Online Video Gets More Product Placements

If you’re a long-time reader of the HDTV Almanac, you know that one of my favorite hobbyhorses to ride is the question of “who is going to pay for the video content?” Advertisers have long been aware that we’re skipping their commercials with our DVRs, but they were at a loss about what to do instead. Some of them are smelling the french roast, however; Nike has cut its television commercial budget by 30%. But if the advertisers leave television, how with the content creators get paid?

I’ve long been a fan of product placement. The practice of putting products in television episodes and movies is nothing new; it has been around much longer than Jack Lord’s big black Mercury on “Hawaii Five-O”. (And who can forget the Reese’s Pieces coup when Mars turned down the chance to have M&Ms appear in the movie “E.T.”?) Product placement is alive and well in both television and movies, as witnessed by the fact that just about every laptop you see on screen has the glowing Apple logo in plain sight.

Now it looks as though product placement is coming on strong for streaming video as well. With online services now producing their own content, they too have the opportunity to make deals to include products in the scenes. An article in Online Media Daily includes an interview with YouTube’s Suzie Reider, head of industry development. According to Reider, advertisers realize that a growing share of their audience is online.

For example, a company called Alphabird is going to produce a new comedy about a home handyman, and it will serve as a vehicle for product placements ranging from tools to appliances. The article doesn’t mention what portion of the production costs will be covered by these deals, but it is interesting that the show is being built from the ground up, so to speak, with product placements in mind. Instead of the mythical Binford Tools of “Home Improvement,” we can expect to see familiar brands in these episodes.

How will consumers react? Well, it’s been going on for a long time already, so I expect we’re more or less used to it by now. It’s only when it’s done with a heavy hand that it becomes objectionable, such as a long shot of a General Motors car driving down a driveway while the cast of “The Mentalist” does some voiceover dialog. (Am I the only one who gets bugged by that? If you turn the sound off, the shot is indistinguishable from a stand-alone commercial.)

Done right, product placement subtly just makes you want to get a pair of those jeans that the star is wearing, or drink that brand of beer, or whatever. I believe that it is likely to be a major part of production funding going forward.

Sharp Ships 90″ LCD HDTV

Imagine a television that is more than six and a half feet wide. Imagine that you could have one in your living room now if you want it. It’s not a pipedream; it’s the Sharp LC-90LE745U 90″ LCD HDTV, and the company announced yesterday that it is available now from select retailers in the U.S.

The mammoth screen has a 90″ diagonal measurement, and relies on a full matrix of white LEDs for its backlight to enable selective dimming for increased dynamic contrast. It tips the scales at a hefty 141 pounds (150 with the stand) so plan on getting some help when you go to mount it. It supports 3DTV, and comes with a pair of active glasses. It also is a Smart TV, but it is interesting to note that the screen does not use Sharp’s four-color-pixel Quattron technology. You might expect it to be a power hog, but it’s rated at just 138 watts when operating, which is less than many 52″  models that are about one-quarter the size.

This is a dramatic demonstration of Sharp’s new strategy, in which it will focus only on LCD TVs 60″ and larger. The idea is that it will leave the lower end of the market to its competitors, where they can slug it out among themselves. This makes sense in that Sharp is the only one with a Gen 10 LCD panel fab, which should mean that they can make these larger sizes more efficiently. The question is whether the worldwide market for these giant screens is large enough to make the play work.

The announced price for the LC-90LE745U is $10,999, but is expect to sell for closer to $10,000. This creates an interesting dilemna for those with five figures of disposable income to spend on a single television; do you get one of the new 55″ OLEDs from LG or Samsung, or do you go for a screen nearly four times that size with the LCD from Sharp? It’s not a decision that I expect to have to make, but it does make for an interesting “what if” question.

Amazon Adds MGM Movies

Amazon Instant Video is the quiet third-place contender behind Netflix and Hulu, but the service keeps adding content to its catalog. Many of the titles are available for free streaming — some in high-definition — for customers who pay for an Amazon Prime membership at $79 per year. In addition to benefits such as free two-day shipping on most orders and free “borrowing” of Kindle books, members also get to watch movies and TV online for free.

