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From dumb box to television that’s alive
Digital … Convergence … Super-highway … MPEG … The web … Pick whichever term you like, it really doesn’t matter because our digital future is here now. All we have to do is open our eyes and recognize the signs.
Here are the hard-headed views of some of the industry’s leading prophets:
The notion that TV and/or the Internet will mean anything to somebody in two years is irrelevant. It is my belief that currently the term ‘television’ doesn’t even have the same common meaning that it did even two or three years ago. It is totally changing.
Steve Billinger, then head of
BSkyB’s interactive division,
September 1999
IP networks are removing distance from the equation. So I can easily see the Hong Kong community in London having all the Hong Kong channels and services available out there available to them over an IP network of some kind in the London area, or indeed anywhere in the UK. The same would apply to the Japanese or any other ethnic group. The same could apply to Brits who want to hook into the Los Angeles area or elsewhere in the world. It will mean TV is available anywhere, anytime.
Graham Mills, British Telecom’s head of Internet and
new media, September 1999
At Canal+ we are in a position which is perhaps a little easier than other broadcasters. We can send an e-mail to our subscribers reminding them in their offices that tonight is the night when their favourite show is on. We can also do this on the mobile, saying the soccer match starts in 15 minutes, and even send pictures of the game. Today we are in the middle of the business because we operate the system as a collection point, a clearinghouse, a distribution system. And we have the database, we have the information a commercial broadcaster does not have. We can now e-mail all of our subscribers across the world, and this will become increasingly important as the free-to-air broadcasts become part of the pay-TV offer.
Claire Leproust, head of interactive at
Canal+ TV, August 1999
The digital revolution in the broadcasting and telecommunications arena is changing the way we interconnect and working within networks is becoming easier. In the past we had heterogeneous ways of transferring information: there was analogue, there was digital, there were very many proprietary solutions. What is happening now is the emergence of a family of transmission and distribution and contribution systems which are all based on open standards, and on a family of open standards that is relatively small. I refer to the DVB family, the MPEG standard, the IP family of standards and the JAVA family of standards. This is the trend. Whatever is going to happen the infrastructure will be devised within solutions … that are public. Any attempt to use proprietary solutions to provide services will be a short-term opportunity.
Antonio Arcidiacono, EUTELSAT’s head of
multimedia and new products, August 1999
Digital transmission actually means that television no longer is a scarce commodity. The whole of our history is about television being a scarce commodity – one channel, two, three, four … Digital transmission means there is no scarce commodity and what that means is that television becomes a variation on the bookstore or news stand theme. So the issue is: when you walk into a bookshop, if you know nothing about a single book, and whether you decide on one or another … Given that vast plethora of information you are going to hit certain subjects that have been pre-marketed, or certain brands, and I think we are going to have pretty significant ‘info-brands’, information in the broadest sense, not just updated train-timetables. And you will have brands that perform their tasks across a number of different ways, each of which access the public.
Adam Singer, chairman of Flextech plc, September 1999
Web-streaming? There is no stopping it. In fact there’s something quite nice about it. It reminds me of the evolution of radio and the early days when people had to use a crystal set to start off with, then it got better and better. It’s junk today and one would have to be pretty keen to sit and watch or listen at these wonderful 2-inch windows, but in time it is going to be huge …
Jim Beveridge, business development manager Europe,
Microsoft’s WebTV Networks, August 1999
The biggest factor, I call it the sleeper of technology, is the growth in local storage. When the PC first came out, in the early 1980s, it came with 10 Mb of local storage. Today you would be hard pressed to find anything with less than 2 Gb of storage. That’s an improvement factor of 200 times. The modem at that time was about 2400 b/s, today the equivalent would be a 28.8 Kb/s, another significant growth factor.
