Why the TV itself is by far the most overlooked chess-piece in the battle for your living room

 

If Apple has proven anything with its historic success in the mobile spaceits that HARDWARE matters. Their ability to control and evolve the iPhone design in lockstep with evolutions in iOS is what has helped create the magical experience of using the iPhone.

When Microsoft created Windows Phone and largely relied on companies like HP and Dell to create the mobile hardware the results were less than ideal. In order to right the ship Microsoft purchased Nokia for $8 Billion which they would later write-off completely.

Arguably the same can be said for Google’s Android OS which only later in the development cycle after struggling with many 3rd party OEMs decided to acquire Motorola and create their own devices. only to flip Motorola a few years later at a $10 Billion loss. Samsung behind its popular Galaxy S8however has become the saving grace for Android solidifying its relevance in the mobile space.

Let’s not forget about Amazon’s epic failure in the creation of their Fire phone(yes they are mere mortals)

We now look to be seeing a similar battle being waged for the living room driven by the looming collapse of legacy TV models with usual suspects like Apple (AppleTV), Google (YouTubeTV), and Microsoft (XBox) all vying for dominance of the TV stand (which will also of course have reverberations on the mobile ecosystem). There are also new entrants in the living room battle like Amazon who is well positioned given their Amazon Prime Video platform and growing ubiquity of Alexa devices, Netflix is indeed a prime contender as well with over 125 million subscribers to its streaming platform.

Finally the “old media world” is waging quite an aggressive battle spending billions on acquiring content and studio assets to run through its fiber optic pipes and wireless pipes: Comcast ( NBC Universal), Verizon (AOL), Disney (21st Century FOX) AT&T (DirecTV &Time Warner).

Why however is there such little attention being put into the ability to manufacture and distribute the most prominent hardware in household video consumption… Televisions! If we’ve learned anything from the winners and losers in the mobile wars it is that HARDWARE MATTERS

The reason why Amazon Alexa, Google Home, and Apple’s HomePod are such high priorities for the world’s most powerful companies is because they provide the “last mile” throughout tomorrow’s smart home and the company that touches the consumer last in the buying journey has the most leverage (especially in voice)…

That’s why Amazon is stealthily sliding its Amazon Basics brands in the Alexa buying journey ; threatening the future of many CPGs in the process. In the same vein, Apple will likely put tremendous pressure on Google’s search business as escalating usage of Siri for mobile search will give Apple all the leverage in Google’s bread and butter business category

The same is true with television. Eventually, (and we aren’t too far away) the TV will become a giant iPad hanging on your wall…

And when it does, it will be the company that controls the actual television device whom will be able to control what content is consumed and how it is monetized. Both Apple and Amazon seem to be catching on based on rumors by each company to distribute their own televisions.

The TV WiLL Become A Giant iPad Hanging On Your Wall

It’s shocking to me that reinvigorated old media players aren’t aggressively courting struggling television manufacturers like Panasonic, Toshiba, and Mitsubishi. Yes Television hardware is unsexy, with razor-thin margins, but one day I predict a closed loop ecosystem will likely be the difference between the winners and losers in the battle for the living room. I even envision a day where tech companies will give away TVs for free just to amass the eyeballs.

The next time you see a 7 year old child try to swipe a television you will fully understand why hardware ands the content it is distributed on will become an integrated model not unlike the iPad and iTunes.