The service currently has a much smaller catalog than its competitors, but it is growing. Last week, Amazon announced an agreement with MGM to include hundreds of “classic” movies and television episodes. Movies include The Silence of the Lambs, Dances with Wolves, Rain Man and The Terminator. One of the TV series to be added is Stargate.

These additions aren’t likely to catapult Amazon to the top of the online streaming list, but they will help keep it competitive. This is likely to be a long race, and so long as Amazon can keep the other two services in sight, it could be in a position to make a strong move in the future.

Net Neutrality: Justice Department Investigates Cable

The Wall Street Journal reported that the U.S. Justice Department has launched an investigation into cable television company practices, especially as they relate to streaming online video from sources such as Netflix and Hulu. One focus of the agency’s concerns is the fact that some cable companies are imposing data caps on subscriber usage of broadband network connections. In particular, the Justice Department is probing Comcast’s preferential treatment of its own Xfinity content streamed over a Microsoft XBox. The company contends that it treats all Internet data equally, but does not count the Xfinity content towards a subscriber’s data usage because the data is streamed just within Comcast’s own private network.

The Justice Department is concerned that this practice violates Comcast’s agreement that it would not “unreasonably discriminate” against streaming data from other companies.

According to the WSJ article, Justice is also looking into the emerging practice of authentication as part of the “TV Everywhere” initiatives by cable and satellite services. The idea is that viewers who subscribe to a package of channels using these services would then be able to access some of that content over the Internet using a computer or mobile device. The Justice Department is concerned that this may be an anti-competitive practice because it requires the user to subscribe to a bundle of products in order to access the online content. This prevents users from subscribing to just an online version of the available content.

Both avenues of investigation have important implications for the future of subscription television services. If the cable companies are allowed to selectively apply data caps to content delivered by competitors — such as Hulu and Netflix — it could make it much more difficult for those online outlets to succeed. On the other hand, if the agency decides that subscription television services have to open up their online streaming content to viewers who do not subscribe to their cable or satellite plans, this could hasten a la carte pricing and result in drastic changes in the market for these companies.

Here’s a video on this story from the WSJ site:

Comcast, TiVo, and… PayPal?

Attention: QVC Shoppers! Open up those home equity credit lines because shopping online is about to get faster and easier!

On Tuesday, Scott Dunlap, vice president of emerging opportunities with PayPal, announced a new partnership with Comcast and TiVo. What could a cable giant, a DVR maker, and an online payment processor possibly do together? Let you buy stuff directly from your television, that’s what!

This means that you’ll be able to make purchases or donations in response to interactive ads that you see on your TV. Press a couple buttons on your remote control, and you can complete the deal using your PayPal account. And you can even pause the programming while you take care of business, then resume without missing anything.

This process has been dubbed “t-commerce” (like “e-commerce” but with a “t” for “television). PayPal did a survey last fall and found that nearly half of the TV subscribers polled were interested in making on-screen purchases. And a large portion of them were interested in using PayPal to make the payments. Viewers could start to see implementation of this system as early as this fall.

Until now, TV commercials have been simply advertising, part of a marketing campaign. This ability to interact with the screen and engage PayPal in the process could be a game changer as it adds the sales function, and removing extra steps for the consumer to buy. It also could breathe new life into commercials. If the ads frequently offer products or services that you care about, and if those ads offer special discounts or bonuses that are only available during the commercial, I can see how this could encourage more consumers to pay more attention to the commercials. And as any student of operant conditioning can tell you, an infrequent and random payoff is the best way to reinforce a behavior that is very difficult to extinguish. (Just ask anyone playing a slot machine.) It would not take many attractive deals sprinkled among the wasteland of commercials to make viewers want to sift through all of them, just so they don’t miss something.

This could make television commercials interesting again.

