Ahh, the DVD. Love it or hate it, it’s still one of the best ways to store data. I’ve yet to meet a hard drive that can survive for 5 years without failing, but as long you’re not using them for frisbees, the DVD can easily make it a decade or more without being damaged. There may be a question about whether or not we’ll have DVD players to play them with by then, but rest assured your data should be there.

Given my fondness for the scrappy little format, I thought it was interesting to see that TiVo was awarded a patent yesterday afternoon (Aug. 16th) for burning TV shows onto DVD. Just about anyone who has ever used a DVR has experienced hard drive related anxiety at one point or another. With the sheer amount of television out there, it’s easy to fall behind on your favorites and run out a space. Offloading programs to a DVD library is an excellent way to free up your hard drive without having to miss out on programming that you wanted to see. In the past, I’ve found this to be especially useful for archiving syndicated TV shows that aren’t always shown in their original order.

The abstract of the patent from TiVo’s application,

“According to an approach for storing digital content onto a DVD, digital content is received from a source, such as a DirecTV link, an over the air (OTA) broadcast, over a cable television link, or any other type of communications link, including the Internet. The digital content is formatted to comply with the MPEG standard to create MPEG digital content and stored on a non-volatile storage. Text-based information is received that describes one or more attributes of the received digital content. A set of DVD subpicture graphics is generated based upon the text-based information. The set of DVD subpicture graphics may represent a structure that can be navigated by a user when the DVD is played. The MPEG digital content is retrieved from the non-volatile storage, converted to DVD format and stored on the DVD with the DVD subpicture graphics. “

On the surface, the patent itself does seem a little bit obvious, but it’s also important to remember that it took the patent office almost 7 years to approve the application. Microsoft’s Media Center may have been using infringing on this technology for years, but I’m not sure that they had it in place prior to 2004. I think it’s also worth pointing out that even though TiVo now owns the patent on this technology, they don’t actually offer the service to their customers. Fortunately, the TiVo Community has managed to scrape together a way to do this on your own, but it would be nice to see a more elegant solution built directly into TiVo’s software.

Given it’s antique status, some may view this development as irrelevant, but because of the complex licensing issues that are tied to media, I believe that the DVD will have a much longer shelf life than most. When you consider how the studios are using artificial windows to try and dictate when you can and can’t watch certain things on Hulu and Netflix, it’s clear that if you don’t want to become a victim of disappearing windows, consumers will need the ability to archive content on their own.

Photo by Mike Demers

It’s hard to believe that it’s almost been 3 years since TiVo announced that they were rekindling their relationship with DirectTV and yet consumers are still waiting for the DVR to drop. I’d say that even for TiVo, this kind of delay has to be some kind of record, except we’re also still waiting for the Comcast/TiVo DVR to launch.

Given the long lag time and complete radio silence by TiVo and DirectTV on the issue, I tuned into DirectTV’s 2nd quarter earnings call hungry for more information. Unfortunately, the call didn’t offer very many tasty morsels.

During the call, DirectTV’s CEO Michael White never actually mentioned TiVo by name, but did say that they the company planned on unveiling a new “high end” user interface in the fall (so far so good.) From the transcript of the call,

“the connected home experience is a fantastic experience. It’s going to get even better this fall with our new high-definition user interface and I think as we add more VOD titles, it’s just going to be more and more kind of pull from consumers I think for that experience and as I said, the good news is, we know it pays. It pays out because of the increased $2.50 in ARPU we get from it. But if we just kind of work in our way through some of the operational complexities of these, I think we’ve got a wireless capability that we’ll be launching this fall, as well as I think we’ll make it available to even more homes.”

He mentioned that this DVR would be entirely in high definition, would include multi-room functionality and would blow people away with it’s connected features. While it’s entirely possible that the DVR White is referring to, could be a generic update, a comment at the end of the call made me suspect that he was actually talking TiVo.

“we’ve got probably still some more work to do to fill in some more VOD content and really, with the HD user interface, really make that experience top for the consumer. I think we’re bringing Pandora, bringing in a bunch of things making it absolutely knock your socks off experience with the customer. And as I said, were already getting more than we had planned in ARPU lift out of those customers. So I feel great about the connected box strategy. I think we’re just working through some of the operational things.”

As far as I know, TiVo is currently the only DVR that provides support for Pandora.

On the surface this all may sound like good news to weary DirecTV customers, but once you actually dive into the details things get much less exciting. During the Q&A, White clarified that by “fall”, DirectTV really meant “the 4th quarter” and would later clarify that by the 4th quarter, he really meant closer to midway through it, since they didn’t want analysts to consider any revenue impact from a launch. Worst of all though, it sounds like DirectTV is following in Comcast’s footsteps, by limiting initial availability of the “new features” to select geographic regions.

“I think the nomad product, which is the ability to port your content from your DVR onto your iPad, I expect you’ll see that in some geographies before the end of the year, will probably going to do with in a fewer geographies to make sure that that’s working flawlessly before we roll it out so rollout might be in 2012. But you’ll see that before the end of the year, the high-definition user interface comes in in the fourth quarter.”

Given that it’s taken Comcast at least two years to expand out of the New England markets, I can’t help but wonder if there is some kind of clause in TiVo’s contract that encourages these sorts of soft launches. Previously, TiVo CEO Tom Rogers had argued that one of the benefits to TiVo being a software company is that they could download their software all at once to their partners and achieve tremendous scale almost overnight. As these rollout continue to “launch” though, this doesn’t look like a very accurate expectation for customers or shareholders to have.

While I’m sure that TiVo is very busy counting all of the money that they’ve made from their business dealings with Dish, it’s frustrating to see “legitimate business partners” continue to pay peanuts for development deals, when it’s clear that they’re only really interested in the patent protection. Instead of being upfront and honest with their customers though, both companies continue to string them along, while we’re forced to wait unreasonable periods for a product that will be obsolete before it’s even launched. For TiVo fans that are still holding out for DirectTV support, the only advice I can offer, is to go pick up a TiVo premiere, a set of HD antennas and make sure to tell DirecTV that you’ll enjoy saving hundreds of dollars per year while enjoying a better DVR.

