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Television Outside the Box

The Technological Revolution of Television

Never before have the balance sheets, strategies, constituent relationships and very existence of media conglomerates been shaped so radically by technology and changing consumer habits. Never before has so much revenue been put on the line, and never before has there existed the potential for so much content, distribution, packaging and pricing to be placed beyond the reach of the media giants.

—Hollywood Reporter, 2005¹

TV has evolved in the past, but the current digital revolution shock is unprecedented. And, just as in earlier periods of fecundity, TV production, distribution, and consumption are all being redefined and refreshed by outsiders, from Apple’s Steve Jobs to the new amateur producers peopling YouTube or Blip.tv.

—Wired, 2007²

The first epigraph, taken from an uncharacteristically forward-looking think piece by one of the industry’s key trade publications, captures the uncertainty and anticipation of the industry as early as 2005. Industry workers knew that technological change was approaching. Many had seen the diverse platforms and applications debuting at electronics shows long before they would reach the living rooms of middle America, but no one could be certain of how audiences would use the new technologies, how quickly they might adopt them, which devices would prove essential, or what might be the next “killer application.” To make things more challenging, constant technological development made the earth seemingly shift beneath the feet of those trying to adapt. By the time a mid-2000s strategy making use of then-emerging DVD and video-on-demand (VOD) distribution opportunities was in place, unanticipated possibilities in downloading to portable devices made many of those preliminary efforts seem woefully inadequate.

Technologies involved in the digital transition enabled profound adjustments in how viewers used television, and these newly enabled capabilities necessitated modifications in many other industrial practices. Emerging devices considerably enhanced viewers’ ability to control television first in, then out of the home. The increased control over how, when, and where to view provided by digital video recorders (DVRs), DVDs, electronic programming guides (EPGs), digital cable boxes, laptops, smartphones, and tablets expanded convenient uses of television. These devices enhanced the comparatively limited capabilities first afforded by analog technologies such as VCRs and allowed viewers far more flexibility in when and where they watched television.

Live broadcast has long been perceived as an inherent technological attribute of television—perhaps because audiences lacked technological tools to control their viewing throughout the network era. As new technologies emerged, the industry initially perceived liveness to be important and endeavored to identify technological solutions that would enable reception of live television almost anywhere—what I categorize as mobile television. However, as U.S. viewers came to use various television technologies, the ability to control viewing, which included using tools to both time-shift and place-shift, emerged to have far greater desirability than the ability to view live television outside the home.

In discussing technological advancements, I differentiate between portable and mobile television use, a distinction not commonly observed in industry discussions. In my parlance, viewers use mobile television when they access live television outside the home, as opposed to the time- and place-shifting characteristic of portable television. These distinctions can seem confusing because many devices allow both portable and mobile television use: Laptops, tablets, and smartphones can be used to download content and store it for nonlinear viewing or to stream live video. While viewers may rarely think of these distinctions, they are important because the liveness of mobile viewing preserves the advertising model particular to linear viewing in a manner quite different from the mostly nonlinear use of portable television. Portability fits clearly within the realm of expanding convenient uses of television, while the desire for immediacy characterizes mobile television. In sum, this chapter distinguishes between mobile television technology use, which accounts for out-of-the-home live viewing, and portable television technology use, in which viewers take once domestic-bound content anywhere for viewing at any time.

Additionally, technological advancements in audio and visual quality—many of which resulted from the digital transmission of television signals—expanded the theatricality of television until the distinction intended by the word (to signify the feeling of watching a film at the theater) became insignificant. The emergence of high-definition sets as replacements for the long inferior NTSC television standard particularly contributed a technological revolution in the quality of the television experience. Digital transmission alone allowed some enhancement of television’s audio and visual fidelity, but the high-definition images in particular appeared as crisp as reality and offered the detail available on film.

Each of these attributes of post-network technologies—convenience, mobility, and theatricality—redefined the medium from its network-era norm. Their significance results from the considerably revised and varied uses of television that consequently have emerged and that contrast with the unstoppable flow of linear programming, the domestic confinement, and the staid aesthetic quality of the network era. Rather than these technological assassins causing the death of television, as many writing about television in the mid-2000s claimed, the unprecedented shift of programming onto tiny mobile phone screens, office computers, and a wide range of portable devices ultimately reasserted the medium’s significance. But the new technological capabilities required adjustments in television distribution and business models in order to make content available on the new screens, which provided a challenging task given the inconsistent interests of rights holders such as content creators (studios) and distributors (traditional channels and networks). Studios sought to maintain tight control over content so as not to disrupt the traditional revenue streams and the long-term value of copyright ownership. Networks desired strategies likely to drive viewers to other content on the network or to other network locations—like network-owned websites—from which the distributor might earn additional value. Both studios and networks sought to maintain their established status in the television industry while new broadband distributors and consumer electronics developers endeavored to rethink many of the business’s established “rules.”

