Our decade-long Blackberry experience dates back to the era when they weren’t phones, used a simple, reliable national Mobitex radio network, and had basic textual email.

Like the Zenith four-button television remote of yore, the old “black brick” Blackberry was simple, reliable, and durable. It ran on AA batteries you could buy at midnight at any convenience store, and was very easy to use.

Over the years, the software and the device merged with the cell phone, accreted more complexity, poorer performance, an ever-changing and incompatible set of expensive accessories and, almost imperceptibly, morphed into an outright disappointment.

The iPhone was the watershed product which reset customer expectations about what a smartphone “user experience” should be. It brought music and media to the handset in a big way and revolutionized feature customization via the App Store. By contrast, RIM’s leadership in important but more boring functionality (security, encryption, and server-synchronized push email) had eroded, partly in perception, partly in reality.

Android devices, the iPhone, and (to a much lesser degree) Windows Phone handsets define the benchmark for today’s expected high-end smartphone functionality. Depending on who you believe, iPhones continue to account for the vast majority of US mobile data traffic, or not. Either way, it’s clear that both Android and iPhone families of devices are the preponderant platform for the foreseeable near-to-medium term future.

Which brings us to Television Everywhere – the general rubric for letting you watch what you want, went you want, wherever and on whatever device you want.

The same Blackberry-like annoying yet imperceptibly gradual creep of complexity and dissatisfaction has infiltrated the TV-watching experience, in lock-step with ever more grandiose cable- and satellite-delivered “digital viewing experiences.” Now, unintelligible 60-button remotes are the norm in a cluster of three or four strewn on the living room coffee table.

Google recently revealed Google TV, a set top box experiment using their Android software platform. Its apparent aim is to deliver and integrate an array of video sources for viewing in the living room. Who knows if anything will come of it, or whether it will fare much better than Apple’s disappointing television offer. What Apple and Google are doing to redefine the handheld communication experience can potentially redefine television as well. There are several points worth considering when thinking about the potential effect of Android, Apple et al on media distribution and consumption:

• changing media consumption without altering distribution: plain old TV watching is itself already way too complicated in a 400-channel universe. The new generation of open (compared to cable), multi-device software platforms like Android have the potential to completely reshape how viewers interact with a range of commercial video sources, regardless of how the signal or programming is actually delivered. Barely a third of US television households have DVRs and, we’d argue, about half of those have no idea how to use complex advanced filtering and organizing features. Imagine instead simple and consistent “apps” on handhelds, set top boxes, netbooks, etc. which enable viewers to make sense of the sources of programming they already have from any of the devices they have.

• popular platforms beget applications: these platforms bring not only a growing array of supported devices and rich user interfaces but a marketplace of independent application innovation – think of it as “crowd sourcing” with some rules and structure. There’s a higher likelihood of  innovating TV-relevant apps vs. legions of cable set top engineers continuing to bang away at… whatever.

• reconnecting with the viewer: studios, show runners, etc. have become increasingly distanced from their audiences as television distribution has fragmented over the last several decades. Even channels, their brands eroded, their identities more confused,  have a weak and diminishing role in organizing viewing behavior and loyalty. Hulu notwithstanding, the new generation of multi-device software platforms could enable Hollywood to play an important (and we would argue leadership) role in TV’s evolution. Studios’ content ownership combined with new, simple (“there’s an app for that”) technologies could enable the television industry itself to take the lead and modernize television viewing, while extending linear television’s economic life well into the future.

US Mobile TV: Destination Unknown

“The 12 major TV station groups that announced plans on Tuesday to form a joint venture to pursue the mobile DTV business envision a national service of at least 10 mobile channels and possibly many more.”

At last week’s NAB 2010, something called “Pearl Mobile DTV Co., LLC” was announced.  As best we can tell it appears to be a serious, if still very amorphous, studio- and station-led initiative to bring mobile television to the United States.

Today there is an obscure form of mobile TV in the US that virtually no one uses. Marketed by phone companies, Qualcomm’s Media FLO uses a slice of the old UHF television spectrum to deliver a few diluted (time-shifted) channels to hand held devices that have air interfaces to both the TV and respective 3G networks. Qualcomm acts as a programming aggregator and distributor and provides the overlay network infrastructure. Structurally, it’s a bit like the still-born phone company TV consortia of the early ‘90s like Tele-TV or Americast – big ambitions, lots of capital, negligible market traction.

Pearl Mobile might signal the beginning of something viable and different for US mobile television in two important ways: (1) putting people and assets that are actually in the television business into the mobile drivers seat, and (2) putting to rest in practice, not just in theory, the technical question as to which national standard the US mobile TV market will rely on and what spectrum will be required.

The Pearl consortium idea relies on station groups contributing spectrum they already have from digital subchannels no one watches anyway. A slice of that spectrum is allocated to mobile TV, under a standard directly related to the US digital technology which just recently replaced analog TV. Television stations themselves would distribute and broadcast programming.

In a way this model only deepens the intriguing mystery of what, if anything, mobile TV is to become in the US. In Japan, for example, mobile TV penetration has crossed 50%, so television’s net audience reach and time spent viewing have increased. The economic benefits have gone to handset manufacturers, a little bit to advertisers (higher reach, but regulatory restrictions constrain additional mobile advertising), with wireless carriers being excluded. In the US the mobile TV “answer” could simply be the same as in Japan: make the audience bigger, increase out-of-home linear TV viewing time.

But the most interesting long-term answer to US mobile TV would be a combination of bigger audience reach combined with the capabilities of always-in-hand, smart devices to organize and manage TV watching, regardless of the end device. To, in other words, turn watching television into an application, not a passive, hit-or-miss experience in a complex 400-channel multi-device world.

Hulu’s Big “Surprise”

In a New York Times interview, CEO Jason Kilar let it be known that Hulu is already profitable as it heads into its third year.

For some time, the prevailing view has been that Hulu would never quite scale, never quite get the revenue split it needed, never quite crack the ad problem, etc., and that subpar performance in those and other areas would inevitably consign it to being a marginal undertaking delivering… yes, digital dimes.

Of course, part of the point of having Hulu at all has been as an experiment to see whether, like the bumblebee aerodynamically "proven" not to fly, Hulu might defy traditional calculations and begin proving out an early-stage economic model for internet-delivered, commercially-mainstream video content. This it has done. At Business Insider Henry Blodget does a nice job (with a needlessly apologetic title about eating crow) of itemizing five of the things at Hulu that went better than one might have expected.

We've never believed the "digital dimes" story, and are in less of a rush than most to call the question as to whether Hulu, or commercial online video generally "wins" or "loses." Based on what we've learned so far (and we hope Hulu will disclose more), we continue to see Hulu as an evolving, increasingly-successful experiment, a big plus for Hollywood, and a platform that could protect or even increase traditional TV viewing in addition to supplementing it.

In a short series we did a while ago (the Myth of Digital Dimes) we asserted that digital's problem wasn't really profitability, but scale. Hulu, despite it's success, is still tiny compared to real television (something we pointed out here with three big fat charts showing unequivocally how huge and still-healthy linear TV is.

Based on our forthcoming book (Television Everywhere: How Hollywood Can Reclaim the Internet and Turn Digital Dimes into Dollars) we'll shortly lay out a case for why Hulu is actually a central tool for sustaining linear TV in the internet era, what those combined economics might look like, and how linear and digital scale can be more effectively combined.

Stay tuned...