Photo by Thomas Hawk

While going over my finances yesterday, I noticed a strange anomaly with my bills. After 3+ years of sending out a regular phone bill in the mail, all of a sudden AT&T stopped. Concerned that there could be a mix-up with my account, I contacted AT&T’s customer support line and was told that ebilling had been activated on my account.

The only problem is that I’ve never registered for online account access, nor have I ever provided AT&T with an email address. When I asked where my bill was being emailed too, the agent couldn’t provide me with an answer, but did say that my statement had been sent out this way for the last 3 years!

People may not be able to siphon money out of your bank account with your phone records, but they can still use this information to harm you. A competitor could use the list of phone numbers you call to prospect for clients, a thief could look for patterns of activity so that they would know a good time to pull off a burglary or a home invasion or an upset ex could use the records to stalk and harass you. While I’m inclined to believe AT&T when they claim that this mixup was actually caused by one of their employees, the thought of someone (nefarious or random) seeing this level of personal detail is a little unsettling to say the least.

Given the fact that there could have potentially been an online intrusion into my privacy, I asked AT&T to investigate the matter further and even more importantly to disable access to my online account. After 30 minutes on the phone, the AT&T rep ultimately declined to investigate the matter further and told me that the company has no way of turning off access to your online bill. Her only solution was for me to register my account online and to set my own password, so that someone else couldn’t register without my being notified first.

While I imagine that a large percentage of AT&T’s customers register for online account access, I’ve got to suspect that I’m not the only one whose never taken the time to do this. In fact, I’d be willing to bet that less than 25% of all senior citizens haven’t registered for online access. Given that all one really needs is a copy of someone’s phone bill, AT&T’s policies are putting some of their least tech savvy customers at the greatest risk. With zero notification for when ebill gets turned on, customers who depend on the physical mail for their billing info must wait at least 30 days to find out that they could have been a victim to a crime. Meanwhile, someone could use the time they get from hijacking your billing, to put 1-900 charges on your phone or to sign you up for monthly plans that don’t really provide any benefits.

Other utilities that I’ve contacted, haven’t had any problems with this request. PG&E for example, won’t even provide me information over the phone, unless I show up to one of their retail locations with my ID in hand. This may seem a bit extreme for most people, but your smart meter data is just as vulnerable.

To say that 2011 has been the year of the hack is an understatement and while I’m sure that AT&T spends millions on internet security, no system is fool proof. Add the fact that AT&T actually receives a percentage of the proceeds from the estimated $2 billion illegal cramming industry and one could make an argument that this security vulnerability is by design so that AT&T can profit at the expense of their less savvy customers. I love the internet and how quick and easy it is to get access to important data in my life, but if other people can also access that data, I’m not sure that it’s worth the risk.

TiVo’s love quarrel with Echostar may have just come to an end, but they still have two more elephants lined up in the crosshairs of their gun and while I always hate to read too much into the legal tea leaves, recent action on one of the dockets, suggests that they may have just stunned one of them with a tranquilizer dart.

As part of their patent lawsuit against Verizon, TiVo had initially requested access to Verizon’s source code on their FIOS DVR. This kind of data makes it easier for TiVo to identify any potential infringement and would certainly be a key piece of evidence towards proving any patent violations. Now there are many reasons why Verizon might not want to turn over this kind of data, but where things start to get weird is that instead of objecting to the request, Verizon claimed they weren’t able to comply with it because Motorola was the one that developed their DVR. This seems fair enough, so in good faith TiVo began working with Motorola to obtain the data.

Fast forward through three months of stalling and Motorola finally turns over two different copies of their database to TiVo. The problem with this is that once TiVo started going over all the documents that they collected, they discovered that Motorola had actually developed “many more versions” of the source code using secret codes names like Burbank, Carlsbad, Del Mar and Cardiff. In total, TiVo believes that there are over 30 different models that Motorola has out there and after being stung with delay after delay over “software modifications” in their trial against Dish, it’s easy to understand why TiVo would want to exercise extreme due diligence on this one.

Once TiVo realized that Motorola was trying to pull off the old fumblerooskie play on them, they dragged Verizon and Motorola back into court and clarified that they wanted all of the source code data on their DVRs. The judge agreed and in March of this year, he ordered Motorola to release “without limitation all Deployed versions of Motorola’s Del Mar source code and all Deployed versions of any predecessor to the Del Mar source code, as well as associated Broadcom code.” [Note: Emphasis added by me]

After the subpoena, one would have really thought that this would be the end of it, but instead Motorola continued to try and string TiVo along. In the attached exhibits, TiVo demonstrated that they contacted Motorola numerous times to discuss the deficiency, yet Motorola seemed only willing to reply whenever TiVo threatened to flex their legal muscle in the case. At one point, Motorola even set up a conference call to deter TiVo from filing this motion to compel, but then opted to ditch out on the call (without even having the courtesy to cancel.)

While these sorts of petty issues won’t actually impact the case, they can still provide us with insight into the case. Motorola’s lack of responsiveness suggests a certain squirreliness on their part. Instead of portraying a company that is confident in their legal position, the attachments paint a portrait of a company that is desperately trying to do anything to avoid turning over this evidence. The very way that Motorola has treated TiVo over the last 8 months could be a primer on how to maximize passive aggressiveness by only using your caller ID. After considering TiVo’s frustration with moving the case forward and the lack of any real justifications for the delays, the judge gave Motorola a final deadline of 14 days to turn over the evidence in question or to demonstrate why they seem to feel that they don’t need to comply with the court’s instructions.

#10 – Make Love Not War

One would think that Ken Burn’s award winning documentary on WWII would appeal more to those who are further from the cradle than the grave, but apparently senior citizens enjoy Angelina Ballerina and Barney too! (h/t – Plamere)

#9 – Who Said Kids Find Documentaries Boring?

This may be a case where it would be more helpful for Netflix to suggest something the kids might like a little bit less

#8 – Beneath the tough rapper exterior lies the heart of a romantic

It may not be all that exciting of an ice cream flavor, but romantic musical fans will melt for vanilla

#7 – Who Knew Mrs. Doubtfire was so angry inside?

Robin Williams’ dressed in drag was pretty painful to watch, but not chop up and eat people bad.

#6 – One Of Netflix’s Darker Comedies

Yup, that’s right, after you watch Reno 911, even Auschwitz will seem funny by comparison

#5 – Beware the Penguins?

