The Future of TV: Close but not Here Yet

I’ve lived an interesting experiment the past two weeks. I signed up for DirecTV Now, Hulu, YouTubeTV, and SlingTV to see what they offered and how it was different from my Dish TV service. For many, cordcutting is possible but, for the masses, I would argue it is not. There are still holes as well as trade-offs many still don’t quite realize. In the end, there are only a few companies I think can win as the service providers of the future and I’ll explain why. Let’s start with how these compare to a traditional TV service from the likes of Comcast, Dish, or DirecTV.

Understanding the Trade-Offs
In trying all these services, the most interesting thing I encountered was the philosophy of each. DirecTV Now, SlingTV, and Hulu all operate with a similar philosophy not much different from a traditional cable service. This is particularly true in terms of UI. The way you navigate live and on-demand content feels very similar to your traditional digital guide and DVR Menu. There is a bit more customization and personalization employed in these streaming offerings and search/discovery is hands down better than anything you get from a traditional cable provider. The cost of these streaming TV services ranges from $30-$70, depending on the package you choose.

It has been argued for some time the sports fan would have trouble leaving cable. That is no longer as true. Many of these services include ESPN as well as NBC Sports which now covers the local hockey, football, baseball, basketball games and more. I’ve yet to find a nationally broadcast sporting event or local sports team I can’t watch. The caveat is that I found when I travel to another state, I was blacked out from watching the San Francisco Giants, for example, since what you pay for only covers local sports and it looks at the area code you are in to determine what local sports or channels to watch. With the $135 a month I pay to Dish for my service, I can use the NBC Sports app and watch the Giants, Warriors, and more from any state. The difference is your traditional TV service gives you access to your teams when away where the streaming ones do not.

The other big trade-off is commercials. With the exception of Hulu’s commercial-free service, the commercials are still there. Which is ironic since TV used to be free and supported by ads. Now it is a paid service — supported by ads. During my two weeks using these services, I missed my DVR and commercial skipping abilities very quickly.

The other trade-off is “catch up TV”. I’ve discovered a lot of new shows lately where I want to watch the full first season. The implementation of catch up TV is sketchy at best with streaming services. Often times, only a few episodes from the current season’s shows are offered. Similarly, past seasons of the same show are not every episode of every season. I found this is show dependent, which means it is rights dependent, as some shows have a season’s entire show list available to catch up on and some do not. The difference with catch up TV within the network’s app itself, like the ABC/CBS/NBC apps, most episodes of the current season are available from the app. The only caveat here is, to use those apps and catch up on whole seasons of shows, you have to be a subscriber to a traditional TV service, not one of the streaming ones.

Here again, the streaming experience breaks down quickly showing it truly is a truncated offering compared to your traditional TV service which covers all the bases.

The last trade-off you have to make when picking one of these services is the likelihood all your channels are not available. For no clear reason why, major networks or popular niche networks were not supported universally. TNT, for example, was not available in YouTubeTV. That became an issue when trying to watch the Cleveland Cavaliers play the Boston Celtics in the NBA semi-finals last night. Similarly, the Hallmarket channel (a very popular channel in my household) was only available on SlingTV and DirecTV Now.

The same issue exists with certain network shows — some have streaming rights and some do not. Here is an example from SlingTV where a show in the live TV guide a show is displayed as not having the rights to stream. I snarkily tweeted this image saying the future of TV is being held up by lawyers. It is mostly true.

A Philosophical Question Remains
At the end of trying these services, I feel it may all come down to philosophy. The question is, is it better to cut the cord and deal with the truncated offerings for a time or just pay the monthly cable bill and get the benefit of the apps for catching up or remote TV? Personally, I have found the most complete solution from Apple TV, as more and more networks apps have been integrating with the Apple TV app. The combination of Apple’s UI on the Apple TV app and the hooks into the TV providers via their apps felt like the best of both worlds for me. However, if I was forced to choose a streaming TV offering, I would pick YouTubeTV hands down.

Even though YouTube TV still has holes in their content offerings, that is something they can fix over time. I really liked the approach of YouTubeTV. Your smartphone, PC, or tablet is the TV and the big screen is the second screen. With the addition of a Chromecast, your mobile device becomes your remote and guide and the TV is just where you display what you want to watch. The only visceral change of the experience is no big stupid guide overtakes your TV when you want to change the channel or switch to a DVR show. You use your mobile device’s screen to navigate, search, pick what you want, and it pops up on the TV. It is the best streaming service in terms of UI, search, recommendations/discoverability, quality of commercials and more.

Which leads to an interesting thought. Given the business model of these streaming services as heavily advertising supported, it seems Google’s business model is quite in line and arguably better positioned than any competing streaming service. Even though I had to sit through commercials, the ones on YouTubeTV were far better and less frequent than any other service. I have to think Google, due to their business model, has an edge here and could likely take the dominant share of over-the-top streaming TV services.

The reality is this: streaming TV is not yet ready for the masses. I understand how younger consumers and early adopters who are willing to put up with the shortcomings like this make it work. However, the average consumer will get frustrated and annoyed at the current offerings when comparing to the experience they pay north of $135 a month for.

We will always pay someone to aggregate or bundle our TV experience. The question remains who and how much. I’d love to see Netflix offer something like YouTubeTV because then they could have all past and current seasons’ episodes and become a one-stop shop for TV content. I’d also still love to see Apple acquire the rights to create their own service. It really is just a matter of paying for the content rights to distribute in both Apple’s and Netflix’s case.

Regardless, until the holes get plugged, streaming TV it is not ready for the masses.

Published by

Ben Bajarin

Ben Bajarin is a Principal Analyst and the head of primary research at Creative Strategies, Inc - An industry analysis, market intelligence and research firm located in Silicon Valley. His primary focus is consumer technology and market trend research and he is responsible for studying over 30 countries. Full Bio

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