The various post-network technologies produced complicated consequences for the societies that adopted them. Viewers gained greater control over their entertainment experience, yet became attached to an increasing range of devices that demanded their attention and financial support. Many viewers willingly embraced devices that allowed them greater authority in determining when, where, and what they would view, although as fees and services enabling new conveniences proliferated, they also struggled with the burden of the many costs previously borne by advertisers. In many cases, the “conventional wisdom” forecasting that the new technologies would have negative consequences for established industry players proved faulty; technologically empowered viewers used devices to watch more television and provided the industry with unexpected new revenue streams at the same time they eroded old ones. The emergence of these technologies consequently resulted in contentious negotiations within and between factions as viewers assessed what capabilities were worth the cost, the consumer electronics industry endeavored to embed its products in the daily use of as many as possible, legacy media (such as broadcast networks) evolved their business models, and legacy and new media services (cable providers and Internet aggregators like YouTube and Hulu) developed mechanisms to make new technologies useful and programming accessible.

Network-Era and Multi-Channel Transition Technologies

The lack of technological variation during the network era enforced a fairly uniform television experience for viewers. Television sets that received very few signals over the air functionally defined the technological experience in the network era, while the use of antennas and CATV added complexity and limitations for some viewers. These devices, however, tended only to enable viewers in rural or mountainous areas the same access to the medium enjoyed by their urban brethren. Either way, viewers had no technological control over television and little choice among content. Certainly, the transition to color television was significant, and many of the technologies that began to revolutionize television use during the multi-channel transition were introduced to early adopters while all other characteristics of the network era remained firmly intact. For most, however, a single television in the home without remote control or VCR characterized the network-era technological experience with television. This uniformity of use aided the industry’s production processes because it enabled the industry to assume certain viewing conditions and rely on viewers to watch network-determined schedules.

Technological developments of the multi-channel transition introduced profound changes for users, first by enhancing choice and control with analog technologies such as cable network distribution, VCRs, and remote control devices. Experiments with remote controls began in the early days of radio and continued through its refinement and into the television era.³ The industry sold as many as 134,000 remote-equipped televisions as early as 1965. Despite these early starts, Bruce Klopfenstein argues that 1984 to 1988 marked the period of most rapid overall remote control diffusion, due to the simultaneous distribution of cable and VCR remote controls in concert with those of television sets.⁴

The VCR is one of the first technologies to trouble our understandings of “television.” The distribution of the VCR as an affordable technology, which achieved mass diffusion at the same time as the remote control, significantly expanded viewers’ relationship with and control over television entertainment. Nearly 50 percent of U.S. homes owned VCRs by 1987;⁵ this figure increased to 65.4 percent by 1990, 88.1 percent at the end of the century, and peaked at 98.4 percent in 2003, after which VCR rates declined and DVDs (and later DVRs) began replacing the technology.⁶ The recording devices allowed viewers to negate programmers’ strategies through time shifting and introduced new competitors such as the home video purchase and rental market. In addition to enhancing viewers’ television capabilities by allowing them to record and review television shows, the VCR also enabled the television set to function entirely independently of the networks’ linear program schedules.

Another key characteristic of the early multi-channel transition resulted from the arrival of cable, which introduced profound changes in both technology and distribution. As a technology, cable substantially altered viewers’ experience with its introduction of a vast array of channels. In 1988, 50 percent of U.S. households subscribed to cable, which was the subscription base analysts believed necessary for cable operators to provide a large enough audience to achieve profitability.⁷ This subscription level marked an increase from just 19.9 percent in 1980, grew to 56.4 percent by 1990, and reached 68 percent in 2000. By 2000, nearly ten million additional households received programming via direct broadcast satellite (DBS—services such as DirecTV or Dish Network).⁸ In the mid-2000s, “telcos”—companies traditionally known for providing phone service, such as Verizon and AT&T—began competing in some markets, offering packages of channels and then-state-of-the-art Internet service. By 2014, 10 percent of homes received television content from a telco. Since the mid-2000s, cable, satellite, and telco penetration grew to roughly 90 percent of U.S. television homes.⁹

Broadcasters maintained many of their network-era programming practices throughout the multi-channel transition even though the audience that regularly viewed them decreased in scope. The increase in program outlets significantly shifted the size and composition of the audience watching the Big Three networks, but it required decades for this change to reach an economic crisis point. In some ways, a paradox of remaining the “most mass” programming outlet reaffirmed the status of broadcasters and allowed them to remain disproportionately dominant throughout much of the multi-channel transition despite their slipping share of the audience. Cable channels drew audiences, but the multiplicity of cable channels was significant only in aggregate; any one channel drew a small fraction of the audience still reached by a broadcaster, and other than content-specific channels such as CNN, MTV, and ESPN, cable channels created very limited original programming during the multi-channel transition. The broadcast networks achieved some cost cutting by scheduling more programs from cheaper genres such as newsmagazines and early “reality” shows, but the broadcast networks were able to maintain many of their core practices throughout the multi-channel transition. Broadcasters’ continued dominance and cable channels’ limited encroachment enabled a conciliatory coexistence that ruptured once cable channels began producing “broadcast-quality” series in the early 2000s and deviated from broadcast norms of season length and scheduling patterns.

Analog technologies enabled limited control and choice during the multi-channel transition, but the arrival of digital television technologies at the end of the century vastly reconfigured technological capabilities and introduced characteristics of a post-network era. The shift from an analog technology such as the VCR to the DVR and DVD may seem insignificant in terms of the similar capabilities each provides, but the arrival of digital technologies profoundly changed television.

Digital Media and the Post-Network Era

Welcome to the age of fast-food TV: nuggets of news and entertainment that can be consumed on cellphones, video game consoles and digital music players. Whether the programming is downloaded via iTunes software or over a cellular network, the trend is changing where—and how—TV watchers are tuning in.