Oh sure they look all cute and adorable, but not if you’re the fish. Something tells me that Netflix may have outsourced this movie category to Charlie Tuna.

#4 – The Scariest Movie on Netflix

Mallcop may have been bad, but it’s a pretty low blow to call it a horror movie

#3 – I’m pretty sure that most pregnant women aren’t that flexible

Is your significant other all of a sudden obsessed with Cirque Du Soleil? You may want to think about taking a pregnancy test h/t – Tgidenver

#2 – Netflix Suggests That It May Be Time To Consider Therapy

It’s good to know that I’m not the only one from a dysfunctional family. For those looking to deal with your Father/Daughter issues, Netflix recommends, the Call Girl or the steamy erotic thriller, Lie with me.

#1 – A Friendly Reminder From Netflix That You May Not Be Ready For Kids Just Yet

Don’t be fooled by the photo of the cute baby on the cover of the movie, It’s Alive probably isn’t something you’ll want to watch if you’re expecting

Still haven’t had enough? Here are a few more that didn’t make the top ten list;

Want to learn whether or not your new date has apartment full of cats back at home? Find out her thoughts on King Lear, Looking for Swamp People? Try the Kardashians, Did you enjoy the Last of the Mohicans? Well Netflix is pretty confident that you’ll enjoy The Last of the Mohicans, Netflix outs Top Gear driving enthusiasts for being closet Jane Eyre fans, Do you enjoy Louis C.K.’s edgy sense of comedy? Well you may want to think about going back to school because Netflix sees advanced Physics in your future, Frankly, the talking lobster already freaks me out, but Netflix thinks people who enjoy movies about LSD, will really like the Little Mermaid too, When I think of classical movies, Black Snake Moan isn’t the first thing that pops into my mind, If you ask them, GI Joe fans will deny it, but apparently they have a soft spot for furry little Sharpays, Family Guy fans take note, you may be a freakin’ genius, Freaks and Geeks are always welcome in Mr. Roger’s Neighborhood.

To Google’s credit, they have been pretty aggressive about fighting spammy search results from content farmers, but when it comes to your digits, they still haven’t found a way to filter out the spammers from the legitimate information. Take for example, a Google search for my own phone number

As you can see from the screenshot, Google is really good at finding any and all search results with this number in it, but most of the links presented are directing users to pages and pages of meaningless phone numbers. If you click on Google’s #1 search result for my phone number, it leads to a company named AllCallerDirectory.com. While this site does provide “reverse lookup” services, it will cost you $15 if you want to buy a report letting you know that it was Davis Freeberg who called. While my blog’s contact page does show up as the 2nd search result for Google, the remaining 467 results are all similar search spam of some sort.

By comparison, the same search on Blekko (who tends to use more aggressive spam filters) yields only 2 results, both of which are high quality hits.

It would be easy to blame AT&T for this problem, because I imagine that there are all kinds of data silos that surround our phone numbers, but when you consider the my number is actually a Google Voice number, there really isn’t any excuse for Google to be directing traffic to these paid services instead of my Google profile.

While I’ve never spent money on any of these reverse lookup services, I imagine that there are lots of people who have paid for information that they could have gotten for free. In an ideal world, I’d like to see Google partner with some of the telephone directories to improve these types of searches for consumers, but in the meantime simply nuking the “directories” that are gaming the system would be a positive step in the right direction.

Most businesses are thrilled when someone wants to give them money, but for some crazy reason whenever you’re dealing with Hollywoodnomics, logic seems to get turned on it’s head. Case in point: MoviePass

I love the movies, in fact I’d argue that I’ve probably seen more films than 90% of the population. As a moviehound, you would think that I would be one of AMC’s best customer’s, but the truth is that in the last 5 years, I’ve only seen 2 movies in the theater. While there are a lot of reasons why, it essentially boils down to the fact that it’s hard for me to justify paying $9 for a film, when I can watch it at home for free*

Now in reality, my TV isn’t actually free, but psychologically, it feels that way because I “rent” my content through services like Netflix and TiVo. While I’m sure that PPV and Blockbuster would prefer that I take advantage of their services, the simple truth is that the transaction fee involved (no matter how small) has made them persona non grata in my lifestyle.

I’ll be the first to admit that watching a film on my 60″ TV isn’t the same as seeing it in Imax, but when the choice is to pay money vs. seeing something for free*, it makes it a lot harder to accept the premiums that the theaters charge. Four years ago, I noted that consumers were making a transition from a pay per view model to a subscription model and that movie theaters would be wise to endorse the trend.

“Why not offer a monthly subscription fee to your local movie theater chains. Consumers would be happy to spend $30 or $40 per month in order to have the privilege of seeing films the way I did when I worked for the theaters. Instead of collecting $40 per year from me now, theaters could instead bring in $480 each year with an all you can eat model.”

A long time ago, I worked as an AMC projectionist and every Thursday night, I’d stay up to the wee hours of the morning screening the new films before they opened. Because of this experience, I know first hand how powerful a theater subscription model could be, which is why I’m so confused that my former employer wouldn’t recognize the brilliance behind MoviePass. What makes this all you can eat movie experience so special isn’t the access to the big hits that you’re dying to see, it’s being able to see mediocre films in a larger than life environment without having to put your wallet at risk. Yet for some strange reason, AMC isn’t interested in attracting customers to their most empty theaters.

Now I can’t speak for everybody, but in my case, had MoviePass existed back then, AMC would have collected $1,920 in ticket sales. Instead they’ve earned less than $40 from me and that includes popcorn.

Not everybody chooses to rent their content, but when you look at the number of cable, satellite, Hulu, Netflix, etc. subscribers, it becomes clear that a huge segment of society chooses to consume the bulk of their content this way. This is why, when I saw that MoviePass was going to create a subscription theater service, I thought it was a no brainer for the theaters involved.

Instead, AMC decides that they want no part of this? Can someone please help me understand how this makes sense because AMC’s justification that “plans for this program were developed without AMC’s knowledge or input,” or that “it does not integrate well into our programs and could create significant guest experience issues”, rings hollow in my opinion.

AMC could have picked up a brand new customer willing to buy tickets in bulk and instead of nurturing a new source of revenue (while MoviePass assumes the risk of proving an experimental business model), AMC has chosen to ban it because they weren’t consulted first? This seems awfully shortsighted and petty on the part of AMC.

