What do I think of internet TV and it’s prospect you ask?
My answer… Welcome to the future.
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The good news is that the day is definitely coming when you’ll have a $20 internet connection and every service you’ll ever need will be coming through a single pipe – that’s precisely why internet TV is so important. In fact, there’s only one reason you don’t already have it - and it’s definitely not technology. The reason lies in very -very big business and amazingly large sums of money. These are in fact the two things that have been holding back technology adoption and investment in the media industry since the late 1940’s.

First it was the major broadcasting networks, and then it was the MSO’s (cable companies) that held a stranglehold on all television content (in fact all video content) moving into your home. Broadband internet adoption and infrastructure (95.5 million homes last year – up 13% from the year before and rising) has now- for the first time in over 50 years provided a means for the content providers (NBC, ESPN, CBS, etc.) to freely and easily distribute content directly to the consumer. This concept is so huge it’s mind-blowing. They (and in fact anyone else who wants to create, distribute, and profit from) video based content is now absolutely free to do so.

Put aside the stupid 3 minute clips of people setting themselves on fire or doing bad karaoke for a second… While people are actually spending time watching that stuff (in Feb. this year, youTube had 9 million viewers, MSN video had 9 million viewers, Google video had 6.2 million, and iFilm’s audience grew 102% over last year), it’s hardly the most interesting pieces of the insanity that has overtaken the world of video consumption and broadcast media.

The first interesting piece is QOS or quality of service… As you mentioned, you personally are more interested in HD content than SD or even the very low-end, low-quality video clips you get online. The industry would’ve agreed with you as recently as last year, and while there’s still importance placed on HD in terms of bandwidth and storage, this mass consumption of low-quality content on the internet, on your phone, on your iPod, etc. has now got the world reconsidering the importance of HD. (You actually wouldn’t believe the number of people who have bought HD tv’s over the past 2 years and never actually bought the HD service form their provider. They’re actually sitting at home thinking they’re enjoying better, crisper, more exciting HD content, when all they’ve actually got is a new tv. This is both hysterical and sad.) You should also remember that there while there aren’t really major streaming services available online for HD content – there are definitely download services available. Check out Maven Networks, Dave TV, Vongo, etc. Also remember that Gigabit networks are coming. –> Don’t make that face, they ARE coming.

The second interesting piece is the fact that the traditional set-top-box is dying. Traditionally the cable companies used old, limited, RF based networks at the edge (the last bit of network infrastructure that exists before a stream hits your tv.) Last year Comcast alone invested over $500m in pushing its IP networks all the way to the home. The set-top-box itself was historically based on proprietary hardware architectures, filled with proprietary software and used to do the RF signal conversion in your house. The proliferation of internet based distribution, IP networks, the adoption of broadband internet access, and the creation of standards based “media center” hardware and software by folks like Microsoft, Apple, HP, Sony, etc. will cause the set-top-box to become more of a PC than the proprietary thing it is. This is very compelling and frightening stuff for the MSO’s of the world and we’re beginning to see their reactions. Comcast has just created its new “Interactive Media Division” and experts agree that we’ll probably see internet based access to Comcast VOD content within 12-18 months. Time Warner has already begun to offer low quality web video clips for TV viewing, and next month will launch their “My On Demand” product allowing customers to upload pictures via the internet and watch them on their tv’s. This world is a changing my friend. Whether you want it or not, your TV will be showing you “internet” distributed video within the next few years.

And, as if all of that wasn’t exciting or intriguing enough, we haven’t spent any time discussing the $2.5b (yes, that’s billion) dollar video advertising market potential forecasted for 2010.

Later we can also talk about the affects of the massive acquisition and distribution of consumer grade video and imaging technology also responsible for fueling this insanity. Someone just spent $2k on a new video camera, cell-phone (which does pictures and video), and a new still digital camera (which, by the way, also creates video), and their video iPod. People’s desperate need to use all of that crap and justify all those purchases is YouTube’s bread and butter.

Beyond that I generally fall into the “I have better things to do” category, but I also understand I may not be the target demographic. This is a huge change in how rich media is being delivered to end consumers and the “tween” demographic seems to be eating it up and CAN’T be ignored if businesses want to be successful in this space. Who would’ve thought News Corp would purchase MySpace and RottenTomatoes.com?