We've posted a few items about the various announcements concerning new TV download services today, but Thomas Hawk has let loose with an intelligent rant about why he thinks they suck:"They offer us a bunch of very limited crap alternatives that people won't end up using to pay lip service to the idea of video on demand. And whether it's the crappy "start over" service from Time Warner (hey, it's great, people can't skip the ads) or a download service from Apple (but with expensive sucky low res versions of shows) or these two latest offerings from NBC (NBC's service will only work with DirecTV DVRs, uh hello McFly) and CBS (their service will contain commercials), these are all stupid offerings that have no or limited appeal at best."
Strong stuff, especially the bit about iTunes being a "Trojan Horse to sell iPods."
1. I have to disagree with a lot of the things Thomas says. He claims that these video on demand will have no appeal to most people. But actually video on demand is nothing new and has been around for a while because people do use it. It has been readily available through cable and satellite. It is only recently that other bigger companies are offering their shows for video on demand whether it is paid or not. Very few things will ever appeal to everyone. If you can appeal to a large enough group of people, then it works.
He also talks about the music business being lucrative. He says for $1 to $2 million, they could release a CD that in many cases would return them revenues in excess of $100 million. I would have to say that not many albums become such big hits. It often costs more to release a CD because first you need to produce the music. Then you need to advertise the album through music videos, radios, and other advertisements. There are also the artists doing interviews on various channels. Then there’s also the printing and distribution of the CD. I would be surprised if all that costs under $1 to $2 million.
He brings out the point that why would television executes innovate to bringing video on demand when DVD sales and commercials are so lucrative. Well, one reason is online advertising is VERY lucrative. For example, look at Google. All they sell is online advertising. Now Time Warner is offering online video on demand through AOL for free. How will they earn a profit? Through online advertising which is the same way Google has been working their own business model.
Posted at 10:47PM on Nov 14th 2005 by John