Drone footage from the protests in Bangkok. Much more interesting to me than Amazon Air. (Via Next Web) All part of the question - what sorts of things become possible now that Android and ARM have collapsed the cost of connected computing?
The BBC puts essentially all of its content online for free in the UK. It's on every device, at every time, on every network, for anything from a week to a month after transmission. In effect, this is the nirvana that US consumers talk about - no blackouts, no device restrictions, no channel conflict, no messing about, and no extra charge.
And peak viewing in October was 540k, versus peak TV of 26m.
So next time you talk about how you never watch TV anymore, remember that you're a very small minority, if only for now.
Looking at the long-term trend is interesting - there's a clear step-up in use every Christmas as new devices come into the base. But this isn't really very dramatic growth. We'll have to see what happens in January after the surge of tablet sales at Christmas - that may lead to a real change in the growth rate, but it's far from certain.
That device-led surge means smartphones and tablets. These are now the second-largest viewing platform, taking share from PCs, while viewing on TVs is pretty much flat. (This is the chart for TV only, excluding Radio.) This may be because the navigation is better on a touch screen or because people prefer the hand-held form-factor (no word on Airplay or Chromecast use), or some combination of the two.
The puzzle in all of this, of course, is whether and when the growth changes and this sort of on-demand viewing becomes a majority behaviour. That might be about the right device and interface (as it was for, say, digital music). But it may also just conflict with how most people want to watch TV.
You can see the full PDF of data here.
Apple's iPad event was pretty unsurprising. It was obvious that the large one would be speed-bumped and get lighter. It was also obvious that the Mini would get retina at some point - the only question was whether the supply chain could deliver enough panels now (with some well-informed people suggesting it could not), and the late-November ship date and $400 price point to how close it was.
The lack of fingerprint scanning in both the new models was a surprise - it may again be a supply problem, but it means that any platform play Apple has in mind (ie payment) will have a smaller install base to launch onto.
However, the big puzzle is the price the now old Mini is discounted to: $300. This compares poorly to a new Nexus 7, with comparable resolution to the retina Mini, at $230. The Nexus 7 is of course being sold at very low margin by Google, but does the old Mini really need to be $300 rather than, say, $275 or $250? What is Apple thinking?
On a simplistic level, Apple's tablet market share is clearly shrinking. The chart below, taken from a presentation I've been giving in the Bay Area this week, shows my estimates of tablet unit sales. (They're in increasing order of certainty as you go from top to bottom. Kindle Fire is not included, since I lack the grounds to do quarterly estimates, but obviously it is not relevant outside the USA and a few other markets).
Apple's recent sales decline is largely a product cycle issue, but clearly, sales of other tablets are growing fast. And yet Apple is allowing the price window underneath the iPad to become meaningful. Why?
To me, the really interesting thing about this chart is how small Nexus sales are. Here is a good device with a nice clean Android install, sold at a very aggressive price. On Google's own numbers, almost no-one buys it. Why? Why do sales of the Nexus 10 appear to be under 1m units?
Meanwhile, every single data set shows iPad with at least three quarters of tablet use, be it app installs, web use or any other third-party engagement metric you want. Where are all those other, non-Nexus Android tablets? What's being done with them?
What seems to be happening is that if you want the post-PC vision that Apple and Steve Jobs created, you probably buy an iPad, and Apple has a large majority of that market, and hence of the use of devices for that purpose. This isn’t very surprising: the Android tablet app offer remains far behind the iPad in a way that the Android phone app offer does not.
But there's also another proposition, a $75-$150 black generic Chinese Android tablet, half the price of a Nexus 7. That proposition is also selling in huge numbers, but it appears to come with a very different type of use.
Why are people buying these? What are they being used for? They're mostly in China (that’s the pink bar above) and emerging markets and in lower income groups in the west. And it seems that they're being used for a little bit of web, and a bit of free gaming. Perhaps some book reading. And a LOT of video consumption. In fact, one might argue that for many buyers, these compete with TVs, not iPads, Nexuses and Tabs. But regardless of what they’re being used for, they’re not being used the way iPads are used. In effect, they are the featurephones of tablets.
If this theory is correct, it suggests that Apple's $300 Mini really isn't a competitive problem, because the iPad doesn't yet face a strong competitive threat (quite unlike the iPhone). Rather, there are actually two quite different markets: the post-PC vision, where Apple is dominant, and a ultra-low margin product that’s also called a tablet but which is really a totally different product.
Every time I hear people say that TV really needs a big screen, and tablets are not a substitute, I think of this.
There's a counter view too, of course, pungently expressed here by David Lynch.
Very hard to predict quite how consumer behaviour will develop. I do remember how everyone needed keyboards, though.
Every month the BBC releases a PDF full of usage data for its iPlayer catch-up product. iPlayer effectively makes all of the BBC's output for the last month or so available on demand, for free, to anyone in the UK. There's a website, smart phone and tablet apps and also apps on smart TVs and games consoles. Pretty much all devices with meaningful user bases can access it. This is what the iPad app looks like (click to enlarge).
Hence, iPlayer stats give a good sense of what viewing looks like when premium quality content is available, on more or less equal terms, on all possible devices. What do people want to use, given use cases, screen size, interfaces and all the other variables, all of which are changing?
The whole PDF is interesting, but I want to single out two charts. This one shows video consumption by device. Tablets are 25% of requests, almost as large as all on-TV viewing, which adds up to 27%. Mobile phones are another 15% for a total of 40% on hand-held devices. (Note that this is just share of iPlayer - live broadcast viewing is still vastly larger).
