The War for Control of Your Living Room

All right, so you’ve heard CES is about the wearable Internet this year —the gadgets you whip out at a party or over dinner or (God forbid) in the car. But back in the living room, there’s a war being waged for that much-maligned piece of furniture we all end up in front of sooner or later. Call it the Idiot Box, the Boob Tube or whatever you want—the majority of media consumption still happens in front of the television, and whether it’s gaming, movie watching, Netflix or just listening to the stereo, tech giants are fighting tooth and nail for a seat on your couch. Here’s what they’re bringing to the party. The Champion From Kabletown: Comcast What it is: Never underestimate the people who own the pipe. Rarely has there been a more widely accepted misnomer than “cord-cutter.” Even a cord-cutter gets the Internet, and he probably gets it from his cable company. Through a cord. Several cable companies have been slow to adopt high-tech initiatives, unfortunately for their subscribers—it’s expensive to implement changes across millions or hundreds of thousands of users, especially if your systems are cobbled together from acquisitions and sales over the years. But one of the most progressive on that score is Comcast (not coincidentally the owner of television network behemoth NBCUniversal), which has been rolling out its “See It” features. They essentially turn Twitter into a remote control that works from anywhere you get cell service—you can DVR something from a restaurant or click over to it from your couch, all using your smartphone. This is only the tip of the iceberg, says Charlie Herrin, svp of product design and development for Comcast, who calls it “a Jetsons moment.” “From your couch, you can flip through, look at and delete all your voicemails,” Herrin says of last year’s feature rollout. “[Next] we have our home security app so you can look at your security cameras, change the thermostat … it’s pretty powerful. You can control it from your phone, and you can see it on the big screen.” Why it will work: Comcast is easily the largest multisystem operator in the country, with 21.6 million subscribers, and the only one that produces as much content (16 cable networks, including its joint ventures, as well as NBC proper, Telemundo, Universal Pictures, Universal Music and several TV studios). It’s uniquely positioned among its competitors to control the living room simply because it owns so much of what you watch and listen to. Why it won’t work: Comcast’s core business is still cable distribution, and if you’re not in its massive footprint, you’ll have to search for your innovation elsewhere. The Fruit With A Grudge: Apple What it is: CEO Tim Cook has repeatedly described Apple TV as a “hobby” for the tech company when grilled by reporters on the does-it-or-doesn’t-it-really-exist service; this, to put it mildly, is starting to look disingenuous. Until late last year, Apple TV was just a bridge device for your iTunes purchases; now it gets authenticated services like HBO Go and WatchESPN, monthly subscriptions like Hulu and Netflix, and freebies like PBS. Apple declined to provide an interview for this article, though a representative did say that the company would continue to provide “new features and content options for Apple TV users.” Like Samsung, Apple is anxious to make everything it makes compatible with everything else it makes; iTunes Radio, iCloud and AirPlay all work seamlessly with the $100 Apple TV device. Why it will work: “I walked the CES floor last year,” says Scott Hess, svp, human intelligence for SMG agency Spark, “and all the TV manufacturers were showing off software features on very kludgy, idiosyncratic menus.” Hess, who makes no bones about his own status as a serious Apple-o-phile, observes that it’s less about who has the greatest insight and more about who can make that insight accessible. Apple is great at that. “The people who own the most intuitive interface own the living room,” he adds. Success, Hess suggests, will ultimately be determined by the number of people who are already in your corner. “You [win market share] through a superior interface, and you probably do that through an installed base,” he says. And of course, mobile and tablet consumption has helped define who controls those bases pretty solidly. “Active consumption is owned by either Apple or Samsung,” Hess sums up. “Your Coke and Pepsi have been established.” Why it won’t work: Apple doesn’t really have any content deals as such—Hulu and Netflix negotiate and hold those, so there’s no Apple TV-exclusive content—and products like the Apple TV and the Google Chromecast are simply bridge devices that run identical apps at this point. It’s not hard to imagine a future where similar devices are so common that it doesn’t particularly matter who the manufacturer is, and in that scenario, Apple’s signature corporate strategy—its promotion of Apple products using other Apple products in pursuit of an all-Apple household—might come back to bite it. If everybody is playing nice except Apple, consumers may take their toys and go elsewhere. The All-Seeing, All-Knowing: Google What it is: Google’s Chromecast bridge device was a triumph of launch marketing. The PR blitz that accompanied its debut was so convincing that the company ran out of its initial promotion—a three-month trial subscription to Netflix, which would have cost $24 of the $35 price tag for the device all by itself—in three days, in addition to selling out on Amazon and in Google’s own Play store. Like iTunes and Amazon.com, Google has a large library of immediately accessible pay-per-episode (or movie) video and audio content; like Apple TV, Chromecast supports several different apps that also stream shows and songs. Most impressively, you can broadcast to it from your Android phone or tablet …or your iPhone or iPad. That in itself would be a risky strategy without the 10,000-lb. gorilla of content licensors, Netflix, on its side. With the Netflix stamp of approval for the phone-to-television broadcast ability, others like Hulu have followed suit, and most recently Barry Diller’s middle finger to the broadcasters, Aereo. Why it will work: “The great thing about Chromecast is that it works with your phone