Multiplatform News: Google Acquires SageTV

  • Google announced it has acquired Inglewood, California-based SageTV and the company’s multiplatform DVR technology.
  • SageTV integrates broadcast, Internet, Netflix and Hulu via its Home Theater PC (HTPC) software.
  • SageTV Placeshifter enables users to view TV from any high-speed Internet connection, similar to Slingbox.
  • Although details have yet to be announced, we may see SageTV functionality incorporated into Google TV.
  • From the SageTV site: “We’ve seen how Google’s developer efforts are designed to stimulate innovation across the web, and as developers have played a core role in the success of SageTV, we think our shared vision for open technology will help us advance the online entertainment experience.”
  • The Engadget post features the SageTV press release and a 4-minute video (created by user jaredduq).

Best of D9: All Things Digital Conference

Walt Mossberg and Kara Swisher of The Wall Street Journal hosted the D9 (D: All Things Digital) conference May 31 to June 2 in Rancho Palos Verdes, California. The annual event featured compelling interviews and demonstrations from an array of top media and technology executives representing companies such as HP, Twitter, AT&T, Nokia, Netflix, Disney, Adobe and many more.

The D conference was established in 2003 by columnists Mossberg and Swisher as an annual showcase for technology innovators and big names from the worlds of business, entertainment and occasionally politics. This year the title was “D9” (indicating its ninth year). The conference is known for hosting influential heavy-hitters and its somewhat exclusive nature. Typically, attendance is limited to about 500 guests.

ETCentric readers were quick to forward relevant news items and announcements that emerged during this year’s show. The following is a collection of links to articles and videos submitted by our readers, accompanied by their comments:

 

D9 Video: Eric Schmidt Highlights

  • Google, Apple, Amazon and Facebook are successfully exploiting global platform strategies.
  • Challenge working with entertainment companies since taking content from scarcity to ubiquity.
  • Also need to deal with disintermediation and piracy. On privacy, Google will remain a place where you can do anonymous searches. And committed to insuring you have control over information they have on you.
  • We’re seeing the consumerization of IT that will lead to the death of IT as we know it.
  • There are not sufficient resources to develop for more than the two largest players: Google and Apple.
  • Search is moving from link-based answers to algorithmically-based answers using artificial intelligence.
  • Concerned about a balkanization of the Internet, which will lead to an Internet per country.
  • If you’re concerned about security, use the Chrome browser and use a Mac.

 

Google Shows Off Its Groupon Killer, Launching Tomorrow

  • Video of Eric Schmidt’s demo of Google Wallet and Google Offers.
  • Google is not charging a processing fee but is taking a share of the offer.
  • Credit card companies are willing to upgrade the POS terminals to get benefits of higher security.
  • Lookout Groupon, LivingSocial, etc.!!!

 

Groupon CEO Andrew Mason on Google, Clones and Hubris – But Not on an IPO

  • CEO sees Groupon evolving in three phases so far: One – the Daily Deal, Two – Personalized Deals, and Three – a technology company where they become more integral to a person’s daily life (i.e. wherever they are and whatever they want to do, they can get a deal right now based on the inventory of available deals).
  • Could you use Groupon to sell media?

 

D9 Video: Microsoft’s Steven Sinofsky on Windows 8

  • 95 percent of how the world gets on the Internet is through Windows.
  • Windows 8 will be a “modern” rethink to enable PCs and tablets to satisfy “things they say are solved in an iPad” and still bring all the benefits of Windows.
  • Video demo of Windows 8 showing touch-based UI (can still use mouse too), live tiles.
  • Targeting 2012.

 

D9 Video: Fanhattan Demo

  • Free video discovery app Fanhattan launched at D9 this week.
  • The iPad app serves as a directory and discovery engine, sourcing reviews and ratings from Metacritic and Rotten Tomatoes, while organizing related content from the likes of YouTube, IMDb and Amazon.
  • Also shows pre-release version running on an Internet TV which is capable of creating a branded movie page in this case for Pirates of the Caribbean.
  • It connects to iTunes, Netflix, Hulu and the ABC Player to view TV and movies.
  • CNET review: “This free iPad app sounds simple–it finds stuff about movies and TV shows you want to watch–but the depth of the content, utility of what the site does, and clarity of the interface just puts this app on a different level than anything else I’ve seen.”

