oddEvan

Slightly uneven since 2005

Category: portfolio

The New Television

It was a little over a year ago that Netflix CEO Reed Hastings laid out their strategy:

“The goal is to become HBO faster than HBO can become us.”

I would argue that this has happened. They’ve surpassed HBO in number of (paying) subscribers, essentially proving the market for streaming internet television separate from a traditional pay TV (cable, satellite, IPTV) subscription.

So let’s have some fun. If we take the assumption that television will move online at face value,1 what options could a television viewer have 5-10 years from now?

The New HBO: Netflix

Netflix is leading the way in premium online video, both in marketshare and mindshare. They see themselves as maintaining this premium brand, and their long-term manifesto specifically mentions having a top-tier viewing experience, including no commercials.

Today, if you ask people what the best channel on cable is, they’ll probably say “HBO,” even if they don’t subscribe. Everyone knows HBO is where high-quality television like Game of Thrones and True Detective is shown. Likewise, if you ask people where the best online video is, they’ll probably say “Netflix,” thanks to original shows like House of Cards and Orange Is the New Black.

Netflix has the market share now, and they’re also doing everything they can to stay foremost in people’s minds when it comes to television. I don’t see them losing this position as more and more video services pop up; their huge head start in content and technology should keep them in the lead. Provided, of course, they don’t do anything stupid.

The New Showtime: HBO

The first name people think of in premium television today is HBO, but the second is Showtime. They win their fair share of awards and attention with shows like Dexter and Homeland; but they’re usually thought of in the same sentence as HBO, not on their own. This is the place I see HBO occupying: excellent in their own right, but always in relation to Netflix.

This doesn’t seem like it should happen. HBO is part of a much larger corporate behemoth and has had many profitable years of existence to build its content abilities. Also, according to numbers from SNL Kagan, HBO’s wholesale price (the price paid to HBO after the cable company takes its cut) is around the same price as Netflix’s price to its end users. In other words, if HBO were to instantly switch to a direct-to-customer model, they would only need to match Netflix on price to bring in the same revenue.

I see two major obstacles for HBO going forward. The first is their ties to the cable industry and the status quo. While the current system allows them to arbitrarily raise their prices without immediately alerting the end-users (a problem Netflix is running into), it also ties them closer to the existing pay-TV market and gives them less time to establish themselves firmly in the streaming market. The second problem is that their current forays into the streaming market have been met with technical glitches at the worst possible times. Normally for a tech-savvy media company, the technical problems are easy and the content problems are hard, but at the scale HBO would need to operate to compete on Netflix’s own turf, the technical problems are quite hard and could impact HBO’s bottom line more than they realize.

The New Network: Hulu

Network television is often decried for being bland, unoriginal, and all-around mainstream. But what every television hipster (of which I am one) knows in their heart is that this is where the eyeballs are. It used to be that broadcast television–and by extension network TV–was the only way to reach most Americans. Today, cable’s audience has grown to the extent that massive audiences are possible for shows like Breaking Bad, but the original networks still command a powerful presence in the television world.

Hulu is most known for making that network TV readily available to internet viewers. Viewers can easily catch the last couple of episodes of their favorite network dramas and late-night talk shows for free on their computers as long as they are willing to tolerate a few commercials to do so. They also offer a premium service, Hulu Plus, that allows access to more episodes and shows as well as allowing viewing through smartphones, tablets, and set-top boxes. Unlike Netflix and HBO, however, Hulu Plus still contains commercials. While this seems antithetical to a premium service, it is practically no different than nearly every single channel available on cable.

I expect Hulu to continue to invest in its original programming, much like HBO and Netflix. Its focus on network-style programming gives it the ability to become the next mainstream-focused network. It remains to be seen, however, whether its decision to keep advertisements in its subscription offering will affect its ability to keep subscribers over the long term.

The New ESPN: ESPN

ESPN’s describes themselves as “the worldwide leader in sports,” and they have done their best to live up to that description, especially when it comes to online video. ESPN has offered live events via their ESPN360 website since 2007, relaunching it as ESPN3 in 2010. ESPN3 is not a free service, however, as it is only available to internet users whose service providers have agreed to pay ESPN for access to the service. This is in addition to ESPN’s recently launched video platform, appropriately titled WatchESPN. Similar to HBO GO, this service is only available to subscribers of participating cable providers.