and your tablet—you’re looking around for something cool to watch and boom, it shows up on your big screen,” enthuses Albert Lai, CTO of Brightcove. Lai says that Google is also the first to take advantage of a cool, fairly recent idea called CEC—consumer electronics control—that enables the user to hijack all of a TV’s functions without using the remote control or the buttons on the set. “If your Chromecast is plugged in to an HDMI port, it can actually enable a CEC TV to be turned on,” says Lai. “It’ll turn it on and tune it automatically to the port that your Chromecast is plugged into.” With Aereo compatibility on the horizon, it might also enable true cord-cutting. Given the right data package, you could stream everything you wanted from a cell tower and kiss your cable operator goodbye. Why it won’t work: Like Apple TV, Chromecast is still at the mercy of smartphone app creators doing all the heavy lifting with content licensing. It just streams what other people have inked the deals for, and if, say, CBS’ agreement with Netflix goes south, that’s it for any Chromecast users who happen to like Star Trek. It’s in Your Pocket and It’s Happy to See You: Samsung What it is: Samsung’s highest-end televisions make going to the movie theater seem low-tech and redundant. The 2014 smart TV, unveiled this week at CES, stands at 105 inches corner-to-corner with a curvature that looks like a personal Imax screen. It also watches back. Hand motions can tell it what to do (“finger gestures,” according to Samsung, which is trying to make a distinction between less-specific hand gestures that debuted on last year’s TVs). There’s voice control, too, and the host of apps includes stalwarts like Netflix and Hulu as well as PC and mobile natives like Facebook and Skype that the content-focused devices don’t feature. Newer Samsung Blu-ray players have plenty of these features, too. Why it will work: “Samsung moves a lot of hardware,” says Spark’s Hess bluntly. It’s a company that makes more machines even than Apple, though it’s comparatively new at the software game. Blu-ray players, televisions, phones, tablets, even a goofy-looking watch. Last year at CES, the company made a point of bragging that it had adopted DLNA across all of its devices—an open-source protocol that allowed its phones, tablets and TVs to talk not just to each other (in order to swap videos and songs and even stream video and audio to nearby televisions and speakers, for example), but also to hardware from competitors like Toshiba, Motorola and Nokia, as well. The last time a big chunk of the market agreed together to take a jump forward like that was the widespread adoption of Bluetooth, which is showing its age these days. Where Apple’s strategy has been “make everything in your house Apple,” Samsung’s has been “make something in your house Samsung.” Why it won’t work: That strategy can backfire, too. “The TV manufacturers are always working to update their interfaces,” says Lai. “All the TV guys will have their new interfaces, and we’ll see what those look like.” They may have compatibility across just as many devices as Samsung, or more. LG, for example, has a new line of high-end speakers it’s touting, and Sony has a shiny new video game console in the PS4 that also plays Blu-rays, Netflix, and acts as a hub for toys like the popular Sonos audio controller. In order to succeed, Samsung’s competitive edge will have to be the quality of its software and that one great hurdle: price. Samsung’s crown jewel last year—an 85-inch 4K smart TV—cost a whopping $40,000. From the Amazon reviews: “It fits perfectly into the arms of the T-Rex fossil I just brought home from China. It’s like YOU KNEW, Samsung. Thank you.” Another wag: “I purchased this for my Atari 2600 and wow did it make a difference! Also, I am very thankful that it has low energy costs as I am on a very tight budget.” You get the idea. It Was Making Computers Before You Were Born: Microsoft What it is: The Xbox One runs cutting-edge games, hosts video apps, plays music, manages your social media, provides a snazzy interface for your cable channels and your DVR, is on a first-name basis with your Windows PC, and makes amaaaazing French toast. “I made fun of it when they came up with the name, but I think I was wrong,” confesses Lai. “It’s one box to rule them all.” In a departure from its usual tactics in the dozen-year war with Sony for market share among gamers, Microsoft has opted for compatibility over horsepower in a bid to make its new device indispensable for people beyond nerd-dom. The expansion is not a totally new idea to this generation of hardware—both the PS3 and the Xbox 360 were compatible with a host of apps and devices—but the One takes the notion to a new level, totally taking over your television. Why it will work: The buzz around the One is tremendous—there was almost no debate about whether Xbox or Sony had debuted with a better library of launch titles (“all your base are belong to Xbox,” as gamers would say), and the no-controller technology Xbox tried out with the Kinect has advanced considerably with the One. A massive ad campaign pointing up not just the gaming but the video, audio and toast-making capabilities of the new machine has resulted in plenty of media coverage, and Microsoft sold some 2 million machines at $500 apiece during the holiday shopping season. Why it won’t work: Advance reviews pretty universally said that while the Xbox One had more bells and whistles, Sony’s PS4 was faster when it came to gaming, which is still the core feature of the Xbox. It’s impossible to tell from direct sales numbers which machine is more popular. No sooner do they arrive in stores than they sell out and end up on the secondary market. But there are ways to measure scalper sales. As of Dec. 23, about 33,000 Xboxes had passed through online auction house eBay; new PS4s, by contrast, had been sold 65,000 times. That’s not necessarily the kiss of death—there may simply be more PlayStations on the market, or the Xboxes may be going for higher prices—but it’s not a great sign.

Performance Marketing

The War for Control of Your Living Room

5 players duke it out to be the conduit to your TV

Sam Thielman

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Sam Thielman