Noah J Nelson on Friday, Oct. 28th
This week the stars seem to be aligned. The battle for the heart of the living room — the television — is back on. Silicon Valley was leaking like a Spanish galleon with tidbits of a TV set designed by Apple, and on Sunday, Google will begin rolling out an update to their Google TV software that will completely change the interface.
It can often seem like this is a fight with little purpose. The TV has been an appliance for generations now, and while it can come in handy as a second display for a computer, it makes a lousy primary display. Why bother with smart televisions? YouTube videos often look like junk, and the only company that seems to have gotten video streaming right is Netflix. (Mind you that’s about the only thing they’ve got going right for them, but I digress.)
So why have both Apple and Google been putting such effort toward building a set-top market for themselves?
We can look to the game console space for part of the answer. Both Sony and Microsoft have created sturdy revenue streams with their Playstation and XBox brands. The downloadable video game content market is looking to cross a billion dollars a year in 2012, and that’s not even factoring in the mobile game market. Worldwide gaming is pegged at $74 billion by the Gartner analyst group. Keeping perspective: the worldwide movie box office in 2010 was only $31.8 billion.
Apple and Google now own about 8% of the U.S. game market, according to analysts at Flurry. The backbone of that is their collective assault on the portable market. Who needs a Nintendo 3DS or a Playstation Vita — the next generation of portable consoles — when you have an iPod touch or an Android phone? Top it off with the way that an iPad can mirror its video output to an Apple TV unit and you have just one avenue of attack on the game market.
With this kind of money at stake, and the kind of success their business models have already reaped in the mobile market, the two companies must be salivating over the prospect of more gaming dollars. In some ways, the tech giants aren’t even a direct threat to the console maker’s core market. What the mobile and social game markets have shown in the past few years is that there is a huge number of casual game players out there ready to part with their money for compact, bird tossing experiences. Um… I mean casual egg-stealing-pig vengeance simulators. You get the point.
Yet games are only part of the story. For Google it comes down to search. Which is the polite way of saying “ad revenue”. A smart TV that was able to track your viewing habits and managed to know your search and purchasing tendencies as well? Pure catnip for advertisers.
This is where the existence of a smart TV starts to get thorny. Google’s search algorithm and Apple’s Siri are already learning everything they can about their users by finding ways to make the search results they deliver more “relevant.” As Eli Praiser argues in his book, The Filter Bubble, this process of refinement can put blinders on what information we find. The goal is to help users find what they want — perhaps even what they don’t realize they want — faster. But, in doing so, the system architecture limits the possibility of serendipitous discovery.
So there’s a bitter pill of irony that comes with a shift away from the age of cable TV to the age of Internet TV: there will be more “channels” than ever before, but finding out what’s on them is harder than ever in a world where you have to wait for the video to start streaming. While tech writers, like John Gruber, are getting excited by the prospect of every network becoming an App, I can’t help but think there’s a bit of a step backwards for the expanded universe of independent producers who are just beginning to hit their stride in the new media world.
Is it too early to miss channel surfing?