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Small-Screen Sea Change

Companies are jostling for position as consumers look for more control over digital TV content.
November 11, 2005

On November 7, TiVo and Yahoo announced a partnership that gives TiVo users the ability to program their recorders remotely using Yahoo’s online TV program guides. On one level, the announcement isn’t particularly remarkable, since TiVo users can already program their devices through TiVo’s website.

But as the latest in a string of launches and partnerships that blur the traditional lines between technologies used to create, manipulate, and view video content it’s more significant.

The impetus behind these new entities is simple: companies are recognizing that consumers want the flexibility to watch digital content any time, and on any device.

“This [movement] is in its infancy,” says Lynne Hentemann, a Yahoo spokeswoman. “But Yahoo believes in extending its content beyond the desktop. We’re trying out new things like this.”

As TR reported last week, media organizations are now experimenting with supplying copious amounts of video via the Internet for a low or nonexistent fee. For instance, Apple and ABC recently announced a deal allowing iPod owners to watch selectd ABC shows on the iPod’s tiny screen for a few dollars per show. Also, mobile phone networks are pushing video clips to users’ phones.

Despite its newness, this cross-pollination between TV, the Internet, and mobile devices is gaining momentum. Indeed, the lines between television content and online content are growing fuzzier – and consumers seem unfazed about it. Indeed, they appear ready and willing to mix up mediums. A recent survey by Jupiter Research found that 25.5 percent of respondents were interested in watching TV content online, although only 3.4 percent had done it so far.

Larger media companies aren’t alone, either, in trying to satisfy interest in watching videos online. Two new startups are creating large online repositories of free, user-created video content.

YouTube, a site currently in a public preview mode, allows users to upload personal video content for free, as well as to add “tags” to their offerings (keywords that help other users search for and find files). For example, a user might upload a video of his or her cat attacking a throw rug, adding the tags “cat,” “pet,” and “humor.” YouTube hopes to do for video files what Flickr has done for photography: create a central, free location where people can easily upload, search, share, and comment on their creations.

“We’re receiving over 5,000 video files a day,” says Chad Hurley, the company’s co-founder and CEO. “We serve over two million videos every day. We’re growing exponentially.” YouTube just announced that it has secured $3.5 million in venture funding from Sequoia Capital.

Meanwhile, on October 31, another video uploading site, Revver, was launched. Its co-founder is Ian Clarke, the mover behind Freenet, a peer-to-peer networking service launched in 2001. (Clarke couldn’t be reached for comment by deadline.)

Naveen Chopra, director of business development for TiVo, acknowledges that the video content landscape is changing everywhere. Asked what role TiVo plays if people move away from the TV set and living room, he initially pauses. “That’s a good question,” he says.

Yet Chopra does remain confident that even if television’s dominance as the primary video-viewing technology begins to erode, TiVo will have a role in the home of the future. TiVo has “a magic formula between user experience, brand, and functionality that users have fallen in love with,” Chopra says. “We have to replicate that experience wherever people want to watch video. There are a million different ways in which the lines are blurring. And we’ll learn what works through trial and experimentation.”

Despite all their experimenting, though, TiVo, Yahoo, and the rest – network programming directors, advertisers, startups – won’t have full control over their destinies. It’s ultimately the millions of viewers who will decide which video-watching models succeed.

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