Experience Trumps Features

Steve Jobs was quoted saying the following at the launch of iPad2 earlier this week:

Apple’s pushing it as a giant leap forward. That’s it for the video. Again, this is the intersection between technology and liberal arts. It’s in Apple’s DNA that technology is not enough. Hardware and software need to work together. Nowhere more true than in the post-PC market. Competitors describe tablets like PCs, with specs and the like, but the iPad shows that it’s all about the intertwined software and hardware. They need to be easier to use and more intuitive than PCs. Jobs thinks that they’re going to be competitive.

This really goes to the heart of how different Apple is from Google. Let me give you some evidence, Google on its GoogleTV effort announced an interesting set of features in the September/October 2010 timeframe – you can read about them here. Of specific interest is the one about “Fling”:

Fling a video to your television

Find a great website on your phone and want to show it to everyone? Now you can. “Fling” what you’re watching, listening to, or doing on your phone by sending it to your TV with the press of a button.

It received feedback and coverage, and NPD’s Ross Rubin tweeted about it as well:

Looks like Google TV’s ‘Fling’ feature will be its counterpart to Apple TV’s AirPlay.

The reality is far from it – and not because the feature does NOT exist but because the experience is tedious. A great consumer experience removes the challenge, removes the complication… In order to “Fling” a page or a video to the TV from an Android phone – you have to “Share”. Yes “Share” – there is no simple press of a button. On the Browser bring up the “Menu” (1), select “Share” (2), and then select “Google TV Application” (and that’s 3). The idea that it can ‘flung’ is not intuitive, you don’t know anything about it.

Contrast that with Apple’s Airplay, a nice icon shows up in a Media Player (with IOS 4.3 supposedly AirPlay will become available to third party apps as well) – tap the Icon, and select the TV/Device to ‘airplay’ to. The context is within the application and it is not being called share.

Now, purely technically, can Google implementation improve – absolutely yes. The key difference is that they release features with plenty room for consumer experience optimization.

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Notes:

1. Snapstick with meager resources gets it (check out how they “snap” the video to the large TV) BUT to be fair – you need to use their app, and their box connected to the TV

2. Business Insider’s Dan Frommer in a blog post today shows that GoogleTV-based Logitech Revue is ranked #563 compared to AppleTV at #10 on Amazon’s Best Selling Electronics.

 

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Logitech Revue sold 93,400 Units as of Q4 2010

The Logitech Revue has two primary peripherals – MiniController and the TV Cam. Per Logitech’s 10-Q for the quarter ending 12/31/2010 – Revue and peripherals sales were $23.4million.

Assuming all of this was only Revue and using an ASP of $250 (instead of $299, since they dropped it during the Holidays) – it would result in an approximate sale of 93,400 Units in little less than 3 months ….

Note R&D expenses were incurred for Revue development – with the development being outsourced? 10-Q makes special note of increase in Consulting Fees due to Revue. And also Marketing & Selling expenses were higher due to Harmony and Revue. All those loft parties apparently did no good …

A detailed analysis at some point with a better model may be more useful. Below are the significant statements pertaining to Google TV and Revue (mentioned 23 times) in the 10-Q.

Amplify’d from www.sec.gov

For home entertainment systems, we offer the Harmony line of advanced remote controls, Squeezebox wireless music solutions and, in the United States, a line of Logitech products for the Google TV platform, including the Logitech Revue companion box, Logitech Mini-Controller and Logitech TV Cam with HD Vid service. For gaming consoles, we offer a range of gaming controllers and microphones, as well as other accessories.

Adoption of the new accounting guidance primarily impacted the revenue recognized from Logitech Revue and our LifeSize video conferencing products. The adoption had no impact on revenue recognized from the remainder of our peripherals, as they are not multiple-deliverable revenue arrangements.

The sale of Logitech Revue consists of two deliverables: the hardware with essential software delivered at the time of sale, and unspecified additional software upgrades to the essential software on a when-and-if-available basis. Logitech allocates arrangement consideration to each of these deliverables using a selling price hierarchy. Under the new accounting guidance, the selling price is based on VSOE of fair value, if available, TPE if VSOE is not available, or ESP if neither VSOE nor TPE is available. The relative selling price of the hardware with the essential software is based on ESP. The relative selling price of future upgrades to the essential software is based on TPE. Amounts allocated to the delivered hardware and essential software are recognized at the time of sale provided the other conditions for revenue recognition have been met. Amounts allocated to the future unspecified software upgrade rights are deferred and recognized ratably over the estimated 24-month life of the hardware. There was no impact to prior period financial statements from adopting the new accounting guidance as it relates to Logitech Revue, because there were no sales of the Logitech Revue prior to adoption of the guidance.

We achieved retail sales growth in all product families during the three months ended December 31, 2010 compared with the same period in the prior fiscal year, with double digit percentage growth in pointing devices, video, gaming and digital home. Digital home is a new product family combining Harmony Remotes, Logitech Revue with Google TV and peripherals associated with the Google TV platform.

To date the platform has not met widespread consumer acceptance and our sales of Logitech Revue and related products have been below our expectations.

In the three months ended December 31, 2010, our retail average selling price increased 3% compared with the three months ended December 31, 2009, and increased 16% compared with the three months ended September 30, 2010, reflecting in part the launch of Logitech Revue in October 2010

In the Americas region, retail sales increased 31% and 35% and retail units sold increased 6% and 16% in the Americas region in the three and nine months ended December 31, 2010 compared with the same periods in the prior fiscal year, reflecting strong sales of products with higher average selling prices and in particular, Logitech Revue. All product lines produced double digit percentage sales increases in both the three and nine month periods ended December 31, 2010 compared with the same periods in the prior year. Sales of the Digital Home product line were especially strong, based on the newly-launched Logitech Revue.