The second chart shows consumption by time. iPlayer TV viewing skews to the evening (as one would expect) but also rather later than broadcast viewing. I strongly suspect this reflects viewing on tablets and mobile phones in bed (the report doesn't break device use out on this basis, though).
Also, note the scale - iPlayer peaks at a 470k audience where TV is still peaking at 24m. And, as shown on the previous chart, there is growth but it's hardly exploding.
The broader puzzle for the industry is quite what effect the flood of cheap tablets has on TV viewing. It is hard (though possible) to see mass-substitution from a large screen, especially for group viewing. But second sets, multi-room and teenaged viewing all seem like they might get split off. Equally, the spread of Airplay, Chromecast and similar might change large-screen viewing habits, since they effectively let you use a touch screen interface yet watch on a big screen.
With Boxee being bought by Samsung at (as rumour has it) not much more than the capital invested, it's worth revisiting Steve Jobs' extremely succinct 2010 explanation of why it's so hard for any external company to innovate in this market. It's a route to market issue, not a technology or vision issue.
And no, this acquisition doesn't mean Samsung will (or rather should) get into the TV content business.
Speculation about Apple Televisions has become something of a joke. I wrote a 15 page report for Enders Analysis a year ago saying why I didn't think one would exist (short version - very low margins, little scope for higher prices, content irrevocably locked up by platform owners), and it occurs to me that I could change the dates and put it out again this year. Meanwhile, the current Apple TV remains a 'hobby'.
However, I've also been pondering acronyms and technologies. There are a couple that seem relevant.
- HDMI power. A device plugged into an HDMI port can draw a very small amount of power from the TV. This isn't quite enough to run , say, a dongle made using off-the-shelf parts, which is why the various Chinese Android-based HDMI dongles now on the market need a (very un-Apple) USB tail, which plugs into the TV's USB port and draws power that way (see an example here). However, if you design your own chips (as Apple now does), you might now be able to get the budget low enough, if you limited what the dongle did.
- Wifi Direct. This is the really interesting part, and it's what drives several new parts of iOS7, including AirDrop. It means (simplifying hugely) that two wifi devices can find and talk to each without needing a base station
- Another part of iOS7's networking API set allows for peer-to-peer local wireless discovery by apps - so your game can look for another device in the same room running the same game. So get your friends around, start the game and stick the action on the TV (or squirt it onto the TV, as Steve Ballmer might say)
- And then there are the new APIs in iOS 7 for hardware game controllers. What should we make of those?
There are a bunch of problems with this. HDMI power is somewhat inconsistently available. Airplay (since it encodes the video feed into h264) puts a lag into the display that may be problematic for games. Airplay by itself may not be enough of a feature (but then, maybe it's possible to implement the current Apple TV feature set in this envelope). And of course developers need to support it and content owners need to refrain from blocking it.
But extending the iOS ecosystem onto a TV for $50 seems to me a much more compelling proposition than trying to get people to break into the 5-7 years replacement cycle to buy a new Apple TV, and $50 is a much more compelling impulse/upsell price than the current $100. Equally, the touch screened device in your hand seems like a better user interface than any remote control. Meanwhile, TVs are a 1% margin business and there's very little Apple can bring to justify a much higher price (or rather, a higher price premium than just buying the existing Apple TV). The advantage, of course, is the strengthening of the broader iOS ecosystem - driving more sales of $650 phones at a 45% gross margin.
For those who don't know, iPlayer is the BBC's online catchup service. It has essentially all of the BBC's output (barring a few edge cases) on all channels, generally for 30 days. WIth none of the channel conflicts that beset US providers, the BBC makes it available on as many devices as are practical, for no extra charge. The only restriction is a UK-only geofilter.
There is an unspoken assumption in discussion of on-demand, internet based TV that a major hurdle to be passed is getting 'it' onto the living room TV, because that is where most viewing will happen. This is where Google TV, Vudu, Roku, Boxee and of course the connected TV efforts of the OEMs focus.
Yet in the UK, where the single most popular content provider makes its content available on any device, the most popular UI is not this:
But rather this - a rich touch screen arms-length experience
Now, there are plenty of caveats here. To start with, iPlayer is not yet on Sky boxes, and this will change imminently, which will push the STB numbers back up: given the size of Sky's base that means the 'TV Devices' line could double. And of course PCs remain dominant.
But 10-20% of TV viewing today happens on secondary TV screens. How many of those will be supplanted by hand-held screens? How many people will decide that actually, the best viewing experience is not tied to wires, any more than the best phone experience was tied to wires, and that the combination of portability, a touch UI and the intimacy of a screen you can hold yourself is better than a huge LCD on a wall on the other side of the room? I suspect a large share of secondary screens will convert, and with it a large new slice of viewing as well. That would imply 20-30% of total viewing on might be on non-traditional screens.
Apple, of course, has a foot in both camps, since the Apple TV lets you browse content on your iPhone and then throw it to the TV screen, as well as browse directly on the TV itself. But perhaps, Apple will never make a TV set because it is already selling a different solution to that problem.
Interesting data from the BBC: mobile + tablet requests on the iPlayer catchup service now outnumber all requests made on TV screens, via STBs, consoles, smart TVs etc.
Still dominated by PCs, as one would expect, but portable devices appear to be growing fast than devices that 'put internet video onto your TV.
Of course, this is partly because there are not many good solutions for doing this. The addition of Sky to iPlayer in the next few months will spike the numbers in other other direction. However, it seems quite possible that hand-held devices will take a big share of viewing - especially for the kinds of viewing that currently happens on 'second sets'.