Learning from 2014's Video Failures, False Starts & Free Falls

By Bob Wallace October 30, 2014

We’ve all heard the saying “live and learn” when something doesn’t go well, or outright fails painfully.

With the technology, media and entertainment (TME) sector featuring several unsuccessful ventures just 10 months in, what can we learn from the remnants of these best video business intentions dotting the field of dreams?

And keep this in mind as you read on: Is it possible that any of these entities weren’t really “in it to win it,” so to speak, but rather looked at their ventures as search-and-learn missions in a fertile test bed first, and as a possible successful business as a bit of an afterthought?

Let’s review some of the big misses that have come to light in 2014, reserving space for more with a few months left, and with a few companies having promised launches by year's end.

Intel TV-The year started with everyone expecting Intel to launch an OTT service at the Consumer Electronics Show gadget fest back in January in Las Vegas. Nobody questioned whether the tech giant could cross over into the entertainment biz. Intel couldn’t navigate the perilous programming waters and eventually sold off its OnCue assets to Verizon.

Lesson learned: Success in one area of TME doesn’t assure success in another, especially when dealing with the sometimes “rules” and intricacies of the content kingdom.

Comcast Streampix: This media conglomerate has stakes in seemingly every segments of the video ecosystem thanks to key and ongoing acquisitions. But one of its earliest new service launches–Streampix–always seemed like a test offering conducted to see if interest in NetFlix OTT would rub off on a service from a cable giant. The cheap streaming offering failed in part because of a lack of commitment to high enough quality (and quantity) content.

Lesson learned: If you really want to succeed in this high stakes video services business, you need to spend big and consistently. Content is king. Ask Intel. And it sure isn’t cheap.

Verizon & Redbox: Success in one distribution method doesn’t always translate into success with a different one, especially if someone has beaten you to the punch in that space. Redbox rocks at automated machine-based rentals but didn’t hit it big as part of Verizon’s streaming service.

Switching from mailing out DVDs to streaming them has worked well for Netflix. Blockbuster tried to jump to streaming very late in the game and failed. Perhaps Verizon wanted to test the waters, hoping like others, there’s enough consumer interest for any web OTT service.

To be fair, claims of fraudulent use surrounded the demise of the joint service. And both entities continue to enjoy success separately.

Lesson learned – There are pioneers, and a few successful fast followers in most market segments. The key word here is fast. Also, it’s best to have an alluring competitive differentiation. How many companies tried to be Cisco in the 1990s and sell networking infrastructure? Answer: Tons. How many can you name that survived? Very few. Sounds like the DVD rental store market.

Time Warner Cable-SportsNet LA: This is hardly a failed effort, at least if the content owner/partners here can press the reset button to wipe out the 2014 MLB season of the L.A. Dodgers. TWC went a full regular season without landing a single major distribution partner for the Dodgers games it paid bigtime for ($8.35 billion). The situation is still the largest known content impasse, with no sign of resolution. To avoid a crash landing on this list, TWC is going to have to give in, a bit at least.

Lesson learned. There really is a price beyond which even the most coveted content, live pro sports, will not sell. TWC found it. With so many video ventures focused on content and packaging, you can’t forget about price. At some point, the content pricing levee breaks.

Comcast SportsNet Houston: Here’s proof positive that regional sports networks are only as good as their content and as strong as their distributors. It’s tougher than solving a Rubik’s Cube in the dark to truly understand what went horribly wrong here without being an insider. Content carriage disputes can kill, or simply cripple a RSN of any type.

I can’t see where anyone won in this endeavor, content owners, contributors, teams and fans (and investors). CSN Houston has already hit Chapter 11. Its financial value/assessment dove amid the latest troubles.

Lesson learned: I’m going to pass on this one. It looks like a combo of stakeholder problems and content carriage issues. Those with inside knowledge have a clearer idea that I might ever have. And it’s important to remember that CSN Houston still exists, unlike many of the above-mentioned undertakings.

3D, We Hardly Miss You! Many saw the latest demise of 3D coming, whether they wore glasses or not. Though the movement pretty much died last year when ESPN shut down its 3D sports channel for lack of interest, the lack of 3D sets at CES in January from big producers Vizio, added an exclamation mark.

The technology, which did not die, had failed to take hold repeatedly dating back to the 1950s. Believing it would find a home in the home was a big reach.

Lesson learned. The saying “if at first you don’t succeed, try, try, gain,” doesn’t apply to the TME space unless you do something differently than in previous attempts at mainstream success. Again, 3D technology is not dead. It has some limited niche applications, such as movie theaters.

Perhaps the most valuable takeaway from the latest iteration of the 3D movement is that it should instill a healthy dose of skepticism in whatever takes the mantle of “the next big thing.” This will raise the bar of proof for future and efforts-in-progress, but in the end, that saves vendors money and can spare them the wrath of unhappy consumers.

The Bottom Line

Though these entities have done big and little things wrong, remember that it is sometimes just as valuable (or more valuable) to know what consumers don’t want, and how they don’t want them, than it is to know what they long for. Those who repeat past mistakes are the only losers here. That’s why the "live and learn" saying applies 100 percent.

And remember, no news in an industry jam packed with it is bad news (Intel TV, Streampix and Verizon-Redbox).

There’s no need for this list to grow by New Years, but it likely will. We’ll likely need a new list for 2015.

For now, DISH Networks and all others promising launches and business model changes by yearend, are officially on the clock!

Stay tuned-

Edited by Maurice Nagle

Founder, Fast Forward Thinking LLC

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