Revisiting Microsoft’s Xbox SmartGlass Platform

Last week I had the opportunity to moderate a second screen panel and attend several other panels and presentations at the Variety Entertainment App Summit in LA.  While I greatly enjoyed the panel on second screen monetization with YuMe, Magic Ruby, Cinram/1K and MTV, I thought the most eye-opening session was the presentation of Microsoft Xbox SmartGlass by Mark Turner.  While I had seen Ron Pessner present something similar back at a 2nd Screen Society in NY last June and I had been playing with the platform at home for the past 2 weeks (and even wrote about it last week), somehow the epiphany of just how big this could be for the entire second screen ecosystem had escaped me.  Let me talk you through the key points they get me excited and explain why I spent this weekend re-exploring the platform at home.



Context:

• Nearly 60m Xbox consoles have sold worldwide, nearly 40m of them believed to be in the U.S.  Half of those Xbox consoles subscribe to Xbox online services--even if we use the same ratio as installs to be conservative (the U.S. rate is likely much higher), that gives Xbox more than 20m homes in the U.S.--roughly as many as Comcast or Netflix.
• Microsoft's stated goals with the second screen platform are to enable 1) Discovery and Control, 2) Immersive Entertainment, 3) better Gaming.  
• Principles as stated in a slide by Mark: 
• 1) Connect via People and Content, not devices.  There are only 5 different versions of the platforms in terms of UI: Android, Microsoft Windows 8 PC/Tablet, Microsoft Phone, iPhone, iPad
• 2) Each screen magically tunes to me.  This is a REALLY BIG deal and we will talk about this most of the blog.
• 3) Each screen as a "superpower" and the 2 screens cooperate together.
• 4) There is a clear focus at any given time between the screen.
• 5) Every second screen experience provides and end-to-end consumer experience. 
• Development of the experiences is done by the content rights holder (game, video, music) in a web-based CMS using HTML 5 and Javascript.

Better than bonus material? What Second Screen could do for title sell-thru

When DVD's first arrived on the scene back in the late '90s, the majority of consumers thought they were a significant leap ahead of VHS tapes because of their size, ability to quickly access anywhere on the disc, better picture quality, etc.  But as the industry realized the opportunity to create a sell-thru model (vs. the rental model with VHS), they started trying to figure out what it would take to get consumers to collect or gift DVD's (the biggest reason for purchases).

Consumer Electronics Companies To Develop 3D Glasses Standard

Working together as the “Full HD 3D Glasses Initiative,” four consumer electronics companies intend to commercialize a backward-compatible standard for 3D glasses beginning next year.

Panasonic Corp., Samsung Electronics Co., Ltd., Sony Corp. and X6D Limited (XPAND 3D) will jointly develop and license the radio frequency (RF) technology for “active-shutter” 3D glasses, including RF system protocols for 3D televisions, personal computer displays, and certain theaters. The standardization will also include multiple types of infrared (IR) system protocols between 3D active glasses and 3D displays, ranging from the protocols already jointly developed by Panasonic and XPAND 3D, to the proprietary protocols of Samsung and Sony, respectively.

Announcing the plans in a statement, Masayuki Kozuka, general manager of Panasonic’s Media & Content Alliance Office, said, “We hope the expanded collaboration on this 3D standardization initiative will make a significant contribution toward accelerating the growth of 3D-related products.”

More at Consumer Reports, which notes that the companies are eager to make active 3D technology more competitive with “passive” 3D systems, whose glasses are more lightweight, less expensive, and already standardized.

Sony’s Crackle Offers Ad-Supported Movie Streams on Connected TVs

Sony Pictures’ online video network, Crackle, has begun to offer free streams of ad-supported movies and TV series to all consumers with PlayStation 3 game consoles, as well as owners of Roku streaming players, Sony Blu-ray players and certain Bravia television models.

The announcement marks a service expansion for Crackle, which was a launch partner of Google TV late last year.

The network claims to offer hundreds of Hollywood films, along with thousands of television show episodes and original programming.

