While the popularity of smartphone apps on iPhone and Android has been well documented, it seems to have taken a while for manufacturers to understand what people actually want from apps on TV. Skropidis attributes this to the app-enabled TV space being relatively new. "It is very much in discovery mode for both manufacturing and consumers," he said. "Though, the solid increase in search activity, catch-up TV and on demand movies is encouraging."
As a platform holder, companies such as LG are in the position where it is likely talking to app developers and partners all the time. When asked about the conversations the vendor is having with developers about their experiences trying to monetise apps on connected TVs, Skropidis says it depends on the content partner's strategy, such as whether they want to be on all platforms such as mobile, tablet, and TV etc, or whether they have a first mover approach. "We work with our content partners by creating models that create various revenue streams, such as pay-per-view service, selling content or selling advertising space within their content or app," he said.
When it comes to delivery of entertainment content, some people have suggested that Smart TV could be the next big platform for video gaming. While Skropidis admits that Smart TVs are being used increasingly for gaming, he does not see them at the point where they will replace gaming consoles. "This is mainly due to the hardware requirements of serious gamers," he said. Memory capability and processing speed are key factors for the best gaming experience, and dedicated consoles will continue to deliver this."
From an analyst perspective, DeHart says this topic is currently a "big maybe." "It certainly does open a very compelling new platform for interactivity," he said. "So it has the potential to become a big platform for gaming, such as for massively multiplayer online games." At the same time, Cloud-based services such as OnLive in the US are now delivering console standard games over remote servers without the need for powerful local hardware, leading one to wonder whether the Smart TV platform will also handle these services in the future.
DeHart sees this as a strong possibility. However, since Smart TVs are still in their nascency, he says more functionality, particularly in the area of content delivery, is a must to realise "anything close to potential return on investment" from TV connectivity. "Remember when you bought your first laptop and it was a big deal, but didn't do everything your desktop PC did?" he asked. "A direct analogy plays out here."
Skropidis also admits to this being possible, but it is still some time off from being realised. "We would need better processors and large memory capabilities within the Smart TVs," he said. As such, the key development that he is currently keeping an eye on in relation to Smart TV is Australia's own burgeoning Internet imitative. "The NBN, with high speed internet to broader Australia, will be a game changer," Skropidis said.
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