On video

The BBC’s iPlayer goes from strength to strength hitting 21 million requests in April. During the same month on the other side of the Atlantic Venturebeat reports Hulu is thriving with 63 million videos served which led me to wonder whether the wag at Google who dubbed the service Clown Co is still laughing. YouTube is as popular as ever but apparently struggling to turn all those eyeballs into cash whilst coming under increasing pressure from content owners who want a slice of the pie.

In the UK, BSkyB Chairman James Murdoch has been complaining that the BBC’s access to its own content and free money in the shape of the license fee represents unfair competition for commercial broadcasters. Speaking as a consumer I like the streamed service and as TV is increasingly delivered over the web, demanding the BBC be prevented from streaming its content online is effectively asking it to be shut down.

I think the BBC’s position is justifiable so long as it behaves differently from commercial broadcasters and makes its content freely available to others. So far it appears to have done so, being one of the first major media conglomerates to enter a non-exclusive deal with YouTube. To me this approach encourages competition rather than stifling it. So long as the BBC continues with this open approach then good luck to them, maybe someone over there should get in touch with the Myka people.

All content owners are under considerable pressure from the dominant distribution system at the moment: piracy. There needs to be an answer as no company which makes a living from selling music and video to consumers and advertisers can move from an offline world which was 95% legitimate consumption against 5% piracy to an online world where the reverse is true.

For too long there has been a conflict between media and technology companies. Neither group has been completely in the right, the former having been too conservative in the face of the threat from piracy and the latter expecting swathes of content to be given up with little prospect of payment. Fortunately things are moving in the right direction, content owners are warming to new ideas and startups like ours are showing a clear way of monetising the traffic.

On Roku and Netflix

Roku has just released its Netflix Set Top Box. As you can tell from my previous posts I am an STB evangelist and I’m always glad to see new boxes out there. At the moment I am unmoved from the position that Humax will take this game but props to Roku for trying.

I am about to make my usual mistake of critiquing the thing without actually trying it but here goes. First the design. The box looks awful. Hasn’t anyone learnt anything from Apple’s success? When will consumer device manufacturers realise that design matters? The remote is ok, nice and simple, but it doesn’t look that great either. Seriously dudes, Pininfarina does a lot more than cars these days so just give them a call next time before sending another soulless brick our way.

Second the service. It’s called the Netflix Player and as far as I can tell that’s all it can do – stream films from Netflix. I’m not going to get as excited as Arrington over this for one simple reason: no tethered box will ever make it. The Roku doesn’t even have its own hard drive, it streams everything directly which means people will have to drag an ethernet cable to the living room to make it work. This is way too much effort for the consumer. There is a limited amount of space under people’s televisions and they want one box that does everything. Every service (Amazon, Apple, Netflix, Blockbuster, whoever) will have to be available to every box. Trying to tie everyhting down will simply delay the STB revolution and encourage piracy.

Although I have gone long on Humax I’d like a side bet on Myka, the most interesting STB currently out there. In BitTorrent they are harnessing the best underlying technology and they are pursuing an open platform. Now I’m not sure where they are with the content deals – that will be the hard part – but I think open boxes are definitely the way forward. This is why I’m so enthusiastic about Humax: one payment and you are away, no fees, no subscriptions. What people really want is freedom, not free.

On Humax and Set Top Boxes

I recently bought a Humax Set Top Box following the demise of my Freesat STB. Apart from Citylink Beckenham making me wait an hour to collect it I am delighted all round. These things are pure genius and I have no doubt Humax will take over the world while bigger companies are fannying around with things like DVD recorders and Blu Ray. The real breakthrough will come when STBs get wifi and can connect directly to the Internet.

This is something we are ultimately planning towards with our startup. TV and film services on the desktop will never make any real money as most people aren’t prepared to sit at their computer to watch TV. Now I know what you are thinking ‘I watch TV on my computer all the time’, my point is that you are not ‘most people’. First of all you are reading a technology blog, secondly to get your desktop TV you are willing to monkey around with uTorrent, Mininova, Bitmetv or whatever which most people are not prepared to do. They just want to point a remote at their TV and go.

At the moment we are in the (very) early days but the destination is increasingly clear: smart STBs. Until Toshiba folded recently there was a great debate over whether HD DVD or Blu Ray would triumph, my prediction is they will both lose. This situation is reminiscent of the mid-nineties when a debate raged over what would replace the CD, the two contenders were DAT by Philips and MiniDisc by Sony. Ten years later who has either? Hard disk based players came along, Steve Jobs spotted the trend and the rest is history.

Smart companies like Apple are not even involved in the next-gen DVD market, focusing instead on smart STBs. That said the iPod prospered long before the iTunes Store because of the explosion of filesharing when Napster launched in 1999. The iPod arrived two years later and was built to capitalise on this content explosion. This time Apple is building the device and tying it to the store. The problem with this approach is that people generally won’t pay $1.99 per episode (or more in HBO’s case) for content they can record to their STBs or get from Mininova for nothing.

To me a far more interesting development is BitTorrent’s move into STB software and the emergence of the Myka STB. This is the future. I expect over the next few years for something similar to happen with video as did with music. In the early days content owners will be determined to use DRM to tie down consumers before realising there is no future in restricted services and opening up. It will need a compelling argument for content owners to do this – in particular how any service can beat piracy. That’s where we come in.