Monthly Archives: April 2013

After recording companies is it now the time for Cable Companies?

It was a major setback for broadcasters on 1 April 2013 when a federal appeals court in New York upheld a ruling in favor of Aereo. The broadcasters have been trying to sue Aereo out of existence for over a year!

This may be the beginning of the end of cable companies.

What is Aereo?  It is a technology company based in New York City that allows subscribers to view content on Internet-connected devices. Imagine being able to watch and record live broadcasts  on your tablet or smart phone or phoblet as some of them are called now a days !

Why do TV or Cable companies hate, now fear Aereo? Aereo does not pay networks for the free-to-air channels it streams. It allows people to receive content without paying for the bundles of channels from which cable firms derive their profits.

How are Cable or TV companies responding? I am sure the initial response was to simply ignore, later as one would expect waste over a year trying to get the court to shut down Aereo.

Let’s look at the sequence of events that I believe have led to this:

WSJ on PC Market

  1. Tablet (iPad to be precise) is the disruptive innovation that has kicked PC industry to a corner.
  2. Windows 8 is having no effect on arresting the decline in PC sales. It is said significant number of customers instead of spending money on upgrading their PC’s are buying Tablets and retaining their existing PC.
  3. Video sharing sites like YouTube brought changes in consumer behavior – most of us watch considerable amount of video on our internet connected devices.
  4. It was only a matter of time before someone would think of streaming live content to these devices – hence Aereo!

The question why or how cable or TV broadcasting companies did not think of doing it themselves?

If history is any indication, not too long ago recording companies refused to see the changes in their consumer behavior as a result of MP3 and paid the price!

Coming back to the story of Cable companies, now that the court has refused to do their work they have finally started getting their act together. CBS has announced that they have acquired a minority stake in Syncbak a local TV streaming venture.

The question is: Are they already too late?

This would be an interesting space to watch as this is yet another industry that refused to understand changes in their consumer’s behavior driven by technology.

Could the BT in the flat-world offer help to the business of air travel?

The announcer said they were truly sorry for the inconvenience caused as the flight I was to take had been delayed.

I was not too perturbed as I love hanging around airports – especially the international ones. I believe they are truly melting pots of humanity!

The variety of people, nationalities, and luggage – yes bags the variety of bags that one gets to see at an airport is mind boggling! Every one heading somewhere – holiday, business meetings, relocation, family reunions, event etc. it always reminds me of a beehive – everyone doing something towards the greater cause, OK may in this case I am stretching it a bit too far but still the cause here is travelling!

I always wondered if airlines business was profitable to be in then I came across this famous quote:

“If you want to be a Millionaire, start with a billion dollars and launch a new airline” – Sir Richard Branson (founder of Virgin Atlantic)

Despite all the downside of the business many intrepid entrepreneurs are still having a go at starting a new airline. Airlines business oozes of glamor and probably hence the attraction is simply irresistible.

Back home in India, we recently witnessed demise of Kingfisher Airlines – what was once a flamboyant airline found by probably the only flamboyant businessman in India.

Running airline business is tough – especially when no airline has any control of that one thing that impacts them most i.e price of turbine fuel. They do however keep tweaking other aspects of the business to stay afloat. Given the state of the economy impacting business travellers airlines are scrambling to survive.

Areas where the airlines do have some control that impacts costs are:

  1. Self-help (Transfer some of the work to passengers like e.g. check-in)
  2. Reduce consumables
  3. Reduce the turnaround time leading to increase in on-time departures

Tweaking these have to be done carefully keeping in mind customer experience. There have been quite few bizarre sounding suggestions that have made rounds. Charging customer based on their weight and the most bizarre one being charging customers for using the bathroom!

Here are few areas involving Business Technology options smartly used I believe could result in real savings:

  1. Check-in: Low cost or budget airlines have got this right. May be they could push it even further with most passengers using smart mobile phones with capabilities like Near Field Communication (NFC) why not allow downloading of the boarding pass on to the handset which could communicate with the computer at the boarding. An image of the boarding pass should suffice for the security. Having check-in counters costs money which can be reduced or in some cases even done away with! On-line check-in too could recommend seats based on history of selections as most frequent travellers have their own preferences.
  2. Baggage handling– It is said 25 million bags are lost every year and airlines spend almost US$ 100 per lost bag – huge money indeed. Technology used is still good old paper with barcode. Barcode readers have to be brought close to the tags to read. Also the tags sometimes tear during processing hence making identification of the luggage difficult. It is said most of the luggage gets misplaced in the point of origin due to torn tags. Why not use stickers with Radio Frequency ID (RFID) tags? With RFID technology costs coming down and with the volumes required it may be worth considering. Given that most travellers reuse the same bags the tags are reusable reducing the amount of paper consumed!

     

I am sure there are several more opportunities where BT could help this industry that is going thru very challenging times; I could think of the two listed I would like to hear from you.