Is the Internet the future of the TV?

In one of my earlier posts ‘YouTube versus TV: Collision Looming?’, I questioned whether that in a current time of convergence between mobile phones, computers and television, that perhaps there would only be one winner. A more recent article published by the Sunday Times has revealed that the stakes are now even higher from broadcasters, telecoms providers and consumer electronics firms to plug the TV set into the internet. Although this is a challenge faced by the industry’s top names, it would undoubtedly open up an exciting new world of choice, interactivity and revenue streams.

Predictions for the Future

According to uSuppli the sector analyst, the sales of internet enabled devices for the sitting room including TV sets, video game consoles and set-top boxes are predicted to reach more than 430m globally by 2014. However to get to this point, the sector is tipped to grow at 34% a year, compared with 12% for personal computers and 23% for Smartphone’s. Thus suggesting we are rapidly approaching the turning point for the Internet TV.

The Smart TV

At the IFA Europe largest technology fair event which took place earlier this month in Berlin, the main focus was on the importance of connecting all other devices to the web and each other. This Autumn ultimately looks set to be the time when we start to see a number of new developments unveiled.   For instance the 3view box boasts the first subscription free TV service with a built in high-definition recorder and hard drive recorders such as Sky+ and Virgin Media’s V+ are common. High definition TV has quickly gained in footage and 3D is on the verge of arriving in the sitting room from the cinema. It is anticipated however that the best is yet to come with the eventual plug in of the TV set into the internet.

In terms of Smart TVs, the most recent developments include Sony’s partnership with Google, which offers a HD set powered by the search giant’s Android operating platform. Samsung is also exploring a similar deal.  Google want viewers to search for programmes in the same way they search the web and propel YouTube onto their sets. Google TV is also set to go live in the US this Autumn and will integrate content from the internet with traditional broadcast televisions, working with TV Studios and production companies for content as opposed to getting into actual content production. Apple has been trying to generate demand into its TV receiver by lowering its price and signing up new content deals with the second generation version of the Apple TV. Panasonic have also announced that they will soon be offering 3D movies on demand with new TVs which supported by their Vieracast web system.

Challenges yet to be Overcome

Although bringing together the worlds of the internet and television has long been an ambition of the communications industry, there have been a number of failures. Stand out examples include Joost, an internet TV service from the founders of Skype, which struggled because of is lack of must see content. The Apple TV has also struggled somewhat as TV companies have been reluctant to licence shows to it after watching the firm make millions at the expense of the music industry. So far only ABC and Fox have agreed to let Apple rent their TV shows. This means that makers of internet enabled set-top boxes and TVs are focusing on signing exclusive content deals with studios and broadcasters, in the hope of becoming the device of choice for the majority of consumers. However this is an inconvenience as consumers want a single device that can replace all of the other devices from under their television, not add to it by forcing them to sign up to multiple services so they get a full range of programmes.

A more seamless experience is also required across devices. It is though that the supply of high speed internet and compression technologies will be the key, enabling more videos to be carried over the internet. Once this number of minutes is large enough it then opens up a whole new set of revenue opportunities such as the future of the way people buy TV ads, the ads purchasing process and the way you track and report it.  Sky for instance intend to launch Sky Anytime soon to help address one of the few gaps in its service.  It will deliver video-on-demand content to 3m of 10m viewers, who have a high definition box with an internet connection. Virgin Media, with almost 4m cable TV subscribers, have also put video-on-demand at the heart of its marketing and is already the main provider for the BBC’s iPlayer. They are also set to introduce an internet enabled TV recorder shortly, intended to offer consumers different ways to access what they want, when they want it.

Experts are united in saying that now is the time for someone to make a breakthrough. Will internet connected TV change your viewing habits? Let us know your thoughts.