 

D9 Video: Hewlett-Packard CEO Leo Apotheker

  • WebOS will be available to other companies and enterprises for their own use.
  • Goal is to create an end-to-end ecosystem that figures out on a single device in the Cloud whether you’re doing enterprise or private work.
  • HP can create a large ecosystem of printers, PCs and tablets amounting to 100 million devices a year itself. They hope to interest others as well.

 

D9 Video: Reed Hastings Highlights

  • On Netflix’s virtuous cycle: the more content they get, the more members they get and they can pay more for content.
  • Consumers want all the new stuff but that’s very expensive.
  • At $8/month, they’re a compliment to the new stuff.
  • The news stuff will remain pay-per-view since has higher margin for content owners.
  • Can grow from 24 million subscribers currently to capture Internet TV and tablet viewers plus a share of the 5 billion active mobile phone users worldwide who like video.
  • Need to stay innovative.
  • Focus on talent density, which is the fewest number of talented people.

 

D9 Video: Twitter CEO Dick Costolo

  • Took three years to send the first billion tweets. Now sends a billion tweets every SIX days!
  • There are over 600,000 developers who have downloaded over 900,000 API tokens.
  • Will look to TweetDeck (recently acquired) as the professional UI.
  • Rolling out a native photo sharing app, relevance sorted search results and web intents which allows you to add a Twitter client into your website. 80 percent of advertisers using promoted tweets renew.
  • Advertisers are experiencing very high engagement rates (VW’s ad: 52%).
  • Focused on success of business, not IPO.

 

DARPA – The Coolest Agency You’ve Never Heard Of: Regina Dugan at D9

  • Regina Dugan’s DARPA t-shirt says “Impossible, Improbable, Inevitable” which describes the progression of their programs.
  • Developed Internet, GPS, stealth, night vision, UAV, MEMS technologies.
  • DARPA’s Mission is the “prevention and creation of strategic surprise.”
  • Encourages programs to have the big success.
  • So that means they can’t fear failure. Fear of failure is the limiting factor.
  • Talks about growth in need for cyber security, new computing architectures, explosive detection system.

 

D9 Tech Demo: Inkling

  • Inkling reinvents the college textbook for the iPad that is both interactive and social.
  • Rather than paying $200 for a book, you can buy it a chapter at a time for far less cost since the content is not re-sold like a physical book.
  • See impressive video demo.

Netflix Leads Downstream Internet Traffic in North America

A new report from Ontario-based Sandvine indicates Netflix video streaming content currently accounts for the single greatest source of peak downstream Internet traffic in the U.S. (recently reported as 29.7 percent, up from 21 percent last fall).

According to TechCrunch: “That puts Netflix above HTTP websites (18 percent), BitTorrent (11 percent), and YouTube (10 percent) as a source of downstream traffic during peak times in North America. (BitTorrent still accounts for half of all upstream traffic). As whole, ‘real-time entertainment’ (which is mostly video streaming, but also includes streaming music) accounted for 49 percent of downstream traffic in March 2011, versus 19 percent for P2P file sharing, and 17 percent for Web browsing.”

The Global Internet Phenomena Report: Spring 2011 from Sandvine also offers the following observations:

  • Real-Time Entertainment traffic is continuing its journey to network dominance, particularly in North America, where it represents 49.2% of peak period fixed access traffic. If this rate of growth is sustained, Real-Time Entertainment will make up 55-60% of traffic by the end of the year.
  • The continued growth of Real-Time Entertainment enables a seemingly contradictory conclusion: P2P Filesharing is here to stay, at least for the immediate future, as evidenced by the marginal drop in share from 19.2% of peak period traffic in Fall 2010 to 18.8% in Spring 2011.
  • The composition of upstream traffic on Latin America’s mobile networks has changed dramatically since the previous study. P2P Filesharing has supplanted Real-Time Entertainment to become the largest consumer of upstream capacity, accounting for 46.4% of uploaded bytes.
  • Europe’s networks reflect rapidly shifting user preferences. Levels of P2P Filesharing and Web Browsing traffic have changed dramatically since 2009, with no consistent trend appearing. Nevertheless, an important exception in this dynamic market is the Real-Time Entertainment category, which continues to grow steadily.