—Meg James, Los Angeles Times, 2005¹⁰

The digital revolution produced two types of consequences for television: interoperability and efficiency. These capabilities adjusted viewers’ experience as the common language of ones and zeros shared in the digital transmission, reception, and home recording of television advanced the medium considerably. It provided the technological opportunity to converge televisions, computers, and other home technologies, and also allowed more efficient signal transmission and storage. Digital transmission further expanded choice, as broadcasters and cable providers were able to relay more information in their broadcast spectrum and cable wire by using a digital signal and eventually Internet protocols. Digital technologies enabled broadcasters to offer multiple “channels” in the six megahertz of spectrum previously required to transmit one analog channel—and the number of channels continued to grow with better compression technologies. Likewise, cable providers expanded channel offerings and added on-demand services (VOD) once they were able to more efficiently compress their signals. The compression technologies allowed digital cable to increase channel offerings with additional niche channels that sought increasingly precise tastes; for example, the general sportscaster ESPN eventually competed in a sector of sports channels for various regions (MSG, Big Ten Network) and sports (NFL Network, Golf Channel, World Fishing Network), as an indication of the expanding fragmentation. The consequences of choice were widely experienced by the early 2000s and receive limited examination here, where I focus instead on the newer developments of convenience, mobility, and theatricality.

The State of Technology Adoption

Viewers’ use of television expanded considerably as they adopted the technologies developed and deployed throughout the multi-channel transition. Many of the technological shifts introduced incremental change to the industry in a manner that did not substantially challenge existing industrial practices, while other technologies instituted such considerable modifications that they contributed to adjustments throughout the production process. The technologies launched during the multi-channel transition were neither uniform in character nor deployed in an organized or coherent manner. Rather, many different sectors, such as computer and consumer electronics industries, governmental regulators, cable and satellite providers, and broadcasters, had varied stakes and visions for the role of these technologies in the future of the U.S. television industry.

All of the domestic technologies explored here were widely available by mid-2005, although penetration rates were still low for some of the more significant devices such as DVRs and high-definition (HD) televisions. A snapshot of technological diffusion and use collected in the spring of 2005 and then the fall of 2013 reveals the varied emergent and integrated status of different technologies (see table 2.1). The years between 2005 and 2013 are marked by a 40 percent gain in homes with DVRs, a nearly 40 percent increase in homes with broadband connection, and the emergence of “second screen” technologies such as tablets as well as the introduction of smartphone technology. These devices, along with VOD capability, feature technological affordances that enable viewers who desire a nonlinear television experience the ability to organize their viewing free from network schedules.

In the spring of 2005, 82 percent of homes with a television reported owning two or more sets, and nearly half (45 percent) owned a television with a screen larger than thirty inches.¹¹ Number of sets became a decreasingly relevant statistic as the screens upon which television might be viewed multiplied well beyond the population of a given home. Ten percent of homes owned a set larger than fifty inches—a figure growing about 4 percent per year—while 26 percent reported having a home theater or Surround Sound audio system.¹² Such audio technology reached this rate in 2000 and maintained considerable consistency, suggesting a likely adoption plateau.¹³ By 2005, only 9 percent of homes owned a high-definition set, although that was nearly twice as many as two years earlier.¹⁴ Substantially greater penetration of HD technology was achieved by 2013; however, not all homes that owned HD sets received HD content because of the varying availability of HD packages from cable and satellite services and general confusion on the part of set owners. As recently as October 2012, a Nielsen study revealed that only 29 percent of prime-time broadcast and 25 percent of prime-time cable programming was viewed in HD.¹⁵ Such data reveal how limited HD viewing remained despite the much greater presence of HD-capable sets.

Table 2.1. A Snapshot of Television Technology Diffusion, 2005 and 2013

	Spring 2005 (%)	Fall 2013 (%)
Sets
Homes with television	100	95.8
Homes with 3 or more sets	45	67
Signals
Homes with cable	67	54
Homes with digital satellite	20	31
Homes with telco signal	n/a	10
Total multi-channel	87	92
Homes with only over-the-air reception	14	~9
Channels and Devices
Homes receiving 40 or more channels	82	unknown
Homes receiving 100 or more channels	40	58 (in 2008)a
Homes with a VCR	87	55
Homes with a DVD player	76	83
Homes with a video game system	39	56
Homes with high-definition TV	9b	83 capable
Homes with a digital video recorder	7b	49
Homes with a computer	67b	80 (Internet connected)c
Homes with a mobile phone	72b	87
Smartphones (of mobile phone population)	n/a	65
Tablet	n/a	29
E-book reader	n/a	26d
Homes online	59b	72c, d
Homes with broadband connection	28b	70c

Sources: Unless otherwise indicated, data from Nielsen Media Research. Fall 2013 data from “An Era of Growth: The Cross-Platform Report,” March 2014, or “The Digital Consumer,” February 2014; 2005 data pulled from Npower for 15 May 2005 and based on total U.S. homes with a television.

^aNielsen Media Research, “Average U.S. Home Now Receives a Record 118.6 TV Channels,” 6 June 2008, http://www.nielsen.com/us/en/press-room/2008/average_u_s__home.html.

