Advanced Television

Jobs: Cable STB stranglehold squashes innovation

June 4, 2010

Apple TV will remain a “hobby” at his company because the cable industry has “squashed the opportunity for innovation in the TV market,” according to Apple CEO Steve Jobs.

Speaking at the opening session of the All Things Digital conference in Rancho Palos Verdes, California, Jobs told delegates that the TV industry has a subsidised model that gives everyone a set-top box for free, so no one wants to buy a box. “Ask TiVo, ask Roku, ask us, ask Google in a few months,” he said.

He pointed out that Sony, Panasonic and many others had failed at getting into the household with a video delivery device (other than DVD or games units). “The only way that’s ever going to change is if you can go back to square one and tear up the set-top box and redesign it from scratch and … get it to the consumer in a way that they’re willing to pay for it,” he added. Although not discounting the prospects for over-the-top video delivery, he argued “the problem with innovation in the TV industry is the go-to-market strategy.”

Jobs admitted that Apple chose to pursue the mobile and tablet market because the TV category had too many barriers. “It’s not a problem of technology. It’s a fundamental go-to-market market problem.” He also criticised what he described as the “balkanisation” of the global TV market, where every country has different technical standards and regulations, which made it too difficult to develop a worldwide product.

Also coming in for criticism were content producers for “desperately grasping at anything they can” to retain control of the movies, music and other programmes they want to distribute directly to the home digitally.

Noting that the opportunities were huge for content owners, Jobs suggested that the way movies are marketed was undergoing a radical shift, hinting that day-and-date release of new films to homes and theatres was imminent, with viewers able “to watch a first-run movie at home if willing to spend a bucket of money.” He advised that studios needed to embrace this as a business model that allows customers “to watch wherever and whenever” they want to see a show.

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