Other major sports providers, like NBC and FOX, have their own streaming video websites and apps. Unlike ESPN, however, these are relatively recent developments, and ESPN’s head start in building out its live streaming infrastructure shows. Throw in ESPN’s overwhelming mindshare in sports broadcasting, and they won’t be going anywhere in the new television world.

The New Cable: TV Everywhere

TV Everywhere is an initiative by the existing cable/satellite companies to tie online streaming to existing cable subscriptions. For example, to use the March Madness app to watch the NCAA Men’s Basketball tournament, you must be an existing cable subscriber to watch any game not broadcast on CBS.

In the future, it’s not hard to imagine a “virtual cable” operator that has access to these apps as its primary service as opposed to a secondary add-on. This service probably wouldn’t be any cheaper than existing cable, but it could easily compete in other aspects such as ease-of-use, customer service, and a general awareness of its place in the new world that other cable providers would not have.

So why is this listed separately from HBO and ESPN? In actuality, it’s not that different, and those channels could easily be part of this “virtual cable” company. The difference with HBO and ESPN is the simple fact that those channels have the sheer brand power to break away from cable. It’s unlikely that TBS or Animal Planet could sell their channels outside of a bundle, but HBO and ESPN have such strong brands that not only could they easily sell access to their apps on their own, they could break their existing cable contracts to do so and not lose many (if any) cable affiliates in the process since no cable company wants to offer a service without those channels.

So what?

Nothing, really. While I could see a lot of these things playing out as I proposed here, anything can change when there’s technology involved. The mythical Apple Television (separate from or a reboot of the current Apple TV) could be just as game-changing as everyone wants it to be. Netflix could have another Quikster moment or find that its original content strategy is unsustainable. The ongoing net neutrality debate could actually affect things.

There’s a lot of what-ifs ahead in the world of television, but personally, I can’t wait to see what happens.

  1. I know I’m asking a lot here. The incumbent providers, many of whom own channels, will do everything they can to protect the status quo. But let’s face it, saying “everything will stay the same because the de facto monopolies given to the current television providers allow them to prevent this future at all costs” is about as interesting as sending the eagles to Mordor

To Learn and Understand

I am a big picture thinker and a perpetual dreamer. I love taking an idea and fleshing out the concept, and I’m continually inspired by the potential that today’s technology affords. If I’m in a room with a like-minded person, things can really take off.

So what would happen if you put me in a room with over one hundred?

My wife and I attended Greenville Grok, a conference designed around conversations and bringing people together. It’s put on by The Iron Yard, a local startup accelerator / code academy / coworking space, and it was started by Matthew Smith who realized he enjoyed the conversations and hangout times at conferences more than the keynotes and formal talks.

While there are a couple of keynote speakers at Grok, the emphasis is on what it calls “10-20s”: ten- or twenty-minute discussions on one topic in groups of eight to ten. My groups included software developers like me, graphic designers, artists, managers, and others; and our employers ranged from hot startups to established players to freelancers. While we all possessed an interest and affinity for technology, the similarities stopped there.

The opening keynote by Kristian Andersen set the tone for the discussions to follow. He started by dispelling the notion that people need to “find what they’re passionate about,” reminding us that the actual root of the word means “to suffer.” Finding what we are built for and willing to suffer for should be the real goal, not simply picking a topic we are excited about. The topic wove its way into the discussions to follow, introducing ourselves to our groups with “What’s your name, what do you do, and what do you suffer for?”

There were a number of good questions addressed in the breakout groups, including

  • How does one deal with the transient nature of digital work?
  • What can a developer do to keep his skills polished?
  • If the internet disappeared tomorrow, what would you do?
  • What’s the place for liberal arts education in learning to code?

I was also able to talk through some some of my thoughts on Netflix and television, but my biggest personal insights came from bouncing off an idea I’ve had for an educational video series. Being able to get quick feedback to help round out my abstract idea has helped give me direction for this venture. (The actual execution, of course, is still up to me.)

The fringe aspects of the conference were good too. We elected not to participate in the BMW test track activity, but the Squarespace-sponsored “hangover lounge” had Mario Kart set up, so that helped. The Vagabond Barista had a pop-up shop set up, and it was nice to have his (very caffeinated) coffee in the mornings. Even the conference t-shirt was different: local print shop Dapper Ink brought a silkscreen rig to the conference and let attendees print their own copies of the t-shirt.