If AMC really believed in the mantra, listen, learn, discuss, decide, execute, measure and … repeat, then they would have at least taken the time to see if MoviePass could bear any fruit. Instead, they’ve jumped straight to an execution (with a promise to repeat if anybody else decides that they want to give them buckets of money without permission.)

I could almost understand this reaction, if AMC had some type of similar program that MoviePass was competing with, but the reality is that AMC has failed dramatically when it comes to the execution of their customer loyalty programs.

For 25 years, AMC ran a program called Summer Movie Camp for kids. The idea was basically a seasonal version of MoviePass, except restricted to handful of old kids movies. Given it’s long run, one would think this was a homerun for the cinema, but I can tell you first hand that AMC did a terrible job of running it. Even on their own website, AMC admits it was a failure.

“Unfortunately, the number of guests has been fewer in recent years, with many shows operating with less than 25 guests in the auditorium. Last year, attendance dropped so significantly that we have made the difficult decision to discontinue the program.”

AMC’s most recent program, also looks like it will be a dud. Not only do consumers now have to pay $12 a year for the privilege of frequent customer membership bonuses, but they only save 10% off for every $100 they spend. This means that you would have to pay to see 33 films in a year before you would actually earn a free one under the program. It’s nice that they want to be so stingy with their best customers, but MoviePass really wouldn’t threaten this.

If MoviePase attracts moviehogs, then it will be uneconomical for them as a business. If they attract consumers like myself, who refuse to pay transaction charges for their entertainment, then it’s complimentary to AMC’s existing program and could greatly expand revenue. It’s hard to tell what the future holds for MoviePass at this point, but with the major theater cartels going hostile against this new innovator, I can only hope that independent theaters will be more interested in collecting hundreds of dollars a year from me instead.

This difference may also help to explain how I can be thrilled to see Netflix adding Pulp Fiction to their watch now service, but dismayed to learn that they’ve also added Death Scenes 1 – 3. For those not familiar with the Death Scenes series, it’s a collection of extremely graphic video clips that show the murder and execution of countless individuals. It is “narrated” by Anton LaVey himself, the founder of the church of satan.

Back in the 90′s, I had friends who would trade Faces of Death VHS cassettes, but Blockbuster was never foolish enough to rent them in their stores. Netflix on the other hand doesn’t seem to have a problem renting snuff films to their members and I think this is a mistake. While I respect the fact that Netflix doesn’t censor other people’s movies, they have drawn a line by not offering pornography on their service. Whether or not, Death Scenes is a pornographic snuff film or a documentary I’ll leave up to my readers to decide, but before clicking on this graphic link to view the evidence, you should take a look at excerpts from how other Netflix members have described the film.

“I was very disappointed in the fact that so many of the scenes had no commentary or too little and seemed to just be a shock value show” – Steathl

“In my opinion, this footage does not qualify as a documentary. Rather, Id consider it more along the lines of a smutt film or Faces of Death with a heaping scoop of pointless thrown in for your viewing displeasure” – QBS 1996331

“There a couple of scenes that will stay with me forever. One was a boy of about nine dressed in 30s style clothing with his hands tied behind him and laying sideways after being executed. The other scene that I have trouble getting out of my head was the pre execution footage of a guerrilla rebel all of about 16 tied to a pole awaiting a firing squad. He looks directly into the camera and you are looking at a boy, face full of rage, terror and, defiance. The next scene he is executed with the other rebels.” – Sedatme

While I didn’t waste my time watching every minute of this film, I did see enough to know that this is closer to pornography then it is to a “documentary” and I would hope that Netflix would be able to see that. The idea of watching people being brutally tortured or murdered may appeal to some niche quarters of the internet, but it’s not appropriate on a site like Netflix.

Update – A quick check of the website, seems to suggest that Netflix has taken the series offline. With so many films that they’re licensing, it’s probably hard for Netflix to watch everything that comes in. My guess is that this film somehow slipped through the cracks and once Netflix became aware of it they reviewed it and rethought whether it was appropriate for their site.

Universities across the US have been at war with P2P for a while now, but this is more than a little bit ridiculous. In an attempt to manage their network, Ohio University has banned access to Netflix. A copy of the university’s email was originally posted to Reddit

“OHIO Students,

Best regards, J. Brice Bible Chief Information Officer”

I’m not sure whether or not this will boost grades at the school, but it does say a lot about how popular Netflix is becoming. While this may be a temporary fix for the school, it isn’t a very good long term bandaid. The internet is more important than it’s ever been and students need access to a robust network to participate in that. If the school can’t keep up with demand, their customers (the students) will leave for places where they have unlimited bandwidth. Even if the school doesn’t upset their students, it’s not going to stop digital video consumption. A ban on Netflix will only drive their students underground where illegitimate sources of content can fulfill their entertainment needs.

Over the years, I’ve had more than one love affair with a TV show, but no matter how much I’ve enjoyed epic hits like 24, Alias or Joey Grecco’s Cheaters, none of them have been able to generate the level of excitement that I feel when I watch Survivor. I’m not sure if it’s the Machiavellian nature of the show or simply being able to watch an assortment of characters who are so wacky that they end up making Gilligan Island look like the Love Boat, but I love the show so much, that I even organized a home version of the game with my family over the holidays (I ended up getting voted out 2nd for trying to emulate Russell Hantz’s bulldog strategy)

Because it is the number #1 show on my Season Pass priority list, you would think that I would never miss an episode, but every year, Survivor changes the name of their show just a little bit, so that DVR subscribers have to resubscribe to each new season. I’ve gone as far as sending angry emails to the Tribune company (the supplier of TiVo’s guide data), but to no avail.

While this may or may not be hurting Survivor’s DVR ratings, the fact that the producers of the show haven’t noticed has always baffled me. It would be like me changing my RSS feed every six months, so that only my superfans could easily follow my blog. Unless you like languishing in obscurity, this isn’t a very good strategy for retaining an audience or capturing people’s attention.

Recently, Jeff Probst, the host of Survivor, launched a blog to promote the show and other charitable causes that he cares about. On his site, he solicits questions from fans and answers the more common ones. While all tidbits about the show caught my attention, one particular answer jumped out at me. While answering the question of how long will Survivor continue to run, Probst says that the survival of Survivor is dependent upon live viewers because “TiVo doesn’t help our ratings.”

