Is IPTV `Convergence’ Or Real Opportunity?

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The melding of the PC and TV once again takes center stage at International CES where dozens of manufacturers, content providers, software developers and distributors are converging to celebrate the emerging IPTV age. Excuse me – the deja vu just knocked me on my wallet.

Didn’t we celebrate “convergence” over a decade ago? And back then wasn’t the melding of the PC and TV going to bring us a whole new world of convenience features and “killer apps” – like being able to order a pizza through the TV screen or a movie from Blockbuster?

When that failed to bring consumers to the stores, weren’t we hearing excuses like, “consumers want to keep the lean-back experience of the TV separate from the lean-forward experience of the PC?”

So what’s changed?

The many IPTV participants unveiling new products and services this week, from Yahoo! to Intel, to Panasonic, Sony and NBC Universal (to name just a few) say it’s video content and broadband connections that will lead to the interactive promised land. Throw in the legions of Millennials jonesing to engage each other in social networking around the clock, and evangelists say you have your secret sauce.

It’s also still about ordering that pizza from the TV screen – as TiVo is finally showing us all these years later – and a video from Blockbuster (or Netflix, Vudu, CinemaNow or some other VOD service) as any number of set-top boxes here will demonstrate.

So far, IPTV capabilities have been limited mostly to expensive high-end TVs or select add-on devices, but this week that functionality is moving to more mainstream TV models and a wider range of products, from Blu-ray Disc players to DVRs to what ever else you can hit with a toss of the hat across a conventional hall floor.

As we’ve learned, content is king in launching a new entertainment platform, and for IPTV to work it will take compelling content unavailable virtually anywhere else. Success also hinges on the development of diverse new forms of special interest IPTV entertainment that can keep some viewers interactively engaged through communities of fans.

Here’s my two cents worth: look to TV series with built-in cult fan bases (“Star Trek,” “Stargate,” “Jericho,” “Battlestar Gallactica,” etc.) disenfranchised after those shows were cancelled. These audiences may have become too small for network or cable renewal, but could still be large to generate substantial revenues through subscriptions, pay per view, advertising and ancillary sales of show-related merchandise.

By establishing chat rooms around syndicated reruns and encouraging fans to come up with story lines, producers could keep projects and enthusiasm going indefinitely on IPTV portals.

MGM Home Entertainment is starting to do something like this now with new DVD and Blu-ray Disc releases of “Stargate SG-1” and “Dead Like Me.” DirecTV has similarly helped to keep critical favorite “Friday Night Lights” alive by contributing to production costs in exchange for airing the third season of the series before NBC gets them for the public airwaves. It has also picked up the abruptly canceled and series “Wonderland.” Why can’t this extend to the Internet?

Time to lean forward and go where we’ve all been before.

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