Related Bloomberg article: “Netflix Offers Streaming Movies on Google Android Phones” (5/12/11)

Netflix CEO Reed Hastings Predicts a Gigabit to Homes by 2021

At this week’s Wired Business Conference in New York, Netflix co-founder and CEO Reed Hastings discussed his company’s growing success and its reliance on the evolution of bandwidth-related technologies. Netflix recently announced its first quarter earnings (up 88 percent with revenues at $719 million). The subscription-based rental service added 3.6 million new customers during the quarter, double the growth from one year ago.

Hastings indicated that streaming was always the goal of Netflix, but the technology was not ready when they launched the subscription service in 1999. Based on number of hours viewed, the Netflix streaming option surpassed its DVDs for the first time in Q4 2010. This is due to a larger selection of streaming content and improved bandwidth to subscribers.

Hastings has been waiting for this moment. “We took out our spreadsheets and we figured we’d get 14 megabits/second to the home by 2012, which turns out is about what we will get,” he explained. When asked about the next ten years he added, “If you drag it out to 2021, we will all have a gigabit to the home.”

Hastings was also careful to point out that he does not see Netflix streaming as a competitor to cable, which is why his service focuses on older movies as opposed to new releases, sports, or news (although Netflix is experimenting with original programming). “It would start an Armageddon battle, and we would not emerge alive from that battle. So we are concentrating on our niche,” he said.

Related Wall Street Journal article: “Netflix CEO Reed Hastings Swears He’s Not Going to Kill HBO: ‘We Compete Like Football and Baseball'” (5/6/11)

Related Engadget article: “DirecTV asks its customers what they like so much about Netflix, could launch competitor” (4/26/11)

Related ReadWriteWeb article: “Netflix Letter to Shareholders Shows It Couldn’t Care Less About DVDs” (4/25/11)

Related TechCrunch article: “Netflix Earnings Up 88 Percent, Adds 3.6 Million Subscribers” (4/25/11)

Related Home Media Magazine article: “Marvel Superheroes Stream on Netflix” (4/29/11)

Premium VOD: New Distribution Model from DirecTV?

The nation’s No.1 and No. 2 satellite TV providers may be looking for new ways to provide movies to consumers. Dish Network (No. 2) recently purchased the assets of bankrupt Blockbuster for $320 million and may use the company’s online streaming service to take on video rental enterprises such as Netflix.

Meanwhile, DirecTV (No.1) is reportedly in talks with Hollywood studios regarding a new movie rental service that would provide $30 rentals just two months after films’ theatrical releases. Studios that are looking to combat slumping DVD sales believe that some consumers, especially families, may be willing to pay the higher fee for access to titles prior to their availability on DVD or from services such as Netflix.

Analysts explain that movie studios are open to new online streaming or pay-per-view models in order to recoup revenue from declining DVD purchases. We may also see $30 premium movie-on-demand offerings from cable firms such as Comcast and Time Warner Cable.

Related TVPredictions.com post: “DirecTV to Offer $30 VOD Next Week?” (4/15/11)

Related Engadget post: “DirecTV, Comcast, Vudu could start offering premium VOD $30 movie rentals in April” (3/31/11)

Netflix Announces Exclusive Rights to Fincher-Spacey Political Drama Series

Netflix has taken another big step forward in offering premium content, following its announcement that it will have exclusive rights to stream 26 episodes of the original series “House of Cards” starting in late 2012. The Internet streaming service outbid cable channels such as HBO and AMC. “House of Cards” is a political drama based on the 1990 BBC miniseries of the same name. The new production will star Kevin Spacey; David Fincher is tapped to direct.

The deal is a big move for Netflix, which traditionally only airs previously produced and aired content. For the first time the company is licensing content before it is successfully produced. “Typically, we license TV shows the season after they run on a broadcast network or cable channel, and occasionally we have episodes from a current season, as is the case with ‘Saturday Night Live’ from NBC, ‘Spartacus’ from Starzplay and ‘Wizards of Waverly Place’ from Disney Channel,” Chief Content Officer Ted Sarandos wrote on the Netflix blog. “In all of these cases, the shows are produced before we bring them to Netflix. ‘House of Cards’ represents a slightly more risky approach.”

According to Ars Technica, Netflix currently delivers 61 percent of all digital video content to U.S. viewers. However, it should be noted that Amazon has tossed its hat into the ring with an instant video service that undercuts the Netflix streaming subscription by approximately $16 per year.

