I Want My TiVO! Cutting the Cable on Cable Cutting

Tech industry investment money has generated what it wanted – a perception within the TV biz that “old TV” is dying as people cut the cable. And they’ve titled this trend “cable cutting”. (Statistics show it’s still a relatively limited trend so far.)

And with all this hype over the past decade I’ve been bothered by a fundamental logical flaw:

• Enormous amounts of money are required to develop programming people want to watch (there are a few exceptions – but they don’t translate into a reliable low cost approach).
• Yet the enthusiasts for cable cutting have made it all about low cost (usually nearly free) subsistence viewing.
• If no one can afford to develop the programming to satisfy consumers, consumers won’t be satisfied.

In streaming we now see financial reality rear it’s ugly head.

Challenge the Myths of Internet TV with Reality

There’s huge money to be made, apparently, for consultants who project radical future change. In TV, that means suggesting TV becomes a variant of online video. (Really? We need better produced cat videos?)

But the rest of us have to earn our money based on reality. And lately there have been some interesting truths to help anchor TVs future in reality.

Future TV Skepticism: Why I Don’t Think Apple will Conquer TV

It’s been a crazy week of reports on TV. It started with the extremists predicting nothing less than complete destruction of TV. They report this, of course, with tremendous glee – after all it’s good for your career to predict the demise of TV.

On the other hand, we’ve been fortunate to read responses from savvy TV watchers who observe TV with more clarity and better awareness of history. In particular, check out this post by Wayne Friedman of Media Post. (Link Here.) And I highly suggest you read this one about why internet HBO would cost far more than cable HBO cable – far more than anyone would pay. (Link Here.)

Cable Cutting & Self Righteous Attacks on TV

I get pretty miffed when the “cable cutter” enthusiasts try to argue that online video will drag society out of the depths of depravity found in TV programming.

After all, what are most teens watching online? You can bet it’s NOT Masterpiece Theater or Nature. More likely they’re watching video’s of guys becoming eunuch’s when skateboard tricks land them on handrails.

This attack in TV is nothing new. I remember making it a few times in youthful enthusiasm while in college. Still, proponents of new media too often sound like sci-fi books — promising a “glorious future” where the internet changes mankind. (They are, of course, merely the latest to claim to remake humanity in thousands of years of such movements.)

GoogleTV: “More Returns than Sales” (Logitech)

I was skeptical of GoogleTV. It seemed Google fell prey to corporate hubris – believing they could build anything and make the marketplace think it’s valuable.

And from the start Google revealed they had no coherent strategy to deliver value to consumers. Instead, announcements made it clear they were in a desperate ploy to steal ad revenue away from traditional TV.

How is it that Television Keeps Getting MORE Vital, Not Less? (Including Some Surprising Thoughts from Jobs.)

There’s something in the water of technology centers in the US that drives an idea that digital media always means revolution. It’s been there a very, very long time. And it makes pretty outrageous claims about technology’s impact.

But when it comes to “revolution”, more often than not, human reality keeps getting in the way. Nowhere is this more true than with the digirati myth that TV will diminish and fade into the past.

Mid-term Status on Web Delivered TV – Chaos Only a Geek Could Love

My family upgraded to a beautiful new 55″ flatscreen, moved over our Comcast and TiVO, then added an AppleTV and upgraded our sound system. And, so, in one grand swoop, we became a modern TV family.

How is this new world? No longer needing to go to the video store for old movies is quite nice. But prepare yourself for four types of chaos.

Content Chaos

You’d think that a monthly Netflix subscription would deliver everything we need. But Netflix streaming has massive content holes. Even worse, there’s no way to predict whether the content you want will be available or not. Besides, Netflix only has old stuff. Old movies. Old reruns. And Disney isn’t on Netflix – at all.

So how about Hulu? The Blazer’s playoff game bumped 30 Rock. Of course, this season isn’t on Netflix. I find it on Hulu – the paid version (cha ching). We have a monthly now, but we really don’t need Hulu. Our cable/DVR combo is much better except for those few times there’s a problem with the cable feed.

Ah, but what about new movies? They are not available on Netflix. That means we have to either seek them at Redbox, TiVO them from the HBO feed, or pay through Comcast OnDemand or AppleTV. Hmmm, $4 a pop.

