Colin Dixon, Senior Partner, Advisory
January 13, 2011
I’m not quite sure what happened to the humble “Internet-enabled TV” at CES this year. For some reason, all the TV manufacturers decided these sets were not just “connected’ but had somehow become “smart.” And CES 2011 was awash with smart TVs. I saw demonstrations from Samsung, LG, Sony, Panasonic, and Sharp. I’m also sure if I’d visited the other TV manufacturers I would have seen much the same thing.
But what I did not see at any booth was a clear indication of what precisely made these TVs “smart.” Far from it. What I saw convinced me that today’s “smart TVs” are in fact just as dumb as ever.
To be sure, the smart TVs on display at CES were big, thin, and beautiful; many displaying pictures that were sumptuously detailed and rich in color. But most booths were not focused on these traditional selling points. Instead, they showed application portals that stood ready to connect the viewer to the world of Internet media.
As I went from booth to booth and gazed at these displays, I realized there were a number of reasons why the “smart” moniker was entirely inappropriate for these new connected TVs.
Every TV Brand has its Own Portal
Although many of the branded TV web portals had a very similar look and feel, under the covers they were all different. For content providers, this means they have to create a special application for each portal. As well, many TV OEMs expect content providers to pay in some way to be in included in their branded portals. The precise details of these business relationships vary by vendor but included sharing advertising revenue and paying a bounty for customers that sign up for service through the TV. For content providers, keeping track of all the variations among TV manufacturers is clearly a nightmare.
Which TV has the Apps a Consumer Wants?
Every “smart TV” vendor I saw offered the same basic set of apps including Netflix, Vudu, Hulu Plus, and Pandora. Beyond the usual suspects, however, there were a wide variety of applications available on each platform. How a consumer is supposed to figure out which TV offers the apps they want is beyond me. Imagine you are going to buy a TV and the store salesman tells you brand X can only get ABC and CBS, while brand Y gets Fox and NBC. Ridiculous, right? But that is precisely what manufacturers are doing with their “smart” TVs.
Anything but smart…
The Vendors are Treating “Smart TVs” like PCs
I recently spent $2,000 on a new “smart” LED TV, and as I entered the manufacturer’s booth at the show I immediately noticed the Internet portal on the TV was slightly different from mine. It now included a search function along with several other new features. I mentioned this to the presenter who told me I must have purchased last year’s model. News to me! So I asked how I could get the update. He told me I could not, that to get the new interface I needed to buy a new TV. Excuse me? Just how many people do you know that are willing to buy a new $2,000 TV each and every year? This is just the PC model all over again and a TV is decidedly not a PC.
“Smart”? Sounds pretty dumb to me.
The Applications are not TV-Aware!
All the “smart TV” portal and application platforms I saw were not TV-aware. That is, the TV platform does not know what I’m currently watching on TV. Why is this important? With these “smart” TVs, a content provider cannot use the Internet to make the TV experience better. For example, they cannot synchronize sports data with a game I’m watching, or show me tweets about a reality show in real time. To be fair, some manufacturers said TV awareness was coming and Yahoo! announced that it already supported such functionality. However, one thing is certain. When they do deliver this feature it will work differently on every platform and content providers will be left to figure out how to support them all.
“Smart” is the New Dumb
For content providers, advertisers, and consumers alike, it appears that “smart TV” just plain dumb. Until manufacturers admit these shortcomings are real and address these issues, the value of their “smart TV” platforms will be perpetually diminished. Content providers and advertisers will sit on the sidelines, and consumers will turn to cheaper devices to bring the Internet to their TV and get the experiences they crave.
Meanwhile, I’m sticking with my Roku, for should I need to replace it in the coming year in order to get the latest content or an exciting new app, it will cost me less than a hundred bucks!
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