Posts tagged ‘interent’

A dying web, or a dead one?

App icons flying out of an iPhone

Billions and billions of customers served

While apps didn’t hit the 13 billion mark in the article I wrote in October (they did hit 10 billion in January ’11 so frankly, that’s close enough), some equally staggering stats have come out about Apps.

  • An estimated 4.5 billion apps sold in 2010, generating $6.8 billion in revenue
  • An estimated 15 billion apps sold in 2011, generating $19.7 billion in revenue
  • An estimated 21.6 billion apps sold in 2013, generating $29.5 billion in revenue
  • Of the nearly 400,000 apps live in May 2011, 62% are paid

While the numbers originally estimated in this October article were off, I believe the argument still stands.  Do you?

Here’s the original article:

I saw  on Gizmodo that 6.3 billion Apps from Apple’s App Store have been downloaded in just over 2 years. It took 5 years for music downloads from iTunes to reach this level.  This works out to be around 17 million apps downloaded each and everyday.

At this rate, the number of downloaded apps is estimated to reach 13 billion by the end of this year, the same as the number of songs downloaded from iTunes by the end of the year.  The fact that apps are reaching this big number at twice the speed of music downloads is pretty remarkable.

As a result, I’m beginning to buy Chris Andersen’s article in Wired Magazine where he argues the Web is Dead. (more…)

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A world without Woody?

Another re-run, but an altogether great look at the continuing saga of UV.

I recently got a comment on a blog which asked about Keychest and Ultraviolet, and I’m here to tell you I found out some not-so-good news regarding “the future of entertainment.”  In a nutshell, I think the industry may be going down the path of confusing us with choices we will have to make.  While the industry seems to be trying, it is still coming up short.  Here’s what I’ve found out:

Disney and Apple are on their own

Imagine a world without Toy Story, Finding Nemo, Pirates of the Caribbean, The Lion King, Up, Cars, or The Chronicles of Narnia.  The top 10 movies from Disney have grossed an impressive $3.3 billion in US box office.  Despite being in 4th place for box office take so far in 2010, Disney is world famous for its franchises that earn billions of dollars.  No one can argue the staggering impact that this studio has had on merchandising, plush toys and bedroom decorations for little boys and girls across the world.

Continue to imagine a world without a close friend and ally of Disney’s:  Apple.  They continue to capture the world’s Luddites with its stupid-simple devices.  A not-unnoticed factoid with this company is that if you add the market caps of massive brands – take Microsoft ($230 billion), throw in two retailers like Best Buy ($18 billion) and Target ($40 billion) – and you come up with a few billion short of Apple ($292 billion)!  No one can argue the impact that Apple has had on the industries it plays in.

At the moment, UltraViolet, the industry’s leading consortium to create device and content interoperability so that we can enjoy content anywhere, anytime, anyplace, is heading down a path without Disney or Apple.  Disney instead is creating its own ecosystem called Keychest. The principles are the exact same as UltraViolet, only they have created an island.  With Steve Jobs on the Disney board, both Disney and Apple will likely continue to live on their own island and extend invitations to only those that are willing to play by their rules.  As a result, the content that is so popular around the world may not be part of UV, and will therefore limit my choice.  The devices that are so prevalent from Apple, will not work.

But what about choice?!

A deep, complete selection of titles from ALL studios from which I can choose and enjoy on any of my devices – from my living room to my devices in the pocket – is critical for me to join to a service.  UltraViolet has done an admirable job in bringing 60+ companies to the table to discuss how to create an alternative in the marketplace, yet driving a truly revolutionary service offering that will inspire me to buy legitimate sources of content still comes down to a fundamental issue: I want unlimited choice.

So long as there are islands, consumers will learn that their freedom of choice is limited, and they will understand that the evolving promises of both Keychest and UV are deeply flawed.  As consumers lapse into apathy and not participate in either UV or Keychest, the industry will continue its gradual decline.  With home entertainment representing more than 50% of a studio’s revenues, studios will stop making movies.  I don’t know about you, but I don’t want to see that happen.

You’re still ignoring my Mom

Here’s another re-run, but I thought I’d toss it out there for further contemplation to ride the UV flurry of news recently…In my previous article, I complained how UV was forgetting the simple customers like my Mom...

We left off in the previous article talking about the confusion of Digital Copy, Magic Codes, DisneyFile Digital Copy, etc.  Let’s now look at some other confusing attempts at creating the future of entertainment and what it means.

