Categories
Technology

Hello Siri . . .

Image representing Siri as depicted in CrunchBase
Image by None via CrunchBase

Gartner, a leading research firm, issued a list of the ten top strategic technology trends for 2014. By strategic they mean that these are developments that are getting a lot of attention and development in the industry, not necessarily that these developments will come to full fruition in 2014. One of the items on the list was ‘smart machines’ and under that category they included self-driving cars, smart advisors like IBM’s Watson and advanced global industrial systems, which are automated factories.

But I want to look at the other item on their list which is contextually aware intelligent personal assistants. This essentially will be Apple’s Siri on steroids. This is expected to be done at first mostly using cell phones or other mobile device. Eventually one would think that this will migrate towards something like Google Glass, a smart phone, a bracelet or some other way to have this always on you.

Probably the key part of the descriptive phrase is contextual. To be useful, a person’s personal assistant has to learn and understand the way they talk and live in order to become completely personalized to them. By contextual, the current Siri needs to grow to learn things by observation. To be the life-changing assistant envisioned by Gartner is going to require software that can learn to anticipate what you want. For example, as you are talking to a certain person your assistant ought to be able to pick out of the conversation those bits and pieces that you are going to want it to remember. For example, somebody may tell you their favorite restaurant or favorite beer and you would want your assistant to remember that without you telling it to do so.

Both Apple and Microsoft’s current personal assistants have already taken the first big step in the process in that they are able to converse some in conversation language mode. Compare what today’s assistants can already do to Google’s search engine, which makes you type in awkward phrases. Any assistant is going to have to be able to be completely fluent in a person’s language.

One can easily envision a personal assistant for life that helps you learn when you are young and who then sticks with you for life. Such an assistant will literally become the most important ‘person’ in somebody’s life. An effective assistant can free a person from many of the mundane tasks of life. You will never get lost, have to make an appointment, remember somebody’s birthday or do many of the routine things that are part of life today. A good assistant will free you from the mundane. But it still won’t take out the trash, although it can have your house-bot do that.

In the future you can envision this assistant tied into the Internet of things so it would be the one device you give orders to. It would then translate and talk to all of your other systems. It would talk to your smart house, talk to your self-driving car, talk to the system that is monitoring your health, etc.

The biggest issue with this kind of personal assistant is going to be privacy. A true life-assistant is going to know every good and bad thing about you, including your health problems and every one of your ugly bad habits. It is going to be essential that this kind of system stay completely private and be somehow immune to hacking. Nobody can trust an assistant in their life that others can hack or peer into.

One might think that this is something on the distant horizon, but there are many industry experts who think this is probably the first thing on the smart machine list that will come to pass, and that there will be pretty decent versions of this within the next decade. Siri is already a great first step, although often completely maddening. But as this kind of software improves it is not hard to picture this becoming something that you can’t live without. It will be a big transition for older people, but our children will take to this intuitively.

Categories
Technology What Customers Want

The Future of TV – The Sets

English: Various remote controls fot TV-set, DVD and VHS. (Photo credit: Wikipedia)

I think everybody agrees that television viewing is changing rapidly, and everybody in the industry has been thinking about how these changes will impact the cable business. I am going to do a series of blogs for a few Mondays looking at where industry experts think the business is moving. I will start off today looking at the future of the television set and then move on to other aspects of the business such as advertising, content production and viewing habits.

For the first time in many decades the purchase of new television sets is down. This seems to be due to two primary factors. First, 11% of homes now say that they now watch all of their video from computers, laptops, tablets or smartphones. So some households have given up on the communal nature of having a centralized set that everybody can watch together. However, the communal nature of TV viewing probably means that most households are going to want to keep a TV set of some sort. Second, TVs are being upgraded less often and people are treating them as a screen more so than a standalone device. When somebody connects a Hulu or Goggle Chromecast device to their TV they have in effect upgraded without the necessity of buying a new monitor.

So I looked around to see what experts think will happen to the TV set over time? Here are some guesses for both short-term and long-term.

Short-Term.  In the short term TV sets are going to get glitzier and have even more functions than they do today. Of course, not all big TV innovations succeed such as the fizzle that came with 3D TVs in 2010. But before TV manufacturers agree that the future of TVs is dead they are going to try to sell new sets by pushing new features. Some of the features being seen on new TVs now include:

  • Split screens. This takes the idea of picture in the screen and creates up to four separate pictures on the screen at the same time. Thus, a sports fan could watch four football games simultaneously. This has to be giving nightmares to companies delivering IPTV over DSL if each set can be asking for up to four HD channels at the same time.
  • Ultra High Definition. There are not TVs being made with 4k resolution which provides 4 times as many pixels with a 3840 X 2160 pixel grid as compared to today’s 1920 X 1080 grid.
  • OLED (Organic Light Emitting Diodes) TVs. These are ultrathin TVs made of layers of sprayed on materials that create a new kind of diode. The diodes emit their own light and turn black when not being used. The Koreans have made an OLED screen that is flexible and only 4 mm thick.
  • IGZO (Indium Gallium Zinc Oxide). Sharp has introduced a new LCD screen that is much brighter and also that can change colors much faster than older LCD screens. This ideal for gaming but also makes a superior TV screen.
  • Smart TVs. It is being rumored that Apple TV is almost ready to release its iTV, or the next generation of smart TV. A smart TV is really a new kind of smarter settop box combined with a screen. Apple will probably include Siri and iSight and other computer and smart phone features into the box. The smart TV will no longer be just a tuner and recorder but will be a full-functioning application machine that can bring the web and cellphone apps fully integrated to the TV set.

