Google TV’s Quiet Uptick

By Adam Sewall on Mar 01 2012 at 8:00 AM

Faced with disappointing sales and poor reception, Google TV has played second fiddle to other connected TV platforms. But when we were compiling our Q4 Video Index, we noticed momentum for Google TV late in 2011.

While still small when compared to all online video watched in Q4, Google TV’s share of video plays increased by an impressive 91% during the quarter. After a series of false starts, Google TV may finally be gaining broader traction with consumers.
What's changed? In Q4, a number of new Google TV efforts were unleashed, including:

It's hard to nail down the exact reason why we've seen this GTV uptick. But with over a billion analytics pings per day across 100 million+ unique users watching online video on an Ooyala-powered site, we think this trend has legs. 

Despite its initial setbacks, Google TV is now a serious contender in the connected TV market. When Google announced its $12.5 billion acquisition -- its biggest yet -- of Motorola Mobility, many people's initial thoughts jumped to mobile phones. Others thought TV. Not only does Motorola make about 11 percent of Android phones, but the company also led in set-top box revenues in 2010.
"We believe Google is also interested in leveraging Motorola Mobility's Home segment for Google TV," said Peter Misek, an analyst at Jefferies.
Straight from the horse’s mouth, Motorola Mobility also sees the potential to help expand Google TV, GigaOM reports.
Motorola Mobility CEO Sanjay Jha pointed to Motorola’s strong relationships with pay TV operators and noted there is a transition underway, as operators shift from traditional set-top boxes to IP-connected boxes. “There is great convergence between the mobile world and content that comes to the home through set-top boxes. Working with the carriers, we’ll be able to accelerate that convergence which will excite customers.”
How will Google TV fare? With fewer than 1 million active devices, Google may find it hard to beat popular contender Roku, which, unlike Google TV, has generated rave reviews from day one. Case in point: Wired said it was "Just Shy of Totally Amazing" while CNET declared it the "Best all-around streaming media box.” Between 2.5 million and 3 million Roku boxes have been sold already, and units are priced competitively, beginning at $59.99. The new Roku Streaming Stick, a USB-sized device that will transform HD sets into connected TVs, is also highly anticipated.
Meanwhile, Apple, which considers its set-top box a "hobby," is estimated to have sold 4 million units in 2011, totaling 32 percent of the market. The new $99 price tag is also much more alluring than the $229 price it debuted with in September 2010. Fans, analysts and consumers are eagerly awaiting the next installment of Apple TV, connected sets expected to offer wireless streaming, multi-device support and voice- and motion-based controls. 
Google showed off its new TV platform at CES with LG, Marvell, MediaTek, Samsung, Sony and Vizio. Time can only tell how these devices and Google’s software perform. The market for set-top boxes and connected TVs is huge. Sales for set-top boxes doubled in 2011, totaling 12 million units, and the number of Web-connected sets is expected to reach 500 million by 2015.


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