Recently, a lot of media attention has been focused on the threat that internet video is posing to traditional TV and cable.  While there is research that shows that users of video sharing sites watch less TV, I think it is important to look at the current challenges internet video poses before it can dethrone traditional TV and cable.

Environment

Everyone knows that the environment one is in plays an important role in determining the overall effect.  Think of taking your date to a Jiffy Lube, where you proceed to select a “three course meal” from the vending machine in the waiting room.  Not a pretty picture?  Guess what - it wouldn’t be much better if you had brought a steak and dinner rolls.  Why not? Because the environment you are being sent a message through is just as important as what you are saying. 

Television

Similarly, the TV environment is generally home to a comfy couch, some snack food, and some of your best friends or family gathering around.  It is a situation more often than not.  Additionally, your family certainly eats dinner at least once in a while with the TV on.

Internet

Contrast this with the internet environment.  You are likely sitting alone, in a small room or in a public room facing the wall.  You are likely sitting on an office chair which gets uncomfortable after extended periods.  Sure, you think your situation isn’t what I’m painting here, but this is how a large percentage of the USA is experiencing the internet.  Not exactly the most conducive environment for you to “relax” and “connect” with friends.

On top of this, as the trend for buying laptops instead of desktops increases, we can expect it to be more uncomfortable for someone to sit and watch for an extended period.  Laptop screens are lower in contrast, and tend to be closer to your eyes than a normal monitor.  This is one of the unspoken reasons most online video is under 10 minutes, whereas TV starts at 30 minutes.

Quality

The vast majority of the 100,000 videos uploaded to YouTube daily are crude, unprofessional, and sometimes even just plain boring.  Having to sift through this is a huge waste of time.  Often, even videos with a 5 star rating or one million views don’t tickly my fancy. Sometimes (which occurs often), I prefer to turn on the TV and see high quality and higher definition shows.  These shows are made in professional studios, given a lot of thought, and have the same characters who I have grown to love. 

Consumer Habits

The saying “you can’t teach an old dog new tricks” certainly has some truth to it.  We, as humans, don’t like changing our habits - even if there is some sort of advantage to do so.  There are still people using yellow phonebooks to find numbers despite the ease of a phone number search on Google.  There are still people who listen to radio despite more interactive forms of media.  There are still people who wash an entire family dinner’s worth of dishes despite the invention of dishwashers.  All of these teach us that just because a new technology is available, people go with what they are used to.  This is of course with exception to the “early adopters” (whom I expect you are, reading this blog). 

Also, while we are looking at consumer habits, it is wise to look at the advertising we see on TV.  It is interspersed throughout the show, and we largely accept it.  Online however, there is a very strong backlash for ads.  It seems we don’t have the same tolerance of putting up with ads online as we do on TV - even if it is the same exact content.  This poses a major issue for sites like YouTube, which will have to run ads in order to become profitable.

If history is a lesson, it will take a long time before people accept a new way of doing things, and TV won’t disappear completely even then.

Reliability

Let’s face it - even if you have a great cable internet connection, you still experience the dreaded “lag” of your video from time to time.  This can be either minor interruptions in your internet service or it can be related to the amount of people currently using the site.  Also, it can be caused by your slow computer (or virus scan running on it’s own schedule) or a hosting system that isn’t powerful enough for video streaming.

When was the last time your TV viewing was negatively affected by the other 30 million viewers? That’s right - it doesn’t happen.  But online, that does come into play.

Scheduling

I admit, a few years ago I actually would plan some of my day based on when the show I wanted to watch was on.  You have probably done the same, and are likely just as embarrassed to admit that we have given those shows the same status as our Doctors (who also make us come in at a certain time, and then have us wait).  While these days you can find a lot of video content online, in some way it overwhelms you with the choices.  I am starting to consciously prefer having my “8 o’clock meeting” with my TV set rather than have to choose what to watch online.

Some Progress

Joost, created by popular internet phone service Skype’s founders, seeks to provide professional quality programming online, for free.  Joost is signing contracts with major studios and networks to stream their high quality and professional grade shows.  If I were a cable company, I would be scared - very scared.  While this won’t put them out of business, it will lose them a good 10% of those customers who were just waiting for an alternative to cable’s outrageous prices.  It will also force their customer service to be better. 

Until now, it has been a seller’s market for cable programming.  You are addicted to TV.  They know that.  Now this will all change.  We’ll see cable forced to lower prices even - something we can’t remember happening in our lifetime.

We’ve seen this happen already with TV.  When YouTube gained popularity, the large TV networks had no choice but to start offering their shows online.  As a matter of fact, the TV executives were quite surprised that offering their shows online (at their site) actually caused more viewers. 

Why?  Because a) the show might regularly be on TV at a time when you can’t watch, b) you can catch up on missed episodes to stay informed, c) it puts the show right on the same place as the fan site, which allows for more community and interactivity, and d) many people who don’t watch or own a TV could suddenly be exposed to great video content.

Joost’s business model will test whether the public is ready to “relax” around the computer, instead of the TV in the living room.

A Final Thought

With all of that in mind, the trend we can expect to see is more video “channels” online which have the same characters in “mini episodes”.  The problem with random short video is that it alienates us from the characters, and we don’t feel close to them.

Lastly, with LCD selling like hotcakes, causing prices to drop faster than an 800 pound gorilla trying to ice skate, and screen sizes constantly getting larger, every day is getting us closer to feeling “comfortable” around the computer as a TV environment.