Broadcasters have shown early resistance to Google TV, (s GOOG) blocking devices running the OS from being able to access full-length video content online. But CEO Eric Schmidt said in front of an audience today that the company is merely guilty of “making a dumb TV smart,” something he believes will eventually create more value for broadcast video content.
Today at the Web 2.0 Summit, Schmidt defended his company’s entrance into the connected TV market. Schmidt said that the TV industry has not had the sort of innovation that Google is trying to push forward with its new OS, due in part to constraints in networking and processing. But with today’s consumer electronics chipsets and broadband networking capacity, Schmidt said Google is able at last to enable a full browser on the TV that can go back and forth between web and TV content.
“They’ve accused us of trying to make a dumb TV smart,” Schmidt said. “Yes, we’re guilty of that.”
Of course, broadcast and cable TV have enormous revenues from advertising and carriage agreements to protect, but Schmidt said that the company is not trying to destroy the value that already exists in the TV ecosystem. “There’s a fear that this enormous revenue stream is somehow going to be affected by all this Internet content… [But] we don’t want to create a situation where revenue goes to zero,” Schmidt said.
Instead, he pointed to companies like Netflix, (s NFLX) which pays handsomely to license content from its partners, and to apps as new potential revenue streams that Google TV could enable. “TV is a big business, and… there are lots of new revenue sources there,” he said. That’s a message Schmidt said he was confident that Google and its CE partners would get through.
Finally, Schmidt said that Google TV will see more support from other consumer electronics manufacturers in the future. While Google TV devices today are being manufactured by Sony (s SNE) and Logitech (s LOGI), he said he “expects other to enter this market… The software is free, after all.”
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