When Netflix chief executive Reed Hastings took the stage at the NewTeeVee Live event today in San Francisco, he had four main points that he sees for the future of entertainment content on the web and on television:
- What you want
- When you want
- Where you want
- Discovering what you want
In terms of being able to find what you want, Hastings believes we’re 15 percent of the way to having the problem solved. Getting content when you want it, Hastings thinks we have solved 100 percent. The “where,” he also puts at 15 percent solved. And finally, the discovery of content. He thinks we’re 25 percent of the way towards perfection on that front.
So how do we push forward those three areas that are badly lagging? With the convergence of web content with traditional television.
While Hastings went on to break down the various models for content today (ad-supported, pay-per-view and subscription-based), the really interesting comments he made were about how the way we control content on our televisions will have to change for web content to take off.
Specifically, he noted the success of the Nintendo Wii and its Wiimote controller, which allows users to manipulate content on the screen using hand gestures. Hastings sees a solution like this as the future for controlling not just video game consoles, but all entertainment in the living room.
Interestingly, this seems to align with recent patents Apple has filed for new remotes, presumably to control devices like its Apple TV product. It makes sense. As I noted recently, using a remote, especially one as limited as the current Apple remote, makes it very hard to get around a device like the Apple TV, which is rapidly adding content and new features as it evolves. Other set-top boxes will have this problem as well. Doesn’t being able to manipulate objects on screen by pointing at them make more sense then hitting up and down buttons?
Hastings believes that 2009 will be the year we see the transition from the old, traditional remotes to the new, more dynamic remotes.
It has to be noted that Hastings is also on Microsoft’s board of directors, so you can be sure he’s made his vision clear in board meetings there where he thinks things are going. Microsoft’s Xbox 360 is already a robust entertainment console and will get a lot better in the next few weeks when it adds Netflix “Watch Instantly” content. If Microsoft adds a Wiimote-like controller (which there have been rumors of), it could be that much better.
Below are live notes (paraphrased):
-What you want, when you want, where you want — and importantly, discovering what you want.
-Two big approaches: Standard television and reinvention via the web. But how do you create an on-demand personal experience?
-The first big breakthrough in web video was Flash. The second big breakthrough was YouTube — this brought these Flash videos to millions.
-“There is no reason why YouTube won’t be streaming high-definition content going ahead.”
-Laptop-based viewing is a big benefit to the youth of today.
Web video models:
-Ad-supported, pay-per-view, subscription.
-Ad-supported will be the largest part of the market because it’s so easy, you don’t need to buy anything. The CPMs will rise, and if they get high enough, we can see very sustainable models — maybe only one or two ads per hour of video.
-Pay-per-view will continue to have tracking with new-release movies and new television shows
-Subscription is the area Netflix is focusing on. This is also good for specialty content like sports.
What you want – we’re 15% there.
When you want – we’re 100% there.
Where you want – again, we’re 15% there.
Discover what you want – we’re 25% there. Amazon is good at it for books, Apple is good at it for music, Netflix is working on movies and TV shows. “We’re all learning from each other.”
-Netflix streaming getting to TV: Xbox, Roku, LG and Samsung Blu-ray, TiVo. Each one is a proprietary encoding, and we’ll see more next year.
-There needs to be a standard for making interfaces to control all this media. A standard which a company like Netflix publishes to and which device makers will support. Then we’ll see even more media partners coming to devices.
-But we could talk about this for 1 to 3 decades. But there is a simpler solution: The web
-“We need web browsers built into TVs.”
-Web on television has a bad rap because of the failure to do it right 10 years ago (in 1999). But that was the days of dial-up with standard definition television. Now we have broadband, with high definition screens and input devices like the Wiimote.
-The real breakthrough will be in the remote. The video game generation is comfortable with the pointer on the screen. The old remote isn’t needed anymore. “Abandon the TV remote today.” Go to a simple pointer to begin to control everything. This will happen next year.
-The video game consoles are helping thing along. The Wii is close, but we need a high definition Wii, one that can also support Flash.
-The standalone boxes are also close, but they need the pointer like the Wiimote.
-Built into TV systems aren’t there yet.
-We need to get this before the cable and satellite companies get their way and make their own systems. These will be closed and will be hard to work with like in years past.
-A question from Sun Microsystems about using Java for this transition.
-Is there something special about this year’s CES?
RH: CES is the beacon of hope (laughs).
-So cable tv is the new dialup?
-What about the other 75% of the discovery portion that’s needed?
RH: First round was collaborative filtering. Now it’s combination of tagging, social recommendations, other stuff. The Holy Grail is to be able to go to a site and say, yeah those are the five movies I want to see. It’s kind of like search on the web, it’s still being perfected. And having this stuff on the TV will help because it’s just like another browser and will provide more data.
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