Weekly Update

Turning up the DIAL on OTT

The NPD Group this week reported that 40 percent of U.S. households with a connected TV streamed Netflix content during the fourth quarter. While impressive, anyone who has used an embedded Netflix app on a smart TV or connected set-top box can tell you that a TV app is a sub-optimal way to navigate and discover content because you’re limited by the functionality of a standard TV remote control, just as you are with linear TV. While content on Netflix may be more compelling than what’s on linear channels, or at least provide additional options, the experience of using Netflix on a connected TV is not terribly different from watching any other channel.

That’s why the biggest news out of Netflix this week may not have been the growing popularity of streaming video, or even its better than expected fourth-quarter earnings report, but the confirmation that it is partnering with YouTube to launch DIAL, a protocol that enables second-screen devices to discover first-screen devices on the same network and launch apps on them.

Here are three scenarios for how that might work, as spelled out in the DIAL (DIscovery And Launch) protocol specifications:

3.1 1st screen service
A Netflix app on an iPhone discovers a Netflix-enabled TV and then launches the Netflix app on the
TV to watch a movie…:
(a) Netflix app on iPhone discovers DIAL service on the networked TV
(b) Netflix app on iPhone uses DIAL to ask TV to launch Netflix app
(c) Netflix app on iPhone discovers Netflix app on TV
(d) Netflix app on iPhone and Netflix app on TV communicate to show the movie

3.2 2nd screen service
A YouTube app on an Android tablet discovers a YouTube-enabled TV and then launches the
YouTube app on the TV and plays a video on the TV; after the video ends, the TV returns to the
previously playing TV show…:
(a) YouTube app on tablet discovers DIAL service on the networked TV
(b) YouTube app on tablet uses DIAL to ask TV to launch YouTube app, passing an IP/port
corresponding to the YouTube app on the tablet
(c) YouTube app on TV communicates with YouTube app on tablet to show the video, then exits
back to normal TV UI

3.3 Cloud service
A (fictitious) WebcamX app on an Android phone discovers a WebcamX-enabled TV and then
launches the browser-based HTML5 WebcamX app on the TV to display a webcam stream…:
(a) WebcamX app on phone discovers DIAL service on the networked TV
(b) WebcamX app on phone uses DIAL to ask TV to launch an HTML5-based browser starting with
the URL for the WebcamX app, passing a unique token based on a random number
(c) WebcamX app on phone communicates with WebcamX app on TV via a cloud based WebcamX
server, using the unique token to enable the server to correctly route traffic between the two apps

The system has been likened to Apple’s AirPlay, but DIAL does not enable direct mirroring of content from mobile device to TV, as AirPlay does. Instead, it operates more like a remote control, in which commands entered on a smartphone or tablet are executed on a TV.  Since it’s running on a touch-enabled, IP-based device, however, those commands can be much richer and more flexible than with a standard remote.

Also unlike AirPlay and linear pay-TV platforms, DIAL is an open protocol, available to any developer that wants to enable their app, and to any hardware maker that wants to enable DIAL on its devices. As Netflix’s direct or product management Scott Mirer told Janko Roettgers this week, “We…felt that having two major video services define and promote DIAL would help get it more widely adopted as a common solution to a common problem, vs. taking a proprietary approach. It’s been a productive partnership and we’re confident that we’ll get wider adoption because of it.”

So far, BBC, Hulu, Pandora, Disney, Vimeo, Daily Motion, Flingo, Easel TV, MOVL, TV 2 Danmark, and Snag Films have registered their apps with DIAL, in addition to YouTube and Netflix.

On the hardware side, both Sony and Samsung demonstrated DIAL-enabled devices at CES. Several other major players, including Panasonic, LG, Philips, Sharp, Toshiba, Vizio, and Western Digital, have also indicated interest in enabling DIAL in upcoming devices.

The launch of DIAL, in short, could represent a major step toward turning second-screen mobile devices into a primary means of discovering and accessing content for the first screen, as I discussed in a previous post.

That has the potential to be far more disruptive to traditional linear TV platforms than are mere over-the-top channels because it promises to deliver a qualitatively different viewing experience in a user interface not modeled on or controlled by any of the traditional gatekeepers.