Sony Regroups Business Units, Promotes Hirai

Sony Corp. plans to realign its core businesses into two groups — one focused on consumer products, the other on professional products — as its board of directors mulls an eventual successor to chief executive Howard Stringer.

Kazuo Hirai, current head of Sony’s gaming unit, will now oversee all of the company’s consumer electronics businesses, in a likely preparation for Stringer’s post.

Stringer — who has extended his commitment with Sony, adding the title of president as part of the reorganization — told reporters in Tokyo that he had discussed a succession plan with the Sony board (via The Hollywood Reporter). While the board has not yet made a final decision, Stringer said, assigning greater responsibilities to Hirai represents “an opportunity for the board to watch Hirai-san and to judge his performance.”

In its announcement of the reorganziation, Sony credits Hirai with leading “the turnaround of the games business [and expanding] the PlayStation Network — which now boasts more than 74 million registered accounts worldwide.”

Meanwhile, Sony’s new Professional & Device Solutions Group — which includes broadcast and professional products, as well as semiconductors and batteries — will be led by Hiroshi Yoshioka, Sony’s executive deputy president.

Apple Still Sits Atop Digital Movie Market

Apple’s iTunes store accounted for nearly two thirds of U.S. electronic sell-through and Internet video-on-demand consumer spending combined in 2010 (64.5%), according to new research from IHS Screen Digest.

While Apple’s total market share declined from 74.4% in 2009, the research firm notes that the company’s continued dominance coincides with a 60% revenue increase in the overall EST/iVOD movie business during the year.

IHS research director Arash Amel notes that while competing services proliferated in 2010, “iTunes managed to grow because of the introductions of the iPad and the second-generation Apple TV, which have spurred the company’s movie rental offerings and have invigorated the iTunes multi-screen ecosystem.

“We expect that in the United States, Apple’s strong performance in iVOD will allow it to continue to bypass the video on demand services offered by many major cable operators,” Amel adds.

Microsoft’s Zune video platform claimed the No. 2 spot for EST/iVOD consumer spending in 2010, with a 17.9% share, followed by Sony’s PlayStation store (7.2% share).

More details at iSuppli.

Apple Rejects Sony E-Reader App: Report

As digital commerce continues to heat up, Apple is now requiring retail app developers to offer an in-app purchasing option for content such as e-books, the New York Times reports.

The new requirement comes to light following Apple’s rejection of a Sony iPhone app that would have let users purchase and read e-books from Sony’s Reader Store.

Sony’s app would have operated like Amazon’s Kindle app for the iPhone and iPad, which opens a browser window to enable new content purchases over the Web. Under Apple’s new requirement, the developers must offer users an in-app purchase option as well — with such purchases subject to a 30% revenue cut for Apple.

The news follows a similar rift in January between Google’s Android market and social game site Kongregate.

Nintendo 3DS Set For March Release; New Sony PSP Details Leaked

Nintendo announced today that it will release its next-generation handheld gaming device, the 3DS, on March 25 in Europe and March 27 in the U.S. Games for the $249 device will feature simulated 3D graphics that can be seen by the naked eye; Nintendo expects publishers to release more than 30 titles between the March launch and the game industry’s E3 trade show in June. In Europe, Nintendo also has inked exclusive deals with content companies such as Eurosport to wirelessly stream 3D videos to devices. More at Engadget.

Meanwhile, new unconfirmed details are surfacing today regarding a rumored game-playing smartphone from Nintendo archrival Sony.

Sony plans to unveil the device in February, according to Bloomberg. The company will first announce an updated PlayStation Portable on Jan. 27, along with a new strategy for networked entertainment services. Bloomberg cites anonymous sources familiar with the plans.

Soft Showing for Google TV at CES: Report

Following a tepid consumer response to the launch of Google TV this fall, Google has asked consumer electronics makers including Toshiba, LG Electronics, and Sharp to delay their introduction of TVs and other devices featuring the service, according to the New York Times. That likely means a muted presence for the Internet TV service at the Consumer Electronics Show in Las Vegas early next month.

