NewTeeVee Live: How to Achieve Video Nirvana, According to Netflix CEO Reed Hastings

How can we achieve video nirvana? The answer, according to Reed Hastings, CEO of Netflix, is to simply put the web on the TV, and the tipping points will come from the proliferation of broadband, high-def screens, and “the pointer” interface for a remote for the TV. He’s well aware that the online video industry has been saying this for a decade, but just wait ’til January’s Consumer Electronics Show, he says, where he predicts we’ll see some promising web-on-TV products.

Here’s some notes from his speech:

We want to watch what we want, when we want, where we want, and discover the content how we want. The debate has been between the TV and the web in the race to deliver the on-demand personalized video future. Standard TV is getting better — now they have over-the-air, cable, satellite, telco, and program guide. We have the DVR and VOD, which are “bolted-on” experiences and in most cases are discrete subsystems. TV’s problem has been: How do you create integrated and personalized experience before the web catches up? TV has the advantage of having a huge installed based, but on the other hand it doesn’t have crazy, innovative, inventive, web culture.

On the web side, the first breakthrough was flash video. Then there was no need to install another codec. The next breakthrough was YouTube, and YouTube showed that streaming — even at low quality — was preferable and popular for online video content. We wanted a TV-like experience where you can click and play. The ad-supported web video model is the largest part of that market. But there is some high-value content and both subscription and pay-per view models.

So how well are we doing in the areas of “where,” “when,” “what” and “discoverability”? We’re about 15 percent of the way to “what you want,” 100 percent at “when you want,” 15 percent towards “where you want,” and 25 percent for “discover your want.”

To get even farther we need a standard for connecting thousands of video web sites and many devices. The problem with creating a new standard is it takes time — anywhere from 1-3 decades. The simpler solution is that the standard is the web itself. We need web browsers — Explorer, Firefox, Safari, etc. — to play web on televisions. People tried it 10 years ago without success but that was in the age of low-speed dial-up. Today for the web-on-TV experience to begin we need broadband, high-def screens, and a pointer remote. The video game generation is quite comfortable with using a pointer on the TV.

Starting at CES next year I see breakthroughs for the web on television. The logical start is video game consoles — the Wii is so close, but we need high-def and to support modern codecs. Also built into televisions we’ll have Internet tuners. The issue with that is that device makers don’t want to bet too big on too-advanced tech, because then they could bet wrong on big devices. Web video will continue to grow, nurtured by PC and laptop-based ecosystem, then will expand to web browsers on the TV screen.

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