Long Run. In the long run it is likely that the TV settop box functionality will be completely separated from the display. The OLED flexible and transparent displays will mean that a TV will be able to be installed anywhere by laying a film over an existing surface. And so there could easily be an inexpensive TV display on the side of the refrigerator, on every mirror in the house or on any wall. These TVs will be operated using the combination of a smart box along with very fast WiFi in the house that will let all of the TVs be integrated into one system. This will allow for interesting new features such as ‘follow-me’ TV where the TV signal would follow the person from device to device and from room to room as they move throughout the house.

TV is also likely to become far more personal to each person in the household, a topic which I will look at in a future blog.

One small detail I almost forgot. The lowly TV remote is likely to die soon. The remote we have today is largely still needed due to a rule at the FCC called the integration ban which requires cable settop box manufacturers to produce a removable tuner, called a cable card. And so the current remotes still work on ancient infrared technology.

Remotes are starting to be replaced by smartphones and there are apps which can take over many of the remote functions. But in the not-too-distant future the smart TVs are going to do away with the need for any device and you will be able to control the TV by voice commands or by gestures. I know this will save me the five minutes it takes me every time I go to watch TV and try to remember where I left the remote!

Categories
Current News Technology

The Battle of the Boxes

Image via CrunchBase

For years we’ve been told that the day was coming when we would be able to get rid of the settop boxes supplied by the cable company and instead use our own smart devices to receive cable TV. A number of years ago the FCC tried to promote this with its cable card order that said that customers must be allowed to bring their own devices and that the cable companies then had to give them a discount for doing so. But cable cards were a massive failure and only a very small percentage of customers went through the hassle of trying to use their own settop boxes.

And then we heard a lot of talk about how TVs were going to get smarter and that we would be able to plug our cable into the back of the TV and eliminate the settop box. And that actually worked for a few years. But then cable companies started converting their systems to all-digital to make more room for faster cable modems, and analog transmissions are quickly becoming a thing of the past.

So we are no closer today to being able to bring our own smart box to the game and almost every home still has a settop box or a DTA (Digital Television Adapter) for which the cable company charges them a fee of around $5 or more per month.

Meanwhile there are a host of new boxes in the world that are designed to help customers bring the Internet and its many programming options to the TV. Among these are Roku, Apple TV and Sony Playstation. There are a number of households that are using these boxes to replace the cable company altogether and are settling for the programming that can be found on the web. These boxes let people subscribe to things like NetFlix, Hulu or Amazon Prime, which are much cheaper than the typical cable subscription.

Time Warner is taking an interesting approach to the battle of the boxes. In March they announced a deal to allow people to use a Roku box in place of a Time Warner settop box. In June they announced a deal that allows customers to use high-end Samsung TVs without a settop box. And it was reported last week that they are making a deal for people to use Apple TV in place of their settop box.

Image via CrunchBase

Time Warner is doing this by developing a specific App that works on each device. A customer can download an app that will let the Roku box mimic the Time Warner settop box and save the monthly fee. It’s reported that the app is not as good as the real thing and the line-up and some reception is not as good as using a TV. But Time Warner sees some advantages to this arrangement. While they lose the typical $5 per month charge for the settop boxes, they also get out of all of the obligations that go with providing settop boxes. No cable provider likes being in the settop box business. They require truck rolls to install and sometimes to retrieve. They break and must be replaced. And a surprising number of people move, pack and take their boxes with them. Cable companies are probably a net winner by getting out of the settop box business.

But I see a few problems with Time Warner’s approach. First, Time Warner is headed down a path that is going to make their software life complicated over time. Soon they will have deals that require them to supply apps for three different boxes. But over time that number is going to mushroom. There will eventually be many generations of Roku and Apple TV and every other current box as they get updated and outdated. And over time there will be dozens, if not hundreds of devices that will be able to get TV signal onto a TV. Looking into the future five or ten years I see Time Warner’s strategy getting very complicated.

But the biggest danger I see is that Time Warner’s strategy is inviting the fox into the henhouse. Do they really want to promote customers to use boxes that bring Netflix and Hulu into the house and make it easier for customers to cancel or downgrade their Time Warner cable TV service? Obvious some people are going to be buying these boxes anyway, but should the cable company be promoting people to buy a box that makes it easier to bypass them? It seems like a risky bet to me.