Renting digital is even difficult

Take renting a movie from one of the myriad digital services that exist today.  While customers are getting closer to being able to choose from a decent selection of titles to rent, there are still strange rules that are not transparent to customers.  Again, I ask you to put your customer hat on – Why are some new titles available to buy and not rent?  Why are some available for rent later? Why does content disappear if I don’t watch it in 24 hours? Indeed, the industry will reply that windows are carefully crafted to protect revenue streams.  But once again, these rules in today’s day and age are frustrating customers and leading them to opt out of digital entertainment altogether.

My Mom doesn’t care about “elegant solutions”

So why has entertainment forgotten about the end consumer and making life simple and more enjoyable?    Why is this stuff so hard to understand?  I believe that while the application of technology is a fun and engaging puzzle to solve, the industry loves to create “elegant solutions” that don’t really solve customer problems, but rather protect industry interests.  Guess what.  Customers don’t care about elegant solutions. They only care about things that delight and awe without any extra effort.  In short, technology shouldn’t exist for its sake alone; it must be leveraged to create awe-inspiring, magical value props.

If anyone from consortia like Ultraviolet or CMX or DEG or others is reading this, please pay attention to making things simple!

Self-preservation vs innovation

I also believe the entertainment technology industry is putting self-preservation ahead of innovation and flexibility. We all know the broad entertainment industry is in gradual decline.  But unfortunately, the reaction to double digit declines is to hold on even more tightly to the formula that worked in the past – get behind a format change and ride it until the next “big” format wave rolls ashore.  The reality is that the choices and actions that are NOT being made today will likely impact the business in three years’ time.  Given the rapid disruptions that occur in entertainment, the industry can’t afford to wait to act.   Within three years’ time, we’ll be in an even more dire circumstance.

To put it in terms my Mom can then understand, I’ll then be out of a job.  And she definitely understands that.

What do you think?  Why has entertainment technology forgotten about the consumer?

You’re ignoring Mom

And she's not easy to ignore...

In this re-run, I confused my poor Mom around T-bird time when I explained a few UV things to her….

It’s a few days after Thanksgiving, and the time I spent with my Mom over the holiday serves as my inspiration for today’s Digital Fool.  During the Martini-full holiday, I tried again to explain to her what I do for a living, and I discussed the many exciting things that are happening in entertainment and technology.

Not surprisingly, she had a rather blank look on her face, without even an inkling of understanding.

“Oh that’s nice, dear, good for you,” she commented, but her face said very clearly: “WTF is he talking about?  I mean really, who cares!  The stuff I get just works – put it in my car or DVD player or VHS, press the triangle button thingie and it goes!!”

She has a point.  Entertainment and technology have forgotten about my Mom and simple people – the mass consumers who are the lifeblood of  home entertainment.  My Mom may not be the sharpest tool in the shed, but she, and millions of others just like her, still buy a ton of CDs and DVDs each year as gifts for grandchildren and a few for themselves.  Let’s talk about some of the recent efforts to coax my Mom into the next generation of entertainment.

Some things are new, but…

Take Digital Copy or as it was once known, Second Session.  This is supposed to be a safe and easy solution for customers to get legitimate digital video and introduce them to a “digital lifestyle.”  Buy physical, and get a digital copy that is either downloaded from a studio site or was included on the disc itself.  While it seems like a good idea,  it doesn’t work so well for me.  For example, a Warner Digital Copy is different than a Disney Digital file.  Each studio has a different sign up process.  Some studios ask for personal information, others don’t.  Some studios store files on a user’s desktop, others store it in a specific file directory.   Even packaging varies from studio to studio – customers really don’t know what they are getting or why.  All customers know is that sometimes they pay more, sometimes the same.   Put your customer hat on for a moment – does this sound like something worth spending time to figure out?

But hooray, Disney has Digital Copy as well, and maybe they can help sort this out.  I looked at their Disney Online Movie website, and I learned about Magic Codes (I’m not kidding).  Check this out (but remember, try to keep my Mom in mind):

How is [DisneyFile Digital Copy] different from a Digital Copy?

With DisneyFile Digital Copy, you receive a standard definition digital version of the movie in iTunes or Windows Media as well as the ability to stream the movie on Disney Movies Online. The DisneyFile Digital Copy is inside your Disney Blu-ray/DVD Combo Pack on the disc labeled “Digital Copy”. DisneyFile Digital Copy is a fast and easy way to enjoy your favorite Disney movies, anytime, anywhere on your PC, Mac, or compatible portable device. Disney fans can watch their DVD or Blu-ray in the living room and enhance their mobile life style by bringing a DisneyFile Digital Copy of their movie on the go!