^bKnowledge Networks Statistical Research, “The Home Technology Monitor: Spring 2005 Ownership and Trend Report” (Crawford, NJ: Knowledge Networks SRI, 2005). The survey uses a telephone sampling method, so the data are figured from a base of telephone households with one or more working television sets.

^cNielsen reports 8 percent more homes with Internet-connected computers than does Pew; I’m not sure which report is more in error.

^dPew Internet and American Life Project, “Three Technology Revolutions,” http://www.pewinternet.org/Trend-Data-(Adults)/Device-Ownership.aspx.

By 2005, a multi-channel norm was clearly in place, with 87 percent of television households receiving signals from a non–over-the-air source, 67 percent of which subscribed to cable and 20 percent to satellite. Cable maintained its dominant status in 2013, though it had lost share to the telco providers—AT&T and Verizon—that began competing in selected markets with a fiber-to-the-home product. Only 19 percent of television households subscribed to digital cable in 2005, although it was available to 85 percent of wired cable homes.¹⁶ By 2012, 81 percent of cable households subscribed to digital cable.¹⁷ Digital cable allowed for advanced and two-way signal transmission between cable providers and homes that enabled more robust video-on-demand offerings and eventually, DVRs using cloud-based storage. Eighty-two percent of television homes received more than forty channels, and 40 percent received more than one hundred in 2005, a figure that increased to 58 percent by 2008. Arguably counting channels was never a good indicator of the range of content people might view. Nielsen reported in 2014 that “the average U.S. TV home now receives 189 TV channels” but watches an average of only 17 channels.¹⁸ Once broadband-distributed video became widely available around 2010, counting channels became an even less informative indicator.

The penetration of convenience devices provides one of the most marked shifts between 2005 and 2013. VCR ownership continued to decline in 2005, and was down to 87 percent. By contrast, and unsurprisingly, ownership of DVD players continued to increase, with 76 percent of homes owning a DVD player in 2005. Despite the omnipresence of DVRs in industry discussions by 2005, only 7 percent of homes had the device, which marked an increase from 4 percent in 2004.¹⁹ DVR penetration began to grow much more rapidly once the devices were integrated into the set-top boxes provided by the companies providing cable service, typically for a monthly fee. (Henceforth, the companies that provide video service—whether by cable, fiber, or satellite—will be noted as MVPDs, the common industry acronym that stands for multi-channel video programming distributor.) Twenty-six percent of homes reported they had access to video-on-demand (VOD) services in 2005, but only 11 percent reported viewing a free or pay VOD program in the previous month; the title availability at this point was most limited and emphasized theatrical film content.²⁰ The transition to digital cable led to greater availability of the service between 2007 and 2011. Only 37 percent of homes had set-top boxes that enabled VOD in 2008, but they were in 60 percent of households by 2013.²¹ Notable expansion in VOD content availability and then use occurred around 2011; the measurement service Rentrak reported that free television VOD increased more than 40 percent in 2012 from the previous year.²² In 2005, 39 percent of television households owned a video game system that attached to the television. This distribution level had been steady since 2000, but began increasing as the devices added Internet connections that expanded the range of activities gaming systems could be used for and newer-generation systems such as the Wii introduced controllers allowing motion control gaming, which also expanded the gaming audience.²³

In terms of the broader home technology space in 2005, 67 percent of homes had a computer, while 23 percent owned two or more, and patterns of growth in home computer ownership suggested that demand had nearly reached equilibrium.²⁴ Eighty-eight percent of computer households (59 percent of all households) used the computer to go online, a use level that remained steady since 2001. Fifty-two percent of online households connected through a regular telephone line, while nearly half (28 percent of all households) used a broadband high-speed method, with nearly even distribution between cable modems and DSL service.²⁵ Significant growth in access to high-speed broadband connections occurred by 2013, with 70 percent of homes connected to the Internet through a broadband connection and just two percent through dial-up, though significantly, 28 percent of homes remained without Internet access.²⁶

This substantial gain in Internet speeds resulting from the shift to broadband, as well as the emergence of smartphones and compression technologies that enabled video to be accessed over 3G then 4G mobile data networks, provided the technological basis for the most significant adjustments in television technology. Seventy-two percent of homes owned a mobile phone by 2005, and 41 percent owned two or more.²⁷ Though 31 percent of households had an Internet-capable mobile phone, or what were then called personal data assistants (PDAs), only 11 percent used the devices to access the Internet, and just 5 percent of mobile phone homes owned phones capable of receiving television-like video, and even fewer used this feature.²⁸ By 2013, 65 percent of the 235 million U.S. mobile phone subscribers had a smartphone easily capable of accessing and screening video content, though this population spent only an average of 1 hour, 23 minutes per month, or 2.7 minutes per day, using their phone in this way.²⁹

Considering television technology now requires looking beyond long-standard figures such as the number of sets and VCR penetration. As these data illustrate, Internet access and smartphone availability are just as important technological pieces to understanding post-network-era access to television content. And though notable increases are evident in the 2013 figures—so much so as to call a new era of television distribution into existence—it is important to reiterate that 28 percent of U.S. homes still had no Internet access.

