The competitive tide is rising, seemingly by the minute, in the IP video/next-generation TV market. Apple, Amazon, Google, Microsoft, Netflix, Hulu, Boxee, Roku and Sony are just a few of the myriad brands competing to “cut the cord” on cable’s ironclad reign over this multibillion-dollar industry. Potential “killer apps” range from OTT set-top boxes to IP-configured gaming consoles to streaming video services to “connected TVs.” It’s enough to confuse even the savviest channel changer.

Monsoon Multimedia wants to simplify the user experience with Vulkano, a set-top box that unites a variety of functions within a single, sleek set-top box. Vulkano comes from the makers of Hava, a placeshifting platform that competed directly with Slingbox. But Vulkano aspires to be far more than a place shifter — it wants to be Slingbox, TiVo and Roku, all in one.

Colin Stiles, Monsoon’s executive vice president of sales and marketing,  told BIA/Kelsey that the continued convergence of in-home communication (think “triple play bundling”) inspired Monsoon to craft a product with five key feature sets:

1. Video Placeshifting: The Hava or Slingbox functionality, with live TV streamed over Wi-Fi or 3G.

2. Web Video: Stream video and photos from computers, smartphones and cameras wirelessly onto the home TV. Currently YouTube is the only provider, but Vulkano is negotiating with Netflix, Hulu, Amazon VOD and others.

3. Timeshifting: Standard DVR capability with an integrated electronic program guide (EPG).

4. Mobile Video Recording: Connected to the DVR, users can schedule recordings to their Vulkano box usiing Wi-Fi or 3G and then watch them on phones and other portable devices.

5. Universal plug and play (UPP): Allow viewers to select and curate content from different devices within their network.

The San Mateo, California-based company has launched two different versions of Vulkano, Deluxe and Deluxe Pro, priced at $279 and $379 respectively. It is already selling directly from its Web site as well as Amazon.com and will add further e-tailers and selected retailers in the fourth quarter.

As we noted above, the race for set-top box supremacy is white hot, with Apple relaunching a smaller, significantly cheaper ($99) box earlier this week to battle Roku. Google TV software is expected out this fall. Moreover, with IP-connected TVs multiplying, what is the future of the box?  Stiles asserted that with the “massive install base, there is room for standalone boxes.” He also noted that Monsoon could be looking to partner its Vulkano as an STB that cable, telco and satellite providers can load their products on top of.

Local over-the-air TV signals are not being delivered yet, though that is on the horizon. Once OTA signals are captured, broadcasters can begin to leverage the accessibility and customization of connected devices such as Vulkano to foster a more interactive and targeted experience for their local advertisers.

Linear ads, for instance, could be stored in Vulkano-esque boxes, with embedded coding that allows them to target particular audiences or be personalized to specific demographics. This could yield new revenue streams for broadcasters and added value for local clients.

Courtesy: Engadget

Steve Jobs might be as adept at captivating a live audience as he is at innovating game-changing media products. For nearly the first hour of Apple’s “September event” in San Francisco, Jobs made nary a mention of Apple TV. And then, just as the invite-only crowd suspected that the festivities may be ending, Jobs pulled his latest, famed “one more thing” trick, quipping that the final “hobby” (his notorious description of the company’s philosophy toward TV) was on the agenda — a $99, rental-centric upgrade of  Apple TV that streams movies and TV shows in HD and is compatible with portable devices.

ABC and FOX are already on board as partners, and Netflix and YouTube streaming are also available.  Jobs announced that commercial-free TV shows are 99 cents for a 48-hour rental, while first-run movies cost $4.99. The 99-cent price point is in-step with the iTunes song pricing model that has radically disrupted the music industry.

Also, because all premium content is rented and streamed (rather than downloaded), there are none of the storage capacity or management concerns that have weighed down iTunes video files in the past.

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Two freshly released viewer surveys underscore the fragmentation of the TV marketplace, the surging demand for online video and time shifting, and the changing consumer attitudes toward traditional, live television.

The most recent Morpace Omnibus study reveals that while 52 percent of viewing is live (linear broadcasting, whether prerecorded such as a TV series or movies, or actual live programming like sports and news), more than a third (36 percent) of viewing is now on-demand. In addition to VOD services, 41 percent of consumers use in-home or network DVRs for additional “on-demand,” non-linear viewing.