DisneyFile Digital Copy is accessible on Disney Movies Online using the Magic Code found in your Disney Blu-ray/DVD Combo Pack. Once you have entered the code you can access your movie on Disney Movies Online from any internet connected computer that meets our system requirements without using storage space on your hard drive.

At this time, select Disney movies are available with a Digital Copy. For more information, please visit DisneyFile Digital Copy

Currently, movies purchased on our site are unable to be transferred to iTunes, Windows Media Player, or any other portable device.

Huh?

Come back later this week – I’ll talk more about other crazy examples in entertainment that are not so Mom-friendly. I’ll also share some cautionary thoughts on why the entertainment and technology industry is making this so annoyingly complicated.

In the meantime, what other silly things has the entertainment industry done in recent years to confuse you?

Plugged in, vol 1

Today’s Fool will be a bit different to mix up Fool posts – and to hopefully spur some arguments like I witnessed out there in the blogosphere this week.

As usual in this space, I found a ton of articles that are signals of bigger things to come.  Here are a few that caught my interest:

FCC may be helping consumers pay more for less

In the article FCC Chief Backs Usage-Based Broadband Pricing, I learned about the FCC Chairman’s proposal that has serious implications for all of us broadband hogs who love to stream lots of video.  Basically, there is a movement toward a pay-as-you-go bandwidth model that cable companies would love, and consumers would undoubtedly hate.  We consumers will hate it  because not only our privacy, but our wallets are at stake.  Stay tuned for December 21 when the vote on the proposal is due at the FCC.  Here’s an excerpt:

The top U.S. telecommunications regulator on Wednesday endorsed the idea that broadband providers could charge extra for providing heavy Internet users with lots of online video or data-heavy services such as videogames.

Julius Genachowski, chairman of the Federal Communications Commission, backed “usage-based pricing” while outlining proposed rules that would bar Internet providers from deliberately tampering or slowing legal Web traffic.

Mr. Genachowski’s support for pay-as-you-go pricing represents a victory for cable and telecommunications companies because it clarified whether broadband providers had the power to charge by what users consumed.

For some great reading, check out the contentious comments and debate at the end of the article.  Go there to find some quirky and rambling anti-government sentiment.

Netflix may need to prepare for a storm

Netflix needs to start preparing for some rough waters ahead, even though they hit $200 a share last week.  At a recent Reuters Media Summit, studio executives talked about their thoughts on how to slow the much-loathed company.  According to the execs, Netflix cannibalizes physical sales and encourages customers to rent and not buy videos.  And this is severely hurting the studios’ bottom line.

Senior executives at three of the big six television and movie studios said they were seeking ways to contain Netflix — from delaying when Netflix can make new DVDs available to rent to raising the prices for digital programs.

This containment strategy was summed up well by Craig Kornblau from NBCU when he said rather bluntly last month:

“While there are things in the Netflix system that are clearly cannibalistic [to sales], there are things we can change,” he noted. “They can pay us more or we can reduce the quality of what we give them.”

Bah humbug. Between increased pressures from studios and upcoming legislation from the FCC, Netflix needs to prepare for some rough weather.

Google’s appetite

In other news, I continue to be amazed at Google’s insatiable hunger and huge stomach to buy, well, just about anything.  Besides offering close to $6 billion for Groupon (which by the way as of today, the talks are off), they acquired a DRM company called Widevine.

What I found interesting with this move is that Google is continuing its march toward legitimate online video distribution.  A key factor of this acquisition is that Widevine is a not only a member of Ultraviolet, but it is one of the approved DRMs.  Therefore, in one quick acquisition, Google has become an integral part of Ultraviolet.

And it will be very interesting to see how Hollywood embraces Google in the inner circles of entertainment.

Questions for thought:

Is the FCC confused and/or evil?

Will Netflix continue its parabolic rise?

Will Google be welcomed in Hollywood?

A dying web, or a dead one?

App icons flying out of an iPhone

There have been billions of downloads

I saw in a recent article on Gizmodo that 6.3 billion Apps from Apple’s App Store have been downloaded in just over 2 years. It took 5 years for music downloads from iTunes to reach this level.  This works out to be around 17 million apps downloaded each and everyday.

At this rate, the number of downloaded apps is estimated to reach 13 billion by the end of this year, the same as the number of songs downloaded from iTunes by the end of the year.  The fact that apps are reaching this big number at twice the speed of music downloads is pretty remarkable.

As a result, I’m beginning to buy Chris Andersen’s article in Wired Magazine where he argues the Web is Dead. (more…)

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