So we thought we’d figured a lot out. But then the Bin Laden raid pre-empted The Amazing Race. But who wants to miss that episode. So, we dashed off into Digital TV. Where to look? Netflix? Nope. AppleTV? Nope. Hulu? Nope. CBS’ website? Not on my iPad. Ah, its on the website if we choose to access it with my wife’s laptop. And as long as we wait some period of time after it was supposed to have aired.

Format Chaos

Before content chaos we confronted format chaos. These devices bombarded us with format options. HDMi or RGB? Svideo or RCA? 720p or 1070p? HD or SD? And each device (except AppleTV) has a huge range of input or output settings. Which one’s work well together? My former network manager wife shook her head as we tried to sort out the alphabet soup.

Remote Chaos

After basic setup, we entered “The Remote Zone”. Our TV is surrounded by 5 devices – each with it’s own unique remote. Then, I remembered a programmable universal remote I’d been given. About 3 days of tinkering later and one remote carried the whole system. Whew.

Reliability Chaos

So we get this all cobbled together… And then there’s an unreliable signal. With Netflix at least once or twice per movie or rerun we lose lip synch and have to restart. At other times Netflix stops in its tracks and pops us out. This didn’t happen wtih – what’s do you call that not so old way – cable?

Not Ready For Consumers

This world is far, far from a consumer quality world. Why?

Too complicated. You REALLY have to want to watch something to figure it out. (And, no, this won’t be fixed by making it 100’s of times more complicated with Google searching on the web.)

It is waaay too expensive. 10 monthly bucks here and there. Then little bits of $4 to get one movie at a time. So right now we are probably paying $30 to $40 per month over our cable bill. But Cable offers more and is easier to use.

With all this in place, we still mostly watch Cable using our DVR – a simple system that is cheaper and delivers the vast majority of what we want.

My kids watch the most on these digital gizmos. It seems to fit their developmental stage interest in watching the same basic program over and over.

And yet, have the digerati claimed about all this digital so-called freedom? That it’s simple and less expensive. NOT IN MY EXPERIENCE!!!

A Call To Action: Fix It

It’s true – none of this was possible 6 years ago. But that’s not the point.

Right now Netflix is real, but Hulu and most of the other options are toys. For them to move beyond this stage, they must rise to mass consumer quality. Consumers won’t pay extra monthly fees without getting far more in a far easier format.

The way things are going I expect we are entering a period with 5 years of bankruptcies, sales, mergers, and acquisitions. Then, maybe someone will bring it together under one roof.

Who might that be? Love ’em or hate ’em, my guess is that it’s the cable providers (e.g. Comcast) who are going to create a unified system. And given their track record for making easy-to-use technology, that should probably concern us all.

Copyright 2011 – Doug Garnett – All Rights Reserved

Research Proves Netflix is the Internet Hawg. What Will the Angry Birds Do?

A recent report looks at all Internet bandwidth (upstream and downstream) and concludes that Netflix is now the single biggest consumer of bandwidth. (Report here.)

And so it begins.

What begins? That’s the big question. Fundamentally, the Internet universe we have come to know and love is threatened by the onslaught of movies online.

For example, in my neighborhood we can tell when our neighbors start watching movies – because our bandwidth slows down dramatically. And, talking with folks, it’s a pretty universal experience to lose Internet speed on Friday afternoon/evenings as well as weekend evenings.

Does this mean an apocalyptic Internet disaster? Probably not. But it looks like Netflix has stolen the internet eggs that we’d like to use for other things. And, from what I can see, the consumer, the movie business and the Internet business are all unprepared for the havoc Netflix is wreaking.

Netflix’s Loophole. I’m told that Netflix dominance is made possible in large part by a short term loophole. Right now, high speed Internet relies heavily on past investment in infrastructure that contributed to the dot com crash, then was bought for a song and expanded in the past decade. My guess is that this means that the current equation (you get all the movies you want to watch for under $10) isn’t likely to last.

So Netflix is using a type of bait and switch tactic: hook us with low prices and it sure looks like they’ll have to switch to high fees later. All this made possible because they don’t have to pay for the bandwidth they’re using today. The result will be that we end up paying more for Internet delivered entertainment than we ever have for cable.

