Right in the middle of Halloween and Hurricane Sandy, my new report for GigaOM Pro on the future of the electronic program guide (EPG) went live last week.
If you’re a subscriber, you can read the whole write-up including market trends, recent technology innovations, company details and predictions for the future. If you’re not, have no fear. As promised, GigaOM is kindly allowing me to publish an excerpt here. Drop me a line if you have any thoughts, questions, or insightful commentary to add, or if there’s another long-form topic you think I should turn my attention to next.
…Beyond the traditional service providers, hardware manufacturers, and software companies that make up the television ecosystem, a number of new players are entering the market with disruptive models. On one end are new hybrid service providers, many of which are small operators or startup companies. Then there are the consumer electronics companies, including smart-TV manufacturers and retail set-top providers. Finally there are behemoth companies like Google, Apple, Amazon, and Microsoft, which are approaching the television business with capital and expertise built in other industries…
CE companies are attempting several different strategies that range from partnering with guide providers to building their own cloud-based platforms to relying on simple and inexpensive client-based guide software. The connected-TV companies are largely taking the first approach. Samsung, Sony, and Toshiba, for example, all partner with Rovi, although Samsung in particular has stated its ambition to create a connected-TV platform. The retail box providers, however, are more of a mixed bag. Apple licenses Rovi guide technology for Apple TV, and it appears that Google does the same to support its user interface for Google TV, though little has been said about that relationship publicly. Boxee ports its own software onto branded boxes that are made by other manufacturers. And Roku relies on its own inexpensive client-side guide software in order to keep consumer prices down. In each case, these hardware providers have their own branded guides, but the underlying technology sources vary widely.
The final group in the market-disruptors category is the sleeping giants – large companies in different industries that have begun to encroach on the TV-service-provider space. Google and Apple began offering their own retail set-tops years ago, but they have largely maintained those products as sideline businesses, providing access only to web content and not focusing major resources on breaking through in the more traditional television-service-provider space. The big question is whether Google and Apple will change their strategies in the future.
If they do decide to go after the TV market in a more substantial way, both companies have an opportunity to upend not only the guide interface but also the associated content- and service-management market. That outcome is a distinct possibility (consider the launch of Google Fiber TV, which is covered in this section’s spotlight). However, many industry watchers have underestimated the challenges along the way. This is true for Amazon too, which has its own Amazon Instant Video service and the Kindle Fire for media playback. Moving beyond the web means learning how to make deals with content programmers invested in today’s revenue models, ramping up customer service operations, and scaling video delivery to support much larger television audiences. It’s a difficult road even for companies with a lot of capital and technical resources.
And finally there’s Microsoft. Microsoft has coveted a space in the television industry for years and made several ill-fated attempts to introduce a successful guide platform into the cable market in the early and mid-2000s. The company finally earned some traction in the U.S. when it partnered with AT&T and the IP-based U-verse TV service. And in 2010 Microsoft began using the Xbox game console to deliver IPTV to the living room. That effort started slowly, but it has progressed significantly. Today the company offers web content on the Xbox, linear television from Verizon’s FiOS service, and on-demand content from Comcast. Microsoft’s major advantage is that it is big enough and entrenched enough to support a developer community, which means its Xbox and TV platform, including the user interface, will be able to continue to grow and expand. Outside the traditional TV service providers, Microsoft occupies one of the more interesting and promising positions in the branded TV UI space.