I went out to dinner last night with Noah Finz. He’s our sports director at the station, a very nice and smart guy, but a technophobe.
We got to talking about where technology is going, especially as it concerns communications. I was surprised at how interested he was… or how well he feigned interest.
With that in mind, I thought I’d write a little about where I see things going. Please remember, the past has taught us it’s really tough to accurately predict the future. This is even tougher than weather prediction because this part of the future will not replicate past events. And, remember these predictions are coming from someone who loves technology. I’m trying to hold back my bias.
To me, the key to the future is not in speedier processors nor more memory and storage, though certainly those things will enter the picture. The big deal is bandwidth. It is the 500 pound gorilla in the room.
Bandwidth limitations is why you ‘only’ receive 150 TV channels. Bandwidth bottlenecks are why your computer often waits while it is plucking data off websites or the Real player takes so much time caching those first few seconds of video before it starts to play.
With enough bandwidth, television can become a one to one medium – unlimited video on demand. Any show or any video source can be run when you want it. Desperate Housewives Tuesday at 8:41 AM. Why Not?
Already, even if you’re not in their home market, you can still watch your favorite baseball team play, because nearly all the games are available over the Internet. CPTV, here in Connecticut, sells a package of UCONN women’s basketball games for out-of-towners with high speed Internet access.
The radically changes the paradigm of commercial television. Without a mass audience watching the same commercial at the same time, television begins to lose its unique sales appeal. There will have to be another way to pay for this.
It could be commercials, maybe a subscription, or maybe both. We’re not limited by what we’ve seen in the past. Sending video as a digital stream rather than analog allows for the integration of other info.
This ability to receive the programming you want, when you want it, will turn television into a narrowcast medium rather than its current broadcast model. There is a demand for shows on knitting or cars or computers or… well you get the idea. Those sharply targeted programs¹ will steal audience from today’s broadcasts.
In the pre-cable days there were a lot of shows that, today, look like they were ‘going through the motions’ to fill the time. I’m afraid we’ll look back at what’s on TV now in the same way, as soon as the floodgates open in this new communications world.
The days of high production cost TV production are limited. Gresham’s economic laws will be seen affecting TV. We’re already seeing some of that as networks run more ‘cheaper to produce’ reality shows and re-run more of primetime TV.
Is there a long term viable business model for shot-on-film hour long dramas? I’m not sure.
Today, local television stations serve two general purposes. They produce and distribute local programming, like news, and they act as a distribution channel for nationally networked and syndicated shows. With video on demand, I can’t see why these program producers will need local stations.
Local stations will be forced to be local stations. Those who don’t will be marginalized out of profitability. This has happened in radio over the last 40 years.
That doesn’t mean the economic model of local TV is gone. It just means stations will have to better understand how to produce more content for local consumption. I also think they’ll have to shift their focus from producing programming to fill their air time to being producers of programming for anyone who will distribute it.
Today’s TV stations will have to turn out video streams the way Chinese companies, like Twinhead, turn out laptops. The majority of Twinhead’s products are produced for others with other people’s brands on them. You might be using one now, with no way to tell. Twinhead’s expertise is production… as is today’s TV stations.
A newspaper in Wilmington, DE is already producing video webcasts of local news. The New York Times is expanding their multimedia content online. I think, in the mature model, newspapers will provide the news and a company with video production expertise will package it for them.
All this is happening and we haven’t even hit our stride as far as bandwidth is concerned. My cable modem at home now brings in data nearly three times as fast as it did a year or two ago. It’s getting to the point where it will soon become faster than my home network can handle!
The price of this bandwidth will do nothing but fall for the foreseeable future. There are many factors at work here.
First, there is the onrush of technology which promises to deliver bandwidth wirelessly. That should add another level of competition for the cable and legacy phone companies.
Next, there is a vast network of ‘dark’ fiber – glass lines that have loads of capacity but have never been used. My guess is, the intercity capacity of unlit fiber is a multiple of what’s currently in use.
The people who really need to be worried are the incumbent wireline phone companies. More bandwidth is their enemy. Already they are facing competition from broadband VOIP companies like Vonage, with cable companies jumping in.
When there are wireless access ‘clouds’ of connectivity over most areas, portable VOIP phones will trump cellular and wired phone networks with cheap and probably unmetered, flat rate, phone service.
It is a very exciting, very different world of telecommunications that’s right around the corner.
¹ – I am having trouble using the word program here because it describes something that might not be. When content becomes very narrow and the viewer becomes very focused on its content, the formality of a ‘program’ may vanish altogether.