Google TV – One Box To Rule Them All?

I believe the timing is finally right for the connected television to make its mainstream splash – and as much as it makes me uncomfortable to consider, It strikes me that Google has a very good chance to finally make this happen with their announcement of Google TV.  For those that did not catch the news last week at Google I/O, Google is making a serious foray into the internet connected set-top box market, promising to make our TV “smarter”.  Bringing the Google indexed Internet into the living room will allow the mainstream public to easily search and view online content, browse photo albums and access all your other digital assets like home movies and music – even that brand new Android phone you have will be able to play in this new world, acting as a remote and proxy for the associated Google ID and online digital media.  Google has some high profile partners too, such as Sony who will be releasing HDTV's with “Google TV” inside and Logitech who has a companion Google Set-Top box coming “later this fall”. 
So why do I think Google TV may be successful?
Reason # 1. Cable & Telco's On Everyone's “Naughty Lists”
In the last couple of years, more and more of us have been looking at our household budgets searching for “buckets of spend” that we can reduce or better manage. For the Cardoso household, and I suspect many others, one of the largest discretionary spend buckets is what on my excel spreadsheet I refer to as Communications & Media Connectivity & Entertainment.  What's in there? A lot of the stuff that my wife keeps asking “Do we really need that?” The usual suspects from land lines and cellular to broadband internet and services such as XBox Live, iTunes, Zune Marketplace and domain/hosting fees.  When you add it all up, it's a rather staggering number – and what's most shocking is that the costs of these have skyrocketed in recent years, with some of them not even existing as recently as 5 years ago
But for several years now, there has been one vendor that has stood head and shoulders above all others in the “I can't believe I pay them this much” department – my cable company.  Home Phone service aside, I pay them for what was once “unlimited” high speed internet, overage charges for the times I go over my cap (which is too often), cable TV, HD access, PVR and cable box rental fees….the list goes on and on.  And the ironic thing is, I keep paying these guys more and more for content that is less and less appealing.  There are only a handful of channels I watch, and most of my content is either on blu-ray or from rentals – that I often rent from my cable provider as well…whenever the “on demand” service actually has something I haven't watched already – and when the service is actually UP!  More and more of the content I want is online now, with services like iTunes and Zune Marketplace starting to make content available that is appealing and priced appropriately.  I would downgrade my cable services in a heartbeat, to include only basic cable for some local programming and family content for my daughter – that would free up a minimum of $100/month, a portion of which I'd gladly pay someone else to unlock premium online content that I could “self select” and not force-fed to me as part of “packages” that give me programming of no interest to me.
Reason #2 It's What Customers Want – To Watch Content On Their Flagship Screen – The Big Flat Screen!
It's crazy – being hunched over your PC or Mac screen watching that episode of LOST on Hulu that you missed last week.  In the meantime, that 60″ flat screen hangs on the wall, dark – along with that surround sound system that is fully integrated into your TV, receiver and ceiling and walls.  Now I know I'm going to get a pile of emails from folks telling me that they can do this already – and to that .5% of the population I say to you to consider everyone else – those who lack either the time or the technical aptitude (or patience) to deploy that sort of capability.  Sure, I've got a couple of media servers in the basement wired up to my Gigabit network and SAN storage devices – I've got a Windows 7 server machine running now, and in the past have played with a myriad of tools and addons such as TVersity along with my XBox 360 and PS3 devices.  The problem is that setting this stuff up is not easy – and when I say easy, I mean in the true “plug and play” context that has made appliance devices such as the iPod/iTunes franchise so successful.  As Ulwick might say, a breakthrough product in this area needs to be something the customer can understand what it will do for them, know where to go to buy it, take the box home, unpack it, plug it in and be enjoying their new toy within the hour – as if it was a DVD player or new PVR/cable box.  The simplicity of the interface needs to completely mask the complexity of what needs to happen in the back-end.  The customer should not have to see or understand what video codecs are installed or how to go about converting their existing content to be compatible – the box (and likely “black box”) should do it all for them. 
Reason #3 Advertising, Advertising, Advertising
If there is one thing that Google knows, it's how to monitize advertising.  As the world leader in the online space, and with traditional television/network advertising going the way of the VHS tape, the Google juggernaut knows that there's a lot of advertising dollars still on the table, and it plans on taking its share.  While everyone, from the cable companies to the networks to other providers like TiVO have their own “walled garden” want-to-be solution in some kind of set-top box or online service, no one has any clue how to actually push it across the finish line.  To be fair, no one is really playing nice – everyone has their modern day equivalent of “BetaMax” or “HD-DVD” – and Google couldn't care less.  
Google is coming in and establishing the framework – it's saying look, here's the technology, it runs on Android and we want you to embed this wherever it makes sense.  In a set-top box, right on the HDTV, in a Blu-Ray player.  It doesn't matter where – Google just wants to do what it does best.  Ensure the content you own, want to own, or have access to, be made available to you.  Google TV will make your TV smarter and generate billions of more advertising revenue for Google.  After all, as long as you are using the Internet using Google tools and technology, Google wins.  
If I am right, there will be many an HBR article written on this strategy that Google executed – the only serious competition might come from Microsoft, but only if they are able to really crystalize their strategy from an execution perspective.  Windows 7 Media Center already does what Google TV is promising to do – plus you get the Microsoft ecosystem as part of the package – the problem (in this pundit's humble opinion), is that Microsoft continues to fail in properly marketing this to the world.  Who knows about Windows 7 Media center? No one.  But even my mom has heard about “Google TV”.
Google TV – One box to rule them all?  What do you think?  
Update: 5/25/2010 8:49AM – Google TV coming only to the U.S this fall.  Canadians will have to wait (as usual eh?)  (Reported By Vancouver Sun)
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Jim Love, Chief Content Officer, IT World Canada

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