Mark Suster's presentation this week to the VCJ Alpha Conference was spot on (as usual) both in its analysis of the VC industry and his calling out the next big thing after social networking: television. I'd like to take this a bit further and slay a few common industry assumptions in the process. The next big thing is indeed TV, but not as you might expect...
The Coming TV Revolution (part 1)
The recent coverage of Eric Schmidt’s MacTaggart Lecture in Edinburgh and the much-anticipated (re)launch of Google TV in the UK have highlighted the way in which most of the industry is missing the point on Internet/TV convergence.
They’ve got it wrong on 3 fronts:
- Pushing more choice of content.
- Misunderstanding how the medium of TV is consumed, and why it’s NOT the Internet.
- Failing to see the value of real-time TV context as the last frontier of data collection to personalize web content for users.
Our living rooms are crammed with options for watching films and TV – broadcast television, cable channels, pay-per-view, our DVD collections, our bursting PVRs, content streamed from our computers and media servers, etc. Now many of our TVs, set-top boxes and game consoles are directly connected to the Internet – the great enabler of personalization and targeted advertising.
And yet both the entertainment and tech industries seem determined to use the TV’s Internet connection to pump more video content into the living room. This is hardly a consumer pain point. If there is a frustration among consumers it’s DISCOVERY, not choice. Showing me an empty search bar when I get home in the evening, and expecting me to balance a keyboard on my knees, isn’t going to displace good old TV viewing anytime soon. We like our TV channels and the serendipitous, lean-back discovery experience they provide.
In the UK, the average adult now watches 4hrs 10min of broadcast TV every day. In the US, the number is 5 hours+. Counterintuitively, those figures have risen slightly in recent years, even though use of other media like the Web have also increased. The obvious conclusion (confirmed by surveys) is that people are increasingly multi-tasking – exploiting TV context to search for stuff on the Web – social connectivity, more information, ecommerce. And they do this IN SPITE of the technology – the second screen is not sync’d to the TV, doesn’t know what’s on, and only responds to active search queries from the user.
TV is clearly not dead. The fact is we like our broadcast TV, and its purveyors have gotten very good at bringing us (and the family) back into the living room at a time of their choosing – we want to see the X Factor live, we don’t want to miss the eviction on Big Brother, we can’t wait a day for the next plotline in East Enders or Glee.
So how do we really give benefit to consumers and extract value for business from connecting the TV to the Internet? The TV is the last dumb screen in the house, unchanged for the better part of 30 years. It’s the only screen that doesn’t know where we are, what we like, what we’re doing. If it knew just those three things, it could be as powerful as any web browser in delivering social connections, information and transactions that are relevant and contextual.
The tech and media industries have struggled with this in part because the TV itself is a poor delivery mechanism for non-video web content. Yes you can tweet and post to Facebook using the apps on some newfangled TVs, but the experience sucks and – hey, you’re covering up my TV picture! This is not the way to bring the Internet to TV. And why are we even trying, given that 60%+ of people watching TV have their laptops, tablets or smartphones open, engaging with the social, transactional web already? Hello!?! The perfect delivery device already exists – it’s the second screen, stupid.
Stay tuned for part 2.