The next major wave of changes is rushing to your TV this fall: new-generation set-top boxes that bridge the gap between television and the Internet. Some observers think this may be the next great leap forward for the TV couch potato, rivaling the introduction of color TV, the remote, and cable.
These are new generations of devices that connect your TV set to some form of external signal, going well beyond the current generation of cable boxes. They're coming from competitors with enormous marketing clout like Apple and Google, and lesser known but respected names such as Roku and Boxee. Whatever the source, all these boxes are bringing a wealth of on-demand video and other content to your TV, including movies, TV episodes, audio programs, and original content previously available only on the Internet.
The introduction of these devices is picking up speed. Apple's Apple TV and the Roku set top boxes, both second-generation systems, started shipping over the last several days. And today (Oct. 6), Google unveiled its Google TV box, the Logitech Revue, at a press conference in New York. Boxee is scheduled for its first public showing in November.
The phrase “on demand” is key to understanding the why of these devices: You watch a show when and where you want, not when someone else schedules it for viewing. And that's the good part.
The bad part is that consumers will be barraged by conflicting messages about what they need to buy to avoid missing out on this content explosion. Should you buy a new set-top box with pre-packaged on-demand services and an innovative technological wrinkle? Or will the content services, not the box they play on, be most important? Will the marketers of new high-definition TVs, Blu-ray players, game consoles, and any number of mobile devices convince you to buy their products, which already give you access to many of the services promoted by the set-top box crowd?
And given the cost of all this — the devices, monthly subscription charges, a la carte picks — is it worth the headache of hooking up a PC or Mac notebook or desktop computer to your TV?
Confusing? You bet. It's almost enough to make you give up and stick with cable TV — or give it all up for a good book.
But if you want to enter the world of almost limitless content on your living room TV, you'll have to do some homework. An Internet-savvy public has shown a real appetite for more and different choices, however, and for less expensive alternatives than tiered levels of cable programming or premium channels like HBO and Showtime. Cutting the cord to cable is becoming a real alternative in many homes, especially in this economy. There are hundreds of free TV shows, movies and other programming available on the Internet, and specialized search engines like Clicker to help you to look for them.
The poster child for this new programming wave is Netflix, the company that delivers DVDs of movies and TV shows to homes via U.S. mail, but has seen its on-demand streaming services become a huge factor in this new movement. Netflix service is ubiquituous, built into virtually every new TV, Blu-Ray player, game console, and mobile phone, and also accessible from any computer — over 100 devices, according to the New York Times. Earlier this year, Netflix made a billion-dollar deal with movie studios including Paramount, MGM, and Lions Gate for streaming access to their film libraries. In late September, the giant Blockbuster DVD video rental chain filed for bankruptcy protection, in no small measure due to competition from Netflix and kiosk DVD dispenser Redbox.
Also in late September, Netflix stunned the TV industry by announcing that NBC Universal agreed to make several top NBC TV shows available for Netflix's streaming service, a head-on challenge to Apple's race for domination in the on-demand network programming market. The second-generation Apple TV set-top box was positioned as a game-changer — not so much for its technology but for its promise of renting TV episodes at the same low 99 cent price as Apple charges for most songs and iPhone/iTouch apps. That high-volume, low cost price point is credited for changing the economics of both the music industry and app developers. Apple is considered the dominant force in digital music downloads; Reuters recently cited a Billboard report, noting that Apple's iTunes store had over 25 percent of the U.S. market.
The Netflix move isn't the only sign that the Apple marketing juggernaut could be faltering in the TV competition: Time-Warner expressed its dislike for Apple's rental plan, and there's been no word from CBS as to whether it will go along with Apple's pricing plan. Only ABC and the Fox group of networks had signed on as the new Apple TV devices began shipping to consumers this week.
On to some specifics about the new boxes, and with one caveat: Be sure your TV set is capable of linking to these devices. Specifications vary, so if you want to join the fray, be aware that one size may not fit all.
Apple TV is a $99 improved version of its 3-year-old original box and is now shipping. Slightly larger than a Klondike bar, it will deliver streaming-only HD content from its deep iTunes Store library of movies and TV shows. It has no hard drive. Many movies will cost $4.99, equal in price to on-demand film rentals on Comcast. TV episodes from ABC, Fox and its affiliated networks will rent for 99 cents. Netflix service is also supplied. Apple TV allows you to stream your TV shows, music, and photos from your computer to your TV via iTunes. With a software update due in November, Apple’s “AirPlay” technology will be featured, enabling users to stream video to Apple TV from any iPhone, iTouch, or iPad on the same network, or any Mac computer running iTunes. You'll be able to start watching a movie on an iPad, pause it, and then pick it up where you left off on Apple TV.
Google TV is generating considerable buzz because of its mission to unite the TV viewing experience with the Internet zeitgeist. It comes in two flavors: as an embedded service — Sony will announce its insertion into new Sony TVs — and as a stand-alone set top box, the Logitech Revue. While Logitech is introducing its box today, Sony says it will hold its own event Tuesday (Oct. 12). As for the product's capabilities, it combines Google search, a Google Internet browser ("Chrome"), a variety of apps including Amazon TV, Pandora, Napster, Twitter and, yes, Netflix. With some services, including NBA-TV, viewers will be able to run both a live TV show and web-based game statistics. HBO and CNBC are listed as partners, but no TV broadcast networks have announced their participation. The system is said to operate on the Android operating system, meaning it could run apps currently used on Droid phones. The unit will sell for $299.
Boxee has long been beloved by Internet users as a "Browser" for finding and playing Internet content. Among other services, it lets users view, rate, and recommend content through social networks like Facebook and Twitter. It lets you screen movies and video on your TV over a home network from your computer, and lets you add various professional or personal apps such as Netflix, Pandora, and many others. Through a new set-top box, the service reportedly will be available for your TV in November. Pricing is rumored to be between $199 (on preorder through Amazon.com) and $229. If you have a computer with Boxee already included, the service should be identical.
Roku was a breakthrough set top box in 2008: the first streaming-only unit to bring Netflix to HD television. Last month, the company released three updated versions starting at $59.99. The most expensive is $99.99 and offers top-notch specs: the highest-definition signal (1080p for those who keep score), fastest in-house WiFi connection, and a USB port for easier use with your computer. (Full disclosure: I was a Beta tester on one of the new Roku boxes.) The Roku box will attach to virtually any old or new TV set, unlike the Apple and Boxee units, which only have HDTV connections (through a so-called HDMI cable). Google TV's specifications are unknown but its statements indicate it will attach to any system. Roku currently offers 80-plus services including Netflix, Amazon TV, Hulu Plus and Major League Baseball (MLB.com). Some Internet-only channels are also available including Jaman, the foreign-language and independent film channel.
While it appears the main action this fall will come from these four boxes, it's worth keeping an eye on two other competitors. CinemaNow, one of the older pay-per-view Internet movie services, is now owned by Best Buy. And VuDu, which claims to have the largest collection of HD movies for streaming, stopped making set-top boxes, was sold to Walmart, and has morphed into a service being embedded into TV sets and HD players, a la Netflix.
And just in case anyone doubts whether cable companies are still in the game, consider the Netflix coup that snatched NBC Universal programs for its own service. Netflix is being featured as an embedded service on the Apple TV set-top box, so when people watch those NBC shows, they'll be paying the Netflix-NBC/Universal consortium, not Apple. And who is buying NBC Universal this year? Comcast.
