More than remote control

IN THE PAST 20 years, technology has changed the way people communicate, work and play at a pace which has been dizzying. The changes show no signs of slowing with yet another revolution coming down the tracks which will almost certainly alter the way people access films and watch television forever.

When the internet started seeping into the public consciousness in the mid-1990s, the few people who were aware of its existence were going online with modems which operated at a speed of 14.4kb per second. Downloading a grainy image the size of a postcard could take minutes and the very idea that television could be watched online was laughable.

Fast forward 15 years and broadband packages offering speeds of more than 20mb a second are relatively cheap and commonplace while some companies offer connection speeds of 100mb which is nearly 70,000 times faster than 1996 downloads.

Full-length feature films can be downloaded from the web in less than 30 minutes while television streaming is now an everyday occurrence with RTÉ, TV3 Magnet Broadband and a host of other companies offering live and catch-up television via computers.

Into the maelstrom has come Netflix, the US-based online film and television rental company which launched in the Republic last week.

While the content it has on offer is limited – something which has not gone unnoticed by many would-be subscribers – it has promised to add new titles in the weeks ahead and insists it will soon be able to reach for the sky and challenge the biggest player in the Irish film and premium television market.

“When you talk about big entertainment businesses, Sky Atlantic and Sky Movies are huge, and our advantage is we are much lower priced than the Sky packages and it is all on demand, click and watch,” says Netflix chief executive and co-founder Reed Hastings.

But could it really be a contender or will it end up with a one-way ticket to Palookaville? Its monthly subscription of €6.99 is much less than Sky which charges €53 per month for its bundled movie package. It will also challenge the bricks and mortar DVD rental shops because it is so much cheaper, removes the need to traipse down to the shop in the rain and takes the fines for returning films late completely out of the picture.

As a result of the digital revolution, the DVD rental business is tanking. In 2004, such businesses were worth £350m in the US but last year they were worth just £73 million, according to the media analyst Screen Digest’s latest figures.

So far it is looking good for Netflix. But it has a big problem. Actually, it has several big problems. The company is promising “tens of thousands of hours of great film and television” to Irish subscribers but, in these early days at any rate, the available content is poor and struggles to compete with Sky Movies never mind the DVD rental shops.

Among the films Netflix was boasting about hosting last week was Paul Blart: Mall Cop(2009). It has Kevin James in the title role playing a security guard who is on duty when his mall is hijacked and only he can save the day by displaying remarkable . . .oh forget about it, you really don't want to know. And you probably don't want to watch either.

Television programmes available on the site include Breaking Bad, which is good; 24which is tired and, um, The Only Way is Essex.

One of the problems Netflix has is that film producers like making money and they have long since worked out the way to make the biggest pile of cash. First they make money in cinemas and then through DVD shops. After that they make slightly less money by selling the rights to Sky Box Office and the like and then to the premium channels like Sky Movies.

It is only at this point that Netflix can enter the frame. Typically, consumers will have to wait a full 15 months after a film has come out in a cinema before they will be able to access it on the online streaming site.

The company has had its problems in recent months in the US with significant price hikes causing hundreds of thousands of users to leave the service. Even so, it is wildly popular and accounts for over a third of all internet traffic in the US at peak times, according to a report from Sandvine. “With so many Netflix-capable devices, the addressable market for the service is already enormous and will only increase, so it’s hard to imagine a scenario in which absolute levels of Netflix will decline.”

Netflix is only one element of the ever-changing world of television. Sky has not been slow to respond to the threat posed by Netflix and before Christmas it launched an on-demand streaming movie service which is available on the iPhone, iPad and iPod Touch to its existing customers.

RTÉ's content is available on-demand although there is no smartphone or iPad app while TV3's 3Player offers "catch-up" TV and comes with Twitter integration which has a hash tag linking straight to the online conversation so you can moan about the guests on Tonight with Vincent Brownethat little bit more easily.

Channel 4’s 4oD catch-up offering arguably has the most polished service and lets you save half-watched shows in your history and create favourites lists for easy access. For its part the BBC iPlayer, essentially a back catalogue of BBC programming, is only available on the iPad and costs €64.99 for a one-year subscription. Then there is iTunes. It does not stream films but offers them for download and sees itself as the natural replacement for the physical DVD or Blu-ray disk.

Launched early last year as Magnet TV by the broadband provider of the same name, AerTV offers live streaming of all free-to-air TV channels available in Ireland and allows people to access live terrestrial television without the need to pay for a television or a television licence.

The streaming revolution is going to gather pace over the next year. Back in the 1970s, Irish viewers were very excited by colour TVs and over the past decade some became mildly impressed by high-definition pictures. In tomorrow’s world, our televisions will have to be colour – obviously – high definition – clearly – and also smart. All the big players in the television market are bringing out internet televisions and if the hype coming out of this year’s International Consumer Electronics Show in Las Vegas is to be believed, TVs with internet connection will soon be everywhere.

There are also the illegal downloads. One reader called Caroline uses a video on-demand service to watch all her television and has done so for three years.

“I have to say I think it’s great,” she says. “A lot of people still automatically reach for the remote control because they think it is easier but in my experience, as soon as people see how simple this system is to operate they are convinced, even my parents can do it,” she says.

The notion that people watch television via services that sit in the grey area between legit and pirate is of great concern to the industry. The director of Aer TV Philippe Brodeur describes pirated programming as “a huge problem” but accepts that it has become a factor because the television stations and film studios were too slow to react to the dramatic shift in how people want to consume what they watch.

“Fair play to Netflix for at least establishing a model which will see people paying for what they watch online,” he says. “Consumers want to access programmes and films online but the industry has been slow to respond to that demand so consumers have, in many cases gone elsewhere.”

He says the big US film studios are putting together a “studio agnostic platform” to create a one-stop-shop for all their programming. “Once they have that platform in place all the studios will have to do is extend the time during which they restrict players like Apple and Netflix from streaming their content but for the moment the aggregators are still well ahead of the studios.

AerTV rebranded in October to show that people who did not subscribe to Magnet broadband could also access the service. They also dropped a log-in page which they felt was acting as a barrier and in the first month the company increased its streams by 300 per cent. It is now streaming around 50,000 hours of programmes to up to 10,000 users each month. “It is the future there is absolutely no doubt about that,” says Brodeur.