Alfred Poor on Video about HDTV

Yesterday, I had the pleasure of discussing HDTV and related topics with David Gewirtz of ZDNet, which he captured on video. We covered a wide range of topics, including OLED HDTVs, 3DTV, screen sizes, Smart TVs, and “direct LED” TVs. The video runs almost a full hour and was made during a Skype video call. (David has invested a lot of time and effort to develop a pretty sophisticated “Skype Studio” for recording interviews like this, and he gets some impressive results.)

So here’s the video if you want to hear more about my latest thoughts about buying HDTVs. If you or someone you know are thinking about getting a new set, you’ll probably find some helpful information here.

If you have any questions, you can email me at or send a Twitter message to @AlfredPoor.

Redbox and Netflix Go Around Disney for “John Carter”

In yet another attempt to put a genie back in the bottle, Disney has decided not to give Redbox or Netflix access to “John Carter” on DVD when the movie becomes available for retail customers, according to a story in the LA Times. Instead, the disc rental companies will have to wait at least 28 days before it can buy at a discount from Disney.

So two disc rental giants went the old fashioned route, and sent out an army of buyers to purchase the discs when they were released last week. According to some sources, the movie is now available for rental from both companies.

The movie studios are feeling the pain as DVD sales dwindle and Blu-ray fails to pick up the slack. They apparently think the solution is to squeeze the disc rental companies, but that is probably a losing strategy because it means that fewer people will watch discs and they’ll turn to other ways to get the content. In time, I expect that this will drive them to online streaming and the use of DVD and Blu-ray will continue to spiral downwards.

OLED HDTVs Are Really Coming… Maybe

[Revised 6/12/12 after feedback from Ray Soneira] 

Okay, I have to start by waving the white flag of surrender. As many of you may have noticed, I went “dark” for an extended period last fall while I was working on some major projects. For the past month or so, I’ve been behind but I was struggling to catch up by back-dating my entries. Well, I was in Boston all last week for the Society for Information Display’s annual DisplayWeek conference. Not only did I not manage to catch up on my backlog of entries, I didn’t even post once about the show while I was there.

So I’m resetting the clock again. I’m accepting the gap in entries for the past month, and will strive to keep up going forward. It’s not that there’s not enough material to write about, it’s just that I’ve got a lot of demands on my time these days. So bear with me as I try my best to keep up.

Which brings us to the topic at hand: OLED TV. Samsung and LG both showed 55″ monsters at CES, but since I didn’t attend, I didn’t see them. I did get to see them last week, up close and personal. And I was certainly impressed. After discussing them with my friend and colleague Ray Soneira of Displaymate, I went back and looked at them even harder. Ray said that they had OLEDs in general have terrible color shift with off-axis viewing. I have great respect for Ray’s ability to see and identify quality issues in displays, but try as I might, I could not see any hint of color shift on either OLED TV. (As it turns out, neither could he.) Now, if I had been able to throw some good test images on the screens (like you get with Displaymate), I might have been able to spot some differences. But from what I saw, they looked awesome.

Okay, so much for the good news.

Right off the bat, I am slapping LG’s wrist for claiming “infinite contrast” on their OLED TV sets. Yes, the screen probably puts out no light when displaying an all-black image, but that’s a pointless way to measure contrast. If you have a dark area next to a light area, I guarantee that some of that light will leak from the light area to the dark area. I’ll grant that these OLED screens will look terrific and have great contrast under these conditions, but the contrast ratio will definitely be something less than infinite. The bottom line is that “contrast ratio” as a meaningful specification for flat panel televisions is officially dead and LG holds the smoking gun. So from now on, ignore contrast ratio specifications and just trust your eyes.

And as good as the sets appeared, don’t start moving your LCD to the guest room just yet. Both LG and Samsung seem to be on track to ship an OLED TV model this year, but it may depend on your definition of “ship.” It is not clear that either company will be able to produce the OLED panels in large quantity this year. LG is relying on new and relatively untested “metal oxide” semiconductor technology to take the place of amorphous silicon. Even the OLED Association’s own forecasts show large panel production capacity to be just over 500 square meters per year for this year (but nearly tripling by next year). At a bit less than a square meter per 55″ OLED panel, that means that there’s only capacity to make 600,000 panels. And that’s IF they started in January, which they didn’t, and IF they were running around the clock, which they aren’t, and IF they are getting 100% yield, which would be a miracle. The consensus seems to be that the manufacturers will be lucky to build 100,000 OLED TV panels this year. Just putting one demo unit in every store that will want to carry them will eat up most of that production.

