They may not be ebony and ivory, but as I’ve said in the past, Blu-ray and video downloads can live together in perfect harmony. When I see people saying things like ‘Blu-ray is DOA’ because downloads will kill it, I tend to either snicker or roll my eyes, or both. Because, while I agree that someday downloads will probably kill off physical media, that day is years away. Many years. People point to music download services, like iTunes, as an example - and I’ll point out that the vast majority of music is still sold on physical media, and downloads have a long way to go before they kill CD. (I buy all of my music via download, CD is a last resort.) And video downloads are many times the size of music downloads.

With video downloads it is always a compromise between speed and quality. For instant gratification you have streaming video, but that’s the lowest quality. Broadband speed limitations restrict the maximum possible streaming bitrates. Downloads can offer higher bitrates, but still require fat pipes to be feasible, and, of course, storage. But even the best download services don’t come close to matching the picture quality of Blu-ray, because they can’t match the bitrates. And don’t even get into bonus features, lossless audio (Dolby TrueHD or DTS HD-MA), multiple audio and subtitle tracks, etc. With most commercial Blu-ray titles using between 30GB or more of disc capacity, we’re not going to be downloading content at that quality in the near future.

So I was a little gratified to see this article in CE Pro, entitled Blu-ray and Downloads: Why Both Are Worth Offering. CE Pro is an industry magazine with a primary audience of consumer electronics professionals, the kind of folks who install custom systems in high end homes. The article focuses on Blu-ray for physical media and VUDU for downloads, but Amazon Unbox on TiVo, iTunes on Apple TV, Xbox 360, PlayStation3, NetFlix, etc, are all possible broadband video options for the consumer. Downloads aren’t about to replace discs for those who prefer a quality viewing experience, but downloads offer the kind of instant gratification that discs can’t match. I think having both available is the best approach, the best of both worlds.

InteractiveTV Today (itvt) recently interviewed Tara Maitra, VP and General Manager of Content Services at TiVo. Tara is in charge of TiVo’s broadband strategy - TiVoCast, Unbox, YouTube, Rhapsody, etc. - so the interview is worth reading in its entirety. But there are some tidbits that caught my eye in particular:

Of the 1.7 million broadband-enabled TiVo boxes that have been deployed in consumers’ homes, approximately 800,000 are actually connected to a broadband pipe. Over a period of a little more than a year, those 800,000 boxes have generated over 20 million downloads.

So just under half of TiVo standalone boxes that are capable of being connected to broadband are. I believe that percentage has been steadily increasing over time. That 20 million downloads is an average of 25 per box per year. I easily average better than 25 *per week* with all of the TiVoCasts and TiVo Web Video downloads I subscribe to.

And this is some interesting info relating to the YouTube deployment on TiVo:

We’re working on developing the technology infrastructure for this now, and the feature should be available sometime this summer. From a technology perspective, implementing this feature requires us to enable streaming on TiVo devices–which is something that we have not supported previously. So this YouTube capability will be our first foray into enabling streaming through the TiVo service.

I think that one of the major payoffs for the YouTube addition will be the basic foundation for streaming on TiVo. Hopefully this ability will finally allow streaming between TiVos (hinted at by Tom Rogers recently) as well as support for other streaming services like Amazon’s planned Unbox streaming, and perhaps Netflix’s streaming.

If you have any interest in TiVo’s broadband content offerings, you should read the full interview.

In a post to PlayStation.Blog, Peter Dille, Senior Vice President, Marketing & PLAYSTATION Network, lists a number of updates, games, and features coming to the PlayStation3 in 2008. The one I’m most interested in is the long-awaited downloadable content. Sony has been talking about providing real, full-length entertainment video downloads (not just trailers and such) for a while now, and it sounds like it is finally getting close:

Many of you have been hearing rumblings about a video service that will allow you to download full-length TV shows and movies via PLAYSTATION Network for North America. While I don’t have any new announcements here for the PlayStation Nation, it’s already been confirmed that we’ll be offering a video service for PS3 in a way that separates the service from others you’ve seen or used. Ultimately the goal of the PLAYSTATION Network service will be to break through the overwhelming clutter of digital media to give you the TV, movies and gaming content you want. More on this very soon …

I’m very curious as to what Sony will offer, especially if they offer HD downloads with better quality than what the others are offering today.

PlayTeeVee has posted a video to YouTube which previews the free games they make available to TiVo owners:

Picked up from TiVo Blog.

Well, it seems like Netflix is finally making a move to bring their Internet streaming service to the TV, as hinted at in their last quarterly call, and they’d partnered with LG Electronics to do it. They’re reportedly developing a set-top box with LG Electronics which will allow users to view streaming movies directly on their TV.

Personally, as I’ve said repeatedly in the past, I think a dedicated STB is a bad move. Unless they can make it dirt cheap, and I mean $99 or less, I don’t think a dedicated client STB is a good option. Remember, this is simply a device which provides access to a service you have to pay for via your subscription. And if it is just going to handle the streaming, then it doesn’t need to be that powerful.

But it sounds like they may have taken the route I’ve suggested before, making this a service that will be included on other boxes:

The leader of online DVD rentals will be entering an increasingly crowded and confusing market when it rolls out the new device via an LG-networked player sometime in the second half of 2008.

And:

Pricing and other specific details of the LG product were not available, but a person with knowledge of the situation said LG would likely embed the receiver into its $799 dual-DVD player, which supports the competing Blu-ray and HD-DVD high-definition DVD formats.

So they may be embedding this as a thin software client into LG’s DVD and/or Blu-ray product line. That would follow from what was said on the conference call, and it seems to make more sense than producing a dedicated Netflix STB. Certainly, a DVD or Blu-ray player which also happened to support the streaming service is a much better value proposition than a single-purpose streaming STB.

