Google Inc will launch its service to bring the Web to TV screens in the United States this autumn and worldwide next year, its chief executive said, as it extends its reach from the desktop to the living room. CEO Eric Schmidt said the service, which will allow full Internet browsing via the television, would be free, and Google would work with a variety of programme makers and electronics manufacturers to bring it to consumers. “We will work with content providers, but it is very unlikely that we will get into actual content production,” Schmidt told journalists after a keynote speech to the IFA consumer electronics trade fair in Berlin. Sony said last week it had agreed to have Google TV on its television sets, and Samsung has said it was looking into using the service. The announcement comes less than a week after rival Apple unveiled its latest Apple TV product and will intensify a battle for consumers’ attention and potentially for the USD 180 billion global TV advertising market.
Over the next few months, Sony and its competitors will introduce a new generation of Web-connected televisions—and services that will stream movies, TV shows, and music over the Internet and onto those sets. The idea is to make it easier for consumers to bypass cable and effectively create their own personal TV channels. That may sound a lot like what many people already are doing by tapping into YouTube, Hulu, and other entertainment Web sites. What’s different is that Sony and the other manufacturers are hoping to go after advertising dollars as well as subscription revenue and pay-per-view fees. Instead of using computers and mobile devices for their daily dose of free television, viewers would pay Sony or another company to watch on much more expensive equipment. Chief Executive Howard Stringer says that as consumers watch less TV in their living rooms, the industry needs to adjust quickly to the changing ways viewers take in entertainment. Last month, Sony unveiled the prototype of a TV that will deliver video and music over the Web in partnership with Google. These Google TVs are expected to be in stores by Christmas
Google is set to move into the living room with a computer operating system that will bring the internet to home televisions. The company is working with the chipmaker Intel and Sony, the electronics giant, to introduce Google TV this week at a conference for 3,000 Google software developers in San Francisco. The aim is to get them to create new and innovative applications in the same way that outside developers have created new software programs for smartphones.The system will be based on its Android platform, which was developed 18 months ago for mobile phones. There are already more than 50,000 applications available for Android. The aim now is to put the web on to televisions via a new generation of TV sets and set-top boxes, further blurring the line between home entertainment and computing. The partners are developing technology that will make it as easy for television users to search the web as for computer users, with access to social networks such as Twitter or Facebook and to movies and TV shows on web video sites such as YouTube or Hulu.com. Google, by embedding its software into televisions, can control internet access on yet another category of devices. By offering its Chrome web browser on the Android system Google will be able to ensure its services, especially its search and advertising technologies, will bring in more profits
Amazon has announced that an upcoming software update will allow Kindle users to share their favourite book passages on Facebook and Twitter. The Version 2.5 enhancement for Kindle and Kindle DX is currently being rolled out to a limited group of users, and a wider release is planned for late May. Other new features include larger and sharper fonts, password protection, an ability to organise books and documents into separate collections, and a highlights feature that will allow a reader to see what the Kindle community thinks are the most interesting sections of a book. The social networking updates may well be a sign that Amazon is looking to widen the appeal and use of Kindle following strong competition from Sony, Barnes & Noble and potentially Apple with the iPad. Several major book and magazine publishers are said to be onboard with the iPad, threatening further competition to the Kindle, which only released its DX and Global Wireless versions in the UK in January. Amazon announced earlier this month that global sales rose 46 per cent in the first quarter of this year, although the firm continues to withhold sales figures for the Kindle device, saying only that they “remain very strong”. The Kindle 2.5 update will be delivered to devices wirelessly, and users will not need to take any action to receive the enhancements
It has been the setting for many a spaghetti western, but now Hollywood has warned that Spain could be facing high noon over its appalling record of movie piracy, with a future devoid of DVDs. The unauthorised downloading of films from the internet is so rife, with film-makers complaining that a legal void makes people think movies are free, that Spain could become the first European country to be abandoned by Hollywood studios. Sony’s threat, which affects DVDs but not cinemas, would put Spain on a par with South Korea, which most studios have abandoned because of a similar free-for-all internet culture. While cinema audiences have declined slowly in Spain, sales and rentals of DVDs have plummeted as high-speed broadband make streaming and downloading easier. As a result, three out of four video shops in Spain closed in the five years to 2009. Spending on DVDs can be as low as 10 percent of the level in the UK or Germany. The statistics show that 30 percent of the Spanish population uses file-sharing sites, against an average of 15 percent in the rest of Europe.” A recent report by the Paris-based TERA consultancy on internet piracy in Europe warned Spain had the highest piracy rate and that spending on DVDs had fallen six times faster than in the UK . The report estimated that the film and television industry lost about EUR 900m in Spain as a result of piracy in 2008 – almost twice as much as the music business lost. Internet piracy was causing some 13,000 jobs losses a year in Spain, the report said
Google Inc is working with Intel Corp and Sony Corp to develop a new class of Internet-enabled televisions and set top boxes, according to a media report. The effort, known as Google TV, has been under way for several months and is based on Google’s Android software which is currently available in certain smartphones, according to a report in the New York Times on Wednesday citing people with knowledge of the project. Logitech International is also involved and is developing peripheral devices, such as a tiny keyboard. According to the report, the partners hope to make it easy for consumers to use Web applications like Twitter on their TVs and to entice software developers to create new applications to run on Google TV. Google has begun testing the set top box technology with Dish Network, the Times said.