Even if Time Warner is onto something, this solution is not for everybody. Certainly the handful of other large cable companies could follow suit, but it’s hard to see this working for smaller cable companies. And this solution won’t work at all for companies that deliver IPTV over DSL or fiber like Verizon, AT&T, municipalities and hundreds of independent telephone companies and small CLECs. The IPTV stream requires a proprietary device to descramble the signal (and  scrambling for IPTV is required in the contracts with the content owners), and so these providers cannot move customers to alternate boxes.

Time Warner’s approach is unique and we will have to see if any other cable companies follow them. This is a home run for the box makers, but I’m not so sure that Time Warner wins too.

Categories
The Industry What Customers Want

Should You Carry OTT Programming?

Every cable provider today needs to consider carrying Over-the-Top (OTT) channels on their cable system. OTT programming is content that is available on the web and includes such things as Hulu and Netflix. There are a number of reasons to consider this:

  • I have discussed the phenomenon of cord-cutters in other blog posts. The large organizations that track cable customers report that a lot of customers are dropping traditional cable. Nielson reported that at least one million people dropped traditional cable last year and that number is expected to increase. The cable industry appears to be at the same place that the telephone industry was ten years ago and everybody expects more and more people to drop cable TV every year much as has happened to land line telephones. To the extent that you can give customers easy access to OTT programming on your cable system you may convince some of them not to leave your system.
  • There are a lot of customers buying OTT boxes, which are devices that let them watch OTT programming on their TVs and also on other devices using WiFi such as pads and smartphones. These are devices like Apple TV, Roku, Boxee and Playstation.  Once a customer has an alternative box in their home sitting next to your settop box they have mentally started the process of dropping you. If you can give customers easy access to the OTT programming they want you will have lowered their incentive to buy an alternate box.
  • You can use OTT programming to develop new products. Nobody makes much money today with cable TV. You can create a new bundle of programming by combining OTT, the basic network channels and local programming that can be more profitable than the large packages you sell of many channels. I will discuss this more below.

There are a number of ways to get OTT programming onto your cable system. You can gather the OTT program sources yourself and put them onto open channels on your system. There are devices available that will let you create a channel out of web content. For instance, you can create a channel that would have buttons for the most popular web content.

But an easier way is to use somebody who has already done that aggregation. There are several vendors who have packaged OTT channels together to make a ‘channel line-up’. Probably the best of these right now is a company called AIOTV (All-in-One TV). This is available on the web to anybody, but they also have a version of their programming that is designed to be used as a web channel.

AIOTV will supply the feed to you for free to get onto your cable system. They sell nationwide advertising and they insert ads at the beginning of each show that a customer watches. If you put them onto your cable system they will send you a small revenue sharing check each month for carrying their ads. It’s not a lot, and the revenue is not the primary reason to do this, but it’s still nice to get a check.

The other nice feature of AIOTV is that their platform gives you an easy way to create additional web channels of your own. There innumerable ways for you to use this capability and you could add additional web content to your line-up that is not already on AIOTV. However, the best use of this capability is to use it to create local programming. You can use AIOTV or other platforms to create a channel for every school, church, non-profit or other entity in your area. The programming would be up to the entities who have channels and they can use it to put items of interest to your community onto your cable system. For example, this is the easiest and lowest cost way to get things like little league games and high-school sports onto your network.

With AIOTV or some similar provider you can create some sense out of local programming. The platform gives you a way to create a traditional looking channel line-up so that people can find the local channels they want. Each local channel supplier also has the ability to operate their channel so that it is continuous feed or on-demand.

Local programming is a way to get and keep customers on your cable network. Other communities that broadcast a lot of local content say that this becomes one of the more popular things on their network. People want to watch local sports and graduation ceremonies and other local events. Most cable systems today carry local city-council meetings, but there is a lot more events of local interest in every community.

Finally, you can use OTT and local programming to create a new product. For example, every cable provider has a basic product that consists of the broadcast networks such as ABC and NBC along with a few other channels. You can create a pretty robust package that includes your basic line-up, OTT programming and local programming. Priced at something like $20 per month this would be the most profitable product on your cable system. Today most companies are lucky if they break even with the larger cable packages after paying for all of the programming.

This kind of line-up offers customers a ton of programming including web access to many of the most popular shows they watched on traditional cable. I have anecdotally spoken to several people who have dropped traditional cable for a Roku or Apple TV box and they say that they don’t feel like they have suffered any big drop-off in options. If you can add live network TV and local programming to this mix you have a robust line-up that many of your customers are going to see as an attractive alternative.

I think that cable systems are on the verge of pricing a lot of customers out of being able to afford their services. Expanded basic packages are now $60 to $70 per month in most markets and continue to increase in price every year. So consider a preemptive strike and give your customers a pre-packaged lower cost alternative rather than waiting on them to go find this on their own.

Exit mobile version