You Gotta Stream

Some of you may remember the popular Rheem ads from the 90’s with the tagline “install a rheem“. Well in today’s online age, “You Gotta Stream!”.

I have been meaning to write about this topic for a long time. The linchpin has been discovering this presentation via Mark Cuban’s blog, who knows a thing or two about online video himself given he is the chairman of HDNet and sold Broadcast.com for a bajillion dollars.

This slide deck is from Netflix. Its very honest and insightful into where this company is going, the opportunities, the threats and the future of entertainment. Check it.

My own personal thoughts

What’s really pissing me off at the moment is my data limit on my ISP and the random wi-fi disconnections. It happens when someone in my family yells out:

hey we’re reaching our limit! We’re X% over, stop watching online video!”

Clearly, we do not have the infrastructure or the networks yet that can cope with high usage, fast internet speed. Nor am I on the correct data plan. YET. I do hear there’s this thing called the NBN being built and WiMax.

I love watching movies and tv shows. I love watching stuff on Youtube, tvshack, from blogs, friend’s videos on facebook, Hulu, etc… I smashed “How To Make It In America” in like 3 days (8 episodes makes it easy). I’ve just watched Book of Eli, A-Team, Hot Tub Time Machine, Zombieland, Invention of Lying, one episodes of Gruen Transfer in the past 2-3 weeks.

On average I watch several videos a week. I’ll also throw in some UFC action, NBA (in season), worldcup, Masterchef, Underbelly, etc… The majority of these I watch from my computer or from my tv.

I’m telling you – the future is going to be streaming. If I miss an episode of Masterchef or Underbelly on tv, I watch it streamed online. It gets posted up by the Network the following day. It’s just so much easier watching it online when I want to.

The alternatives in Australia suck

I can’t say that I’ve watched many movies online. Because the better services like Netflix, Hulu, Amazon are not available in Australia. There are ways around it, but I can’t be bothered. Its too much effort. The ones that I can access for streaming do not have great quality. Plus my wifi connection will drop out at some point and I do not want to stream it again from the start or lose my point in the video.

Theoretically speaking, downloading means that I can’t watch it immediately. I would have to wait til when the download finishes (which could be the next day). But sometimes, you have a hankering for a certain movie or tv show. You don’t want to wait. So you have to settle for an alternative. We, well me specifically, are dreaming of a world where this stuff is on demand and affordable.

Currently, Netflix has a leading position in the consumer market in the US. It charges $8.95/month for unlimited streaming of its catalogue. It is focusing on the long tail – not the new releases. This is partly because the studios do not want Netflix to be showing new releases before it is in DVD rental / sales, as it could cannibalise those sales and they probably have existing arrangements that Blockbusters, etc… would have first release.

In Australia, we also have Telstra which has a online streaming consumption model and also iTunes. But these are either too expensive, alacarte and not subscription based.

Parrallels with music

With my music, I do not have a collection on my laptop anymore. I have some music on my phone. Now, I just stream music online. One of my favourite sites is 22tracks, where the music is available to be streamed and has been curated into the newest tracks and by genre.

I occasionally do download music such as free mixtapes or free albums which the artists or music blogs give out. I haven’t purchased music in a long time. The last time was in the States when I bought some mixtapes from Amoeba in Sunset Boulevard, Los Angeles 3 years ago. Before that, it would be several years again when I was working down the road from Dirt Cheap CD’s. I’d wander into there and pick up a few hip hop CD’s during lunch.

For me, music has become a commodity. I still love my music. But I no longer want to purchase it or have the need to. I don’t even really download it anymore. I can stream it on demand. I can usually hop onto Youtube and find the songs that I like. There are lots of paid music services out there like Spotify, LaLa, etc… but I think its EXTREMELY difficult to get people to pay for music now, even if its unlimited streaming and storage in the cloud. As consumers are simply used to free. And many of them are not prepared to pay. The horse has bolted.

Back To The Future

I feel that movies and tv shows are also going down this path. We have so many movies available via P2p networks. People have more movies than they can watch. Because they have so many movies, it also devalues them, turning them into commodities.

The future is streaming movies. A mix of tv, cable and online streaming. The question is whether people are prepared to pay for this on demand access. Or will we simply shove better ads into them to entice purchase of goods/services.

I’m out like Australia in the world cup,

Matt Ho.

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