Google to Take on Cable and Pay TV? Sure. They Want To...

written by: Richard Kastelein

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Published on Sunday, 06 November 2011 12:41

The Wall Street Journal recently came out with an article describing Google's aspirations in offering offer paid cable-TV services to consumers - which is a move that could unleash a new wave of competition within the traditional TV business. And a move that will fit very nicely with Google TV Advertising platform - a project that has been quietly running for a couple of years behind the scenes.

Google TV Ads is an online marketplace that makes it easy for anyone to buy, sell and measure national cable television advertising. Using AdWords, you can launch a TV advertising campaign in minutes.

In 2010, Slate magazine ad critic Seth Stevenson tried out a Google service that allows one to run their own commercial on national TV for as little as $100.

Not only is Google stealthily moving into the value chain via the cable pipes, it appears they are not thinking small when it comes to fiber networks either.

When Google unveiled its plans to build a test broadband network in one market, in February of last year, it said it didn't intend to build a nationwide network. I predict they will.

And then there's TV production - as reported by Appmarket.tv last week,

Google Chairman Eric Schmidt told major players in broadcasting and the content business in Edinburgh earlier this year that:

Some have suggested Google should invest directly in TV content. To argue that misunderstands a key point: Google is a technology company. We provide platforms for people to engage with content and, through automated software, we show ads next to content that owners have chosen to put up. But we have neither the ambition nor the know-how to actually produce content on a large scale....But of course we are helping to fund content.

Yet rumours have been rampant since the WSJ reported in April 2011, that Google is overhauling Youtube to push more aggressively onto TV screens, competing head-to-head with broadcast and cable television for ad dollars. And they are willing to spend 100 million to do it. Now these channels will start coming online next month, as well as right on the big screen in the living room via Smart TVs, newer Blu-ray players, game consoles, many hybrid boxes such as Roku and Boxee.

The new channels will feature content from actress Amy Poehler, actor Ashton Kutcher and basketball star Shaquille O'Neal, as well as news and how-to content. Sounds like a lot more reality TV drivel. The new programming will include channels created by celebrities and producers from the fields of music, television, film, news and sports, said YouTube. 

At Appmarket.tv we have also reported previously that Google was planning a YouTube movie subscription service in UK, that Google was reaching for brand sponsorship of new 'Youtube Originals' - moving into video production, the wildfire rumour that didn't happen with Google to buy Hulu for $2 Billion?, and even going as far to Negotiate to Stream Live NBA, NHL Games on YouTube. Google acquired New Networks for this very move.

Let's stop from differentiating between Google TV and Youtube... they are merging and will be very much part of the same ecosystem in the future. Right now, Youtube is by far the most popular TV App on Connected TV Devices (...even a YouTube 3D Video App on the Samsung Smart TVs). It's lean-back, short form, and very compelling to the masses - the UK Internet population made more than 785 million visits to online video websites – an overall increase of 36% year-on-year and YouTube accounts for 70 per cent of that. Justin Bieber recently passed 2 billion views of his Youtube channel.

And Android has joined the party on the Google TV platform. Other companies are already building Android connected devices and TVs to compete with Google TV itself - starting with a slick HDTV from Sweden we reported on, and further with the Chinese who are starting to pump them out en masse.

If it's all sounding a bit disingenuous on Google's part - saying one thing and promptly doing another - that's because it probably is.... at least in my opinion.

They also say they are not, will not and have no intention of entering the travel industry. They now have launched Flight Search. This is said to be a worst-case scenario for online travel agencies such as Expedia and Priceline and travel metasearch engines such as Kayak and Bing Travel, which were concerned or fought Google’s acquisition of ITA Software six months ago. Expedia is certainly not happy.

On one hand, I am happy that Google is a source of massive disruption. Shaking things up is always great for entrepreneurs. On the other hand, they ought to just be open and transparent about it. Rather than saying one thing and doing another.