Gidley's Gossipings

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What was more significant for PayTV the Apple TV+ or Google Stadia announcement?

There have been 2 big announcements this week that impact the TV industry - 1) Apple announcing their OTT proposition and 2) Google announcing Stadia and I’d like to argue that of the two the most significant for the TV industry is the Google announcement.

If we review what we know about each announcement

Apple TV+

  • A PayTV Service reaching Apple and some non-apple devices (FireTV)
  • A large potential global audience
  • Lots of content - both original and from existing networks
  • Aimed primarily at Apple Ecosystem, with some support for 3rd party devices (Amazon Fire, Samsung, LG, Roku)

Google Stadia

  • A Gaming service based on cloud servers and low latency streaming
  • A Game controller offer low latency response
  • Tools to enable games to be ported to the service
  • Targeted at any device - runs on Phones and Browsers

These are both big announcements but I’d argue the Apple one is less significant. Apple’s offering is similar to Amazon Prime, Google TV, Netflix and existing PayTV operators. It’s got nothing fundamentally new to offer consumers and is just adding to the range of competitors in that space. Google on the other hand are offering a new experience, high quality gaming on any device without needing to buy consoles or high end PCs. This is a fundamental increase in reach for gaming as an entertainment form.

But what has gaming reach got to do with PayTV?

A lot - PayTV is in a battle for consumers attention and gaming is one of the largest time sinks and competitors for the consumers money. If Google (or Sony, Microsoft, Nintendo) can get a cloud gaming service working well in the real world they’ll suck up audiences.

There is also one other wild-card - today the TV industry spend a fortune getting Set Top Boxes, TV’s and Phones connected to video services. Cloud gaming is going to drive scale and make serving both the video and UX from the cloud cost effective - this will disrupt the client side ecosystem and will see the platforms for gaming and TV converge into a single experience. Cloud gaming is solving rapidly all the problems of security and latency that video faces today and will go on and solve the reach issues that all video services have.

So What?

This is a key trend to watch - the question is when, not if

  • The internet is good enough to deliver video content and UX’s from the cloud to all devices
  • The convenience, low latency and added security of cloud served solutions beats the benefits of a local device
  • We move more and more to a ‘dumb’ terminal model with smart cloud servers delivering everything
  • Google (et al) get uni-cast cloud UX to a point it’s cost effective (due to their massive scale)

For PayTV industry this should be a wake up call - don’t worry about Apple copying your business model instead worry about Google (and others) grabbing the audience attention and changing the economics and then disrupting your business.


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