Content Providers, Technology Companies Split on Importance of Smart TVs

Smart TVs provide an opportunity for traditional network TV providers, said Mike Petro, industry solutions director at online video technology startup Ooyala. “Maybe cable operators are threatened” by smart TVs if they're taking a “walled garden approach,” he said. But, “at the end of the day,” most cable operators are offering “triple play” service deals that include Internet access, “so they need to find ways to leverage that” and get their apps on TVs, he said. The “next big thing is really going to be dominance” of the start screen, he said. CE manufacturers may “have the edge” there because they make the devices, said Petro, who said his company attracts more than 250 million unique users each month.

Content providers need to convince hardware makers to “work with us” to make it easier for consumers to find their content on the devices, said Gary Delfiner, president-digital distribution, at independent movie distribution company Screen Media Ventures.

It’s important for smart TV makers to provide personalization capabilities on their devices for consumers, similar to what Microsoft is doing now via the Xbox One’s visual recognition system, said Chris Golier, vice president-mobile marketing and strategy, at the NHL.

But Molly Williams, strategy lead at mobile advisory company Applico, predicted smart TVs will “go away over the next couple of years” as software takes on a much more important role. Most of the standout Black Friday deals last week were “more software-driven” products than hardware-driven ones, she said, citing the Xbox One. More consumers are talking about Apple TV, Roku and game consoles than Samsung TVs, she said. “The hardware itself is going to become a lot less important” in the future as consumers increasingly turn to “ecosystems” that they subscribe to for their content, she predicted.

Smart TVs won’t go away, but “they have to get smarter,” said Delfiner. While many young people don’t own a TV, families own TVs and “that’s not going to go away,” he said. While many people don’t own TVs, they still own devices with some sort of screen, including smartphones or tablets, that serve the same basic function, said Petro. The TV industry runs the risk of a consumer “backlash” if it introduces a new broadcast standard in 2017 that isn’t backward-compatible with today’s products, he said, without specifying Ultra HD by name. Consumers won’t want to invest in smart TVs if they think the standard will change and that product won’t work in the future, he said. Updating software on an Apple TV or updating an app on an iPad is “a lot easier” than buying a new TV, he said. It’s also a lot cheaper to buy a $99 Apple TV or $35 Google Chromecast than to buy a new TV, said Williams.

The NHL, meanwhile, is seeing a huge amount of live second-screen viewing of hockey games by viewers using tablets and other devices, said Golier. “Sports is DVR-proof,” he said.

China is among the most difficult markets to launch an app in, Elias Guerra, senior director-marketplace development at mobile analytics provider Flurry, said earlier at the conference. That’s in part because of the various dialects that apps must be adapted for, he said. Therefore, it’s probably best for a company to launch its app in another market with “less friction” first, he said. The U.S. is a great “test market” to launch an app in, but there are also opportunities in countries including Vietnam, he said, calling that a growth market. But he warned that user acquisition costs are “relatively high” in Canada and that South Korea is a “very competitive” and “highly saturated” market to launch an app in. Australia is a good market for launching a gambling app, said Giordano Contestabile, vice president-product management at game company Tilting Point. It’s “probably important” to launch an app with multiple local partners when doing so outside a company’s home country, said Pankaj Bengani, vice president-global strategic partnerships at mobile ad company InMobi.