The Changing Face of Video
As I think back to some of my earliest memories regarding television, I see how much the video landscape has changed in my time. For example, I vividly recall the first time I saw color TV at a relative’s house. It was Bugs Bunny, my favorite cartoon, in all its colorful glory. My reaction at the time was the same as the guy who might catch his first glimpse of a football game on a neighbors new, big-screen HDTV with multichannel surround sound– “We MUST get this!”
I also have a vague recollection as a little boy when I was at the movies with my parents one time and saw a sign from a group that was lobbying against “Pay TV”. I asked, “You mean they’re actually going to start charging us for TV?”, as I imagined some government agency retrofitting our TV with a coin slot. After all, back then your TV entertainment investment consisted of a big piece of furniture that contained a little, black & white screen, and an antenna that your father risked his life putting up on the roof. If you were lucky, you got three or four channels, sub-standard but reasonably static-free sound, and not too much in the way of snow or ghost images. While not close to today’s cable line-up and clarity, there were also no monthly charges. Today, families hardly blink about spending $75 to $100 or more for Television.
The landscape is quickly changing again. As old fogies like me reminisce about the past, a whole new generation of connected youth is accessing video in all kinds of ways on all kinds of devices. They are just as likely to spend their time on a laptop watching short videos on YouTube and full shows on Hulu, Joost or Veoh, than sitting in the living room watching a traditionally broadcast program.
This trend toward Over the Top (OTT) video is a threat to any provider who makes a living offering traditional video services. In fact, a study by Trender Research™ predicts that 7% of households will “cut the cord” by 2012, choosing to get their video from non-traditional sources. On the bright side, the report also says that many will continue with their traditional video services for some time due to a familiarity and comfort level with video status quo, coupled with some remaining obstacles that makes OTT video difficult to set up and less convenient.
This can all quickly change, though. I remember when CDs first came out (dating myself again). The prediction at the time was that it would be years before the masses converted over to the new technology due to the investments people had in existing equipment and record collections. This failed to take into account the folks coming of age in the early 80s, who bucked that trend. We may see something similar with OTT video, especially as devices like Boxee, Roku, and Internet-ready TVs make streaming video from the Web easier.
What does this all mean for traditional video providers? Well, I certainly wouldn’t want to be a satellite TV provider in the coming years. For those providing Cable TV or IPTV over a landline, it should be a wake up call, and emphasize the importance of providing a fast, reliable broadband connection and excellent customer support. Yes, there will also be wireless and mobile broadband, but the threat of wireless supplanting the wired home will be far down the line due to issues with spectrum availability.
In short, even now, customers have less and less need for traditional video programming delivered via their local cable or telco provider. This trend will continue, and will be driven in part by savings, although services like Hulu are already instituting a payment system for some content. The primary driver will be a new generation that has grown up with the Web, and expects access to millions of sources of content with a few clicks. They will expect the same when they navigate their video world, and it won’t be long before that vast fount of content is ubiquitously available on the big, living room screen. As video consumption becomes more and more provider-agnostic, the future for today’s traditional video provider will be all about the quality and value of the data service and support that they deliver.
Author: Rick Yuzzi (68 Articles)
Rick Yuzzi has over 25 years experience in sales, marketing and management. Hired in 1995 to establish the sales department for a fledgling Internet Service Provider that later became ZCorum, he is now a key member of the executive team, overseeing the company's marketing efforts. In addition to blogging on marketing and the industry, Rick also tweets as @ZCorum.