Likewise, even by 2005, choice—measured by subscription to non–over-the-air providers and the number of channels available—seemed to have reached useful capacity. There always might be room for more—endlessly so, thanks to broadband-distributed video—but the average number of channels that audiences viewed suggested that few had interest in the expansion of linear channels. Nielsen estimated that despite exponential growth in availability, the number of channels viewed by a household tended to increase only slightly. A household with 31 to 40 channels viewed an average of 10.2, while those with 51 to 90 viewed just over 15. The number of channels viewed remained at 17 from 2008 through 2014, despite an increase in average channel availability from 129 to 189.³⁰ The call for à la carte cable packaging that would allow viewers to select only the channels they desired had begun by the early 2000s, though it would take the perceived disruption of cord cutting a decade later to yield serious industry consideration.

On one hand, there was good evidence that a post-network era was emerging and that the “state” of television needed different forms of evaluation than those that had marked its quick rise to ubiquity. But there were also signs of network-era persistence: Even by 2012, aggregate Nielsen data indicated that despite nearly 50 percent DVR penetration and expanding VOD offerings, time spent viewing time-shifted content accounted for just under 8 percent of time spent viewing.³¹ Again, that is an aggregate figure, and perhaps the significance of time-shifted viewing gets lost in the use of background television; among some sectors of the audience, time-shifted viewing accounted for well over 20 percent of prime-time viewing. The stakes of such moments of transition are so considerable that selective release of data could affect perceptions just as significantly as not recognizing the new questions and methods that need to be explored.

Digital Control Yields Convenience

Digital technologies allow for such a new array of television uses that it is difficult to sort out the variety of technological affordances provided by different devices and how those then map onto or deviate from how audiences actually use them. The typical audience member may focus only on what different technologies do, and thus organize them differently than I do here, as I am also concerned with how the capabilities of devices also require adjustments in other production practices. This section examines the new conveniences offered by technologies, beginning with technologies that make home viewing more convenient, then those that enable portable (non-live) viewing out of the home, and finally a consideration of how the convenience of breaking from the linear schedule occurs across domestic and portable technologies.

Viewers first gained the convenience of defying networks’ schedules with the VCR, which established a modest beginning that since has been expanded by DVRs and digital devices that integrate Internet and television to vastly expand consumer control. The first technologies made television more convenient by allowing viewers greater control over when they would view, though continued to bind that viewing to domestic sets. By the time these domestic control technologies began reaching audiences larger than early adopters—around 2010—a second expansion in convenience emerged as the technology, infrastructure, and distribution strategies converged to meaningfully establish portable television. These technologies (laptops, tablets, and smartphones) and broadband-delivered aggregators (such as Netflix, YouTube, and Hulu) expanded the nonlinear viewing made possible by the first technologies by enabling viewers to access this content anywhere they could receive a broadcast signal, access a wireless Internet connection, or even receive a mobile phone signal—which, for those with ample financial resources, meant virtually anywhere in the United States.

The first digital control device, the DVR, initially appeared to offer little additional capability than the VCR. Yet its efficiency and ease of use made its contribution significant. While programming a VCR was perceived as so difficult that a joke about the flashing 12:00 VCR clock became ubiquitous, DVRs featured one-step recording capabilities from their introduction in 1999. For some DVR users, time shifting became the default mode of viewing for most programming—particularly in prime time—a difference suggestive of a shift from mere control to convenience. Even early-generation devices featured on-screen menus and programming schedules far easier to navigate and quicker to load than those offered by digital cable systems over a decade later. The remote capabilities available with some machines that enabled viewers to program the DVR from out of the home by accessing it via computer or mobile phone further illustrated the convergence of digital technologies and expanded control.

The ease of recording common to DVRs and their tape- and disc-free, hard-drive–based archive made them a significant threat to the conventional practices of the television industry. VCR users could—and unquestionably did—“zip” through commercials in recorded material, but VCR use tended to be restricted to more isolated occasions of particular shows; based on Nielsen data, MAGNA Global estimated that VCR recording accounted for only 6 percent of the average prime-time audience in 2005.³² Industry analysts marveled at the level of satisfaction earned by DVR technologies, as adopters recounted that their DVR “changed their lives” and professed “love” for the machine. Like many skeptics, I saw the DVR as an insubstantial advance from the VCR, until I used one. I quickly joined the converted as my whole approach to viewing television changed radically once I could easily control so many aspects of the experience. By the 2007-2008 season, as DVR penetration rates reached above 25 percent, networks and advertisers agreed to begin buying and selling advertising based on the “C3” report Nielsen had developed that included live viewing plus DVR viewers who watched recorded programs and viewed commercials within three days of recording.³³ DVR penetration continued to grow, and networks agitated for a move to a “C7” measure that would count playback done within a week. Yet, though nearly 50 percent of homes had DVRs in 2013, Nielsen reported that homes with DVRs watched only eleven hours, thirty minutes of recorded programming each month—a mere 8 percent of average total viewing.³⁴

The introduction of the DVR affected television in wide-ranging ways. DVRs were many viewers’ first experience with nonlinear viewing, a way of viewing that growing VOD offerings and online streaming from Netflix or Hulu would expand. The DVR also provided the first clear technological threat to the conventional advertising model of thirty-second commercials embedded in programming, and fear of this technology led to adjustments in advertising strategies and program financing models.

