On Sky+

Driving around the UK I am assaulted by various billboards with assorted celebrities telling me how easy Sky+ is. They are essentially extolling the virtues of PVRs but the ad campaign implies the only service which supplies such functionality is Sky+ which, of course, requires a Sky subscription.

What amazes me is that Humax has not piggybacked on this by pointing out that you can have all the same features with no subscription by buying one of their boxes. They are equally easy to use. I bought one for my mum and she was up and running in no time. Sky is making money by making people pay a sub for something they can have for nothing. Astonishing.

Disclosure: I own a Humax box, so does my mum.

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 surfing and fast wireless

I was in Australia a few months ago learning how to surf. One day while I was lolling around in the Hunter Valley reading the paper I saw an article about a new chip being developed by NICTA which can shift large amounts of data wirelessly. This is exactly the type of technology which will be needed for the next generation of STBs and if I was a VC I would rush to give them the $10m they need to bring it to market. Stan Skafidis, the project director, said:

The hard yards ahead of the spin-off venture will not be in securing funding but in convincing the market.

Convincing the market means explaining how this new wireless chip will revolutionise the delivery of video. The reason wireless is important is because it is easy. People want don’t want to fiddle around with Ethernet cables on an STB, they want to plug it in and for it to work – wireless is the only way to achieve this. On top of this the wireless connection has to be blindingly fast, 802.11g won’t cut it for a mainstream consumer device – downloading high quality video takes too long. At 5 gigabits per second the NICTA chip fits the bill.

People won’t wait 40 minutes to download a movie even though that is far quicker than waiting for a disc to come from Netflix. Until these speeds come down to under five minutes video downloads won’t take off. One option is to develop software which can start playing the video while it is still downloading but the real answer is radically improving download speeds and that what will convince the market of NICTA’s value. I expect every single next generation STB will need this chip which is what gets VCs excited. I don’t think they will have any trouble getting the cash.

Improving the speed from the wireless router to STB is only one half of the equation. There is not much use in developing a blazing wireless connection if Internet connections are still chugging along at under 10Mbps. In the UK this means a complete infrastructure upgrade, fortunately this seems to be going ahead with a project to lay fibre optics in the sewer system. Once complete the UK will be able to get speeds of up to 100Mbps so props to H20 for pioneering this. I’ll certainly be one of their first customers when they reach London. Another benefit is they won’t have to dig up any roads to do this which I am delighted about since at any one time Thames Water seem intent on digging up at least two sections of my bus route to work. This is an entirely mysterious process as there never appear to be any workers around – just fences, holes and exposed pipework.

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.