NPD Group Blog » Tunnels To The Television

Tunnels To The Television

Monday, April 26th, 2010
By Ross Rubin, Executive Director, Industry Analysis

At the DisplaySearch blog, my colleague Paul Gagnon examines the proposed Hulu subscription service and expresses concern that the service could be jeopardized by fearful cable stakeholders. Indeed, cable companies, such as Comcast, have likely been pressuring broadcasters such as NBC, which have in turn pressured Hulu to vigilantly block access to any device or software that is designed to display content on the television, as arbitrary as this “line in the sand” may be. A recent example of this was Hillcrest Labs’ Kylo TV browser that debuted at this year’s spring DEMO Conference, but which landed on its face because Hulu suddenly decided to block it.

Paul, therefore, has good precedent to suspect that cable companies will frown upon Hulu’s offerings. But there’s also at least one reason why they might not. Putting a price on the value of the Hulu service enables cable companies to position their own TV Everywhere services directly against Hulu. This is far more challenging to do against a free service consumed by people unwilling to pay for subscription TV regardless of how it is delivered.

Paul also notes that Internet-connected televisions (which could be easy targets for blocking unless manufacturers strike deals with Hulu) are growing in popularity, but so are other pathways to the TV. According to NPD’s Retail Tracking Service, networked content devices have seen strong growth since the beginning of the year. Some of this has been due to lower-priced networked music products from Sonos and Roku. But the most significant new entrant has been Netgear’s Push2TV WiDi receiver that works with the new video projection technology integrated into certain notebooks using Intel Core i3 and Core i5 processors. Dell, Toshiba, and Sony have been among the earliest to support WiDi, while Netgear has been the first out of the gate with a receiver that works with all these brands.

The lesson behind WiDi’s success is that consumers will go to the trouble of bridging the PC and television if you lower the technical and financial barriers to doing so, and it bodes well for future technologies that seek to simplify wireless HD video transmission such as WirelessHD and WHDI. Perhaps by the time those technologies are ready for the masses, Hulu — or whatever version of its service that meets with MSO approval — will offer great flexibility at a price that entices consumers.

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