Sony and Logitech joined Google for the launch of Google TV in October. Samsung still plans to exhibit new Google TV products on the CES show floor, while Vizio will host private demonstrations of its Google TV implementation off site, the Times reports.

Hulu Drops Plus Price; Vudu Coming to PlayStation Network Next Week

First launched in a “preview” version in July, the Hulu Plus subscription service is now generally available, with the online video site dropping its monthly price to $7.99 to step up its competition with Netflix.

In a blog post Hulu says that current subscribers who joined during the preview period would receive a credit for the difference from original $9.99/month price.

As of today, the Internet TV service is available on devices including Roku boxes and PlayStation 3 consoles; Hulu said Plus would come to a range of other devices, including Blu-ray players from Panasonic and LG Electronics and the Xbox 360 system, in the months to come.

In other Internet TV news, the Vudu movies-on-demand service is set for debut on Sony’s PlayStation Network next week (via ZDNet). The Walmart-owned company will begin offering its 4,000-film catalog to PlayStation 3 users on Nov. 23, with two-night rentals starting at $2.

Vudu also unveiled plans to upgrade its user interface by the end of the year, sharing snapshots of Vudu 2.0 on its corporate blog.

Hulu Expands Premium Streaming Service

Those interested in Hulu’s paid “Plus” option no longer need an invitation to subscribe to the service, as the major-broadcaster-backed streaming company adds more TV shows and hardware compatibility to its offering. Hulu said in a blog post yesterday that it has recently added new fall TV series such as Fox’s “Raising Hope,” ABC’s “No Ordinary Family,” and NBC’s “The Event” to the Plus service’s catalog.

The company also announced the availability of Hulu Plus on Sony Bravia 2010 TVs, with the service expanding to other Bravia devices “in the near future.” In addition, PlayStation 3 owners with a PlayStation Network account will be able to subscribe to Hulu Plus with the release of an updated application for the console next week.

End of the Line For Sony’s Cassette Walkman

More than 30 years after introducing the portable Walkman cassette player, Sony has ended production of the device, according to Japanese media reports (via the Huffington Post). The company has sold more than 220 million cassette Walkmans since the device’s 1979 debut; Chinese firms have a license to continue producing Walkmans for sale in Asia and the Middle East. Sony published a history of the Walkman on the 20th anniversary of the player in 1998, a year which also saw upstart electronics brands market the first portable MP3 players.

The successor to the portable music market, Apple’s iPod, has sold 278.5 million units worldwide since 2002, according to a tabulation of the company’s quarterly sales figures. Yet a thirty-year run seems unlikely for the device. Even as Apple introduces new models, iPod sales are on the wane: the company reported an 11% year-over-year unit decline for the device during its most recent quarter (ended Sept. 30).

A Preview of the Google TV User Experience

An ABC Nightline segment previewing Google TV takes a passing glance at the remote control for Sony’s forthcoming Google TV-compatible display (in stores Oct. 12). Geek-tech site Engadget hits pause on the Nightline segment to consider the Sony controller itself, and what it may indicate about the overall Google TV experience.

The handheld controller cuts a WebTV-meets-PlayStation profile, featuring dual navigation pads and a full QWERTY keyboard to facilitate text searches. (Fellow electronics maker Logitech, in comparison, offers a full-size keyboard with in its Google TV product, the Revue set-top box.)

Engadget gushed yesterday about the Sony controller: “[It’s] everything you’d need to rock the web and video all at once….[M]an does October 12th look even more painfully far away.” Others take a more critical view of the putative future of television’s navigational interface.

TechCrunch, for one, expresses the hope that Google TV remote control apps are in the offing for Android phones, similar to the apps available for iPhones and iPads to control Apple TV. (Google’s Rishi Chandra appears to be playing with such an app at the end of the Nightline piece, viewable via Hulu on the Engadget site.)

Apps Will Be Key Feature of Google TV

The Google TV service will launch with apps including Netflix, Pandora, and Amazon’s Video on Demand, with the company planning to open the platform up for independent app development in 2011. So says Google on its newly unveiled promotional site for the service, which electronics makers such as Sony and Logitech are integrating into “smart” TVs, Blu-ray players, and set-top boxes for introduction this fall.