There is an alternative outcome. Comcast (and other cable operators) seem to be the Timex watches of the entertainment business. Nothing exciting. Nothing particularly motivating. But they take a licking and keep on ticking. So in truth, Comcast may dominate and Netflix could be forced out of the picture.

I never believe companies who claim they have suspended fundamental economic truths. And Netflix’s statements about bandwidth lack economic truth. Fortunately we were reminded recently that economic laws can’t be broken when Blippy had to return to a sane business model.

So let’s hope that sanity comes back to the discussion of TV over Internet. Because right now it’s stuck in an imaginary economic universe where bandwidth performance is free.

And lets hope some of those angry birds get their eggs back so we don’t move back in time and end up with the neighborhood equivalent of dial-up because the Hawg stole the bandwidth.

Copyright 2011 – Doug Garnett – All Rights Reserved

More Research Shows DVR’s (e.g. TiVO) Increase Advertising Impact!

Unless you’ve been isolated on a 15 year space mission, you know that the ad business has spend 15 years telling us that DVRs will destroy ad viewing.

But those who pay closest attention have long suspected this isn’t true. And there has been data showing that DVR’s haven’t decreased TV effectiveness. Now Nielsen’s detailed DVR tracking confirms what other studies have shown (click here for the MediaPost summary of the study).

Squirrel! Advertising Agencies Chase Utopian Theories

There’s nobody easier to sell to than other salesmen. Unless, of course, you’re promising a consumer revolution to advertising agencies. Then, stand back and let the stampede commence!

I was reminded of this recently by the promotion for a communication conference. It opens as follows:

THE GREAT DISRUPTION – The consumer strikes back. 

For decades new technologies and media consolidation overwhelmed viewers and readers with new platform options, countless channels, confusing dials, settings and features no one asked to get. Now, the ’disrupted’ consumer is the one disrupting old media and ad institutions. The agency is scrambling to remain relevant in a world where consumers ignore ads and work their social networks to make decisions. They are fleeing the desktop for mobile media faster than content and marketers can keep up. Their love of time-shifting and multi-screen multi-tasking has attracted a mob of tech, media and digital companies all skirmishing for their attention as all platforms seem to converge in the living room. Technologies are no longer the great disruptors; the consumer is.

Recent email promoting the Online Media Marketing Association conference

Sound familiar? It should. It reflects group think found in many corners of the advertising biz and featured in a recent Fast Company article. Sadly, this group think is rampant among people who are paid enough that they should know better.

It seems to me, though, that ideas like this get their power in the advertising industry because agencies dislike the idea that they are selling things. All this “power to the consumer” and “consumer revolution” group think seems to be popular because it is anti-salesmanship.

It doesn’t matter that the ONLY reason that their jobs (advertising roles) exist is to help companies sell things to their consumers. It doesn’t matter whether we are in brand advertising, social media, online content creation, retail, display, outdoor or hard core direct response – everything we do is about selling goods to people.

Perhaps this reality is too hard to accept when you have an elite training at an art or portfolio school. Not liking the reality, it’s much nicer for a 20-something (or 40-something) to get excited about some nearly utopian mythology implying companies who become social butterflies will see their goods whisked off the shelf. (These theories usually help agencies make themselves rich while accomplishing little for their clients.)

My tendency is to respond with a tough message: Deal with it or get out. Truth is, you shouldn’t be in advertising unless you are dedicated to selling goods (today or in the future).

That doesn’t mean we’re sharks – it means we know our value to our clients. What advertising does is important and valuable – to people, to consumers, and to the economy. Our work creates jobs at companies (desperately needed jobs) in manufacturing, engineering, accounting, and more. Our work helps connect consumers with products they love. Well executed, our work builds a strong foundation for companies to thrive.

Of particular interest, the claims in the OMMA statement flat out aren’t true. So, for anyone who wants, I’ve posted a line-by-line deconstruction of the comments.

Why write all this? Advertising is important work to the country and our economy. It deserves better than this AdBuster-driven self-loathing.

Copyright 2011 – Doug Garnett