Yet by 2014, just as the DVR had infiltrated nearly half of television homes, its future began to appear uncertain. Distribution technologies such as VOD and online streaming that developed after the initial DVR diffusion suggest that its role in the transition to the post-network era may be more as a technology that provides a bridge to the post-network era, rather than as a technology of the post-network era. Subsequent, arguably complementary, technologies made the effort of selecting and recording content that DVRs required—even if largely mechanized through “season pass” type settings—seem somewhat burdensome. With viewer control embedded in its name, VOD expanded viewers’ control over their television experience and is a technology characteristic of the industry’s shift beyond a mere multi-channel transition toward a more full-fledged, post-network era as VOD requires no linear television experience.³⁵ VOD technologies provide a range of services akin to DVRs: both devices enable viewers to pause, stop, and rewind or fast-forward through programs. But the key distinction between them lies in where the technologies store content. DVRs pull content from the twenty-four-hour linear stream of programming that networks transmit and store the recordings on a device in the home (though next-generation devices have cloud-based storage, which makes this distinction negligible). VOD technologies store content on a server maintained by cable providers, and viewers access this programming bank at will, choosing among the offerings of the provider. VOD functionality can also be controlled by the MVPD, most commonly by disabling fast-forward capability.

The slow pace at which MVPDs introduced VOD offerings and developed a robust programming supply is far more a matter of the complicated rights allowances required in a business of many middlemen and advertising protocols than of technological capability. The development of VOD libraries required extensive negotiation between content creators, cable channels, and MVPDs in order to identify a financial model that would serve all three entities and still be desirable to viewers.³⁶ Throughout the mid-2000s, MVPDs rebuilt their infrastructure and offered VOD as part of top-tier digital subscription packages. By 2005, free VOD was available to 26 percent of cable subscribers, but primarily allowed them to view only “extras” and “bonus footage” rather than full episodes.³⁷ Some cable services experimented with subscription video on demand (SVOD), but the model of paying specifically for the on-demand content was less popular (unsurprisingly) than the “free” access, which cable services included as a “value-added” perquisite to encourage digital cable subscription. Subscription services such as HBO did include on-demand access to much of its content as part of subscription comparatively early on, providing its subscriber base with the earliest access to full-length on-demand content.

The other impediment slowing VOD development resulted from finding a way to monetize content. Distributors lacked a motivation until VOD viewing could be “counted” in ratings. Not until around 2012 did technologies allowing “dynamic advertisement insertion”—or the capability to change the advertisements included in VOD streams over time or by subscriber zip code—develop. These systems could change the advertisements based on date or location of the viewer and provided an economic motivation for MVPDs to push VOD adoption.

In just the seven years between editions of this book, the VOD world has changed substantially—at least for subscribers of some cable systems. As concerns about viewers cutting cable subscriptions to access broadband-delivered programming through services such as Netflix magnified beginning in the fall of 2010, large MVPDs began creating libraries and “any device, anywhere” availability more comparable to the convenience and choice being offered by broadband-delivered programmers. By 2013, the cable giant Comcast, for example, offered subscribers unlimited free access to 30,000 titles, including episodes of 600 television series, through their Xfinity VOD television service, 270,000 titles on Xfinity.com, and 20,000 television shows and movies through the Xfinity app for iPad, iPhone, or iPod touch. This was part of the TV Everywhere initiative launched by Comcast and Time Warner in 2009 as a way to allow authenticated subscribers access to their “living room” content on a range of devices and eventually outside the home.

MVPDs aggressively overhauled their value proposition to audiences in the face of widespread cultural adulation of the alternative Netflix offered, but as of 2014, it remains difficult to claim VOD as a victory for the cable and telecommunication industry. These industries underutilized VOD capability for a long time and developed them only when a threat emerged. The comparison of the development of VOD in the U.S. market with the iPlayer, the British Broadcasting Corporation’s on-demand application, reveals considerable insight into the implications of the public service mandate versus commercial mandate on innovation, particularly those operating with a functional monopoly, as was the case of the U.S. MVPDs. The BBC launched its iPlayer in 2007, which featured an interface more akin to Netflix’s graphic interface than the text-heavy and awkward-to-navigate interfaces still offered by MVPDs in 2014. BBC’s self-control of program rights and mandate to make programming accessible yielded far more immediate experimentation than evident in the United States, where publicly held companies are punished by the stock market for reinvesting in technological development, and filling libraries requires extended rights negotiations with a multiplicity of parties. The first MVPD to make an interface similar to the iPlayer available began rolling it out in mid-2012, but had not reached its full subscriber base a year later; availability seemed limited to those markets in which competition from a telco existed. Unsurprisingly, despite growing availability, research in 2012 revealed limited use of VOD, and the industry source Variety categorized the report as evidence that the cable industry had “fumbled badly with VOD,” missing “a $6 billion business” and “paving the way for the emergence of over-the-top alternatives like Netflix.”³⁸

Despite its slow start, because VOD is an endeavor of the MVPDs—companies that connect 80 percent of homes to the Internet as well as cable—VOD has a structural advantage likely to secure its centrality to the post-network era.³⁹ Robust and consistent libraries will leave viewers with little need to record programs on their own or to seek additional middlemen to aggregate content, so long as VOD offerings don’t include the bloated commercial pods characteristic of linear viewing. However, creating and maintaining robust and consistent libraries remains a significant challenge for MVPDs that own minimal content rights.