This is the second Grok I’ve attended, and I will continue to attend any chance I get. I learn best by participating (or maybe I just love running my mouth), so the format of this conference means I get much more than my money’s worth. The fact that it’s put on by cool people, has cool stuff, and was held in a cool building just makes it all the more enjoyable.

See you next year, everyone!

Why Apple Should Not Buy Nintendo

They really shouldn’t. I want to set expectations up front, and when you’re talking about either Apple or Nintendo, people (myself included) are going to have Opinions. But let’s back up a bit first.

The ideal

A good merger is one where the whole is greater than the sum of its parts. By that, I mean that the two companies coming together amplify each other’s strengths and compensate for each other’s weaknesses.1 The best mergers will emphasize the second more than the first.

Let’s look at the Apple-NeXT merger in 1996 as an example of a successful merger. NeXT was a small company that made what they considered to be the best operating system in the world, NeXTSTEP. Their computer, the NeXTcube, was used for a variety of advanced computer uses, most notably by Tim Berners-Lee to create the first web server and web browser. They also had Steve Jobs, arguably one of the best business leaders in the industry. By 1996, though, they had dropped their hardware division and were only selling their software to run on conventional PCs as a replacement for Windows.

Apple at this time was in trouble. They made what they considered to be the best computers in the world, but they were lagging behind in the software race. They had tried and failed to develop their own modern operating system, and were in serious danger of losing the personal computer market to Windows 95. Their management was unfocused and unable to bring the different factions within Apple to work together.

Apple and NeXT shared the common goal of making the best products they could. NeXT had a solid operating system but couldn’t convince people to give up Windows to use it. Apple had strong hardware but their software hadn’t evolved enough to take advantage of that hardware. At its core, the merger brought the two companies together on their common goal, with Apple supplying the hardware NeXT needed and NeXT supplying the software and management Apple needed.

The end result? The immediate change with Apple was the influx of good management from NeXT, particularly Steve Jobs. The software team at Apple immediately began work on newer versions of the existing Mac OS (versions 8 and 9) that bought Apple enough time to get the new, NeXTSTEP-based Mac OS out the door as Mac OS X. The advanced operating system not only improved performance on Apple’s existing hardware, but allowed them to switch to a completely different type of hardware when they needed to. On top of that, OS X was versatile enough that Apple would eventually use it to power the iPhone and iPad.

Over 15 years later, that $400 million investment is still paying off. That’s a good merger.

The reality

So where are Apple and Nintendo today? What are their strengths and weakness that would make-or-break our hypothetical merger?

The Apple of today prides itself on a–dare I say it–magical marriage of hardware and software. The design ideal is that when you see their work, whether hardware or software, it is beautiful; but when you need to actually do work, the hardware and software become almost invisible compared to what you are doing.

However, Apple has traditionally not been good at games. Not many people know of their attempt at making a game console with Bandai, and for good reason: it wasn’t good. Gaming on the Mac has always been a second-class citizen, and companies like Valve have only begun targeting the Mac in the past few years. Games are very popular on iOS devices, but those games are not significantly tied to iOS itself. As Ben Thompson writes:

  • Games take over the whole screen; this means that tailoring a game to fit a particular platform’s look and feel isn’t important
  • There is an entire industry devoted to providing cross-platform compatibility from day one. Most game developers are targeting game engines such as Unity, not iOS or Android. This is acceptable because of point one

Nintendo is committed to making the best gaming experiences possible, then making them better. In the past, this has led them to create some of the most beloved franchises in the video game world, including Super Mario, Zelda, Kirby, and Pokémon. In recent years, this has meant pursuing new hardware: not only the gyroscope for the Wii and the touchscreen for the DS but also things like the DK Bongos for the GameCube, the microphone for the DS, and the stereo camera on the 3DS. For every hardware feature Nintendo releases, there is a game like Wii Sports, WarioWare, or Donkey Konga designed specifically to get the most fun from that feature.

The current Nintendo is a victim of a changing landscape. They lost mindshare and marketshare of hobbyist2 gamers to Sony and Microsoft, and their (smart) response was to pursue the mainstream market with the Wii and DS. This strategy paid off until iOS and Android devices began capturing mindshare and marketshare in the mainstream with free-to-play casual games among other benefits. Their efforts to woo both markets with the Wii U and 3DS have been decent, but some worry it won’t be enough to keep the company around.

The dream

So what happens if we bring the two companies together? Let’s assume for the sake of argument that Apple uses some of its cash horde and buys Nintendo outright.

