aNewDomain.net – Intel promises to transform your TV experience with an upcoming Internet video service and accompanying settop box later this year.
Intel’s new TV service faces a tough challenge — it must successfully carve out its own television niche as Apple, Google, Microsoft, Amazon, and others compete to do the same. The move by Intel is unusual but bold. Intel built its business supplying chips to PC manufacturers. As Intel’s chip sales have declined along with its PC sales, the company is looking to diversify its business by focusing more on the consumer market with smartphones, tablets, Ultrabooks, and now TV.
Still, is the highly-competitive and exclusive TV market the right place for Intel to wedge its way in? Or does a heavyweight like Intel care if it doesn’t succeed? The following are some key ways Intel has positioned itself to find success in the TV industry.
A Visionary Leader
Intel is hedging its bets with Eric Huggers, who is now vice president and general manager of Intel Media. Huggers previously worked at Microsoft and the BBC, where he helped launch iPlayer in 2007, an online service that gives viewers the ability to watch programs they missed on regular television.
Huggers said his marketing chief helped launch Apple’s “iProducts” and he has executives with experience from Netflix and the BBC on board.
Interestingly, in September 2010, Google hired Robert Kyncl, Netflix’s content chief, to be its chief negotiator with the studios. But it wasn’t until May 2011 that Google finally added 3,000 movies to rent. It took even longer for Google Play to be on par with other online services.
Collaborate with Content Providers
Netflix helped revolutionize TV viewing by partnering with content providers and offering streaming shows and movies. Yet even Netflix is bound by rigid licensing contracts. Microsoft, Apple, Sony, Dish Network, and now Intel have recently tried to negotiate contracts with media companies.
Huggers said he is working with providers and is confident Intel will have a compelling product to launch this year. Hugers still faces challenges. Reuters reports that Intel has struggled with the new TV service because major media content providers have been hesitant to let the company unbundle and license specific networks and shows at a rate cheaper than what cable and satellite partners pay.
Bernard Gershon, head of digital consultancy GershonMedia and a former Disney senior vice president for strategic planning who helped develop Disney’s online strategy, is skeptical that Intel can ink contracts with content providers.
Intel has tried before and failed several times with digital media distribution. In 2005 Intel launched ViiV in an attempt to make Intel-powered PCs, notebooks, and home theater PCs the entertainment centers of a digital home. Viiv did not succeed and was scrapped in 2008.
A Great Console
Intel may be able to make a great console, but can it compete with the likes of the next generation of Microsoft’s Xbox and Sony Playstation consoles, set to release this holiday season? Having a video game system, Blu-Ray player and access to Netflix on one console is appealing to many. After all, Sony was able to rule with its Blu-Ray format (over the HD DVD format) largely due to the popularity of the PS3.
Successfully Dealing with the Public
Intel has very little experience running a public-facing service or dealing with consumers, notes Digital Trends. It’s true. Intel has been comfortable interacting with its core customer base of OEMs, enterprises, and developers.
So the question is can Intel produce a product that customers actually enjoy, and then the support to back it up? Intel would need to develop the expertise and infrastructure to distribute digital TV programming in real time.
Right now Intel doesn’t have anything close to that.
Chandler Harris is a freelance business and technology writer located in Silicon Valley. He has written for numerous publications including Entrepreneur, InformationWeek, San Jose Magazine, Government Technology, Public CIO, AllBusiness.com, U.S. Banker, Digital Communities Magazine, Converge Magazine, Surfer’s Journal, Adventure Sports Magazine, ClearanceJobs.com, and the San Jose Business Journal.Tags: Business,Cloud,Downtime,Gadgets & Devices,Home,Lifestyle,Strategy,Technology