Today in Connected Consumer

Connected TVs and over-the-top streaming don’t have to mean lost advertising revenue for content owners and could even create new advertising opportunities, according to a new report by Frank Magid Associates and commissioned by digital ad network YuMe. A national survey of connected TV users found a marked preference for ad-supported content over paid, ad-free content. Moreover 90 percent of viewers say they notice the ads in OTT streams and two-thirds say they are “likely” to interact with them. Even if that’s over-stated it’s an impressive number. Meanwhile, Fortune contributor Nigam Arora dives into the Apple TV 2.0 patent I discussed in my latest Weekly Update to uncover this nugget: a method for replacing ads in broadcast streams with locally cached ads on the fly. While Arora suggests it could be used to replace ads inserted by broadcasters with ads from third-party sources, I suspect it has more to do with giving the networks a way to target individual Apple TV users based on various metrics collected by Apple. That would be more of a win-win.

Today in Connected Consumer

In my Weekly Update this week I give Microsoft its props for its latest digital living room moves. But there is plenty more connected-TV action to come.   Apple’s Worldwide Developers Conference opens on Monday and many analysts are expecting a major TV-related announced. And dark horse Intel may be getting ready to make a major move with a new set-top box with built-in facial recognition technology that can target ads at specific viewers in a household. Meanwhile, cracks are growing into major fissures within the TV business itself over the availability of premium content on digital platforms. Dish Network CEO Charlie Ergen has gone to war with the networks over the increased amount of pay-TV content available online, while former ABC Entertainment chairman Lloyd Braun warned a group of network executives earlier this week that they’re not making enough of their content available online. Expect the debate to get louder.

Microsoft gets Smart about the digital living room

Once the SmartGlass SDK is available, developers will have what amounts to a write-once, deploy-anywhere development environment to work in. Presumably, apps can be written to the SmartGlass APIs without having to devote additional development resources to creating separate versions for iOS, Android and Windows Phone devices.

Today in Connected Consumer

As Steve Jobs famously noted two years ago, the problem facing Apple in trying to crack the TV business was not a matter of technology but the lack of a viable “go-to-market strategy,” given pay-TV providers’ tight grip on the set-top box. Just before his death last year, he even-more famously, if enigmatically told his biographer, Walter Isaacson, that he had “finally cracked it.” How? It’s beginning to look as if Apple has decided that if it can’t beat the pay-TV operators at their own game it might as well join them. With rumors of an Apple smart TV reaching fever pitch, there are growing reports that is looking to partner with pay-TV operators as part of its roll out strategy, rather than trying to muscle them aside. In contrast, Boxee is trying to muscle the operators aside for set-top supremacy — and is finding its way blocked.

Today in Connected Consumer

There’s trouble in Tinseltown. Movie theater attendance hit a 16-year low in 2011, dropping 4 percent from 2010. The slowing turnstiles have led some analysts to lower their ratings for shares of publicly traded theater chains, sending the stocks down sharply. But don’t expect things to improve much soon. BTIG analyst Rich Greenfield released his predictions fro 2012 yesterday (see here for the LA Times’ right up, and here for Greenfield’s registration-required blog post) and he offered little cheer for the traditional movie business. “We believe consumers are tiring of expensive, premium-priced movie experiences, particularly when combined with an increasingly unsatisfying exhibition experience,” Greenfield wrote.”We expect movie attendance to fall yet again in 2012; more importantly we believe attendance is now in a secular decline in the U.S.” At the same time, Greenfield expects video piracy to explode over the next few years as TVs, “rapidly become IP-enabled or ‘smart’ directly or indirectly with apps that facilitate piracy.” He also thinks SOPA is a fool’s errand that will do nothing to change consumer behavior. Good times.




Today in Connected Consumer

In response to a question at last week’s Streaming Media West conference, Google’s business lead for its Google TV platform, Shanna Prevé, predicted that Logitech would push out the keenly awaited GTV 2.0 update for its Revue set-top box “within the next few weeks.” She may have to wait a bit longer. The day after Prevé demo’ed the new version of the platform, Logitech CEO Guerrino De Luca announced that no update would be coming. According to De Luca, bet too heavily on the first generation of Google TV, which ended up costing his company $100 million. While De Luca predicted that Google TV — or something like it — would eventually succeed, for now, Logitech needed time to lick its wounds. The timing couldn’t be worse for Google, however, which was hoping to make a splash by announcing new hardware partners for the platform, only to see its messaging get stepped on by an old one.

Today in Connected Consumer

Google presented a demo of the new version of Google TV at the Streaming Media West conference yesterday, which featured many notable improvements over the lame first version. Much of the discussion around the new version has focused on the addition of the Android Market to the Honeycomb-based platform, but I was struck by the subtle, yet striking, shift in Google’s approach to TV navigation. Whereas the first version relied primarily on a browser-like search bar for surfacing content, the new version relies heavily on structured program guides that look much more like…well, TV guides. Lesson to be learned: There’s a risk to pushing consumers too fast out of UIs they’re comfortable with.

Today in Connected Consumer

TV ads are starting to go over the top. Yesterday, Adobe acquired Auditude, maker of a video ad management platform for publishers. As the provider of the leading online video streaming platform, Adobe will now be able to offer video publishers a turnkey delivery and monetization solution. The integration could help make over-the-top video delivery a more commercially viable alternative to traditional MVPD distribution. Meanwhile, CE makers could also help spur development of the OTT advertising business. On Tuesday, LG Electronics unveiled a multi-year deal with YuMe to enable marketers to place ads directly on LG connected TVs.The development of a significant OTT advertising revenue stream could make IP deliver far more disruptive to the current pay-TV business than we’ve seen thus far.

PlayJam raises $5M to bring casual games to your TV

TV gaming startup PlayJam has raised a $5 million Series A funding round from GameStop Digital Ventures, Adobe Ventures, Endeavour Ventures, London Venture Partners and others. The financing comes as PlayJam sees a massive opportunity to bring new games to connected TV platforms.