As the prospects for a 10 Gb hard drive become interesting, when it is linked to compression and inserted into a STB. It can expand the content window. In the UK the content window before Channel 5 and Sky was four, a four-channel content window. With cable and Sky analogue, you have a 40-channel content window, more in the USA, perhaps 80 channels. With digital the content window expands to nearer 200. Today’s improved compression could give us today 400 channels of content without a problem. But if you add 10 Gb into the STB now, costing around $100 in the year 2000, that would add another 50–80 virtual channels. But go just a little further, and add 100 Gb of hard drive would mean 800 virtual channels. And 100 Gb is suggested for within the next 5 years. So we think the biggest revolution as far as the consumer is concerned will be local storage, which will completely change the paradigm for viewers, which is currently based on time. We ask ‘what’s on now’. And local storage changes that, and we can start asking ‘what would I like to watch’. It is going to be content-driven from your local disk, with maybe 1000 hours of choice, and not necessarily the 200 hours of broadcast channel choice.
Dr Abe Peled, CEO of NDS Inc., August 1999
These quotations are from people whose business interests are very much focused on the new wave of broadcasting. They have, it is fair to say, a vested interest in the prophecies being fulfilled. However, their statements have so much obvious truth about them that they simply cannot be ignored.
As a ‘health warning’ we might do well to take note of the words of the truly prophetic Ray Hammond in his book The Online Handbook:
The linking of computers around the world is going to have far-reaching effects, and the spread of knowledge, the interchange of ideas and the dissemination of information are going to produce a revolution in our society.
Hammond, 1984
Hammond’s words, written almost 20 years ago, show how dangerous it is to attempt to be a latter-day Nostradamus. Hammond was completely accurate about the wired future; he was just a few years out in his estimate of how long it would take for us to get hooked. To his credit, in his follow-up volume, Digital Business (1996), Hammond admits the network revolution has taken longer to achieve critical mass.
Across the Atlantic there are even more pundits and prophets. Pulitzer Prize-winning writer Joel Brinkley, in Defining Vision (1997) states:
These new machines are wondrous indeed because, unlike the earlier Japanese models, these are digital televisions. A TV that receives its signal digitally is no longer just a dumb box passively displaying pictures and sound. Digital televisions, properly equipped, can be powerful, interactive computers, hardly different from desktop PCs. With those capabilities, suddenly television comes alive.
Brinkley, 1997
In Chapter 3 we look at how the USA has attempted to tie digital television into an introduction of high definition digital television (HDTV), encouraged by two most powerful influences, the US government and the film-making industry. The government viewed the freeing up of most of the analogue TV bandwidth as the answer to its fiscal problems; and Hollywood seemed to want to move its current cumbersome cans-of-celluloid distribution methods into a new paradigm where its latest blockbusters can be delivered direct-to-HDTV set, bypassing the expensive cinema-based middlemen.
However, Dr Abe Peled, a highly-regarded engineer who heads up NDS and is deputy-chairman of Tandberg-NDS (two companies at the cutting edge of televisual technology), described the introduction of HDTV in the USA in 1999 as ‘the big yawn’. HDTV is happening in the USA, but at a far slower pace than most experts predicted earlier in 1999.
The USA (at the time of writing) is committed to an analogue switch-off during 2006. In Peled’s view:
The original reason for the 2006 date was so that Clinton could settle his budget plans, which he did by auctioning off the spectrum. I think they will postpone it. Already there is an amendment that allows for a delay if 5 per cent of sets have not been converted. Oddly enough, the biggest interest we have seen is for data carriage from broadcasters, of value-added services on top of the HDTV signal for which they can charge. We see some action in this sector, from people seeking income streams from data services.
Peled issues a warning about HDTV:
The other problem of HDTV is only just being realized, and it concerns on-air talent. The Los Angeles Times carried a story about a weather-girl who it said needed to shave her armpits a little closer. This is serious for some smaller stations that do not spend lots of cash on make-up or sets. All of a sudden they realize they have to spend more on clothes, on sets, on professional make-up … it gets like film. All this costs more money and they are asking ‘where does the extra money come from?’
Peled’s company developed the multi-camera angle technology used on BSkyB’s digital transmissions, permitting viewers to call up their own sub-set of news from its Sky News service.
Look further ahead, look past the current Sky Digital system, which is already the best in the world. Look to even greater fragmentation of the audience. Take the USA, perhaps the most radical example of this, where over the past ten years some fifty per cent of the prime-time audience has disappeared from the major networks. But it’s not that they’re sitting in front of their PCs, but they are watching one of the dozens of other cable networks. It hasn’t changed that much, simply fragmented in sub-sets of an audience. It makes it more difficult for advertisers to reach that mass audience, but in many respects digital allows more targeted advertising, even down to post code advertising. BMW’s for Manhattan, and Range Rovers for the country.
