With the proliferation of video publishing services over the past year (YouTube, Google Video, Brightcove, etc.), a lot of attention is being paid to online video. Yahoo’s recent announcement has only increased the buzz. Online is clearly where the future of video distribution lies.
However, online video today is still in its infancy and has a long way to go before becoming the predominant delivery mechanism for video (ie, when most people have canceled their cable service and get all of their video over the Internet). The reason for this is:
- Online video is still a pain to watch on a TV. Most people still refer to watch video on their TV. To do this, you either have to have a good understanding of relatively complex technology to set up a home media network, or you have to be willing to live with a PC next to your TV. Neither of these are really mainstream solutions, yet.
- Online Video is Still Poor Quality. Most online video sites stream their video into a small player roughly 4 or 5 inches in diameter. This is pretty unsatisfactory for anything more than a preview or a short clip of two Chinese kids lip-syncing the Backstreet Boys. Watching a movie or TV show like this is pretty excruciating.
- Online Isn’t Good at Live Broadcasts. For live high quality news and sports feeds, broadcast still kicks ass. This will become even more evident as we start to see HD video move into high gear over the next 24 months. The Internet wasn’t really designed for broadcasting a single file to millions at the same time. Until the Internet goes through one or even two more evolutions, the infrastructure will be woefully inadequate at handling enormous files.
It’s also true that most of the stuff that people currently find highly valuable (Sopranos, Desperate Housewives, American Idol, etc.) are broadcast over cable and satellite. Now these are available via Bittorrent trackers, but they still suffer from all of the problems outlined above. They’re not really a mainstream solution.
So, the device that people are going to want for the near term is one that provides broadcast access from your cable/satellite provider, on-demand access for quality long- and mid-form content, and open Internet access for everything else.
The problem that all the existing solutions have is that they only cover one or two of these networks and not all three. Cable set-top boxes provide broadcast and on-demand, but not Internet. IPTV devices carry broadcast and on-demand, but no Internet. TiVo and MCE handles broadcast and Internet, but no on-demand. iPod and PSP handles Internet only. Nobody provides the whole package.
People are going to demand all three soon enough, but I think carriers will be slow to respond. After all, the only real network that can currently handle all three is the cable network and those guys aren’t about to let Internet content make it directly to their set-top box. IPTV may be different, but I’m not holding my breath.
Either way, broadcast will remain a critical component of any mainstream video service for many years to come. This is actually a driving principal of CozmoTV.