Meanwhile, the migration online continues, with results from an Altman Vilandria & Co. survey declaring that broadcast TV consumption on the Internet doubled over the past year.

Morpace Omnibus Report: August 2010

The list of competitors jousting to disintermediate cable’s long-held and lucrative grasp over television viewing is lengthy but muddled. This proverbial ”kitchen sink” of attackers includes “connected TVs” (Sony Bravia, utilizing Google TV software), Internet-connected gaming consoles (Playstation 3, XBox 360), streaming video services (Hulu, Netflix), and over-the-top (OTT) set-top boxes (Apple TV, Roku).

However, no single platform or technology has conquered this potentially prolific space. There is no “killer app”… at least not yet.

Increased online and time-shifted viewing is yet to dramatically cut the cord on cable TV providers, with only 3 percent of 18- to 34-year-olds sampled by Altman actually canceling their cable. Couple that with 96 percent of Morpace’s respondents answering that they still watching at least some programming from a traditional device, and TV’s place begins to look more secure.

But dramatic shifts in viewing behavior appear to bubble just beneath the surface. Altman found that while only 3 percent of the 18-34 group have “cut the cord,” another 25 percent have “seriously considered” dropping pay TV altogether.  This is just the latest jolt to the cable industry, which lost 711,000 customers in Q2 2010 alone.

The upshot of all this data: A cavalry of competitors are storming the gates, but local and national broadcasters still have opportunities to differentiate their assets through mobile (the Washington Consumer Showcase of Mobile DTV, which we have documented), 3-D and other innovations.

Even with the OTT space cluttered and disjoint, local broadcasters can begin fostering partnerships that enable them to package their content across devices and locations while unlocking diverse, non-linear revenues. Plus, OTA programming has this ace in the hole — it’s free. The net effect can be additive for local broadcasters, not subtractive or substitutive.

A few weeks ago, mobile video platform MobiTV released findings from its delivery of the 2010 FIFA World Cup suggesting that the larger the screen, the longer the time spent viewing. No surprise there, as total average minutes viewed for 5-inch screens (118) nearly doubled those of 2-inch screens (61).

What is eye-catching are the minutes themselves, which put new data behind rising mobile video consumption trends. All told, MobiTV reported that it served more than 100 million minutes of soccer.

While MobiTV and its counterparts — FloTV, Verizon VCast and Sprint TV, among others — see consumer adoption and usage rates surging, their media offerings are singularly national. All the essential TV food groups are on the menu — sports (ESPN), drama (USA), news (most prominent brands) and lifestyle programming (Oxygen, TLC).

Unaddressed is local programming, which raises the question, “Where is the mobile opportunity for local broadcasters?”

The Open Mobile Video Coalition (OMVC) is currently studying this question through the Washington Consumer Showcase of Mobile DTV, which BIA/Kelsey is supporting in conjunction with Harris Interactive.

Nine Washington, D.C.-area TV stations are participating, with four discrete products sampled for wireless TV use. The one pure-play cellphone is the Samsung Moment, available through Sprint. Two hundred area residents are utilizing the built-in receiver chip in the handset to test live, local broadcasting as well as a fleet of national channels. OMVC reports “high excitement” for over-the-air mobile TV.

Meanwhile, in Raleigh, N.C., News over Wireless, a division of Capitol Broadcasting, which owns and operates WRAL-TV and the immensely popular WRAL.com, is working to localize TV news on 3G mobile devices through carrier partnerships on behalf of stations in more than 50 markets.

Even though Hulu CEO Jason Kilar calls his service “incremental and complementary” to cable, the online video hub’s potential fall IPO is a testimony to the transition of TV across screens and the rapid growth of OTT (over-the-top) services.

OTT delivers IP video to end users over third-party broadband using gaming consoles, set-top boxes, and other devices to connect the Internet and TV. The upshot: The ”cord is cut” on cable.

BIA/Kelsey projects that OTT will surpass cable within three years, reaching 62 million homes by 2013 as consumers demand greater customization and control of their content. Hulu is the most watched OTT service, with 53 percent of all OTT users accessing it. Notably, 42 percent of those viewers already watch at least some Hulu programming on their TVs.

The timing of the reported public offering is especially interesting considering that Hulu — a joint venture of News Corp., NBC Universal, the Walt Disney Co. and Providence Equity Partners — reported only $100 million in income last year and is yet to release tangible revenues from its recent rollout of the $9.99 per month Hulu Plus premium service, which aims to create a second revenue stream alongside its core advertising business. ComScore reports that it did serve up more than 780 million video ads in July, far and away the most of any online video property.

