Lay Techs: Tech for Laypeople

In 1999 Napster introduced a technology known as P2P or Peer-To-Peer, a file sharing capability over the then newly commercialized World Wide Web. Originally intended for the easy transfer of files and documents by users to their peers, P2P has moved on to become the main source of free music downloads by anyone around the world connected to the Internet.

This new form of piracy shocked and crippled the global music industry as traditional label companies did not know how to react to the overwhelming losses that followed. Because technology has already begun outpacing legislation, international legal arms were still unable to wrap around this supposed industrial catastrophe.

Disintermediation: The Savior of Music

As the world struggled with the pandemic outbreak of piracy, consumers began to realize their purchasing power and how their lack of support is causing the severe dwindling of good music producers. This was the time when CEO of Apple, Steve Jobs, announced an alternative method of selling music over the Internet; he introduced iTunes. This remarkable virtual store was able to connect content creators directly with consumers, allowing them to sample music from home, buy them instantly with the click of a button, and synced automatically into their portable media devices.

Despite record labels all over the world crying foul over iTunes butchering the music industry, it allowed artistes to earn more out of every album sold. At the same time the elimination of middlemen, distribution networks, physical disks and expensive marketing significantly reduced the price of these albums to consumers. As a result many independent artists were able to establish themselves globally without the help of expensive music deals with giant label companies.

Legacy vs Innovation

The Internet did not only affect the music industry. Once thriving By-Subscription television channels like MTV, VH1, Nickelodeon and Comedy Central were facing enormous threat by Free-To-View video sharing website You Tube. With content being available On Demand, traditional television companies were forced to evolve by transforming and changing the distribution of their content to suit and stay afloat. MTV began moving out of showing music videos to producing original reality series while Comedy Central was able to control content distribution over You Tube, making money through advertisements. Although both these companies still sell their content to middlemen like Fox and Viacom, who are also now facing extinction with the world shifting to a newer television age.

With fiber optic connection, High Definition videos can now be streamed to big-screen TVs without the need for separate cables and satellite dishes. This means cable network providers can no longer control the content that gets into consumers’ hands. More innovative service providers like Netflix, Google TV, Apple TV and Showtime are now able to provide movies and TV series to consumers instantly, with no frills and ala carte, across almost all smart devices. On top of that gaming consoles like Sony’s Playstation, Microsoft’s xBox and Nintendo’s Wii have also announced their interest in jumping into the pool by providing access to movies and TV series. Even the highly anticipated 4K and 8K Ultra-High Definition televisions are already being met with higher speed fiber optics infrastructure by Corning Inc.

Gone were the days when customers would have to pay monthly subscription to packages of ten channels when all they ever needed to watch was one. Gone also were the days when consumers needed to check movie schedules and plan their daily routine around these timings. So long as one is connected to capable Internet, one can watch any of their subscribed and purchased videos over any of their devices anywhere in the world.

Observation

As of the recent decade technology has been evolving in the most alarming rate. Past generation corporations held on to their legacy in terms of glory, business models, distribution channels and marketing methods. They spent tens of millions in currency to battle legal infringements when what they should have been spending on was innovation. Younger companies without these encumbrances, small and vibrant, were able to excel at today’s economy and take the lead in providing according to current consumption patterns rather than traditional companies always having done them the other way around.

Businesses are often faced with disruption from competitor product and service providers that initially come off as targeting lower-end market of similar industries. The bigger and more matured companies, referable here to as cable and satellite TV providers, would console themselves by saying that these competitors are not big enough to cause any harm and upstream consumers would still buy into the premium of cable networks. Before they know it, smaller competitors began consuming their target from all possible angles and leaving them perplexed. This phenomenon has happened in nearly every known industry - automobile, photography, electronics, and credit service providers being classic examples.

At the moment cable network providers’ existing competitive edge would be their ability to bring the most updated TV series episodes to consumers, whereas Internet-based competitors only sell the series by full seasons which means they would have to wait for the entire season to complete before being able to put them up for sale. But this is by no means a fool-proof defense. Companies like Google TV and Apple TV can just as easily strike deals with production companies to sell their series by episodes if need be. On top of that, the ‘Convenience-First’ consumers of today prefer gulping down entire seasons in 26 hours than 26 weeks.

The Future of Television

The once impenetrable fortress of this capital and infrastructure demanding industry is now corroding to the tides of change. If cable and satellite television providers still feel they have the upper hand over smaller competitors for whatever reason, a proper evaluation of their methods and models need to be done. Such is the fate of industries being involuntarily thrown into the same deadly pit as technology companies, their only options are to either adapt or jump ship. One can only hope their CEOs and top management people can recognize this and are able to make the shift before it’s too late.