Goodbye Empty Black Box, Hello Smart TV

Goodbye, black box, and thank you. You've served us well these past 25 years. But we're done playing the couch potato and watching just another pretty picture. We're ready to lean forward and define our own programming experience on a bigger, now connected, screen. Hello, Smart TV.

Earlier this year Intel introduced its new Atom-based CE 4100 System on a Chip (SoC) for PCs and TVs. Now, a few television manufacturers -- Sony, for one -- are marketing an Intel-enabled Smart TV, which will let you find and watch content and applications from any TV platform. Soon you'll be using apps on your Smart TV, so -- as Google TV has said -- the coolest thing about it is that we don't even know what the coolest thing will be yet.

But with apologies to Google, I think the coolest thing about it is this: Smart TV is shaking up the sprawling television landscape, and making manufacturers relevant again for the first time since 1986. That's when GE bought and broke up RCA, the last company to both manufacture TVs and own a network (NBC), and -- not coincidentally -- the single most innovative company in television history. (I spent some of my career working with RCA's central research center, now called the Sarnoff Corporation.)



The inventions that came out of RCA (and then Sarnoff) included television itself (although Philo Farnsworth might disagree), color television, video-on-demand, and satellite TV. The Center even helped lay the groundwork for the HDTV mounted on your living room wall right now. At the time of GE's acquisition, the dissolution of RCA made sense: Programming was in its ascendancy, and the TVs themselves had become, for the most part, dumb black boxes.

Not anymore. Now, manufacturers -- the Sonys, Samsungs, and LGs of the world -- are back in the picture, about to join the ranks of TiVo, Netflix, Hulu, Apple, and XBox in disrupting the TV programming world. After all, they've got the technology from Intel and a platform for creative application development -- with business models to follow -- to give consumers the experience they want when they want it. Consumers don't care where content comes from; they just "want their TV." With this shift comes a new opportunity to define how content is delivered, consumed, and paid for -- with advertisers yearning to know if there's an ROI for this new medium. This means that the other key players will be -- I believe -- those companies leveraging data to support the new ecosystem (and yes, I count among them my company TRA, which, it should be noted, Intel has invested in). Advertising will continue to foot most of the bill for programming, as it has for the last 50 years, and for advertisers to understand where to put their dollars in a digitally driven world -- Old TV? New TV? Other media? -- they'll need sound data. As Jack Myers wrote in a recent industry report, it's not consumers who are king, but the data about them.

So if you want to know where TV is going, follow the money -- er, I mean data. Data will drive the allocation of advertising across the platforms and devices that have overwhelmed consumers and emptied their pockets in recent years. It will define new roles for players long entrenched in the old TV game. (As Google is learning the hard way, the primary challenge is no longer posed by technology but by securing the right partnerships across the industry.) And it will raise questions about security and privacy that only certain companies -- those who understand where the marketplace is headed -- will be positioned to address.

These are some of the issues I'll explore in future posts. But if there's one thing I know, as I sign off from this first entry, it's that a new Golden Age of Television has arrived, offering consumers with the ability to interact with programming and applications in new ways, on new screens and new places. Hope you'll be here to see how it plays out.
3 comments about "Goodbye Empty Black Box, Hello Smart TV".
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  1. Stanford Crane from NewGuard Entertainment Corp, January 3, 2011 at 2:19 p.m.

    I find the digital (only) world is all too eager to declare the broadcast world obsolete, perhaps because that's the way they got funded, or perhaps because they see everything as win/lose.

    As a content creator and producer, we believe advertisers want a complete strategy which encompasses all platforms. Isn't that the best of all worlds? To control that presentation and to monetize all areas, we pay for the development and production and even buy the broadcast time, thus freeing the network from the (perceived) financial risk.

    Why can't we have all screens?

  2. Paula Lynn from Who Else Unlimited, January 3, 2011 at 2:44 p.m.

    Again, a lot depends upon how much consumers will have to spend on more enticing TV's than they already have the past couple of years replacing their old boxes with the flat versions. Connectivity costs for programming for the consumer is skyrocketing and busting their budgets. Plus, consumers will start to feel more squeezed this year with more government and service sectors eliminated funds. Smart needs to mean affordable, too.

  3. Mark Lieberman from TRA, January 4, 2011 at 7:21 p.m.

    I couldn't agree more, Paula. The industry does need to develop truly sustainable business models, and this includes sustainable for consumers, too, so that the consumer doesn't have to continue to paying for all of these additional services and products. Since advertisers subsidize consumers' costs, the advertiser needs to be able to measure the effectiveness of their media spend. That road, too, leads to data.

    Stanford, we can, and we will provide measurement for all screens. But starting with the largest media spend (TV) is important to inject a sense of accountability. The explosion of digital databases on these multiple screens provides a unique opportunity (as opposed to the small panels of the past, which cannot possibly measure all screens accurately).

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