Views from Phanfare CEO and Co-founder Andrew Erlichson

Link Pandora, the natural evolution of channel-based entertainment

Used to be, consumers watched mostly broadcast channels. The technology required that the media be broadcast (TV, Radio from terrestrial towers using a lot of spectrum to broadcast analog signals). Consumers like to be programmed. It allows you to sit back.

Then came limited on-demand programming over proprietary cable networks and finally internet-based on demand programming. With the Internet, since multi-cast never really took hold, the “media host” must stream an individual stream to each consumer. It costs essentially the same whether each person is sent the same stream or a completely custom stream.

With the costs the same, you might be tempted to build a full on demand system (hulu, YouTube). But the reality is that the cognitive load is fairly high to have to find all your own media.

Hence, the Pandora answer. Use an algorithm, versus a program director, to program an individual stream for each consumer. The bandwidth and compute costs are about the same and development of the algorithm and software is a fixed expense that you can amortize across all the viewers or eyeballs.

Pandora has literally replaced the traditional Network Program Director with a computer! But rather than the program director needing to figure out the best compromise to entertain the market segment he holds, the algorithm can program each consumer individually.

Truth is, while on-demand is fun at times, for music, most people prefer a lean-back passive experience most of the time. Pandora hence makes perfect sense.

It is likely that long form TV will go the same way. I mostly liked watching the shows that I choose, but discovering new content requires that I be programmed to some extent. Given that you watch TV for 30 minutes at a time, it won’t just be a sit-back stream like Pandora, but instead an amazing recommendation engine that will be able to show me any piece of professional content based on what they believe I would enjoy.

Tivo attempted this, but I never found its recommendations very compelling. Plus Tivo is simply too expensive for most people to use. Maybe it needs to be more like Amazon: Viewers who watched this also watched this. TV first needs to go over to be delivered entirely by IP. Maybe Boxee can be this software.

In any event, it is interesting how the changing technology from broadcast to packet-based IP made the evolution of custom channel-based programming possible and cost effective.

  • http://www.jmarbach.com jmarbach

    The challenge for companies dealing with the entertainment industry is to develop an artificial intelligence system that thinks like humans. Very few companies have developed a product thus far that can do so. Most of
    those that have tried to develop an artificial intelligence product have failed, such as Tivo, and others have been an enormous succes; such as Pandora and Animoto. Why? Many companies are not willing to invest in innovating a new product, due to the engineering costs involved for a system not yet proven. Take the position that NetFlix is in, they are offering a $1 million prize to the first team of developers that can improve customer movie recommendations by 10%. This is an extremely effective way of yet again evolving the channel-based entertainment with artificial intelligence.

  • http://blog.phanfare.com erlichson

    The devil is certainly in the details. The nice thing about net though is that you get a lot of data as the omniscient programmer. for example, amazon's recommendations work well, I am guessing, because they are simply recommending items that people like you have purchased at amazon. I am not sure the tivo recommendations look across your overall viewing and compare to other people. They should, but I think tivo only recently relaxed their privacy policy to allow this type of analysis, which they have included in swivel search (I think that is the name).

  • David

    I absolutely love Pandora and it was the main reason why I bought a Squeezebox, and it was once of the very few internet services (including Phanfare) for which I was more than happy to pay an annual fee. However since I live in the UK… I haven't been able to stream it for about a year since they got in trouble with international copyright laws (if I remember correctly). All innovatie streaming services seem to have issues streaming outside the US. Until such legal restrictions are sorted, those companies will never be able to become global and reach their full potential. My Squeezebox and I will be waiting for that day…

  • David

    I absolutely love Pandora and it was the main reason why I bought a Squeezebox, and it was once of the very few internet services (including Phanfare) for which I was more than happy to pay an annual fee. However since I live in the UK… I haven't been able to stream it for about a year since they got in trouble with international copyright laws (if I remember correctly). All innovatie streaming services seem to have issues streaming outside the US. Until such legal restrictions are sorted, those companies will never be able to become global and reach their full potential. My Squeezebox and I will be waiting for that day…

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