[opendtv] Re: Valve's Newell: How PCs Will Take Over the Living Room

  • From: Craig Birkmaier <craig@xxxxxxxxx>
  • To: opendtv@xxxxxxxxxxxxx
  • Date: Thu, 21 Feb 2013 13:09:47 -0500

At 9:49 PM +0000 2/20/13, Manfredi, Albert E wrote:


You keep missing the elephant in the room, Craig.
The devices hyped up by the press, whether any variant of AppleTV or now of this Intel scheme, obsess about having to obtain rights to the content. Jeroen confirmed this too. This (self-inflicted) problem was part of Steve Jobs' own "frustration" in developing Apple TV. 

You are confusing several issues here:
1. The ability to design and sell devices that can access TV content that is AUTHORIZED by the congloms; this content may be available in the free and clear, or it may require some kind of subscription: 
  a. Portals such as Netflix, Hulu Plus and Amazon Prime are subscriber based;
b. Many conglom streaming service require an MVPD username and password for access.
All of these services work with a wide range of devices including game consoles, PCs and streaming devices like Apple TV, Roku and Google TV.
2. The ability to rent or sell content via an online store. iTunes does this across iOS devices including Apple TV, and computers (Macs and PCs) running iTunes. Amazon does this across a wide range of devices, offering packaged media sales and streaming of many titles. Google Play sells/rents movies, TV shows, games and Android Apps for use with Android devices, Google Tv and computers with web browsers.
3. Services designed to compete with MVPDs. Not much here as it is nearly impossible to license the content. The Intel initiative is designed to "change" this, by offering an ala carte alternative to the MVPD bundles. It is far from certain that this will be successful.
ONLY the third approach comes even close to your characterizations. Yes Jeroen is correct, as was Jobs, that the media congloms are the big problem here, requiring licensing for their content.
We agree that the congloms own this stuff and have every right profit from it via licensing. 

We also agree that the MVPD bundles are anti competitive.
Where we completely disagree is that attempts to create VIABLE alternatives to the MVPD bundles are just another "walled garden." IF Apple or Intel, or Jeroen, or Steve Job's ghost, or ANYONE can convince the media congloms to license ALL of their content for an ala carte service, the potential exists for a real marketplace for content to develop.
Unfortunately this is not likely to happen. If the congloms decide to stick their toes into these waters, it is likely that the pricing will be significantly higher thabn the cost of the MVPD bundles today.
For example, you might be able to buy Apps for your favorite channels, but the cost for your favorite 10 channels is likely to equal or exceed the cost of your current MVPD bundle. And this is probably THE BEST CASE.
So how come this was never an issue in the previous un-walled TV distribution model, which was OTA TV? Could it be because the CE manufacturers too want to play "walled garden" to the extent they can? Google as well, by limiting users to their search engine in GoogleTV?
The congloms needed someone to handle customer service and billing. There was, still is, no way for TV stations to collect money from their viewers, other than through advertising. Back in the Golden Age of Broadcast TV, ad revenues were sufficient. Also, there was no alternative to OTA TV until cable and the VCR came along (except going to the theater).
When cable TV began to impact the ratings of the broadcast networks, there was an uproar... 

"They are STEALING our signals!"
The reality was that they were making broadcast TV available to an even larger audience, but why quibble over details. The problem was that they could charge subscribers for the new content - subscriber fees provided the capital to allow fledgling cable networks to compete.
By 1992 the broadcasters were able to regain control over TV distribution, via the Cable Act, which allows them to charge for their signals as well. The congloms used this new anti-competitive power to take control of the vast majority of content we watch today; they now own more than 90% of what you can watch on an MVPD system. Once they had control over content - AGAIN - they started using re-transmission consent to collect subscriber fees.
NO Fuss. No Bother. The MVPDs handle the billing and the congloms rake in $26 billion a year from U.S. TV viewers IN ADDITION to advertising revenues.
The elephant in the room is that the pitiful few open sites these Internet appliances do offer are just token offerings. They have no business subtracting value like that from the Internet. And it's oh-so-obvious that they do so only to bolster their own walled garden.
Why do you continue to place the blame at the feet of the people who are trying to BREAK UP THIS OLIGOPOLY?
I don't understand how anyone other than the congloms is subtracting value from the Internet. In a competitive marketplace you would be able to watch ANYTHING that is advertiser supported, or rent/buy anything WITHOUT ads. 

But this competitive marketplace DOES NOT exist...
Apple, Google, Intel, Netflix, Amazon, et al have NOTHING to do with the problem. 

They are trying to help you, and all you can do is point your finger at THEM!
BTW, iTunes is not a hardware platform. Since you seemed to use it as an argument. But as you saw from my very brief test last night, Apple is happily keeping its faithful users of iPhones, iPads, and AppleTV from using any manner of available Internet TV sites out there.
Really? What sites can I NOT access with an iOS device, using any of the available browsers for these devices? Apple TV is restricted via its own UI, but with Airplay you can access anything that is not BLOCKED by the congloms.
Congloms colluding with one another, to develop combined portals such as Hulu, are no problem for me at all. Why? Because they can do so and they can also retain their own sites, without forcing consumers to buy proprietary and deliberately limited boxes. Congloms colluding with CE manufacturers is a whole other matter.
You're next. Hulu blocks everything but PC browsers. But that's OK, because there's an App for that! 

It's called a Hulu Plus subscription.

Regards
Craig


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