Now Jeff Probst certainly isn’t the first one to appeal to their fans to ditch the DVR, but I think that his pleas are at least a little bit misguided. I’m not sure whether it’s because the producers of the show don’t care about the DVR ratings or the advertisers themselves, but either way I think that there is a lot more value to a DVR viewer then his answer would suggest.

Over the years, I may have fast forwarded my way through more than one commercial break, but I haven’t been able to avoid the product placements that are embedded in the show. I don’t know whether or not the show makes more money from these ads, but I would suspect that they do.

Whether it’s Sears demonstrating the utility of their Craftsmen line of tools or Sprint demonstrating how you can keep in touch with loved ones on their new fancy cell phones, throughout a season there are many times where branding creeps into the show. While some may find this an annoyance, I actually enjoy this type of advertainment and it undoubtedly makes me more willing to spend my money on a brand.

During 2002, 24 introduced several cars during their program and I can tell you with 100% certainty that seeing those cars zip around in that show is what made me seek the out and ultimately buy my Thunderbird. When was the last time anyone could say the same thing about a car commercial?

Furthermore, even though I TiVo the show to watch later, because the program always leaves me wanting more, it drives me to the CBS website where you can view all kinds of clips and interviews that don’t make it to television. Unlike viewers who are tuning into the show online instead of live or on DVR, these clips are additive and include lots of spammy pre-roll ads that I wouldn’t put up with if I didn’t stay excited about the show.

It could be that Survivor is so good that they don’t need to rollover their DVR viewers every season, but by ignoring this opportunity, they are losing the ability to turn their more passive fans into passionate ones. With DVR penetration now exceeding 40% of all viewers, this kind of backwards thinking will ultimately hurt them and the show’s long term chances. So while I can appreciate that a live viewer may be worth more money to the show, I’m going to continue to time shift it, so that advertisers can learn how much more valuable it is to capture my heart for 44 minutes, then it is to hold my attention hostage for 60.

Most of the conditions around the Comcast merger seem to deal with content, but the one piece that actually “sounds” like it could help consumers is the requirement that Comcast provide $49.95 stand alone internet access to their customers for the next three years.

On the surface, I like the idea of a price cap, but when you do the math, it’s clear that the FCC has left plenty of room for profits in Comcast’s future.

Because Comcast currently offers stand alone internet access at $40.95 per month (or at they do in the SF bay area), it means that their prices can go up by $9 over the next three years, before they’ll have to worry about hitting the cap. This means that they get to increase rates by 21% to comply with the program.

Ouch, I’m sure that it will be painful to comply with this condition When you also consider that the price cap is only for 3 years (despite all the other conditions being for 7 years), it means that Comcast could effectively increase rates by 7.3% each year. With the historical rate of inflation around 3.25%, it’s clear that consumers are getting bamboozled on this one.

I was surfing YouTube and came across an interesting ad announcing the launch of Hulu Plus on TiVo. It appears that the ad was uploaded by the agency that created it, so it’s hard to tell what this means in terms of timing, but one tidbit that I was able to glean from the spot, was an announcement that TiVo will be giving away 1 free month of Hulu+ service when they launch it on their DVR. TiVo offered a similar promotion when they launched support for Rhapsody and while I ultimately didn’t turn into a subscriber, I did enjoy the opportunity to check out the service. The simple fact that Hulu makes their paying customers still view ads, kind of makes the service a non-starter for me, but if TiVo wants to comp me with backstage access, I certainly don’t mind taking a peek. While it’d be nice to see this launch sooner than later, at least some of the details are finally starting to leak out.

In related news, it also looks like the same ad agency uploaded a spot for TiVo’s iPad app to the site. Since TiVo announced on Twitter that this would launch by the end of January, it makes me wonder if both partnerships will be launched simultaneously. We’ll have to wait to see if this is the case, but methinks that we won’t have to wait long to find out.

The more things change, the more things seem to stay the same. Over the last ten years, the internet has redefined nearly every aspect of our lives. Whether it’s how we communicate with old friends, how we get our news or how we do our shopping, I could give you countless examples of how this technology has changed the way we interact with the world.

Thinking back to when dial up was first getting started, it’s not too hard to imagine an entirely different future. You see, when internet service providers first got into the business, they didn’t want to provide unrestricted access to their subscribers. Instead, they wanted to create a massive intranet where they could charge businesses fees to reach their customers.

In this bold new world that they envisioned, people wouldn’t be buying search terms on Yahoo!, they’d buy keywords on AOL. Instead of being able to use any email provider you wanted, they would only allow you to log into Compuserve accounts. This balkanization of the internet almost succeeded and for a time, Compuserve actually ran one of the top airline ticketing services, but eventually consumers saw the forest for the trees and instead of paying $19.99 a month for a stripped down version of the world wide web, they insisted on unfiltered access to the internet.

Once a few consumers started to move, the rest of the industry followed and as a result we now have third party sites like Facebook, YouTube and blogs, that have been able to build an audience on the free and open web.

With online video still coming of age, it’s interesting to see how the same Compuservation is occurring again, except this time it’s around the television. NewTeeVee has a provocative post out where they argue that the smart television providers are becoming the new gatekeepers for content. This is better than having the cable companies control your television, but it’s is still a watered down version of what you deserve.

I don’t care whether we’re talking about TiVo, Boxee, Roku, AppleTV or any of the latest digital video solutions, all of them have placed restrictions (albeit sometimes unwillingly) over how much their customers can do with their hardware.

Some of these restrictions are because of frightened content owners. For example, customers who rent their TiVo from a cable company aren’t allowed to access Netflix because of agreements Netflix made with the studios. Some of these restrictions are because of plain old fashioned greed. Hulu has already had more than their fair share of conflicts from disabling access to their videos on devices that are designed to sit next to your TV and would love to charge hardware companies for access. Some of these restrictions are self imposed. There’s nothing stopping Apple from offering flash on their iPad, except for their own selfish desire to control 100% of their media eco-system.

