Connected TV: Coveting the Hearts & Minds of Developers
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When the connected TV market sorts itself out over the next few years, who will win?
The history of computer science is the history of evolution from closed to open -- that is, the evolution of a particular technology platform made available to a select elite who make money versus available to the masses where everyone participates in the treasure. That evolution has played itself out from the dawn of computer science in the 1950s to today. Firms that opened their platforms to developers and their employers have historically won. Winning is all about hearts and minds.
Univac invented the first computer used in business. They had “first mover advantage.” The first Univac 1 was delivered to the United States Census Bureau in 1951. The machine used 5,200 vacuum tubes and weighed 29,000 pounds (13 metric tons). My Dad worked on that computer for Univac in Minneapolis after leaving the Navy just after the Korean War. It's arguable that the Univac 1 and its successors put the first man on the moon. By the late 1950s, 46 had been sold and the Univac 1 was replaced by smaller, faster machines. Even so, the Univac 1 spawned innovation at several companies, but IBM quickly emerged as the market leader. In the 1960s, the industry was known as “IBM and the seven dwarfs.” IBM won because they made it easier to write code on their big iron.
Hearts and minds.
In the early 1970s when Bill Gates was in the eighth grade, the Mothers Club at Lakeside School used proceeds from the school's rummage sale to buy an ASR-33 teletype terminal and a block of computer time on a General Electric mainframe for the school's students. His experience at Lakeside led to Microsoft and to Windows 3.0 in 1990. With Windows 3.0 came the personal computer’s first widely available software development kit, an SDK that opened up application development to a vast world of developers who could write applications and make money on the emerging market of personal computers.
In the personal computer battle waged between Microsoft and Apple in the 1980s, the key to winning was clearly not a better user experience or the underlying operating system. The Mac was a better personal computer. It just didn't have the apps that Windows did. The battle was won on an open platform and its SDK that gave engineers and their companies an opportunity to realize a return on investment in their lines of code. Microsoft didn’t win because they had a better product. They won because they did a better job at capturing the hearts and minds of developers. When I was on the Windows Base Team in the late 1990s, we were never really worried about WIndows market share as we worked on the OS. What kept us up at night was making sure the work we did ensured developers would remain loyal to Windows development. The monopoly was never really about the product. It was always about keeping software engineers in our camp!
The cellular phone companies and the handset makers in the US didn’t learn much from the lessons of the personal computer battle that played out in the 1980s and 1990s with Microsoft on top. When the Qualcomm BREW SDK debuted in 2001, it was then and remains today a difficult environment for developers. The SDK is difficult to work with, the handsets are heterogeneous devices under the skin that need lots and lots of debugging, and the carrier distribution model is byzantine and obtuse. Getting an app onto a handset is a black art with enormous friction. For almost a decade, the handset OEMs worked with the carriers to reduce or eliminate that friction but had little success. Even today, getting an application onto one of 50 million Verizon BREW handsets is an enormously difficult challenge that costs a lot of money and takes months of sweat and treasure. Few were (or are) allowed in the walled garden so engineers looked elsewhere for a wanting suitor that came with a big dowry.
Enter Apple, the iPhone SDK, and the iPhone App Store in July 2008. It was immediately apparent that summer that Apple had learned from the errors it made in the PC war and the mobile app market was about to change in big ways.
While a great product, the iPhone is arguably not the best mobile phone in the world. Blackberry is better for business. Feature phones are better for plain old voice calls. However, the iPhone is the best mobile application platform in the world for both developers and consumers. The iPhone SDK is easy to work with, and the distribution model is transparent with little friction and the apps are good and voluminous. "There's an app for that!" iPhone is to the PC what the PC was to the mainframe of the 1980s. Open versus closed. No walled garden. Apple has become the richest technology company in the world not because Apple necessarily has the best product but because they’ve done the best job at creating an economic model where everyone can win.
Hearts and minds.
Having spent years in automotive working on delivering the web to new cars, I worked on the closed or walled garden approach with the automakers who were and are afraid of apps breaking their cars. Their general approach is to develop and deliver a computing platform that is tightly controlled with all the choices for features and the user experience made by a select, elite few who "know what consumers want." It is the archetype of the closed (failed) versus open approach. A classic walled garden.
That’s why L4 has chosen the connected TV market.
The connected TV platform enablers appear to have learned from studying the battles that played out in computer science over the last 60 years. The automakers have not with the notable exception of Ford, which is investing in an open development model with their Sync platform.
The Yahoo! Connected TV platform, like the Windows 3.0 SDK and the iPhone SDK that came before, is easy to get, easy to work with, and has an open, frictionless distribution model. Yahoo!, with their TV maker customers Samsung, Sony, Vizio, and LG have created an open channel to consumers for companies around the world that will be able to build a business in an open market. Write a great connected TV app, ensure it meets quality standards for certification, and Yahoo! will ensure the app at least has access to eyeballs in a massive market -- the living room. In short, Yahoo! is capturing the hearts and minds of developers by creating an economy where everyone with a good idea and a little money can build a business. Google is doing the same thing now with Google TV.
That said, there is a difference between Google and Yahoo! On LinkedIn, the largest social network in the world for business, Yahoo! has 46 members in their group. Even though Yahoo! has had a product in market much longer, and Google only has a press release and a video demo, there are 588 members in the Google TV group.
Why? Why does Google have 13 times more mindshare on LinkedIn than Yahoo! does when Yahoo! has had a product in market for years and is releasing the third generation of their SDK?
Google has a history of delivering open platforms that enable engineers and their employers to make money. Search. Ads. Maps. Mobile phones. Now TV. Google has earned a coveted place in the hearts and minds of developers. Google gets what we got at Microsoft in the late 1990s. Lure developers to your camp and keep 'em happy. Yahoo! has not managed to do that just yet. The connected TV market is capitalism at its best. Open and frictionless.
At L4 Systems, we have to make a bet. We can’t simultaneously develop on three platforms: the web and Google TV and Yahoo! Connected TV. Where will we choose to invest our precious treasure? For now, while not immediately obvious unless you're in the industry, we will launch our product on the Yahoo! platform and then quickly port to Google. We will bet on both. May the most open platform win (as long as we do on the way too).
Hearts and minds!
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