Television is already changing as a result of the influence of computing; for example, the tumbling fall in the cost of chipsets, which Peled says already cost ‘nothing and next year will be next to nothing’. Storage costs are also in free-fall, and this makes successful digital forecasting possible. ‘Cheap chips will make digital set-top boxes even more affordable’, says Peled.
However, most developed countries of the world are already migrating to digital transmission. They too want to re-allocate analogue bandwidth for more lucrative uses, and one way or another by around 2008–2010 European broadcasters expect to be fully digital. While viewers may not be enjoying commonplace HDTV transmissions, there seems to be an inexorable slide towards whatever the Hollywood studios want; if Hollywood says HDTV, then it will be HDTV for all.
The cost of entertainment, at least as far as the hardware is concerned, is falling: inexpensive chip-sets, lower-cost flat-screen televisions, free or inexpensive set-top boxes, and not forgetting Dolby multi-channel surround sound (said by more than a few experts to have been responsible for selling more large-screen televisions than any other technological advance since colour). But convergence, from the world wide web and cheap telephony, is also influencing every element of the broadcasting mix.
Take these words from WebTV’s Jim Beveridge (in September 1999):
[The industry is] going to be using more fibre, more ADSL, more cable, satellite and wireless. In my view we are going to be using a mixture of broadcast standards and IP-based standards. I see broadcast and IP protocol-based standards coming together. If you are thinking of what the consumer is going to use, then what the consumer is going to have is a number of gateways to getting programming to him. Some will be IP-based and some will be broadcast-based, and I actually think the methods that will work will be when the two base-standards come together which is very much the way [Microsoft] is heading right now.
Clearly there are bandwidth restrictions on the Internet and I see the Internet almost like a sea of technology and services. What people will do is take elements of that which is offered and build into their own networks what they believe is worth including. So you are going to see live streamed media [direct] across from Australia to California then it is not going to be a great experience. But if you have servers where the material has been cached and in addition have access to cellular bandwidth then you will be able to receive the video without problem at all.
This is the clue: unlimited bandwidth, web-streaming, cellular … Because I am a journalist specializing in broadcasting, I have tended to skirt around cellular telephone technology, and even the fast-emerging Palm-type and Windows-CE personal devices. As 2000 unfolds this is now almost impossible; the creative people at Nokia, Ericsson and Motorola talk about ‘next generation’ cellular telephony, with harmonized standards now agreed. We now have cell-phones that can surf the web, transmit video and recognize human speech for ease of operation, and far more is promised.
These are not so-called ‘blue-sky’ developments. Already on the market in its second iteration is the famous Nokia ‘Communicator’: a telephone, keyboard, e-mail and fax machine all in one. Indeed, the Windows CE-based devices (such as the Philips ‘Velo’ and Casio ‘Cassiopeia’) take this technology and build in voice-recording functionality on a solid-state circuit. The Panasonic ‘IC’ recorder has similar functionality, offering 60 minutes of recording in a tiny machine the same size as a credit card, while the Philips ‘Xenium’ is a GSM phone that accepts voice commands.
All these products exist, and some of them have been about for a few years. The industry is now gearing up for the next-generation cellular telephones which conform to the WAP (Wireless Application Protocols) ‘media telephone’ standard. Nokia released its first model (7110) in the summer of 1999. It allows users to surf the web and display information in a text format on an expanded LCD screen.
Sweden’s Ericsson has similar models (MC218 or R380 dual band), promising simplicity of use and guaranteeing you will be ‘surfing’ within five minutes of owning the phone. In Japan, NTT DoCoMo, the world’s largest mobile phone operator, claimed more than one million subscribers to its new ‘i-mode’ mobile that uses ‘compact HTML’ to access the web, e-mail and on-line banking. for 2000, NTT is promising MPEG-4 coding for its next-generation devices based on W-CDMA (Wideband-Code Division multiple Access) technology. In addition to speech, music and ISDN-type video, NTT believes W-CDMA will allow users to access these ‘broadcast’ services almost anywhere in the world.