Convenience technologies—including the DVR, VOD, DVD, broadband-delivered program services such as Netflix (also known as SVOD, subscription video on demand), and mobile applications that can be used on devices such as phones and tablets—enabled viewers to more easily seek out specific content and view it on living room screens and in an ever-expanding variety of venues. These technologies increased viewers’ ability to select not only when to watch, but also where, and provided the most expansive and varied adjustments in the technological capabilities of the medium. Convenience technologies encourage active selection, rather than passive viewing of the linear flow of whatever “comes on next” or “is on,” and consequently lead viewers to focus much more on programs than on networks—all of which contributes to eroding conventional production practices in significant ways and to producing the distinctions among prized content, live sports and contests, and linear viewing highlighted in the introduction. The viewing behaviors these technologies enabled, in tandem with the vast choice among outlets that viewers could now access, were vital to the shift of television from what Bernard Miège theorized as a “flow” industry to something more like a “publishing” industry.⁴⁰ Convenience technologies also increased the deliberateness in viewers’ use of television, which allowed for adjustments in how programs were created, funded, paid for, and distributed.

Matters of Space: The Convenience of Portable Television Devices

DVRs and VOD allowed viewers to capture television from the dictates of the networks’ linear schedules, but on their own, these technologies still confined viewers to conventional “living room” viewing. Freeing viewers to watch content anywhere they desired required another set of technologies that allowed portability. Viewers first experimented with this possibility by watching television series sold on disks on portable DVD players, but rapid technological diffusion quickly made portable viewing much easier. By 2005, the more elegant solution of downloading programs to iPod players and devices also used for gaming, such as the PSP (PlayStation Portable), freed portable television from requiring a physical medium. TiVo-brand DVRs also expanded the convenience of the device through the TiVo ToGo application, which offered easy transfer of programs it recorded to laptops and portable media devices. All this would soon seem most insignificant, though, as broadband-delivered program providers unshackled television from its domestic confines and enabled viewing on laptops, smartphones, and tablets.

As of 2014, the dominant experience of television that developed through its network era and multi-channel transition made it seem like the conveniences of portability and mobility were distinctive technological affordances that required specific assessment, if for no other reason than their different relationship to existing economic models. Per my definition, mobile television is linear, while portable television is nonlinear. Mobile television consequently remains useful for conventional advertiser support, while portable television is chosen in a manner consistent with prized content and may be better monetized through transaction payment. The decades during which living room viewing dominated the experience of television remain paradigmatic in the minds of many in a way that rhetorically counterpoises mobile and portable viewing as some sort of threat, but this is simply our imagination of the future being tainted by knowledge of the past. The previous impossibility of mobile and portable will be forgotten as quickly as the place-based past of telephone calling has been, which will allow fluidity of viewing spaces to seem a “natural” use of television technology instead of the battle for supremacy that characterizes contemporary outlooks.

An important early volley in portable television came with Apple’s October 2005 announcement of the sale of individual episodes for $1.99 on iTunes. Apple’s announcement was important because it attached a particular economic value to an episode of television and the beginning of a repository of television shows available for purchase, which has since been expanded by Amazon and Google. Also important to sketching this history was the release of the Saturday Night Live short “Lazy Sunday” on YouTube in December 2005. This video, initially posted without authorization by the rights holder, NBC, attracted 1.2 million views in just ten days, offering a most preliminary suggestion of a slightly different application of broadband-distributed, nonlinear television. Though YouTube had been designed with the purpose of facilitating amateur sharing, the flurry of posting broadcast- and cable-originated content to YouTube indicated how the site might also serve as a repository that could help viewers manage the abundance of post-network video.

Though there were important developments in the next few years (see table 2.2), the real start to the revolution in portable television began in 2010. In January, Apple announced the iPad, which it released three months later. Though the technology alone is of limited use without applications, the tablet developed into a technology more preferred for portable viewing than the existing laptop and mobile phone screens. Applications and broadband-delivered program services began developing at this time as well. HBO GO launched in February 2010 and was widely hailed by users and the industry as a model for broadband distribution. Users appreciated its easy navigation and depth of content, while the industry appreciated the minimal disruption to existing models through the authentication system that allowed only linear HBO subscribers access. Then, in April, the sports giant ESPN rebranded its ESPN 360 service as ESPN3 and by October established an agreement with Time Warner Cable that allowed subscribers full access to ESPN on computers, then mobile phones in April 2011. Finally, in November 2010, Comcast offered its Xfinity TV app for the iPad, which was followed by Time Warner’s TV Anywhere application in early 2011, and the efforts of other MVPDs to allow subscribers to access the content available on their living room set through other devices and in other locations through authentication soon followed.

The fall of 2010 marks the beginning of what I categorize as the “Netflix Surge”: a period during which Netflix presented a much more disruptive—though short-lived—model for broadband-distributed, nonlinear television. In the fall of 2010, Netflix began offering a streaming-only service and, by many measures, provided top-tier content: it featured the content of the subscription network Starz and other licenses achieved at low rates before license holders realized the potential of the service. Netflix’s quick subscriber gains—reported in frenetic blog-era trade press accounts—inspired and fueled unreasonable anxiety about cord cutting, and soon the acronym OTT (over-the-top) began appearing to acknowledge concerns that cable subscribers would use Netflix and other broadband streaming and downloading distribution services as an alternative to cable subscriptions. Certainly, emerging Internet use figures, such as that nearly 25 percent of all evening Internet traffic was Netflix use, were noteworthy,⁴¹ but given that Netflix traffic and all that streaming and downloading were, for the most part, traveling through “tubes” provided by the same MVPDs who also provided cable service, the level of anxiety seemed excessive.⁴²