From day one, Apple has a large library of exclusive games for its platform, games that are fun and that people want to play; and Nintendo is essentially guaranteed a place in the new smartphone world. Nintendo can, with some effort, create versions of classic games from its library for iOS, accessable to a massive audience that would easily pay the current asking prices of $3-5 each. These games would obviously not be available for any other smartphone or tablet platform, increasing the value of iOS both to consumers who want to play Nintendo games and to developers who want to reach those consumers.

Going forward, Nintendo can help Apple to move its platform forward much like they have with their own platforms in the past. Possibilities dreamed up by the iOS platform team can be made concrete by Nintendo’s game team. Both companies thrived in the past by pushing the integration of hardware and software, and having both companies push each other could bring out the absolute best in both. If Apple does release an app-capable Apple TV as rumored, a library of Nintendo games would only help sell the device.

Let’s not leave hardware out of the equation. A Jony Ive-designed game console would be great for publicity, but Nintendo could gain more immediate benefits from Apple’s supply chain. Apple has incredible buying power when it comes to quality components, especially solid-state storage and touch screens. A (relatively) quick update to the 3DS and Wii U touch screens would elevate the quality of those devices, and that is an area that Apple has made itself an expert in.

This, of course, assumes there are no cultural issues with the merger. Part of what made the Apple-NeXT merger so successful was the understanding that NeXT management was essentially taking over Apple. If the hardware or software teams at the two companies aren’t able to find common ground with each other, the best talent could walk out the door and the resulting company would be far worse off than either company would have been separate. This could be a moot point; desperation on either side has a way of forcing compromise where it wasn’t thought possible.

But that’s not why I think it wouldn’t work.

The problem

The best mergers amplify shared strengths and compensate for weaknesses. The worst mergers amplify shared weaknesses. And Apple and Nintendo share a similar weakness: online services.

One of Apple’s biggest competetors moving forward is Google. Google was born on the web, and as such, Google understands the web on a near-instinctual level. Servers talking to servers talking to phones is a beginning requirement for a product, not an idea tacked on halfway through the process. More importantly, they know how people use the web. They know how many people leave if search slows down less than half a second. They know how to give users email, file storage, online document editing, and keep it all in sync. Apple’s previous online service, MobileMe, was not well received. Their new service, iCloud, is an attempt to modernize the service and make it more reliable, but the reality falls short of the ideal.

One of Nintendo’s biggest competitors moving forward is Microsoft. The Xbox is a powerful game machine on its own, but its biggest strength is the Xbox Live service. Every Xbox Live game ties into the same online infrastructure, allowing individual players to define their friends once (using easy-to-remember names) and play with them in every game. This is something Microsoft has fought for from the beginning of the service. Most importantly, the interactions and purchases in Xbox Live are defined around people. Contrast this with Nintendo, which bases its interactions around devices. Social connections are made by exchanging device-specific friend codes which have all the joy and personality of 16-digit phone numbers. Purchases and friend lists are device-dependent, so replacing a console outside of a warranty repair means losing your entire library of downloaded games.

Knowing all this, how appealing does it sound to know that the company that brought you MobileMe is merging with the company that brought you friend codes?

To be fair, both Apple and Nintendo are learning in this area. Apple’s iCloud service is getting better, but it will be some time before developers (and their users) begin to trust the service. Nintendo is slowly making improvements to their online service, but they would still rather shut down a service than see it misused.

Both companies, still approach the internet the same way they approach products: slowly and deliberately. This often leads to them missing a crucial component of what their customers actually want. A merger would make this worse, not better, as companies (just like people) lean on what they know during times of transition. A merger would deny both companies the opportunity to truly learn and understand online services in the modern, connected world.

Which stinks because I really want to play Pokémon on my iPhone.

  1. It’s a lot like marriage in that regard, but that’s a topic for another day. 

  2. Some places call them “hardcore” or “serious” gamers, but the basic idea is people who pursue gaming like most people pursue hobbies: investing more time and money than average and knowing more about the subject than most people. 

The Voice

It was the middle of the night in the middle of winter my freshman year when God spoke to me.

I was skirting the edge of depression and worrying about the future. In this particular case I had worked up the courage to walk across campus to see if some girls I had been hanging out with were around. They weren’t. On the way back to my side of campus I stopped at the lake to calm myself. The part of my brain that I should never listen to (yet always do) was yelling again about how much trouble my future was in. In this case, it was how my fear of approaching women and my general personality and just absolutely everything about me was going to mean that I was not going to find my wife at college even though most people do and that meant I was never going to find a wife in general and so on.