The European giants that pioneered the mobile telecoms industry are now stumbling in the wake of American and Asian rivals
When Eric Schmidt, chief executive of Google, takes to the stage in Barcelona on Tuesday evening to deliver the keynote address to hundreds of mobile phone industry executives gathered for the Mobile World Congress the industry’s biggest trade show, the message will be clear: well done, Europe, for getting mobile communications this far. We’ll take it from here.
For two decades, Europe’s mobile telecoms sector has considered itself to be a world leader. It had the biggest names, the technological knowhow, the most customers. Over the past year, however, that hegemony has been smashed. At a time when Europe is mired in economic turmoil and facing a demographic timebomb, one of its great hopes for fuelling future growth is slipping away.
“Europe has become the ‘flyover states’ of the mobile industry,” says a senior European executive, referring to the disparaging term used to describe middle America by high-powered business travellers shuttling between California and New York.
“All the service innovation is being done on the west coast of the US, and all the manufacturing and technical innovation is being done in the Far East. All we’re doing is selling other people’s products.”
His customers now care only about access to services such as Google, Facebook and Twitter on their phones, and the devices they covet are the iPhone or the latest BlackBerry, which has proved a great hit with teenagers. This year’s hot handsets, the executive says, are being made by HTC, the Taiwanese manufacturer, which will use this week’s show to unveil its latest devices, featuring Google’s Android software. While Apple lords it over the high end of the market, China’s Huawei and ZTE are creating cut-price smartphones that will democratise the mobile internet in the coming years.
Sensing the change blowing in the wind, even Microsoft’s chief executive, Steve Ballmer, is turning up in Barcelona to front the software group’s latest attempt to break into a market that it was once shut out of by Europe’s gatekeepers, Nokia and Ericsson. As for Apple itself, the iPhone maker would never do anything so vulgar as actually appear publicly at the event, or have a stand in one of the eight exhibition halls; but its executives will be in town, holding meetings behind closed doors with suppliers and networks as it looks for more wireless partners to back its latest invention, the iPad, outside the US.
After a week in which the turmoil in Greece has shown the fragility of the eurozone and a new acronym, “Pigs”, has entered the economic lexicon as a harbinger of doom, the evidence the Mobile World Congress will provide of Europe’s loss of control over the mobile phone industry is a harsh blow.
It leaves European policymakers, many of whom have bought in to the idea that the future lies in the creation of innovative technologies, to pin their hopes on new areas such as green energy or fall back on old stalwarts such as biotechnology. But the green sector has yet to prove the breakout success that will give Europe its own version of Silicon Valley, while biotech has always been the saviour that never quite seems to arrive. After the dotcom crash at the start of this century, biotechnology was looked to expectantly, especially in the UK, as the next big thing. In America, meanwhile, graduates from Stanford and drop-outs from Harvard were quietly getting on with building Google, Facebook and Twitter.
The impressive lead in mobile communications that Europe once held over the rest of the world was created by the European Union. In the 1980s, when wireless communications went mass-market, America’s Motorola vied with Finland’s Nokia and Sweden’s Ericsson for dominance of the nascent global market. Europe’s players were handed the advantage when the EU officially adopted and set aside specific wireless spectrum for a digital mobile technology called GSM.
The first networks appeared in 1991 and overnight the European technology players that had helped create the standard had a huge market. Seeing its success, other countries soon adopted GSM, expanding the market for Ericsson, Nokia and others throughout the 1990s. Even America’s largest network, Verizon Wireless, is switching to the super-fast version of GSM later this year. So where did it all go wrong?
“As soon as the mobile business opened itself up in such a way that internet technology could become available on mobile networks, that was the end,” according to Mark Newman, chief research officer at Informa Telecoms & Media. “Maybe Europe had a chance but it blew it, in my view, because there are too many sets of interests, each so obsessed with their own sphere of influence that they could not co-operate.
“You had operators and device manufacturers never pulling in the same direction, and I cannot see any way in which Europe can regain the ascendancy. Essentially the future of communication services is that people want access to the cloud of services called the internet.”
