Google TV: Operating System or Service?

Google TV hasn’t launched as successfully as many might have hoped.

The “cord-cutters” were getting excited. They wanted to cancel their cable subscription and have Google deliver them all the entertainment, social networking, shopping, and information that their 60” HD TV could display. Unfortunately, for those cord-cutters that ran out to purchase a new Sony TV, or Logitech set-top box, Google TV offers search but not much in the way of content.


Google has been rejected by the networks in their request for content. Netflix however has not. Is Netflix more likable? Not really. They did pay up to $1 billion licensing content from networks. Where Google paid $0. Apple pays only revenue share but they still get TV content, so why not Google?

Remember that the recording industry is not happy that Apple controls their marketplace. The TV and movie industry will try to make sure that Apple does not totally dominate their content distribution and will make lots of deals — with Netflix and many others.

At the same time, the TV networks will try to avoid making deals with competing ad networks like Google. Netflix is in the right place, at the right time, with the right amount of money to license content. Netflix today (valued at nearly $10B) is a bigger company than Shaw Communications, about the same as Cablevision, and about ½ the size of Rogers.

For Google to think that Google TV would somehow be different than YouTube is surprising. After years of trying, YouTube has not attracted premium content and Google TV has not changed this — yet.

So, how does Google make Google TV a success? Here are a few options:

  1. Pay to license content, even though they are a competing ad network, money talks.
  2. Commission content – who doesn’t want to make a TV show?
  3. Vertically integrate – Comcast bought a network, why not Google?
  4. License Google TV to Netflix and Amazon OR to Comcast and Rogers OR all of them.

Google can’t be blamed for attempting to put together a service from licensed content. They do own YouTube. Cable-cutters would probably flock to a channel of content that is commissioned and produced by Google.

Why not start a TV channel? Marc Cuban did it. Google’s TV station could bring to life Wikileaks cables in the form of documentaries, drama, news, and comedy. The TV station could be called “No Evil TV” and could build on Google’s considerable assets with great ease. Or they could buy an existing network. I pick Fox, Google has enough cash to buy News Corp.

Of course, the option that makes the most sense is one in which Google opens up Google TV to all hardware as they do Android to all hardware. Google TV needs to be an Operating System (OS) not a service. This is important for the marketplace and for Google.

Google needs to believe the world needs a TV with a good browser. This, of course brings up Chrome, Google browser and desktop OS (just how many operating systems does Google need anyway?) Google unveiled an app store for Chrome this week, so now apps are integrated into a web browser for desktop computers, but not yet for Google TV.

Set-top boxes, game consoles, and TVs don’t achieve, or even strive, to offer a good browser experience. For Google’s core business – search advertising – they need a browser on TVs that really works. The problem for Google is that search doesn’t work on TVs or even mobile that well. So far, apps have proven to be a more successful model in delivery of content on these devices.

That apps are outdoing the browser on mobile and in the living room is a problem for Google (and others). Samsung recently reached 1 million downloads of apps on their Samsung TV App Store. While this pales in comparison to the iTunes records (even RIM claims its store downloads 2 million apps a day), Samsung and Apps are out in front in the all important living room and Google now has to play catch up.