But you’ll probably want to wait in any case. The initial price projections are at about $7,500 to $8,500 per set. That’s a hefty premium over LCD. In his SID keynote speech, Dr. James Lee from LG projected that the price will drop to 1.5 times the LCD price by 2015, and will reach price parity by 2017. The way that LCD prices continue to tumble, however, those are aggressive forecasts and I will be amazed if the company can hit those goals.

So let’s sum up: gorgeous image, crazy expensive, unproven technologies, aggressive manufacturing expansion, and possibly overly optimistic about future pricing. As much as I’d love to have an OLED screen in my living room, I’m accepting the fact that it will probably be on a cell phone or tablet, and not on my television.

Comcast Partners with Skype

In a joint announcement last week, Comcast and Skype unveiled plans to provide video chat service to Xfinity customers. By adding an adapter box to their set-top box and a “high-quality” video camera, subscribers will be able to send or receive instant messages or video calls to any Skype user worldwide, including smart phones, tablets, and personal computers, as well as other Comcast subscribers who are equipped for Skype calls. The press release describes it as “HD video calling” though it does not provide specific details on resolution.

The service will support picture-in-picture, so you can have your video call in a small window on your television screen, or press a button to swap it so the Skype window is full screen and the program that you’re watching is in the small window. (I can see how investment types might find this useful as an inexpensive way to videoconference while keeping a financial news station open in the window.)

The service will roll out in Seattle and Boston first, with Detroit, Indianapolis, Miami, Atlanta, Augusta, Chicago, Pittsburgh and Harrisburg, PA following almost immediately after. Existing Xfinity triple-play customers can get a free three-month trial. According to the Comcast website, the service will cost $9.99 a month after the initial promotional period.

I’ve said all along that Skype in the living room has been a missed opportunity for the television makers. I believe that should have been advertising the pants off this feature ever since they started incorporating support for it in their HDTVs. Making it easy for grandparents to see and interact with young grandchildren is a hands-down winner, and Skype is a staple for people of all ages who want to stay in touch with distant family and friends. I think the $10 a month seems a bit steep, even when you figure in the rental of an adapter box, camera, and the new remote control. Still, given the high penetration rate of broadband connections in the home, I expect that there’s a large market for the service even at this rate. Who knows? Maybe this feature could be a competitive advantage that even might drive new customers to sign up with Comcast.

Alone Together: Is Split Screen TV a Good Idea?

Conventional wisdom has it that television remains a group activity. We are rapidly being assimilated by our personal mobile devices, and I often see two people together who are both busy texting or Facebooking or whatever on their smartphones. Then I read a blog entry by some DisplaySearch analysts that describe a new “smart dual view” technology from Samsung.

All this does is take a standard stereoscopic 3DTV, and set the shutter glasses so that both eyes see one frame at a time. This lets you have two people in the same room watching two different programs at the same time. The article doesn’t mention that each person would also need to be wearing headphones so that they only hear the soundtrack for their program.

This isn’t all that new. It’s really just a variation of the scheme that let video gamers see their player’s view in a full screen, without being able to “peek” at what their opponent is seeing. But I’m concerned about the idea of using it to “duplex” video content in the living room. Why bother with the big screen at all? For less money, you can each buy your own screen and then retire to your own personal corner or cave to watch whatever you want. No more fighting over the remote. No more negotiating about how we’ll watch one of “your” shows and then watch one of “my” shows. And no more having to talk to each other while you skip over the commercials.

I get it. Samsung is grasping at straws to find new ways to market the 3DTV technology until we get enough 3D content to make consumers want it for its original purpose. But I really don’t think that isolating people even more is the right solution.

What do you think? Send me an email at or a tweet to @AlfredPoor, and let me know if this is a good idea.