The most profound announcement that came out of CES may have been the one with the lowest profile.
On Tuesday, Netflix announced that it had partnered with a number of device manufacturers to embed a “Netflix button” on them. The implications aren’t subtle: Netflix sees itself as good enough, or likely even better, than any other channel that streams content on the television. After all, Netflix seems to be saying, do you mean that I should wait for a network to show me a movie?
Of course not. And in the future, TV makers will not want to, either.
Content providers, on-line services, device makers, and, yes, consumers are locked in an on-going war over content. The same technology conglomerates that suddenly realized that consumers liked creating content – what, you mean that our customers will actually make our own commercials for us? – want their slice every time a consumer touches their content. Remember, for years a consumer would have to pay each and every time that he or she visited a motion picture theater. But in the 1980s, users began paying a single price for a motion picture channel like HBO. All-you-can eat became ingrained in the American psyche.
Now, however, consortia like the DECE want to install initiatives like “Ultraviolet,” which will “encourage” users to download and “own” media that they do not actually own, all hosted on a Hollywood server. In their camp are companies like Blockbuster and Vudu, which grant and encourage users to “rent” first-run movies over the Internet. I tried out Wal-Mart’s Vudu service over the holiday (they offer a free rental to start things off) and both my wife and brother-in-law commented admiringly of the video quality. Netflix Instant Streaming doesn’t offer almost the immediacy of Vudu, where you can watch Inception and Avatar, among others.
And you know what? That’s perfectly OK by me. With a three-year-old in the house, I have not almost as much free time as I would like. I’ve written before about how my son likes watching YouTube Leanback on my Logitech Revue. But in his very limited TV time, he is also perfectly happy to watch a Thomas the Tank Engine video on Neflix. Or Sesame Street. Most of the time he wants a book read to him – the ideal solution!
Neither he nor I really see much difference between Netflix streaming and the video that “streams” from ABC, NBC, ESPN, or TNT. The only difference, to me, as a consumer, how I access Netflix – either as a menu option on my PlayStation 3 or Logitech Revue, or a site that I can visit on my laptop. These still require intermediate steps. Putting Netflix on par with another channel means accessing it with the ease and convenience of any other channel. And that is what placing the button on the remote does.
Piracy is an economic force. Free is an economic force. Hulu’s business model was a response to piracy. Others, like Google – before it “got religion” in an attempt to bring YouTube in line with Hollywood – and Snapstick, appear to be responding to customers, and enabling them to bring the Web to the TV screen.
The TV companies are in the catbird seat. We do not call them “home theatre” companies for nothing; they provide the screens, and an Internet-connected tv can supply any app that it has the horsepower to draw. In a few years, products like Google TV will simply be integrated into the television; the only reason we have not seen an integrated TiVo is the investment users have made in their set-top boxes. I believe those services are coming.
The point is, however, is that the HDTV is a neutral service. An HDTV manufacturer can include an a-la-carte app; it can also add an all-you-can-eat service like Netflix. The Netflix deal is an attempt to stake out an advantageous position.
For now, Netflix chief executive Reed Hastings has stated that the growth in Netflix subscriptions is enough to pay for new content. Eventually, that growth will slacken. Netflix will most likely accede to Hollywood and start paying for content. Another, competing service will evolve. Will it be Snapstick? Some other?
Content follows the medium. Desktop PCs have given way to notebooks, and to mobile phones. Now there are several new, smaller battlegrounds: the tablet, the connected TV, the media streaming device. But they will all converge on the TV, and it is there that Netflix wishes to be king. The question is who will be the power behind the throne.
source : www.pcmag.com
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Submited at Tuesday, January 11th, 2011 at 1:00 pm on Uncategorized by robert
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