A Hulu IPO, coupled with mounting research backing OTT growth, should motivate local broadcasters to take notice of the migration of Internet TV onto traditional screens. Competition is deepening. TV viewership, while growing, is also fragmenting, with more sources of video and more devices delivering it. OTAs can pursue a multitude of strategies, both a source of opportunity and confusion.

Broadcasters will need to foster partnerships in order to build the necessary infrastructure to provide OTT services. With that in place, a coherent OTA + OTT offering could unlock new revenue streams and afford consumers a richer viewing experience.

With Google TV Ads’ announced partnership to auction inventory across 11 national networks carried by DirecTV, the search giant begins to try to rebut skepticism about its ability to achieve significant reach. Now it must demonstrate the ability to generate healthy revenues, driven largely by SMB platform adoption, to avoid the pitfalls it suffered in similar newspaper and radio consortia.

DirecTV’s 18.7 million households, combined with Google’s existing relationship with Dish Network, more than double TV Ads’ overall reach to 33 million homes. The networks — including brands such as Bloomberg, FOX Business, Fit, Fuel and TV Guide — are generally lower-rated, with many highly targeted to specific demographics.

However, Google Ads will have access to local inventory across all dayparts, a breakthrough that previously impaired its perception as a primary TV advertising vehicle and was absent from the radio partnership.

For SMBs, there is a give-and-take. Google TV ads is effectively an extension of its lucrative, popular AdWords platform that enables businesses to create, target and track their own self-provisioned campaigns. As Mike Boland has written about extensively on this blog, the self-service nature of the platform can make the process more seamless for SMBs with existing AdWords accounts, which can tailor their buy according to channel, daypart, geography and demography.

Additionally, the tracking analytics that Google offers through data it extracts from set-top boxes can afford these advertisers a more transparent and targeted approach to offline spending.

If an increasing number of new clients are drawn to the service by its granularity, then advertiser demand may drive more traditional media companies — the more prominent names that have not opened up their inventory — to reconsider partnering with Google. To this point, most cable and telco providers, as well as prominent cable networks — the ESPNs, TNTs and USAs of the cable universe — have shied away from Google, not wanting to share their own audience data and fearing the possible commoditization of their inventory.

Conversely,  SMBs must adopt the Google TV Ads platform en masse for the search giant to sell at scale and generate substantial revenues. Again, this relies on self-service, which stems from both awareness and user-friendliness of both campaign creation and bidding. Much of that awareness connects Google TV Ads’ aforementioned reach-and-prominence dilemmas.

Our estimated $18.1 billion in income is a 10.9 percent increase compared with last year’s $16.3 billion. We think there are a few contributors to this respectable gain. First, there is a growing swing in advertisers returning to television, as evidenced in a recent story in Advertising Age and a point that we’ve often made at BIA/Kelsey that you still can’t deny the large amount of people you can reach with a local television station ad, despite DVRs, the Internet and other distractions.

Second and equally important, we have seen a pattern of advertising growth in non-election even-numbered years going back a decade, as evidenced in the below chart. Notably, in the years coming off a recession the industry picked up double-digit increases. Arguably, it’s easy to say that there’s nowhere to go but up after a negative year. However, we note that with consistency the industry always seems to be rediscovered after the times are bad, and we don’t see that changing anytime soon.

Our predictions for the half of the next decade remain positive and upward. Television remains poised as part of the invaluable media ecosystem; we’re always happy to report that.

The deal initially covers 10 of Gannett Broadcasting’s 19 markets, including Atlanta; Washington, D.C.; Tampa; Buffalo; Sacramento; Grand Rapids; Little Rock; Portland, ME; and Macon, GA. Gannett is keeping the DataSphere arrangement separate from Ripple6, its social media marketing unit, which was recently merged with PointRoll, Gannett’s rich media services company.

Seattle-based DataSphere, which received $10.8 million in funding and is partially owned by Fisher Communications, now has deals with at least five media companies and powers more than 300 local news sites. Among its media partners are Fisher, Raycom Media, Local TV and Hubbard Broadcasting. More than 1,000 SMBs are served by the Fisher sites in Seattle, Portland and Boise. The service had also been tested out on a limited basis by Cowles.