Kyocera’s Visual Phone VP-210, suggested as the ultimate in PHS (Personal Handyphone Systems) can receive and transmit live video, send and receive still digital photos and incorporates a visual data bank of 200 numbers and their owners’ images.
While all-powerful Microsoft is pushing its Windows-CE technology as the operating system and solution for ‘broadcasting’ the web to television sets, cellular phones and perhaps even the wristwatch, Europe’s cell-phone makers seem to have the edge with their Symbian consortium, using an advanced operating system (Epoc) based on that developed by hand-held computer specialists Psion. One challenge still to be overcome by all these mobile-based technologies, no matter how they operate, is the twin – and usually contradictory – demands of most users. On the one hand, users want small cellular devices; on the other, manufacturers want more functionality; and the moment you build-in a ‘TV’ screen you have an inherent drift towards bulk and high battery-power consumption.
WebTV’s Beveridge thinks most of our new services will be based around web sites.
Look at what the BBC is doing with their 6 p.m. and 9 p.m. news. I see people adding to that sort of concept, so that consumers can pick up their information as and when they want it. In my view the time-shift marketplace is going to be large in that respect, and it might be because they will go direct to the server to pick it up, or the fact that somebody is prepared to stream it to me specifically when I want it.
Steve Billinger, from Sky Interactive, agrees.
First off, all current digital platforms will continue and will have a viable share, and all of their principal roles will be in building the platforms of choice for building compelling media brands, and those brands will be extended to all other digital platforms. Every future platform will be digital and interactive as matter of course. It doesn’t matter where or what it is. I am including digital radio, all forms of wireless, all forms of broadband. In my view television will continue to be used to build the primary compelling brand position, and that all of those platforms will deliver slices of the content pie. I use the term ‘content continuum’.
Billinger suggests what he calls a perfect example:
Mention family entertainment and you think of – perhaps it’s the BBC in the UK but in the USA it’s Disney – and when they want to experience family entertainment they need to be able to find a Disney-branded product, and I think they will be able to find that brand and product on every available platform. There’ll be times when they are on the radio, and the Theme Park, and on Broadway, and the hockey team in the park on a Saturday night. Each will continue as viable-share businesses, they will be the first choice for building that primary brand value. They will almost certainly be the starting off point. However, all of these platforms must be seamlessly integrated to present a kind of content continuum.
Disney is surely the perfect example of brand extension. Not content with animation, or natural history or even theme parks, their brand can now be found just everywhere. Who would have guessed that a movie (The Mighty Ducks) might now be experienced as a Disney-owned sports team?
Content is not King
Disney’s attempt shows that the normally accepted truism of broadcasting, that ‘content is King’ is only partially true. More accurate in a digital, multi-channel, multi-platform age, might be ‘The trusted brand is King’. Billinger comments:
The blur between content and technology, or content and utility, is going to be so fuzzy that it will be difficult to differentiate what is what. For example, in any interactive space what is e-mail? I call it non-category specific content. It isn’t news, sports or entertainment, but it’s a critical part of the customer offering, and this is the main thing that so-called new media guys don’t get. Because increasingly the technology is king, they are both kings.
Some industry experts have suggested that only established brands have any chance of succeeding in this new world. Billinger disagrees:
Let’s go back. Look at the three most recognized brands that have emerged recently, none of which are in the ‘content’ business that we would normally recognize: Amazon, e-Bay and Yahoo! All three represent utility, and utility has become content in that environment, and that has built their brand value. We all thought that ‘content was king’ meant CNN and the like. My view is that these are now irrelevant and that customers in an interactive technology-based market, which is what every future platform will be, cannot tell the difference [between CNN and Yahoo!]. One way to do it is to supply better features, better technology, than anyone else or package those utilities, features or technologies better than anyone else, which is what the portal-play is all about, or create platform-specific via the usual types of media structures.