The launch of Logitech Revue and the associated peripherals contributed sales of $23.4 million to our new Digital Home product family in the three months ended December 31, 2010.

Marketing and selling expenses increased 43% and 46% in the three and nine months ended December 31, 2010 compared with the three and nine months ended December 31, 2009, primarily due to the addition of LifeSize sales and marketing personnel in December 2009, and variable demand generation activities focused on Harmony remotes and Logitech Revue.

The increased advertising and marketing spending related primarily to approximately $27 million of variable demand generation activities in connection with our Harmony Remotes and Logitech Revue, as well as other new product launches.

Consulting fees related to our development of Logitech Revue for Google TV also contributed to the increase in research and development expense compared with the prior year. Read more at www.sec.gov

See this Amp at http://bit.ly/gCgSut

GoogleTV & Sony: Bad Marketing Combination?

WSJ and NYTimes recently reported on Google requesting partners to delay launch of GoogleTV products. May be the existing partners have also given up? The pictures below were taken yesterday showing the GoogleTV demo in the SonyStyle front display window at Atlanta’s flagship mall – the Lenox Mall.

 

GoogleTV product may be ready or not, having a front window display in a premium shopping mall that shows a cryptic error message with a blank screen furthers the negative image of Sony and Google.

 

 

 

Boxee & Its Remote Control

The Boxee box had been waiting its turn to be setup since I got it just before Thanksgiving. I finally set it up last week, and here is what you need to know:

1. The shape is different, unique. It is sitting there on my entertainment center – quietly, the Boxee icon glowing. The box design makes it a contender to remain on top of the entertainment center rather than being tucked away.  The ID may make for interesting conversations.
2. The size is certainly very small compared to the other boxes using the Intel CE4100 such as the Logitech Revue.
3. Setup was not too difficult – especially compared to the GoogleTV experience. It rebooted twice to go through the upgrade process.
4. Apps have to be added – these apps bring video content to you. Roku calls them channels.
5. The remote control is also unique. But it also happens to be the disappointment. It is an attempt to have a minimalist design like Apple’s remote gone bad. Here are some observations on the remote control:
   • The remote is NOT IR – good news because you don’t need to point it anywhere, it is RF.
   • The remote has two sides. One side is the Apple-remote style (btw the functionality is identical to that of the Apple remote) and the other side has a small alpha-numeric keyboard.
   • On the Apple-style side the buttons are centrally placed – and the only clue on what side is up is the Boxee logo. The Logo is placed at the lower size of the remote and hence decides the Up, Down, Right & Left keys of the remote. When you grab the remote – you need to make sure that you are holding it the right side up. I ended up pressing the wrong keys many times and a friend of mine had a similar problem.
   • The arrow keys – the distance on the pad is a tad bit too much. In the age of Smartphones and Apple Remotes – the thumb is used travelling only so much when you are trying to click the keys. I had to stretch my thumb in order to effectively click the keys.
   • Similarly having the keys placed centrally – you do not have enough room to hold on to the remote like you may on the Apple remote.

 

 

 

GoogleTV: Follow On Chronicles

Google TV effort was officially announced at the Google IO 2010 conference in San Francisco.  I had, like many, many other blogs, posted my thoughts on the rumors before the official announcement here. This is a follow up to that post.

There were hiccups during the demos at the Google IO experience none the less the it was impressive keynote. Now that it is announced, here are my observations:

1. The Browsing Experience is going to be very interesting. Videos of the demos at the conferences, trade-shows, comments and blog posts indicate that they indeed have bought the full experience of the PC-style browsing to the Television. This will be a game changer. The link shows the GoogleTV User Interface in action – if you observe carefully you will notice that unless you take a specific action – the viewer probably has no idea that there is a browser platform embedded. As soon as you initiate action using the Keyboard, you see a search bar overlaid on top of the video to start of the GoogleTV experience.

2. At the recently concluded IFA 2010, Sony demonstrated (or a video of it) GoogleTV embedded as a part of their TV. Reports & blog comments indicate that the browsing experience was very rich. It is my belief that GoogleTV embedded as a part of a TV would be the most rich experience. It would reduce the add-on cost of a companion box however in the beginning at least it won’t integrate well with the Pay TV STB connected to the TV (and hence Search would not provide results from the STB/DVR). I think it is only a question of time before some innovative developer would build a back-channel app that would integrate at least with the guide of the PayTV STB and Search Results (assuming the APIs for search are available to apps on the GoogleTV platform)

3. Logitech is gearing up for launch their Revue by arranging loft parties – winners have been announced – waiting for the launch now. The challenge I see compared to the Sony’s GoogleTV TV is the cost and hassle of having a ‘companion box’. Logitech, of course, is targeting consumers who want the richness of Android Apps and Open Web without having to buy a new TV!

4. Whether GoogleTV succeeds commercially or not – it is going to herald openness of Web Browsing to the living room. Even if the Web is Dead – the Android apps on the GoogleTV will enhance the TV Viewing Experience.

The only (and major) downside of GoogleTV, especially for mass adoption, is the price tag – beating the Apple iTV at $99 is going to be extremely hard unless Google is aggressive in releasing GoogleTV on semiconductor platforms other than Intel.