Everyone seems to be writing about convergence these days. It is fair enough, sounds pretty similar as the pre-"dot com" era of the late 90's ... everyone has an opinion, every corporation has a plan of how to make it succeed - remember dog.com, cat.com, parrot.com ? everyone selling niche pet stores to investors? Well I believe we are on the verge of another singularity!
What is the difference this time? Not much, and a lot. Not much - because everyone is guessing what is the direction the consumers will follow, it is a total unknown. A lot - this time the winner(s) will alter significantly how people entertain using technology.
First of all, there are various areas of convergence - which are analysed in isolation by multiple authors -. As I can see, the convergence areas are:
- Television and PC.
- STB and Games consoles
- Internet, telecommunications and media (broadcast, unicast, games, etc)
- Fixed and mobile telecommunications.
The television manufacturers are making bigger and smarter televisions, devices such as cablecards indicate that there is a shift is towards a single entertainment device (a big screen with one remote control) that allows for plugging of the peripherals as part of the design - no external STB in this case. There is nothing stopping the television from having a slot for future upgrades of CPU, hard drives, graphics cards, basically transforming the TV into a PC - with today's technology easily done with a keyboard and mouse hooked via wi-fi or bluetooth.
The next in line for convergence - the STB and games console - and this one is just around the corner for Christmas shopping ! Microsoft & Sony are bringing the concept of single entertainment device closer and closer each generation, now you don't only play single-user games and watch dvds, you can play online, download game and software updates, music, chat with your pals, soon you will be able to download video-on-demand films without having to go out - if you are blessed with a low contention ratio from your supplier, you can download it almost as fast as you cook your popcorn. The price difference between devices is the first thing that pops to mind, but if you remember, convergence of STB & Television seems to be on its way - nothing stopping Sony from generating a "pluggable" PS4 into it's next generation televisions - it all comes down to the convergence of the above - also, i rather pay $300 for a device that gives me games, dvds, vod, chat (and hopefully broadcast) than $30 for a vod/broadcast device (because anyway ... I will buy the games console, so I can save 10% and spend it in popcorn !)
Now forgetting what devices you have at home, the next step is to focus on how all the information will get to you. This is where convergence between media, telecommunications and the internet comes - here we see the beginnings with the AOL and Times Warner merger, Sky purchasing Easynet; NTL, Telewest, Virgin and potentially ITV merging; and many many other examples in the making. You might think that the AOL/Times Warner is a bad example to put - talks about split and leaving markets are just the ripple effect of the misconstruction of a merger during the dot com era - it was obvious then to some of us that the Internet wasn't mature enough as a market to be considered an equal to a media company (Warner brothers was founded in 1923 and like a good wine, it is a business that has matured over wars and economic depressions - AOL was part of a "wave" that ended with the burst of the dot com bubble). But this time is different, everyone knows the true value of Internet, telecommunications and media services - mergers will be proportional to the real value each component will add to the venture - based on retrospectives, not wild guesses. In the UK there is a lot of momentum around media companies launching broadband services that you can access from your PC (Channel 4, ITV, Sky), this shows how media and internet are also seeking the path to convergence. Software and hardware companies (Google, Microsoft, Apple, Cisco) have joined the race from the internet-end of the spectrum, information and technology are vital to enhance the user experience, it is possible that some of these enterprises will merge, acquire or partnership in order to compete in the convergence race. We can see Google in partnership with Earthlink for service provisioning, then the recent acquisition of YouTube for the video (plus its internal development of Google video) and finally the partnership between YouTube and Verizon for video content delivery over the mobile platform, seems here we can see all the bases covered for how entertainment and information will get to your house - all that seems missing is a GooBox, or a Playoogle console. I could continue further around this area of convergence, but it is certainly one most people have talked about, so there is plenty of information already out.
The next converging lines are in the fixed and mobile telecommunications, IMS being the most used acronym associated around this area of convergence. Everything related to telecommunications will converge by using an IMS platform (this has always confused me as IMS is more a framework that will enable the convergence, more than a solution to the problem of convergence, I guess that are just the ways of marketing), Nokia, AT&T, Siemens, BT, Sony, Lucent/Alcatel and Motorola are the biggest players so far - BT Vision is the closest attempt to convergence from a Tier 1 player, (we have to wait and see how it compares to Homechoice/Tiscali user experience when launched). The new value added services this platforms are delivering shows how entertainment and user-centric delivery is paramount to a successful proposition. This is the time to develop as many differentiators as possible - when the market starts boiling, some of these will be what determine who is successful and who isn't.
So where exactly are we converging ? it will be a total new world of consumer experience - the winner will be the one that gives the experiences in the most natural way, "seamlessly" and "ubiquitous" will be the adjectives used to describe the ultimate convergence. There is a long list of features that could be used to describe the converging point, some of them might what will encompass it, some might be attempts to define it ! There will be lots of efforts coming from different directions that will help shape this convergence, most of it still to be written by the consumers and how satisfied they are with the features.
More to come ...
PS. There is much more that could be written around this, as all the blogs, this is just a set of opinions to enable further discussion.
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