Whatever the reason, no matter how you slice it, these “internet” enabled devices have all failed to actually bring the internet to your TV. Looking over the headlines from CES, it’s clear that tablets and “smart TVs” were all the rage in Las Vegas this year and while it’s neat to see content companies start warming up to these devices, if consumers are forced to continue at big media’s pace, it will take another 10 years before you’ll be able to access even 90% of the content that’s out there today.

Because of these restrictions, it’s become increasingly difficult for me to endorse these options as adequate solutions. Over the years, I’ve managed to sample and collect a large number of different media streaming devices, but by far, the most powerful digital media device that I’ve ever used was the cheapest laptop that I could buy from Walmart. Maybe I’m crazy and other people don’t actually want access to the internet on their TV, but from the very first moment that I plugged it into my television, it was just as liberating as the first time I used TiVo to free my TV.

Since almost all new laptops include an HDMI port, getting it connected to the big screen was as easy as plugging it into an HDMI cable. Not only will this setup let you access sites like Hulu without big media interfering, but I can also do PC related tasks on a big screen environment. For example, over the holidays I was able to connect to Skype and do a video chat with the entire family on the big screen. I’ve always been a fan of comic books, but the comic book experience is very different when you’re looking at the action at 40+ inches. Do you ever play video games like Axis and Allies? Being able to see the entire war map actually changes your strategy compared to when you have to view troop movements region by region.

The point that I’m trying to make is no matter how progressive and advanced these technology companies are, no matter how many “apps” developers create, until the CE industry and the content industry abandon their gateway plans, you’ll never get to experience everything that the world wide web is capable of.

Instead of navigating this minefield of short sighted media companies and a CE industry that has lost sight of who their real customers are, take my advice and buy an HDMI enabled laptop before you buy the latest and greatest half baked technology product. A cheap laptop won’t necessarily make it easy to record your broadcast television, but if you’re only going to own one media device for your TV, an HDMI enabled laptop will beat the pants off of any digital device on the market today.

Looking for more proof that the pay television industry still doesn’t believe that cord cutting is really a threat? Analysts are predicting that those of you who haven’t cut the cord yet are likely to see price hikes across the board in 2011. Given all of the cool digital distractions that are out there, one might argue that this doesn’t make a whole lot of sense, but the reality is that the telcos will continue their rate increases until the higher prices don’t offset the subscriber losses.

Last year may have been a watershed year for the cord cutting movement, but a closer look at the data reveals that most consumers haven’t been as price sensitive as those who quit pay television. As of October 2nd 2010, ESPN had approximately 100 million subscribers. I use this as a proxy for the pay tv industry since most basic cable, satellite and fiber customers receive the channel by default. A year earlier, ESPN had approximately 99 million customer. If we assume that the telcos averaged $75 for a TV subscription in 2009 and that they increased rates by 5% last year, then this means that not only were they able to net an extra $5.4 billion in fees last year, but they’ll get to collect again on these fees in 2011 and into the future.

So what happens when consumers finally start to resist these fee increases and the trend reverses, the cable companies still get fat and happy until they have a full scale revolution on their hands. Even if we assume that 2% of all telco customers will quit pay TV over every 5% increase in price, then we’re still guaranteed to see fee increases into the foreseeable future.

Don’t get me wrong, losing 2 million subscribers would hurt the pay TV industry, but at the new $78.75 average price, it would only cost them $1.8 billion in lost revenue each year, while they would be gaining an extra $4.125 billion with the higher subscription fees. While the pay TV industry may realize that their golden years for growth are now over, that doesn’t mean they can’t do basic math and engineer higher revenue while they have you over a barrel. Until a significant number of people say enough’s enough, they’re never going to take the threat of cord cutting seriously, so if you are still paying for your television, then you’re part of the problem, instead of the solution.

Over the long run, defections will accelerate and eventually they’ll be forced to abandon their annual price increases, but until then it’s clear that the pay tv industry is going to milk consumers for as much as you will let them. The only silver lining that I see in all of this, is that a 5% increase for the pay television industry is equivalent to a 50% increase in what Netflix’s charges for a digital subscription. This should give Netflix a lot of room to remain competitive while poaching the digital living room.

In 2006, Netflix scored a grand slam when they announced a $1 million prize for anyone who could improve their recommendation engine by at least 10%. It took 3 years for a team of scientists to actually accomplish this feat, but the prize was ultimately worth far more than a million dollars in publicity and to Netflix’s bottom line. Better recommendations not only led to happier subscribers (less churn), but they also made it easier for Netflix to sell the niche content that they spend less money on. Recognizing the benefit that they received from the contest, Netflix was quick to announce a sequel, but ultimately had to suspend their plans over privacy concerns.

While a contest to replace Silverlight likely wouldn’t garner as much attention, I believe that the financial benefit to replacing this outdated codec, would be just as significant.

Some will argue that I’m being tough on poor old Softie and that Silverlight represents some of the best video compression out there, but consider my logic for a moment. From the way I see it, Silverlight has two basic flaw. It’s buggy as all get out and it’s a bandwidth thief.

The screenshot posted above is a real life example that I encountered of Silverlight in action. All codecs are prone to errors of course, but look at all the hoops Netflix makes their customers jump through just to support a buggy piece of software. If I had a nickel for every time I’ve had to restart my browser after a Silverlightning strike, I’d probably have .35 cents by now. Seriously, I have less trouble with Real Network’s codec and that’s saying a lot. Instead of putting up with these kinds of errors, Netflix should be actively searching for a more reliable alternative.

Given Netflix’s runaway success, it shouldn’t be a surprise that the big telco companies are running scared. While usage based pricing hasn’t hit the US yet, the Canadian telcos were very quick to raise rates the minute Netflix invaded their territory. When you consider how many internet service providers also sell video, it’s clear that Netflix will need a way to undercut these tactics, especially if they plan on expanding internationally. Currently, an SD movie over Silverlight clocks in at approximately 2 Gigs, while an HD movie will cost the user 3Gbs towards their cap. If Netflix could reduce the size of a movie file by 50% – 75%, without sacrificing quality, they could end the usage based meter for their customers, while also undermining a critical future component to their latest competitors’ business model.

Getting Hollywood to sign off on an outsourced video codec could be a potential problem for Netflix, but even if they were able to gradually ween their customers away from Silverlight by delivering independent films with the new technology, the benefit could still be substantial. Given how little they pay for traffic, they probably wouldn’t save $1 million on their bandwidth bill, but being able to stop telcos from nickle and diming Netflix’s members would be priceless and would help to future proof their business.

