The new TV wonderland?
How Google TV Will Change Television—and Why Everything Will Stay the Same After All.
It doesn't always work at the first attempt: In recent years, there has been constant talk of the imminent merging of the Internet and TV, and devices have appeared on the market with which TV sets could be upgraded to be Internet-compatible. However, the tangled cables and configuration effort involved have so far only appealed to die-hard technology freaks, but not to the general public. One of the best-known examples is the Apple TV box, which was launched three years ago but has hardly been advertised since and has not taken off. Apple CEO Steve Jobs recently described the TV venture as "a hobby" at an industry conference. For as long as cable network operators in particular occupied the market with their set-top boxes, it was hardly possible to introduce innovations into living rooms. Consumers did not want yet another box with a new menu guide and an additional remote control. In addition, the cable TV market is extremely balkanized with numerous different providers, which makes a joint market offensive impossible. Jobs knows what needs to be done: go back to field one, take apart the various set-top boxes and redesign them from the ground up to make all the different functions accessible with a uniform user interface. Then, he said, the whole thing would still have to be presented to consumers in a way that would make them happy to pay for it. "I'm sure there will be smarter people than us who will figure out how to solve this problem," Jobs said, explaining why TV is just a hobby for Apple behind the iPhone and iPad. It's quite possible that Google will succeed in doing just that. Although the Google TV offensive was announced back in May of this year, it only really became concrete at the beginning of October, especially when the Swiss peripheral manufacturer Logitech presented the first Google TV box ("Revue"). Once the device is installed between the TV receiver and the TV, it becomes the central control point of the home AV system and controls (via external IR boosters) other devices, which basically meets Jobs' idea of an integrated solution. The apps familiar from smartphones can now be used on the TV, and thanks to Google's Chrome web browser, it is possible to surf the Internet, which is easier when a wireless keyboard is used as a remote control. Of course, media content, be it from the in-house library or from online rental companies, can be played. And there are several other cool features, such as voice control instead of remote control.
Google TV will soon be in everywhere
But the most important thing for future development is easily overlooked: Google TV is based on Google's open Android operating system. Quite a few cell phone manufacturers have already jumped on board this free offer from Google, because it allows them to save their own development costs and profit from the ever-increasing market shares and the corresponding awareness. Therefore, the chances are good that Google TV will soon be everywhere: In TV sets, but also in other set-top boxes and in game consoles. Just as teletext became established here thirty years ago in a relatively short time, the Google TV platform is likely to become the global standard on TV sets.
If Google TV succeeds in connecting home screens to the Internet, existing business models will be shaken up. Apps that can be used to call up and buy shows à la carte will cut into the established players, especially pay TV providers and cable network operators. But from Google's point of view, these are likely to be side effects and not the main intention. It's all about advertising, and first and foremost about user data. Google has long been analyzing our surfing behavior on the basis of search queries in order to identify our interests and preferences and to link them to corresponding advertising messages. If our TV habits can now also be analyzed, this represents a huge step forward. On the one hand, when surfing behavior can be supplemented with TV behavior and the corresponding user profiles become sharper. On the other hand, if population groups that hardly ever surf the web can be captured in this way, thus expanding the reach for targeted advertising sales.
Individualized program recommendations
At the heart of this strategy is the Electronic Program Guide (EPG). Just as with program guides, users can use it to decide what is on the screen and what is not. Here, Google can overtake existing offerings, such as those on cable providers' set-top boxes, and come up with individualized program recommendations. To do this, the company's own program selection from the past is offset against similar user profiles. If information from social networks ("See what your friends are watching") is also taken into account, a useful guide through the flood of programs can be created. Google TV can not only list all the programs received over the air, via cable or satellite, but also supplement the overview with content that has been recorded (family videos) or purchased (from on-demand providers) or that can be accessed on the Internet (YouTube, etc.). It is true that Google, as the platform owner, is in a good position to win the EPG war that is looming for the next few years. In any case, the service providers who currently make their business from aggregating program data will want to have their say. They could simply launch an alternative offering with an Android app and thus beat Google on their own platform.
Need for action on funding and advertising bans
The home altar is becoming a global marketplace, and that has profound consequences. Established broadcasters will feel the effects first. Because the first channel will no longer appear when the TV is switched on, but the home menu of Google TV, which can be freely compiled. And TV channels are now only one option among many, because conventional TV is only needed for live broadcasts, especially in sports. In addition, media consumption time in front of the TV can now be spent with many other contents and activities. For example, with interactive games, with web videos and video chats.
Google TV is shaking up the financing foundations of both fee-financed and private stations. If consumers accept Google TV, in the long term politicians will have no choice but to rethink the legal basis and adapt it to the new circumstances. After all, this can justify the transition from the license-fee-financed broadcasting fee to a nationwide pay-per-view system and thus individual usage-based billing (just as with water and electricity consumption). Subscriptions as well as individual sales of broadcasts could be considered. There will be a need for action not only in financing, but also in advertising bans: How, for example, should prohibited tobacco and alcohol advertising be dealt with, which is displayed on the TV screen, for example as a partial overlay of the current program, but is distributed via the Internet? Private stations must fear that providers such as Google TV will squeeze advertising out of them, since they can address viewers far more precisely thanks to targeting data. In addition, offerings like Google TV encourage time-shifted consumption, making it more difficult to measure reach for TV spots, which can then often be skipped.
