At the recent World Economic Forum in Davos, Switzerland, Microsoft's Chairman Bill Gates reported on the imminent doom of television because of Internet-distributed content. His television doomsday timeline was within the next five years.
When Gates speaks, everyone listens, which is a byproduct of being one of the world's richest men. History reveals, though, that Microsoft's incredible success was not built on Gates' prognostications. Rather, his fortune and Microsoft's preeminence is owed early on, it seems, to sheer good fortune and later to incredible marketing genius.
Gates' crystal ball
In 1981, when IBM could not reach an arrangement with Gary Kildall to use his CP/M operating system for IBM's soon to be introduced desktop computer, the company approached a fledgling Microsoft. Gates then purchased the rights to QDOS (Quick and Dirty Operating System) from Tim Patterson for some $50,000, evolved it into MS-DOS and convinced IBM to allow Microsoft to retain the rights. The rest, as they say, is history.
But, let's get back to Bill's expertise in predictions. In one of his first books written in the mid-'90s, “The Road Ahead,” the first draft hardly mentioned the Internet. This gross omission was subsequently amended in later versions.
Several years ago in a newspaper interview, Gates indicated his belief in the coming demise of Apple's iPod when he said, “I don't believe the success of the iPod is sustainable.” Apple's latest quarterly report indicates that, as of January 2007, iPod sales are close to 90 million units.
At the 2001 Comdex Exhibition in Las Vegas, Gates' comment about the tablet PC was, “It's a PC that is virtually without limits, and within five years, I predict it will be the most popular form of PC sold in America.” And, to the great relief of those in attendance at the 2004 World Economic Forum, Gates said that the spam problem would be resolved within two years. So much for Gates' prowess as a seer.
Competing for eyes
While clearly the PC screen competes for eyeballs with the television display, they are very different experiences. A PC session is typically a task, communications or information-oriented session where most of the video experience is clip-based. Television, on the other hand, tends to be a sit-back, entertaining medium, viewed in program-length segments.
Then there is the whole matter of distribution. Think HD. Along with broadcasters' investments to deliver HD, the public has made huge investments in large screen displays to view it. But can HD be delivered over the Internet? Not today. Within five years? I don't think so.
Google, which recently acquired YouTube, doesn't think so either. OpenTV's former CTO, Vincent Dureau, who is now head of TV technology for Google, in a speech in February, said the Internet was not designed for television. “The Web infrastructure, and even Google's [infrastructure], doesn't scale. It's not going to offer the quality of service that consumers expect,” he said.
While viewers will certainly be watching more Internet-sourced video in the next five years, it will just as certainly not replace the lean-back-and-entertain-me HDTV experience. A lot of that Internet video will be watched on handheld and mobile wireless devices. And here, too, the broadcaster has a role to play — not just with supplying content, but also with delivering that content. For example, during a demonstration at CES in January, DTV content was transmitted using proposed ATSC A-VSB technology and delivered to viewers with handheld devices.
Time to get back to my e-mail. There is a lot of spam to delete.
Anthony R. Gargano is a consultant and former industry senior executive.
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