The home entertainment industry pushes, but everybody wants to pull


Last year, over a million people left cable television. This year, it's estimated that 2.6 million will cut the cord. The reason for this trend is simple: The packaged, bundled model of television and movie delivery is out of date, and it doesn't fill the needs of consumers. It never has. Over the next few years, we're going to see the entire industry switch from the current "push" model, to a "pull" model that has individuals getting exactly what they want on their televisions; no more, and no less. And I've met the guys who are going to make it happen.

We've already seen the beginning of this model in a few primitive ways. We already have unstructured content on demand (think YouTube), and some streaming video services. Although there is no real unification there between services, and no real organization, the handwriting is on the wall. The people have spoken. There are many reasons why the old model of packaged content is unsustainable. Jonatan Schmidt, co-founder of Trova Networks -- the company that is changing the game as we speak -- tells us why. "It's too expensive. Eighty percent of the content is not what people want. They only use 20 percent of the content, but they pay for 100 percent. More importantly, you have a huge disconnect between various types of content providers' needs and wants, consumers' needs and wants, and everything in between."

Creating the first global digital content marketplace, and upending several major cable and content providers in the process, is no small task. Spending their own money, and gaining the support of several industry insiders in the process, Schmidt, along with co-founders Emilian Elefteratos and Russel Davis, have already hashed out some impressive partnerships and built a working beta version of the Trova set-top box. My prediction is that Comcast, Apple TV, Netflix and a half dozen other companies who have so far failed to see the big picture, will be knocking on their door very soon. One of the biggest, most fundamental problems with these content providers and even with the so-called "alternative" content providers, is that the content continues to be segregated. It's not integrated with anything else you own or use. "And, when you look at the amount of content that can be delivered," says Schmidt, "it's infinitely more than any of the cable providers are actually delivering to you." The cable providers' "package" model gives you two or three options, when in reality, very little choice at a price point that continues to creep upwards.

Schmidt likes choice. He thinks other consumers will like it too, and will soon realize that the cable companies have delivered only the illusion of choice -- while pushing lots of content at you that you don't really want. "I don't want to watch what you tell me to watch. I left Russia because I didn't like being told what to do," he jokes.

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