• by Steve McClellan  @mp_mcclellan, August 29, 2011

Despite its struggles to gain traction in the U.S., Google chairman Eric Schmidt said the company would launch a version of its Google TV streaming product in the UK in early 2012.

The company launched the U.S. version last year, but sales of the devices have remained sluggish. Key U.S. broadcasters, like CBS, ABC and NBC have blocked programming access by the Google boxes.

Google's effort in the U.S. has not been helped by critics either -- like The Wall Street Journal's Walt Mossberg, who panned the device last year as "a geek product, not a mainstream, easy solution ready for average users. It's too complicated, and some of its functions fall short."

But Schmidt said the company is taking steps to ensure that Google TV gets off to a better start in the UK. Among other things, it has recently teamed up with Kantar to create a single-source research panel to measure Web and TV habits to better understand cross-platform video consumption.

Schmidt made the Google TV announcement this past weekend at the Edinburgh TV Festival, where he was also the keynote speaker. He had plenty to say about what the UK media business was doing right and where it has fallen short.

While complimenting channels like Sky Television and ITV as "formidable" players making necessary adjustments in the digital era, Schmidt added that many of the nation's approaches to entrepreneurship, regulation -- even education -- were holding its media industries back.

"Your track record isn't so great!" he exclaimed. "The UK is the home of so many media-related inventions. You invented photography. You invented TV. You invented computers in both concept and practice. Yet today, none of the world's leading exponents in these fields are from the UK."

Part of the problem, he submitted, was a lack of emphasis on the sciences in the UK educational system. "There's been a drift to the humanities -- engineering and science aren't championed," he said. "I was flabbergasted to learn that today, computer science isn't even taught as standard in UK schools. Your IT curriculum focuses on teaching how to use software, but gives no insight into how it's made. That is just throwing away your great computing heritage."

Schmidt noted a recent plan in the U.S. to train an additional 10,000 engineers a year. "If the UK's creative businesses want to thrive in the digital future, you need people who understand all facets of it -- integrated from the very beginning," Schmidt said. "Bring engineers into your company at all levels, including the top."

While acknowledging that Google was the subject of antitrust investigations in both the U.S. and Europe, Schmidt suggested UK media regulation was stifling innovation. "Overall, British Television is subject to far more stringent regulation than its counterpart in the U.S. This means less flexibility and scope for UK companies seeking to compete on the global stage."

He contended that it is "no exaggeration to say decisions made in the next year will determine the long-term health of your broadcasting and content industries for decades to come. If economic growth is the priority of the Government, your regulators need to be cautious when making new laws in this space, or risk stifling the growth of your content businesses."

The television business, he said, "is going global and transforming in form. This new era, where innovation and speed are paramount, has parallels to the Internet. To compete on the world stage, your content businesses need the freedom and legal framework to behave more like Internet companies."

He said regulators should focus on "how do we protect the space needed for innovation. Again, listen to the entrepreneurs, not the lawyers, if you want innovation to thrive."

Of course, Schmidt did not suggest a regulation-free environment for the industry, and he did not mention Google's $500-million settlement last week stemming from ads the company permitted on its site by Canadian pharmacies allegedly selling prescription drugs illegally.