In June I shut off my cable. All of my television content has come over IP since then. I connected a laptop to my HDTV and began watching all of my shows via a web browser -- through Hulu and by direct surfing on network websites.
The experience has been incredibly interesting. I have found that the video quality -- while not HD -- has been pretty good. And the most surprising complaint I have about the ad experience is that the frequency of individual ad creatives is too high. For example, when an advertiser has a sponsorship on Hulu, it tends to run only one or two creatives during the entire show -- across four to six commercial breaks. Thus, I sometimes see the same ad over and over again. It's surprisingly annoying; I'd frankly rather see more ads at lower frequency than fewer ads at higher frequency.
Although I have been able to experience the future of TV by splicing some technologies together, for most of the population, the setup I've devised simply isn't workable yet. On a 720p screen, the discovery process of navigating through Hulu, or especially the networks' own websites, has been very frustrating. And setting up the TV as a second monitor entails so much complexity that even my tech-savvy friends who have visited and tried to use my setup balked at the number of required steps. On my new 1080p television, it's much better -- but still less than ideal. A wireless mouse and keyboard are helpful. In the beginning, I didn't have these, and having to get up, choose, then start the next show each time was problematic.
This love-hate relationship with my IP-based television experience has been fun -- and enlightening. Keep in mind that what I'm discussing is TV over the internet -- not IPTV. IPTV is a cable television experience delivered over dedicated IP networks owned by the telcos and cable companies. IPTV is a great thing, but it's not the subject of this column.
A dedicated set-top box experience would be ideal -- it's really best to have a TV-based interface. There are products like this on the market, including dedicated set-top devices like Vudu and the Apple TV product. You can also use entertainment devices like the Xbox 360 and Sony Playstation 3, or a PC with TV capabilities that come from Media Center within Windows Vista.
This week, I've had a new experience that tells me we are very close to being able to provide the whole world with an amazing TV over IP experience. This week, I began using Netflix's new offering that lets you select on-demand streaming shows on its website and have them delivered to your television via an Xbox 360. I've got this setup on both TVs in my house, and for $8.99 a month, I can watch hundreds of TV shows and movies streaming in real-time to an HDTV.
Now, the content isn't quite HD quality, for the most part -- but it's an absolutely seamless television over IP solution. Even though I've been saying we'd get there for years now -- I wrote my first paper on TV over IP in 2004 -- I have to admit that this experience has blown me away. I would vastly prefer a free (no subscription) service supported by ad funding. But for now, the Netflix offering is relatively inexpensive, and the quality is fantastic.
Streaming television and movies in at least 480p (DVD quality) video, with some HD content -- even if I need to download the shows -- and some standard definition live streaming for news, weather, and sports highlights -- this is all that most people really need. This is the experience I want, and I'm sure many others would like it too.
In a lean-back television experience, the ad-funded content can have more than four ad breaks and can present pods of ads. I'd recommend half as many ads in the IP-based television experience as we see in broadcast TV. Typically, broadcast TV has 40 minutes of content and 20 minutes of ads in an hour of programming. Dropping this to 10 minutes of ad content would help drive adoption of TV over IP. In an interactive environment, there are also new ad formats that can be inserted into various parts of the experience. TV over IP has the potential to give viewers new ad experiences, as well as the ability to make interactive requests for information and buy through an ad. For advertisers, it can deliver real measurability of impressions, dynamic ad delivery, and the ability to target. Combined, all these factors will more than make up for the revenue lost in dropping half the ads.
I want my internet TV!
Eric Picard is the advertising technology advisor to the Advertising Platform Engineering team at Microsoft.