I managed to get stuck in traffic during the middle of the day today and had the opportunity to listen to old people talk radio while I waited. There was some cranky guy on who was clearly worried about his own job in media. During the program he bemoaned Facebook’s $50 billion valuation, the demise of newspaper circulations and the end of the good old days when we used to have to pay travel agents $100′s of dollars to buy tickets for us.

Even though I didn’t agree with his bleak sentiments, it did make me reflect on how technology has managed to eviscerate one industry after another. Some of these trends caught on like wildfire, while other ideas were forced to lay dormant for years while the rest of the world caught up. Whether you’re talking about landlines, photo processing booths or Blockbuster Video, sooner or later good ideas have a way of replacing yesterday’s technology.

Normally, I expect to see new innovators challenging the status quo, but one industry that is experiencing it’s own “life changing” moment right now, is actually being led by the incumbents. Most people think of billboards are being somewhat of an eyesore. If you’re located in an area where you spend a lot of time, then you know what it’s like to have to look at the same old ad for months and months. By the time they do update the ad, the old one is usually halfway peeled off. Advertisers may be able to reach millions of people with a campaign, but it limits the value when they have to plan their campaign months in advance and when the presentation makes their brand look so tattered.

Over the last year, there have been two improvements in the signage industry that have impressed me a lot. The first has been how effective Lamar Advertising has been at using their digital signage portfolio to make a splash in social media. When Ashton Kutcher was trying to hit 1 million followers on Twitter, the company cashed in by giving away free exposure to @aplusk. When the goons at NBC butchered the Tonight Show by bringing Leno back, Lamar used outrage over the incident to reach the heart and souls of TeamCoco fans. While neither of these examples netted the company any serious cash, what they did prove was how much the internet/media/consumers will freak out over billboards that mention current buzz. With most companies clueless about ways to drum up buzz, Lamar’s portfolio offers an easy way for their customers to inject themselves instantly into any social conversation. Even if the sign is only up for a day, it will live forever online. With the TV advertising industry ready to pop, there will be a lot of money available to businesses that can provide this kind of immediate reach and response.

The other signage company that has really caught my attention is Clear Channel Communications. The company may be a dinosaur and burdened with way too much debt, but over the next 2 years, they plan on deploying 300 interactive displays that can only be described as life sized iPads. So far the displays have been a huge hit at San Francisco bus stops and I think that they are the real deal. Before the holidays, Digital Signage Insights posted a comprehensive behind the scenes view into how they work and their capabilities,

“The content management system, graphics processing unit, and real-time measurement application built into each digital bus shelter are capable of producing 3D graphics and immersive content the likes of which have not been seen in the digital out-of-home media sector. Clear Channel and its partners have just begun to scratch the surface of what these systems are capable of. The “Yahoo Bus Stop Derby” is a crowning example of what can be achieved at the convergence point of creativity and technology. San Francisco’s interactive bus shelters have been built with the future in mind. Owing to Clear Channel’s and Obscura Digital’s views on the expansion of the web into real world environments, the units allow for seamless scalability and back-end cloud networking. From supporting cinema-level 3D graphics, processing interactive 3D visualizations, to offloading real-time rendering to the cloud, San Francisco’s new bus shelters can do everything short of driving you to the office. On top of that, the shelters have been equipped with a real-time user-metrics collection system that provides advertisers with actionable intelligence throughout their interactive campaigns. The granular behavioral data that the units capture can be used to optimize applications in real-time, so to achieve the highest level of user engagement.”

The outdoor signage industry may seem as quaint as using your spare change for the payphone, but there’s no doubt in my mind that the industry is evolving. Whether either of these companies have the balance sheet or wherewithal to move past their debt issues is another story entirely, but I certainly can’t fault them for creating new and innovative ways where advertisers and consumers can connect on a more emotional level.

For the last several years, the entertainment industry has been doing their darndest to put The Pirate Bay out of business. Whether it’s been suing TPB’s users, going after TPB’s hosting providers or trying to make the site’s founders criminally liable for the behavior of their customers, it’s clear that TPB doesn’t have many friends in Hollywood. More recently, we’ve seen a legal settlement industry spring up where mass lawsuits are threatened against consumers for allegedly participating in P2P activities. Whether or not the entertainment industry has been successful in these endeavours is open to interpretation, but in their zeal to put an end to filesharing, they may have created an even more dangerous monster.

One could argue that it all started with YouTube, but over the past few years we’ve seen a shift in consumer behavior away from P2P and towards streaming and downloading services. To see proof of this trend, all one has to do is compare the traffic of TPB with the streaming/downloading search engine FilesTube.

According to Compete.com, over the last year FilesTube.com has been able to consistently attract 50% more visitors than TPB. Not too shaby of a feat considering that Filestube.com didn’t even exist 3 years ago.

Given their animosity towards TPB, one would think that entertainment executives would be celebrating the cultural decline of TPB with a round of cold beers and high fives, but the reality is that instead of curbing piracy, they’re merely redirecting that illicit traffic towards safe harbors where consumers don’t appear to be at risk. In the immortal words of Princess Leia, “The more you tighten your grip, Tarkin, the more star systems will slip through your fingers”

By continuing to squeeze P2P users with countless numbers of lawsuits, the entertainment industry may have been able to establish a precedent that uploading content to the internet is a copyright violation, but what’s less clear is whether or not simply downloading that same content is actually illegal?

According to the Copyright.Gov FAQ website, “Uploading or downloading works protected by copyright without the authority of the copyright owner is an infringement of the copyright owner’s exclusive rights of reproduction and/or distribution. ” [Emphasis added by me]

Setting aside the ethical question of whether or not it’s moral to download grey area content, it is clear that US Copyright law places some restrictions on infringing downloads vs. legitimate ones. From the same FAQ page,

“Whether or not a particular work is being made available under the authority of the copyright owner is a question of fact. But since any original work of authorship fixed in a tangible medium (including a computer file) is protected by federal copyright law upon creation, in the absence of clear information to the contrary, most works may be assumed to be protected by federal copyright law.” [Emphasis added by me]

Now I’m not a legal beagle, but I believe that this means that consumers can’t be prosecuted for downloading a movie, if the service they are using claims to be offering content with the blessing of the legal copyright owner. For example when I’m streaming (making a cached copy) of old episodes of Battlestar Galactica from Netflix, I’m not actually breaking the law because I have a reasonable belief that Netflix has licensed this movie for their subscribers.