Google also announced content partnerships with several television networks, including HBO and Turner Broadcasting; but its general focus differs from the rental model put forth by the rival Apple TV service. More at TechCrunch and the New York Times.

NPD: Despite Success of ‘Madden’ And PS3, Game Sales Slipped 10% In August

Sales of EA’s latest “Madden NFL” installment, which the publisher releases annually in August, sold 1.8 million copies last month — a 6% increase from the franchise’s sales in August 2009, according to the NPD Group. Meanwhile, the research firm notes that sales of Sony’s PlayStation 3 console rose for the thirteenth consecutive month, with the hardware maker still generating momentum from its price cut of the system to $299 last summer.

Overall, however, the videogame industry saw a 10% decline in sales of games and hardware during August, to $818.9 million. Sales of software declined 14% year-over-year during the month, to $403.5 million.

More at the Los Angeles Times.

Federal Appeals Court Favors Patent Pools In CD-R Case

A divided U.S. Court of Appeals for the Federal Circuit recently held that patent pools may legitimately bar licensees from using or licensing competing technology, handing Philips a victory in its years-long legal battle against recordable CD maker Princo.

Philips — which together with Sony licenses CD-R patents as the “Orange Book” standard — issued Princo a license in the late 1990s, but sued the manufacturer at the International Trade Commission after Princo stopped paying royalties. Princo accused Philips of patent misuse, arguing that the Orange Book licensing agreement had anticompetitive effects. The majority of the Federal Circuit found the opposite — although two dissenting justices wrote that a patent misuse defense should be available when patent pools effectively seek to suppress alternative technology.

Sean Gates, an antitrust and intellectual property specialist at law firm Morrison & Foerster, gives a comprehensive overview of the case’s background and ramifications at Lexology. Law.com has responses from the parties and interested trade groups.

Analyst Raises Sales Projections For Microsoft’s Kinect

Lazard Capital market analyst Colin Sebastian is looking for Microsoft’s Kinect motion sensor to sell four million units worldwide in the fourth quarter of 2010. The analyst said in a note to investors (via MCV) that the videogame accessory, which Microsoft plans to release Nov. 4, is building more buzz in the marketplace than Sony’s competing Move motion controller (which is due in North America Sept. 19).

Sebastian also noted that with Microsoft ramping up its Kinect manufacturing to some two million units a month, price promotions on the $149 sensor could be in the offing.

Wii Sales Top 30 Million In U.S., Nintendo Says

Nintendo said yesterday that its Wii console had topped 30 million units in the U.S. since its introduction in November, 2006 — reaching the unit sales mark faster than Sony’s PlayStation 2. (via Information Week). Worldwide, the Wii has sold 73 million units to date — roughly half the 140 million units claimed by the PS2, which remains the game industry’s best seller, according to USA Today.

Microsoft Prices Kinect Game Accessory At $150

Microsoft says it will market the Kinect motion/voice sensor in November as a $149.99 accessory for the Xbox 360 console. The company also will sell a new version of the Xbox 360 system bundles with Kinect for $299.99.

The pricing matches pre-announcement reporting by game blog Gamasutra – which earlier this month quoted analysts as stating that a price point over $100 has potential to “severely limit sales.” But the price might be OK, Wedbush analysts Michael Pachter and Edward Woo said, if Microsoft expects constrained supply during launch.

Sony’s rival motion control platform for PlayStation, the Move, arrives in September with a price point of $99. That price includes a camera, controller, and Move-enabled videogame.

TV Advertisers Weigh In On 3D Home Entertainment

Time for more musing on the prospects of 3D home entertainment, as Sony launches its line of 3D TVs and ESPN flips the switch on its 3D channel for World Cup telecasts. The Wall Street Journal profiles the first 3D advertising campaigns from Sony as well as Procter + Gamble’s Gillette brand and Disney’s Pixar (for “Toy Story 3”) that will run on the ESPN channel. High production costs has other advertisers tempering their enthusiasm for the technology: sources estimate the premium for a 3D ad spot to range between 30% and 40%. Meanwhile, New York Times advertising columnist Stuart Elliott reports from a panel discussion in Manhattan on marketers’ emerging 3D opportunities.