So I went down to the lake to pray.

Now, when I say “pray,” you should read “talked and sometimes yelled out loud at God because there was no one else to listen.” It was more than a little irreverent, but it was what I needed. I poured out everything: how anxious I was about the future, how I was afraid that even if God brought the right person into my life I’d be too stupid to notice her, how lonely I was, and how afraid I was that I’d always be lonely. And while I didn’t hear a voice, my thoughts went in a direction that was completely different from where they were going.

In that moment, it was like God took the scared, freaking out child that I was, took him gently by the shoulders, knelt down, looked him in the eyes, and said, “Evan, I have been watching out for you your entire life. Why would I stop now, especially on something that is this important to you?”

I was still scared. But a lot less freaked out. And—spoiler alert—I found her.

This week, I’ve been skirting the edge of depression (maybe more than skirting, to be honest) and worrying about the future. In this particular case, I’ve been without a job for three months now. I’ve been searching and interviewing, and I’ve been subject to the usual delays and pitfalls of a job search. Despite my relative success at keeping myself busy with a nice side project, I’ve been giving into panic more than I care to admit. The part of my brain that I should never listen to (yet always do) is yelling again about how much trouble my future is in. In this case, it’s how my lack of what I perceive as a robust background is going to mean I can’t get a job and if I do get a job is it going to be one that I will enjoy and not just show up to and will I really be able to do the job if I do get it and so on.

Time to go down to the park to pray, but somehow I don’t think the message has changed.

File Sharing Rant

I’ve largely taken a back seat on the whole file sharing debate. However, now that I actually have a self-published work I feel it is time for me to make a public stance. Here goes…

I’m going to have to agree with John Gruber’s assessment of Richard Stallman’s latest essay:

I waver between rolling my eyes at Stallman’s kookiness and admiring his singleminded determination.

In my case, however1, Stallman’s kookiness extends to a large portion of the Free Software Foundation’s philosophies. Above all else, the FSF champions the right to modify and redistribute software. I have no problem with this goal as I will often promote a free or open source program (which apparently are not the same) when it is a viable alternative to a commercial program. I use WordPress instead of ExpressionEngine. I use The GIMP instead of Photoshop. But I use Safari instead of Firefox because I find Safari to be faster on my Mac. In my case, I am willing to give up a “freedom” that I don’t really use (the ability to modify the source code) in exchange for a more pleasant computing experience.

It is Richard Stallman’s opinion on creative works that I find unacceptable2. Never mind that because not all Creative Commons licenses are free he refuses to endorse any of them (he, of course, suggests the GPL). What is dangerous is that he equates creative works such as movies and music with information and file sharing with the general term “sharing.” In doing so, Stallman shows his background as a computer scientist. A program is written to solve a problem; the FSF’s arguments that there are more benefits to releasing the source are valid here largely because the program can benefit from the scientific method. Information wants to be free, and the solution to the problem (the program) is simply another form of information.

A creative work, however, is not simply information. It does not consist of simple facts or present a solution to an established problem. It is, when done properly, a reflection of the author or artist’s heart. It can be anything from a commentary on society to a rewrite of a poorly done movie to an attempt to reconcile temporal existence with eternal life. As such, creative works cannot be held to the same standards as computer programs, and vice versa.

Equating creative works to information reduces the author’s creative expression to its digital format, an act of language that cheapens the work even more than the term content. And distributing digital creative works over file sharing is not simply sharing, it is copying. Like anything distributed over the internet, the digital information is copied, not moved, from one computer to another. Loaning a CD or a book to a friend is sharing, since while one is in possession of it the other is not. File sharing creates copies, so that both are in possession at the same time. While not necessarily the same as theft, this cannot, by any reasonable definition, be considered sharing.

This is not to say I am against file sharing as a whole. There are hundreds of out-of-print and hard-to-find works that can benefit from file sharing in order to preserve their value to society. Also, it can be used by lesser known artists to encourage the viral word-of-mouth growth that is essential to growing a fanbase. This is the aim of Creative Commons, and I am disappointed that a man committed to “freedom” refuses to acknowledge the benefits of such a system.

1 John Gruber may agree with me, but I won’t presume to speak for him.

2 Yes, it’s a Wayback Machine link. The post as linked from the original slashdot article no longer exists.

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