Since many streaming sites are largely controlled by the company that is paying for the bandwidth, it would be relatively easy for the studios to hold these companies accountable if they did stray off of the straight and narrow path. Where the legal waters become more murky though is when service providers (streaming companies) allow others to upload content instead of taking charge of this themselves.

With YouTube receiving 35 hours of content per second, it would be impossible for them to screen every second of footage that is uploaded to their site. Because of this the DMCA offers YouTube a safe harbor as long as they respond to DMCA takedown requests and don’t encourage piracy. To date we’ve seen several lawsuits that have tried to challenge this exemption, but so far they’ve all been a bust for the entertainment industry.

So on one side of this digital triangle you have consumers who are exempt from legal liability as long as the service provider requires uploaders to claim ownership of everything that they upload, on the other side of the triangle you have the service providers who are exempt from liability as long as they respond to DMCA request and don’t uploading anything themselves and on the final side of the triangle you have the content owners themselves who must choose between trying to police an endless stream of piracy or to quietly embrace the millions of consumers who are now streaming their television instead of paying for cable.

In a perfect world, only the actual copyright owners would be uploading their content to these digital locker services, but because sites like Megavideo.com pay users based upon the number of plays their videos get, there is an economic incentive for rouge operatives to cheat the system by claiming content as their own. To Megavideo’s credit, they have a history of refusing to pay copyright violators, but from a practical standpoint there are many who’ve been able to collect royalties on other people’s content.

Also to Megavideo’s credit, the entertainment industry has a long history of embracing “piracy” while staying in the closet about this. For example, when Viacom sued YouTube for copyright infringement, some of the clips they sued over were uploaded by Viacom employee’s themselves. It would hardly seem fair to hold either YouTube or consumers who watched those clips liable for copyright infringement when Viacom was creating a honeypot to tempt web surfers with.

Some will argue that content owners would never do this, but there are many reasons why someone would choose to embrace piracy and the popularity that it can bring a film. Whether you’re trying to jumpstart a struggling TV series or you’re trying to increase licensing opportunities, just because someone doesn’t pay to view a video doesn’t necessarily mean that the creator won’t benefit from that attention.

One of the things I’ve noticed when browsing through the FileTube.com search results is that often times studios will be unrelentingly aggressive about filing DMCA takedown requests the minute infringing files are uploaded while other files will remain online for over a year without even being “noticed.” While it would be tough to argue that 100% of these files are being monetized by the original copyright holders, I do believe that many copyright holders have chosen to secretly monetize their content in this way, but aren’t able to publicly disclose this because of how it might impact their negotiations with more traditional video distributors.

While the uploaders who falsely claim ownership of copyrighted material certainly put themselves at legal risk, with most of the uploading activity occurring outside of US borders, it’s unlikely that many infringers will find themselves being dragged into US court.

Some will cry foul over this latest trend, but I do find it fascinating how alternative business models can thrive when copyright issues aren’t strangling internet startups.

For example, one of the unique ways that Megavideo is able to sell memberships for their service is by letting consumers watch a certain amount of video each day for free before being interrupted with a time out. By running their business this way, they are able to use each and every video as an advertisement for their paid service. Since you may be 80% of the way through a movie when the time limit hits, a consumer is given the opportunity to ask themselves whether or not the content is really worth paying for to see right away or if it is a piece of garbage that you don’t care about finishing anyway.

Can you imagine if you were able to go to a movie theater and didn’t have to pay for your ticket until you had already watched 80% of the film? It would probably hurt ticket sales for a lot of the big budget flops, but the really well made movies would be incredibly successful because they’d be able to convert a larger percentage of those free eyeballs into paying customers.

Whether or not content owners are embracing this business model may be unclear, but by aggressively pursuing P2P users, the entertainment industry has made it clear that downloading without uploading is a much safer alternative for consumers then participating in the P2P movement. As technology marches forward, we’ll find out whether or not this Bermudian Copyright triangle gets sorted out, but in the meantime the efforts to prosecute P2P users, only seems to be driving consumers from a clunky bandwidth intensive technological solution to offshore providers who are offering a more elegant experience.

It’s probably worth pointing out that the MPAA has claimed that movie streaming is still considered a form of theft, but instead of backing up their position by citing the appropriate copyright laws, they instead try to equate digital streaming with physical theft.

The problem with this position is that companies like Sony (one of the MPAA founding partners) is apparently offering a shoplifters paradise in the form of all you can stream free movies on their Crackle.com website. Other MPAA partners like 20th Century Fox have not only made their movies available online at their official sites, but have also licensed their content to a number of different distributors like Comcast’s Fancast.com. Since it would be impossible for the end consumer to know the contractual details of every one of these down stream relationships, it would hardly seem fair to hold the consumer liable if someone uploaded a clip that actually infringed.

While I’m entirely open to exploring other opinions that downloading (without uploading) is still a copyright violation, I’ve yet to see any legal evidence indicating that this is actually the case. What do you think, when you hit play on a Simpson’s clip on YouTube have you actually committed a crime?

I was recently perusing my Comcast bill and noticed that they are once again raising prices on their DVR packages. At. $19.95 per month, it’s still 48 cents less per year than what TiVo currently charges for a TiVo premiere with no up front cost, yet millions of people still put up with a sub-par DVR experience at virtually the same price. Over the last 10 years, I remember TiVo raising prices once, over the same period it feels like Comcast has raised prices every 6 months. On the surface, $19.95 per month for a DVR may not sound like a lot, but thanks to the most recent rate changes, it now costs East Bay Comcast customers more to record their television each month, than it does to subscribe to their basic TV service.

It would be one thing, if Comcast was using your $240 per year in DVR fees to keep improving their DVR experience, but anyone whose used the device knows that it still suffers from severe lockups and buggy/slow interactions. Heck, even if the cable dinosaurs wanted to innovate, because of how much money they pay the content industry, they’re still prevented from offering services like Netflix on their DVRs.