The industry did see it coming. It tried several times to create a mobile internet that was not going to be beholden to the American giants. In the late 1990s, a pared-down wireless internet service called WAP was being pushed by several GSM operators. Customers, many of whom were used to dial-up internet access, were unconvinced and soon started summing up the service by replacing the “w” with “cr”.
A few years later, O2 tried to create its own mobile web by importing the i-mode standard from Japan. Again, it was a dire failure. When the “true” web started turning up on the next generation of 3G phones, the operators tried to keep their customers within “walled gardens” – as they were called – creating content portals that offered customers what the operator thought was the best of the web. Usage was paltry. Having spent billions buying licences to run 3G services, the operators had to prove to investors that there was consumer appetite for mobile internet services, so they demolished their garden walls.
Ironically, the operators’ initial intransigence over the mobile web brought both Apple and Google into the industry. The former saw a way of bringing the vertically integrated approach that had worked so well in music – where it controls both the device, the iPod, and the store, iTunes – into the mobile market. The latter made its move because it feared that the combined effect of Apple and market leader Nokia could shut it out of the mobile internet altogether.
In fact, Google needn’t have worried about Nokia because the runaway success of the iPhone changed the game. The arrival of the 3G version of Apple’s device a year and a half ago dramatically altered the mobile industry and proved that consumers, given the right device, will do much, much more than use their phone to make calls and send texts.
Nokia is still the largest mobile phone manufacturer in the world. But the Finnish giant, a former rubber boot manufacturer whose success created hundreds of millionaires and helped pull the country out of recession when the Soviet Union collapsed, has been sideswiped by the success of Apple and the encroachment of Google’s Android platform. It has been forced to make Symbian, its own software platform, free to developers and handset manufacturers, as Android is, and last month took the desperate decision to give users of its smartphones free access to its satnav services to make its devices as attractive as the iPhone. Only three years ago it spent €6.5bn on the map firm Navteq but it is now effectively giving that intellectual property away as it tries to protect its market share.
The crisis into which Nokia has been plunged by Apple has pushed it into bed with another American giant, Intel. The two companies will use Mobile World Congress to announce new microchips that Nokia hopes will help it to compete with HTC’s latest devices. Apple already has its own in-house chip design team, having bought fellow Californian company PA Semi two years ago.
Ericsson, meanwhile, spun its handset business into a joint venture with Sony. However, after initial success with ”featurephones” based on Sony’s Cybershot (camera) and Walkman (music)technologies, Sony Ericsson’s share of the billion-device-a-year market has collapsed under the onslaught of Apple and BlackBerry, halving from about 10% three years ago.
But it’s not all doom and gloom, says Olaf Swantee, who runs Orange’s mobile operations across Europe. He reckons that Europe’s big mobile phone operators, such as Orange, Vodafone and O2, have the opportunity to leverage their huge customer service bases to get themselves back into the game.
“Yes, the [US] west coast and Asia have really taken very strong positions,” he admits. “If you take equipment manufacturing, companies like Huawei have grown really strongly and we have seen traditional software manufacturers like Google and Apple enter the mobile market as it becomes a more software-driven environment. But, as the market moves to a more mature phase, what is becoming more and more important is the customer interface.”
The importance of direct customer contact, whether that be through shops or call centres, was proved this year when Google launched its Nexus One mobile phone. It sold it only through its website, and those customers who had problems with the phone had to email Google, rather than talk to its network partner, AT&T. Many found themselves waiting days for issues to be dealt with.
In the race to increase revenues – not least to pay for the network investment required to deal with the traffic generated by devices such as the iPhone – the mobile phone operators have the chance to claw back money from the likes of Apple and Google, which aggregate other people’s content through their iTunes and Android marketplace stores.
“Once the markets top out,” says Patrick Bossert, director of strategy at global billing services expert Convergys, “and growth slows and margins get tighter, then those aggregators will be looking to solutions for local-language customer care and marketing.
“They cannot afford to establish a base in every market in which they operate, but the service providers are already there. They may not have a lot of leverage now but, boy, do they have a lot of assets that are actually quite desirable.”
It’s a theme that the GSM Association, which represents all these networks, will be picking up this week as it tries to wrest some of the initiative back from Google and Apple.
“I don’t feel that we are being left behind, but there are areas that the mobile operators need to address,” says Michael O’Hara, the GSMA’s chief marketing officer. “And getting their assets into the developer world, finding a way to get into the value chain, is really key.”
Being great at customer service is hardly the white heat of technology, but for Europe it might just be the start of some sort of fightback. For now, though, the story is going to be – for home-grown talent, at least – depressingly familiar. As Informa’s Newman warns: “In 2010, Apple is going to make hay. I can’t see anyone catching them up this year.”