If you have interesting content, you put it in an app and all you have to do is make sure that as many people as possible download it and, depending on the business model, pay for it. This opens up new opportunities for large publishers and small entrepreneurs alike. Where editorial teams work efficiently with multimedia, content can in principle be produced for this new distribution channel without any great additional expense. After all, the difference between an iPad edition and a TV edition is not that great. But via platforms like Google TV or Apple TV, innovative start-ups, such as video podcast producers, can also find an audience easily and all over the world.
It is still unclear how the advertising business will operate
The new TV wonderland will not arrive overnight - on the contrary: the majority of the population will continue to receive TV programs via cable, antenna or satellite dish for several years and consume them as usual. Video-on-demand services will also emerge only hesitantly, as service providers will have to conduct lengthy and complex licensing negotiations. And advertising, too, will only gradually shift in significant proportions, if at all. While advertising geared to personal interests is widely accepted in the web browser, some people may find it unpleasant on TV, leading to defensive reactions. Google has not yet announced any concrete plans as to how exactly the advertising business will run on Google TV.
Christoph J. Walther
Google TV will soon be in everywhere
But the most important thing for future development is easily overlooked: Google TV is based on Google's open Android operating system. Quite a few cell phone manufacturers have already jumped on board this free offer from Google, because it allows them to save their own development costs and profit from the ever-increasing market shares and the corresponding awareness. Therefore, the chances are good that Google TV will soon be everywhere: In TV sets, but also in other set-top boxes and in game consoles. Just as teletext became established here thirty years ago in a relatively short time, the Google TV platform is likely to become the global standard on TV sets.
If Google TV succeeds in connecting home screens to the Internet, existing business models will be shaken up. Apps that can be used to call up and buy shows à la carte will cut into the established players, especially pay TV providers and cable network operators. But from Google's point of view, these are likely to be side effects and not the main intention. It's all about advertising, and first and foremost about user data. Google has long been analyzing our surfing behavior on the basis of search queries in order to identify our interests and preferences and to link them to corresponding advertising messages. If our TV habits can now also be analyzed, this represents a huge step forward. On the one hand, when surfing behavior can be supplemented with TV behavior and the corresponding user profiles become sharper. On the other hand, if population groups that hardly ever surf the web can be captured in this way, thus expanding the reach for targeted advertising sales.
Individualized program recommendations
At the heart of this strategy is the Electronic Program Guide (EPG). Just as with program guides, users can use it to decide what is on the screen and what is not. Here, Google can overtake existing offerings, such as those on cable providers' set-top boxes, and come up with individualized program recommendations. To do this, the company's own program selection from the past is offset against similar user profiles. If information from social networks ("See what your friends are watching") is also taken into account, a useful guide through the flood of programs can be created. Google TV can not only list all the programs received over the air, via cable or satellite, but also supplement the overview with content that has been recorded (family videos) or purchased (from on-demand providers) or that can be accessed on the Internet (YouTube, etc.). It is true that Google, as the platform owner, is in a good position to win the EPG war that is looming for the next few years. In any case, the service providers who currently make their business from aggregating program data will want to have their say. They could simply launch an alternative offering with an Android app and thus beat Google on their own platform.
Need for action on funding and advertising bans
The home altar is becoming a global marketplace, and that has profound consequences. Established broadcasters will feel the effects first. Because the first channel will no longer appear when the TV is switched on, but the home menu of Google TV, which can be freely compiled. And TV channels are now only one option among many, because conventional TV is only needed for live broadcasts, especially in sports. In addition, media consumption time in front of the TV can now be spent with many other contents and activities. For example, with interactive games, with web videos and video chats.
Google TV is shaking up the financing foundations of both fee-financed and private stations. If consumers accept Google TV, in the long term politicians will have no choice but to rethink the legal basis and adapt it to the new circumstances. After all, this can justify the transition from the license-fee-financed broadcasting fee to a nationwide pay-per-view system and thus individual usage-based billing (just as with water and electricity consumption). Subscriptions as well as individual sales of broadcasts could be considered. There will be a need for action not only in financing, but also in advertising bans: How, for example, should prohibited tobacco and alcohol advertising be dealt with, which is displayed on the TV screen, for example as a partial overlay of the current program, but is distributed via the Internet? Private stations must fear that providers such as Google TV will squeeze advertising out of them, since they can address viewers far more precisely thanks to targeting data. In addition, offerings like Google TV encourage time-shifted consumption, making it more difficult to measure reach for TV spots, which can then often be skipped.
If you have interesting content, you put it in an app and all you have to do is make sure that as many people as possible download it and, depending on the business model, pay for it. This opens up new opportunities for large publishers and small entrepreneurs alike. Where editorial teams work efficiently with multimedia, content can in principle be produced for this new distribution channel without any great additional expense. After all, the difference between an iPad edition and a TV edition is not that great. But via platforms like Google TV or Apple TV, innovative start-ups, such as video podcast producers, can also find an audience easily and all over the world.
It is still unclear how the advertising business will operate
The new TV wonderland will not arrive overnight - on the contrary: the majority of the population will continue to receive TV programs via cable, antenna or satellite dish for several years and consume them as usual. Video-on-demand services will also emerge only hesitantly, as service providers will have to conduct lengthy and complex licensing negotiations. And advertising, too, will only gradually shift in significant proportions, if at all. While advertising geared to personal interests is widely accepted in the web browser, some people may find it unpleasant on TV, leading to defensive reactions. Google has not yet announced any concrete plans as to how exactly the advertising business will run on Google TV.
Christoph J. Walther