Related Wall Street Journal article (subscription required): “Web Shows Get Ambitious — Tech, Media Companies Race to Create Video Hits that Look, Feel More Like TV” (3/21/11)

Related Business Insider article: “Exclusive Interview with Netflix CEO Reed Hastings — Netflix’s Market Opportunity Is a Lot Bigger Than You Think” (4/4/11)

Related Ars Technica article: “Amazon Takes on Netflix with move streaming service for Prime” (3/11)

Apple may Offer Streaming Video to Devices via AirPlay

Apple is considering adding streaming video to its AirPlay service, which currently allows users to stream audio from an iPhone, iPad or iTunes to a home stereo or other devices. According to Bloomberg, two people familiar with the matter (who asked to remain anonymous) suggested the new feature would enable streaming video from an iPhone or iPad to television sets — and that Apple would license its software to CE manufacturers who could potentially use AirPlay in their devices for streaming movies, television and other video content.

Expanding AirPlay functionality could possibly spark more use of Apple devices and services in the home, despite the company’s limited success selling the $99 Apple TV set-top box thus far. Bloomberg reports that, “For Apple, AirPlay is a way to expand into the living room without having to introduce new products.”

While Apple and others such as Google are looking to explore the possibilities of streaming video and Web-connected televisions, a challenge for streaming content from a mobile device involves bandwidth issues and whether signals can be carried without interruption. Regardless of any technical obstacles, there is clearly a shift in how consumers are accessing TV shows and movies, with an increasing number of people accessing instant streaming services from the likes of Netflix and Hulu. Apple’s Steve Jobs — banking on a complete shift from physical media toward content distribution in digital form — has gone so far as barring Blu-ray players from Mac computers.

Are Consumers Ready to Cut the Cord?

As alternatives to traditional cable TV services continue to be introduced, the discourse grows regarding whether or not consumers are ready to “cut the cord.” Recent data from ESPN and research firm SNL Kagan suggests that any cable subscriber losses are being offset by gains elsewhere. However, as a percentage, fewer households are subscribing to cable than in the previous year. And financial services firm Stifel Nicolaus recently reported that pay TV might not be making a comeback over the longer term. The research report indicates year-over-year subscriber growth was at a mere 0.3 percent during 2010 — “the lowest year-over-year growth on record.”

According to Stifel Nicolaus analyst Christopher King: “Cable operators have been quick to point to housing and the anniversary of the nationwide digital transition in 2009 as reasons for recent subscriber declines; however, our analysis suggests that growth in the pay TV market has underperformed household formation in recent quarters and the impact of the 2009 digital transition should no longer be an issue.”

The pay TV market is over-saturated (at more than 84 percent of households), and while many continue to blame the state of the economy and the saturation on the declining numbers, it is interesting to note that Netflix added 6.4 million subscribers during 2010. As the cost of pay TV subscriptions continue to rise, consumers are beginning to “further re-evaluate the value they place on traditional pay TV services which bodes well for the likes of Netflix, Amazon and Apple TV among others,” King wrote in the report.

Editor’s Note: For those interested, the GigaOM post “Cord Cutting Threat Ain’t Over Yet” features some very interesting charts including Pay TV Subscriber Growth 3Q09-4Q10, Pay TV Penetration 4Q06-4Q10, and Netflix Subscriber Growth 2010 (as compared to Pay TV).

IntoNow App Takes Social TV to the Next Level

IntoNow is a new iOS app that identifies and tags live TV shows in realtime, creating something similar to Shazam, but for television rather than radio. Users press a button on the app interface while viewing a television program and, with the aid of a platform called SoundPrint, the app uses the program’s audio for identification within 4-12 seconds. The results appear on the iPhone or iPad screen and can be shared via social networking entities such as Facebook or Twitter, or can be added to a Netflix queue.

Engadget has a video demo where the user is watching CNN on a laptop (place-shifted via SlingBox), and uses the IntoNow app on an iPad to identify the TV stream. Based on the sharing features, users can also see what their friends are watching, check out program info for selected shows, and even leave comments. Social interaction is taken to the next level with push notifications in which the app lets users know when their friends are viewing the same content.

This is yet another step toward media content sharing that may significantly impact consumer viewing habits. Engadget reports that the initial launch is iOS only, but the company has plans to tackle other platforms such as Android.

Related Forbes article/review: “IntoNow Just Foursquared TV. Can It Groupon Its Commercials?” (3/25/11)