Sony Consolidates Blu-ray Hardware Manufacturing

Sony announced June 2 that it will discontinue production of Blu-ray Disc players and DVD recorders at its Hungarian manufacturing site, consolidating operations into a Malaysian subsidiary to improve profitability and efficiency. The Hungary facility is scheduled to cease operations in December 2010. Sony Corp.

PlayStation Store Shifts DLC Release Day

Online PlayStation 3 gamers will now have a day’s jump on the Xbox 360 audience for new downloadable content, as the Sony-owned digital distribution network moves its release date from Thursday to Tuesday. First content to be released under the new schedule next week includes an expansion package for Activision’s “Call of Duty: Modern Warfare 2” and a downloadable game for Sony’s PSP device. By Kotaku

NYT On ‘How TV Makers Are Selling The Idea Of 3D At Home’

The New York Times profiles Samsung Electronics, Panasonic, and other electronics brands in their attempts to convince consumers that 3D home entertainment is here to stay. Marketers have their work cut out for them in meeting forecasts that state between 3.5 million and 4 million 3D TV sets will be sold in the U.S. this year. But brands are upbeat: Samsung, for example, says that some 2,000 early adopters had purchased its first 3D HDTV models within two weeks of their launch. By The New York Times

Google Seeks TV Foothold With Intel, Sony

Google and Intel have teamed with Sony to develop a platform called Google TV to bring the Web into the living room through a new generation of televisions and set-top boxes. The move is an effort by Google and Intel to extend their dominance of computing to television, an arena where they have little sway. For Sony, which has struggled to retain a pricing and technological advantage in the competitive TV hardware market, the partnership is an effort to get a leg up on competitors. By The New York Times

Sony, Panasonic, Others Gear Up For 3D TV Blitz

Sony Corp. expects to increase its TV shipments by 70 percent over the next 12 months, due in large part to its upcoming 3D models, according to Sony executives.  Panasonic, meanwhile, said it’s planning to introduce 3D TVs at Best Buy this week for $2,500, about half the price they’re available for in Japan. By ChannelWeb

CBS, Sony Team On 3D Research

The research center and screening facility will focus on consumer preferences and perceptions toward 3D programming, as well as how broadcasters and studios can best deliver 3D content for viewing both in and out of the home. “The Sony 3D Experience” will be located within the expanded CBS Television City research facility at MGM Grand Hotel & Casino in Las Vegas. The new center is also being supported by RealD, which is providing its advanced 3D filters and eyewear. Via PR Newswire

Sony Opens 3D Technology Center

Sony Corp. has opened the Sony 3D Technology Center at Sony Pictures Studios in Culver City, CA, with the goal of training cinematographers, directors, game developers and others in the art and science of 3D production and post. By Studio Daily

Report: Sony Mulls Catalog ‘Conversions’ For Blu-ray 3D

A Sony executive tells Bloomberg in Tokyo that the studio could begin marketing 3D versions of catalog films within a year’s time. “Companies specializing in conversion processes are starting up in India,” the Sony executive notes, “and the infrastructure is getting prepared.” Via New Zealand Herald

Price Cuts Spur Videogame Console Sales: NPD

The current generation of videogame console hardware has outsold the last by more than nine million units to date, according to the NPD Group.

Overall console hardware revenues declined 13% during 2009, a year that saw significant price drops on Sony’s PlayStation 3, the Nintendo Wii, and Microsoft’s Xbox 360. The price cuts have spurred unit sales growth, however: overall hardware sales for the month of December increased 16% year-over-year.