‘Portal play’ is a neat phrase. The concept that your network TV channel is now also your portal, your doorway to an entertainment-rich nirvana, is a view shared by Claire Leproust, head of interactivity at Canal+. She already sees the Canal+-backed digital bouquet (Canal Satellite Numerique) as being a ‘portal’ in its own right.
if you look at a bouquet like ours we already have these channels but also it means that each channel becomes a mini-portal, and if you accept the idea that each channel [focuses] viewers interest and going a step further, each programme can be a sub-portal at that time with each channel playing a role to promote that portal.
Adam Singer is chairman of Flextech plc, the UK’s largest digital broadcaster after BSkyB, and the name behind such channels as Living, Bravo, Trouble and Challenge TV. Flextech is also in a huge joint-venture with the BBC (UKTV). Singer comments:
In my view everything becomes a sub-set of the Internet. The Internet’s high-speed capacity is capable of carrying [everything]. If that is a true statement then you just pull down from the pipe the information you want and you utilize it on the device that’s most relevant to you. This is already done and exists on the telephone. The telephone line is the pipe, and if it happens to be a fax signal you pull it down to a fax machine, if it’s a paging message it goes to a pager or if it’s voice to a telephone. It seems to me the same thing happens here. You have your info-brand and you pull down the bit you want onto the appropriate technology. The one thing you don’t want to get hung up on is the ‘lean-forward’, ‘lean-back’ thing-in-the-corner conversation. Because there will be times when you want to be told a story, and times when you want to interact, and times when you want to know more.
Flextech is already developing this concept; web sites are backing up every one of their channels, but these sites are turning up as channels as part of Flextech’s digital TV offering. Singer says:
You will choose the appropriate device for the time and place. You can already see this on the MP3 player. What is an MP3 unit, but a portable hard-drive? It provides all sorts of opportunities for mainstream broadcasters. Take The Archers [a popular and long-running radio soap-opera] on the BBC. Why they have not thought about putting out whole batches of back-catalogue files of The Archers so that people can drop into the series whenever they want to… Or take Gardener’s Question Time [another long-running radio show]. Why not offer listeners the ability to pull down all the answers about greenfly on roses. You no longer need a radio for this, yet it is the exact same piece of information. Miss the show on Sunday at 2 p.m. and you can listen to it on the way to work or the shops on Monday morning on your MP3 player.
Neither does Singer see there being a ‘winner-takes-all’ technology emerging.
It’s interesting that there should be any concept of a single winner. The concept doesn’t exist with music, where there are umpteen ways of receiving music. You don’t often hear the argument that radio was the ‘winner’ over the concert hall. They are both forms of distribution and dissemination. So, it strikes me that it is to do with the right way to receive information at any given moment. You want to find out where a local restaurant is, you tune into your Internet-connected, sat-nav GPS whatsit, pull down the information, push a button to make a booking and it will give you the 3 star rating, and that is exactly the right device for that piece of information! And we could do that perfectly easily right now.
He goes further:
As soon a you start trying to select a winner you are lost. You can be certain that is not going to be the winner. In 1983 I decided with my career choice that cable was going to be the winner! I am not too sure I got it right. If you are in the content business the job is to get the content out … Eric Clapton does not care how he gets heard, as long as he is on CD, mini-disc, cassette, MP3 and the radio … That’s the issue. The future is everybody will be a digital home and every home will have the ability to receive significantly more signal than they can receive now and they will all have some ability to interact whether they elect to or not.
That is the basis of this book – during the next ten years every home will be a digital home whether people like it or not. There’s one other thought I want to share. A long time ago, when I was still in short trousers, for a bit of extra pocket money I delivered groceries for the corner shop to customers living locally. I had to take special care with the eggs, then sold loose.
Now we have tele-shopping, and I am hooked. I already buy my books from Amazon.com and the big groceries from a home-delivery supermarket and my wine and water from other bulk-suppliers. Currently I do all this via the PC, but I want the convenience of doing it from the television, while e-mailing my family, and ordering a CD. I am not alone, and when every home is a digital home and the dumb television, linked to a telephone, has interactive potential, I know consumers will react positively. But I might just also want to do it from my cell-phone, or portable Palm-Pilot when sat on a train or in a traffic jam. It will make my life more convenient, and I am not alone. Whether I’ll want them to deliver my eggs only time will tell.