Table 2.2. Key Developments in the Transition to Nonlinear Television

2005 June	YouTube launches.
2005 October	iTunes announces $1.99 downloads.
2008 January	Netflix offers unlimited streaming plan.
2009	Hulu becomes culturally relevant. It doubles its content library, adds Disney as a partner, and by October 2009, has over 855 million video views.
2010 February	HBO GO launches.
Late 2010–early 2011	Major strides in TV Everywhere: Comcast, Time Warner Cable, and Cablevision release authenticated apps for iPad.
2011–2012	Smartphone use expands from 30 to 56 percent of the mobile phone market.
	MVPD-provided VOD becomes increasingly robust. Begins offering most recent five episodes of original cable and many broadcast series.
2013 February	Netflix releases full season of House of Cards.
2013 May	Netflix releases full season of Arrested Development.
2013 October	Comcast announces package allowing viewers access to HBO with Internet and limited basic TV subscription.

It should have been clear to anyone with a background in television economics and distribution that between the cost of renegotiating their content with the expanded subscriber base and the unlikely ability of circa 2010 Internet infrastructure to accommodate growth of Netflix beyond a niche, the Netflix Surge would flame out quickly. Netflix investors went on a wild ride in 2011, with stock prices rising to a high of $298.73 on July 13, 2011, and the service achieved a subscriber base of 24.59 million in the United States at the end of June 2011.⁴³ By the end of September 2011, the service made missteps, announcing a splitting of the by-mail and streaming service in what was effectively a doubling of cost to consumers and lost 800,000 U.S. subscribers, which was most significant for its deviation from high quarterly subscriber gains, and sent the stock price falling to $113.27.⁴⁴ But this doesn’t diminish Netflix’s contribution to inaugurating a post-network era, and by many measures the service had recovered by 2014. The Netflix Surge was crucial for offering more than a hypothetical thought experiment of how post-network television might operate. It had significant ramifications in pushing MVPDs to innovate to avoid disaggregation of content and presented viewers with a usable interface and the nonlinear tools of recommendation engines and queuing, which helped fuel viewer desire for better nonlinear alternatives.

Netflix and MVPD services’ TV Everywhere initiatives are addressed in greater detail in chapter 4’s exploration of changes in television distribution. Key to the discussion of the convenience of portable television here is the role Netflix played in enabling audiences to consider laptops and tablets “television screens.” Netflix, perhaps more than any other entity, disrupted the long acculturated sense that television content should be viewed on a television set. Similar to the rabid TiVo fandom that permeated the popular culture of those of a privileged habitus in the early 2000s, Netflix again captured pent-up demand for a different kind of television experience, and for a few months, suggested a new world of television. The realities of television economics and the fact that Netflix—at this point a quintessential middleman—owned neither content beyond a handful of shows nor the connection into the home made apparent that Netflix was unlikely to overtake those who produced content or could deliver to audiences, but it could force revolution on those who did.

Matters of Time: Breaking from the Linear Schedule

By increasing asynchronous viewing, convenience technologies expanded the audience fragmentation and social polarization that preliminary choice and control technologies had already enabled during the multi-channel transition. Whether DVR owners who reschedule viewing on their own terms, viewers who wait several months to purchase full-season DVDs, or those who stream shows via VOD or Netflix, users of convenience technologies have come to select their own viewing conditions, including the crucial one of time. The resulting temporal fragmentation may seem comparably insignificant relative to other adjustments—such as the fragmentation of viewers among a multiplicity of channels—but it has had important implications in disabling the coterminous circulation of television within the culture, which significantly changed the way television operated as a conduit of cultural discussion. Beginning in 2004, feature articles in the popular press recounted the trend of audience members waiting until a full season of a series was available on DVD and then watching the full season at a self-determined pace.⁴⁵ Rachel Rebibo, a DVD owner who preferred this viewing experience, explained, “With a DVD player, I can set my schedule and turn it off anytime. It’s my choice.”⁴⁶ Another DVD viewer, Gord Lacy, offered, “I loved West Wing. I watched eight episodes in one night. I had only ever seen the pilot, and I’m Canadian watching a show about a U.S. President.”⁴⁷ Those who turned to DVDs for control began changing the television viewing experience, and many who left the linear world for prized content, aimed never to return. By 2011, the ease of streaming full seasons of programs though Netflix or by accessing increasingly robust VOD caches of programming offered further tools to those willing to wait in order to obtain greater control of their viewing.

But until 2012, viewers made the personal choice to defer viewing until they could amass a stock that would permit favored pacing—distributors still released content in weekly intervals of individual episodes. Once it ventured into content creation, Netflix defied the model of weekly episode release and made available all of the episodes of the first “season” of its original series Lilyhammer simultaneously, a strategy it reproduced with much greater notice when releasing House of Cards in February 2013. Netflix suggested a possible future in which viewers would not have to wait for a linear, weekly delivery of content. The premiere of House of Cards generated extensive debate about the economic and cultural merits and consequences of this release strategy, and despite the voluminous commentary, reflection on the utter arbitrariness of the existing norm—given new delivery capabilities—went uncommented upon.