The month was the first in which Sony — which reduced the price of the PS3 by $100 in September, to $299 — sold more than one million PS3 consoles. The Wii, whose price fell to $199 ahead of the holidays,  also experienced its biggest-ever sales month in December, with 3.8 million consoles sold. NPD

Sony Slates Its First 3D Blu-ray Products For Summer

Sony Electronics made one of the first 3D product announcements as the Consumer Electronics Show got under way in Las Vegas yesterday. The forthcoming 3D Blu-ray player also will feature access to the Bravia Internet Video platform, which includes Netflix, Amazon Video on Demand, YouTube, Pandora, Slacker, and NPR streaming capability. Sony has not yet disclosed pricing. By CNET

Sony, Panasonic Eye Blu-ray Capacity Increase

New technology from Sony and Panasonic could enable Blu-ray manufacturers to boost the format’s per-layer disc capacity from 25GB to 33.4GB. Existing players would likely be able to read the higher-capacity discs with a firmware upgrade. Via Blu-ray.com

Sony Plans Its Own Online Store

At an event in Tokyo yesterday, Sony offered a glimpse at a would-be iTunes rival that would sell movies, music, books, and other downloadable applications for mobile products. By Business Week

PS3 Posts Gains In October, But Game Sales Stumble

Sony’s PlayStation 3 was the only game console to realize a year-over-year sales increase in October, selling 321,000 units during the month, according to data from the NPD Group. Videogame software sales fell to $573 million, an 18% decline from last year’s record $698 million. By PC World

Disney Movies ‘Up’ For Sale At PlayStation Store

Sony’s PlayStation Store will offer its first Disney movies for electronic sell-through, starting today with “Up,” day and date with its DVD and Blu-ray Disc release. “Up” is one of about 80 Walt Disney Studios Home Entertainment movies now available to own through PlayStation Store, which delivers digital game/movie/TV content to the PlayStation 3 and PlayStation Portable consoles. Up until this point, PlayStation’s online marketplace only offered Disney films for electronic rental. By Video Business

Notes From Blu-Con: Studios Look For Sell-Through To Rebound As Recession Lifts

Executives convening at Blu-Con 2.0 in Los Angeles today are trading insights and observations on the state of the Blu-ray Disc business. Among them:

• Studio chiefs expect home entertainment consumers to shift back to a sell-though model as the recession eases, according to a Video Business tweet from one of the conference’s keynote sessions.

• Meanwhile, Home Media Magazine relays Sony’s statement  that the PlayStation 3 console still comprises 60% of the Blu-ray hardware market. Separately, Best Buy’s Mike Vitelli notes that portability is the format’s biggest challenge.

Sony To Offer Netflix Streaming To PS3 Users

Netflix is gaining another digital link to living-room TVs, in a deal with Sony to offer the company’s “Watch Instantly” streaming service via Web-connected PlayStation 3 consoles.

Beginning next month, Sony’s PlayStation Network will offer Netflix streaming at no additional cost to Netflix subscribers who also own the console. For Sony, the agreement brings to the PS3 an enhancement that Microsoft has offered on the rival Xbox 360 console since November 2008. Microsoft integrates Netflix access within the paid version of its Xbox Live network.

Initially, at least, there is a catch with the Sony-Netflix service: users must rent a special Blu-ray disc from Netflix, load it into their players, and access the streaming service via the disc’s BD Live features.

Streaming has proven to be popular with Netflix subscribers. About 42% of Netflix’s 11.1 million subscribers streamed at least 15 minutes of a TV show or movie during the company’s third quarter, up from 22% in 2008, CEO Reed Hastings told analysts in a conference call last week.

Unlimited streaming comes as part of Netflix’s $8.99 monthly subscription plan. New-release films and current TV seasons are largely absent from the service. But that could change if current discussions between Netflix and studios lead to a new home entertainment release window scheme.

Higher-Capacity PS3 Will Allow For More Downloads

Sony plans to release on Nov. 3 a PlayStation 3 console with 250GB of built-in storage for $349, a $50 premium over the company’s 120GB model. Sony’s digital PlayStation storefront offers movie downloads as well as games. By Video Business

Amazon Selling PlayStation Download Codes

Sony Computer Entertainment broadens its retail reach for game downloads, with Amazon now selling access codes for games on Sony’s digital PlayStation Network. Via PlayStation.com

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