Actually, that’s another issue, I don’t know that Netflix’s streaming service is going to hold up to being displayed on large screens. It certainly is not going to be HD content as very, very few people have broadband connections fast enough to stream real HD content. Even if limited to 720p using H.264 it would be tough to stream real-time without massively over-compressing the stream. This is probably going to be limited to SD content, maybe 480p streams upscaled by the player - like a DVD. In a world increasingly going HD, that seems iffy. Especially with competitors like VUDU going HD, and Amazon Unbox/TiVo expected to go HD soon as well.

On the other hand, being a streaming-only service does reduce their hardware requirements, particularly in storage, and that could make it easier for Netflix to land additional partners. All HD DVD players have network interfaces, and a growing number of Blu-ray players do as well. TiVo is still a possibility, reviving their old partnership, though likely only on the Series3 and TiVo HD as the older boxes can’t handle the newer codecs. (And streaming MPEG-2 is unlikely.) Just about any media center extender product would be a candidate too. But the first thing to come to mind for me was actually the Sling Media SlingCatcher product, now due in 2008.

Hastings said the LG partnership was the first of many such deals for Netflix. “We’d like to see a hundred Netflix-capable boxes,” he said, noting he also was exploring partnerships with makers of Internet-connected game consoles, cable and satellite companies.

Still a lot of unanswered questions. But we’ll probably see and hear some more at CES next week.

From EngadgetHD.

EDIT/UPDATE: The New York Times has an article today which offers a bit more info. It confirms that the streams will not be HD, at least initially. And it has this:

The deal with LG is something of a strategy shift for Netflix. The company had been experimenting with building its own Netflix-brand set-top box. Last spring, to help create the device, the company hired Anthony Wood, the founder of ReplayTV and a pioneer of the digital video recorder.

But Mr. Hastings said that integrating Netflix into other companies’ devices made more sense. He said Mr. Wood would soon leave Netflix to return to another company he founded, Roku.

So it does seem that Netflix had been toying with their own STB, as rumored for a while. But they came to the same conclusion I’ve expressed all along - something like this is better as a service embedded in other boxes, than part of a standalone box. Standalone boxes that do nothing but download movies have not done well - see Akimbo and Moviebeam, Akimbo morphed into a service for Windows and dropped the boxes, Moviebeam is dead. I don’t think VUDU will be successful either, unless they can sell the box for $99 or less - then maybe. But it is still better to be a value-add on a box with other features.

I first reported on XStremeHD just a few weeks ago, when they dropped a press release which was sparse on details. There still isn’t a lot to go on, as they’re holding their cards close to the vest in anticipation of making announcements at CES next month. Some details are starting to trickle out however. From their CES page we can glean that they’re using Seagate hard drives, and that they’re using DTS to encode their 7.1 audio.

An article in PC Magazine sheds a little more light. XStremeHD will have a ’server’ in the home, which receives the content from the satellite. There will be three models of server, with capacities ranging from 500GB to 2TB, with the low end storing 30 to 70 titles, and the high end up to 280. (I’m guessing the third, unmentioned size is 1TB.) The server can distribute content to media receivers around the home.

XStremeHD will used leased transponder capacity to delivery content to a small dish at the home. Which satellites will be used is unknown, but it is known that they will not be using DirecTV or DISH Network birds. Users will be able to self-install the dish, or they can utilize an installer to set everything up. Content will be distributed in MPEG-2 or MPEG-4 formats in full 1080p, with audio up to 7.1 channels. That compares favorably with Blu-ray or HD DVD for movies.

What isn’t clear is the way the content will be distributed. Will be a pre-downloaded, as Moviebeam used to do, so that users can only watch the films already stored locally? Or will it use on-demand streaming to provide a wider assortment of content, like VUDU does? Or some combination, say where the first X minutes of a number of programs are stored locally and the rest is pulled down dynamically, to allow immediate viewing while giving the system time to download more? The article doesn’t really clarify that at all. It opens with this:

A new service that will fill a set-top box with high-definition, pre-downloaded movies will launch early next year…

But it later states:

The technology will apparently use streaming; Gonzalez claimed that consumers will be able to watch movies within five minutes.

So which is it? I guess we’ll find out at CES.

The same article has some info on VUDU. While the MSRP is $399, it seems VUDU also sells the boxes for just $99 to “evangelists”. It sounds like they’re seeding boxes with users willing to talk them up online:

However, Cosson also confirmed a report by blogger and former Wall Street analyst Henry Blodget that VUDU offers discounts to “evangelists”. Although the VUDU boxes are normally $399, VUDU offers evangelists the option of buying the box for $99, together with an additional $99 worth of movie credits.

“There is no quid pro quo,” Cosson said. “We are just giving them suggestions to what they should do as an evangelist.”

According to an e-mail Blodget said he received, VUDU suggested that evangelists “educate others about the benefits of getting movies delivered over the Internet and directly to the TV,” “respond to third-party blog postings,” “participate in online surveys and help us shape the product’s evolution,” “present the product to friends and acquaintances by hosting movie parties,” and “be [VUDU's] eyes and ears in the marketplace.”

Heck, for $200 (box and movie credits), I’d probably check it out too. While I don’t like the idea of Yet Another STB in my entertainment center, it would be easier to swallow if the costs weren’t so high. $400 buys a TiVo HD and a decent service period, and then you can use Amazon Unbox for movies. While Unbox is still SD only, it is expected that TiVo will be adding HD downloads (maybe we’ll hear something at CES). And right now VUDU is still really SD, the handful of HD content is more a demo/trial at this point. If VUDU could find a way to drop the acquisition costs and make their money on the content, I think they could shift some more boxes.

Via Gizmodo.