Friday, December 18, 2009

Almanac - How Our Predicitions For 2009 Worked Out

So, it’s navel gazing time again as I look back on my predictions for 2009 and see how well my crystal ball was working back at the beginning of the year.


The Death of the STB - The biggest theme of this year's CES show will be the death of the set top box, with LG launching a screen with Netflix embedded and Intel working with Toshiba and Samsung. The screen manufacturers have finally realised that they, actually, own the eyeballs, and are likely to try and leverage this in the near future. In the past they might have used this as a means to leverage sales of their commoditized plasma and LCD screens, but now they're more likely to look to take a share of ongoing rentals and downloads, having learnt the lesson the hard way from the likes of Apple.


Well, I think this one is a 8/10. More and more screens are appearing with chips built into them. This will be a slow process, especially with so many incumbents, and even new entrants to the IPTV market such as the UK MNOs are likely to use STBs in the short term, but the trend is certainly underway.


Major Vendors Take Video Seriously - Twelve years ago I started to stream video over the internet. Now, Microsoft's Steve Ballmer thinks that this is a good idea. Welcome to the party, Steve! But the real reason that Microsoft and Intel take this seriously is that their mainstay - the corporate market will be spending in this sector and nearly nowhere else over the coming year, since video networks will be cheaper than flying executives business class and putting them up in four star hotels and arranging huge conventions for salesmen and resellers.


Another good score. 2009 was the year when internet video found its feet. Giants such as Cisco and Intel are making serious efforts in this arena. 9/10.


Corporate Takeup - I'm cheating here since I seem to predicting this year after year, but already 2009 has seen a flood of enquiries to VidZapper from corporates, educational establishments and government agencies wishing to launch their own channels and I suspect Internet TV will prove reasonably durable during the downturn since it presents a cheaper, more accountable way of doing video market, now that objections about bandwidth, etc.. have largely disappeared.


Hmm, not quite as I’d expected. Companies having web channels as readily as they have websites is still some way off, although more and more companies are experimenting. 4/10.


The Small Screen - Of course, the other major trend is going to be smartphones - just as the concept of carrying all of your record collection in your pocket seemed pure fantasy a decade ago, so perhaps does the same concept for video now; as Blu-Ray struggles we're moving into the era of downloads taking over from DVDs and the new format may well be marginalised. Downloads will be the theme for the next couple of years, but in time both music and video will become virtual objects, living on remote servers (indeed, one of the best ways for rights owners to protect their content will be to centralise control rather than having millions of copies flying around the internet).


The rise of Spotify, Hulu and iPlayer means that this was spot on. 10/10.


Rights - whilst on this theme, we're moving into the age of more complex, and perhaps more flexible, rights management. Rights owners will need to sweat their assets as new budgets are cut; I expect it to be a busy year for the company where I am Non-executive Chairman, Rights Tracker. I still think it's early to predict that someone will set up a company that effectively sells and deals in secondary and unused rights online, but that day can't be so far away.


Again, this has been the year of rights. Indeed, if anything this aspect of the industry is going to become more important year on year. 8/10.


Stagnant Ads - the ad market is not likely to see any great moves forward this year, despite the success Hulu has been having; expect more complex sponsorships to come to the fore as every quieter ad agencies finally have to get clever about their business.


The recession somewhat stymied this prediction, even if almost every MPU now seems to carry a video ad. 5/10.


CDN Clearout - CDNs are likely to suffer from more competition and from the advent of cloud services. Already Amazon's S3 has seen great takeup amongst Web 2.0 startups.


The CDN market has been surprisingly stable, but the pie isn’t growing. The value of the market is staying the smae year on year as the value of bandwidth declines and the entry of major wholesalers such as Level3 have made it an uncomfortable time for the incumbents. Amazon’s decision to offer streaming Flash (already supported by VidZapper) is likely to have great impact. 7/10.


Universal broadband - with Governments all over the world now determined to invest in infrastructure to ease their ailing economies, expect initiative all over the developed world in the provision of better broadband services for everyone.


Yes, the UK Government, followed by many other governments around the world, announced a levy to pay for universal 2Mbps broadband (whatever that means). 10/10.


Mergers and Closures - inevitably the coming year will be one of consolidation, and services such as Bablegum and Joost may struggle to survive unless funded by the deep pockets of their respective founders.


Bablegum struggles on, but Joost has hit the rails. More and more mergers are happening as the industry consolidates.


What did I miss ? Well, the co-operative initiatives in the industry such as Hulu, HBB and Canvas were worthy of more than a passing mention.


The sheer growth of viewing of internet TV was also a surprise, as was the fact that people are viewing more TV, both traditional and online.


So, look out for out 2010 predictions on this blog before very long, and please feel free to add your own thoughts.


Happy Christmas!