It must be frustrating for Apple. Here’s a company that’s supremely good at dealing with the psychology of the customer, but it’s up against a brick wall when it comes to competing with cable and satellite.
To be sure, it’s clear now that customers will drop their cable or satellite subscription at the drop of the hat when offered a better alternative. Strong industry forces and an opposing psychology, however, work behind the scenes to slow down Apple’s efforts.
Human Psychology
TV viewers, whether they’re watching a TV series or a popular movie series, like Harry Potter, like coherence and continuity. For example, I have the first two Jason Bourne movies on DVD and the Bourne Ultimatum on Blu-ray. Most people in my position would love to re-purchase the first two movies on Blu-ray as well. The fact that most of us have ditched all our VHS tapes and perhaps even DVDs and converted to Blu-ray discs is a testament to that human need for modern, elegant, complete solutions. Studios depend on that psychology.
Jason Bourne, credit: IMDB
The same goes for TV shows. Customers tend to be skeptical of TV shows. Often a favorite show goes on hiatus, because it’s not doing well, gets tweaked, then returns to an even smaller audience that has finally lost interest. For example, the ABC series V. As a result, many TV viewers, frequently burned, will buy a TV series only after a season is complete and watch it straight through, sans commercials. Few would relish the idea of purchasing a TV series piecemeal and remain content with a few missing episodes.
Recently, Apple suspended the rental of TV shows on Apple TV. What I think happend was that not enough of Apple’s customers were ready to lay out a continuous stream of money, each week, for a TV show that might be suspended at any time. Others, chastened by the fickle approach of the studios, would tune in from time to time, never being a consistent money maker for Fox. The grand experiment to fly in the face of known customer behavior, for the sake of some incremental revenue, failed.
And there we have the fundamental paradox of home TV viewing. The studios are all too willing to cash in on the psychology of their customers who want completeness, yet from time to time, for the sake of money and advertising, they will gladly, spontaneously burn the viewer, making them forever gun shy. If anything, the modern TV viewer has been trained to be cavalier and detached, akin to the feeling of being burned in love. It’s that tendency by the TV industry to first exploit the customer desire for continuity and coherence, but then forsake that very strategy for short term gains that infuriates viewers. It’s like being in a prison camp: manipulated, deprived, insulted, victimized and left wondering what’s next. To add insult to injury, the cost of being a victim keeps rising.
The Apple Way
Nothing showcases the difference in thinking between Apple and TV studios and networks like a tour of the Apple customer household. In the den is, perhaps, an iMac with iTunes, lots of TV shows and music on the hard disk and hardly a DVD (and zero Blu-rays) in sight. In the living room is an HDTV, DVR, a Blu-ray player and lots of DVDs and Blu-ray discs, mixed and matched, in an incoherent scatter. Movies recorded on the DVR are locked inside, and despite the occasional industry rumblings, there’s no coherent, standard mechanism for watching those recordings any where one might please. It’s a mess.
In the den, there’s a consistency of vision. In the living room, there’s a mishmash of technologies caused by the customer trying to optimize, minimize cost, balance various technical elements, and keep from being burned. Purchasing rotating plastic is basically an insurance policy. As Murphy’s Law says, “…the organism will do as it damn well pleases.” In my case, it’s unlikely that I’ll ever buy the other Bourne movies on Blu-ray because I only watch the movies occasionally, and sinking funds into maniacal completeness on a dusty bookshelf is wasteful. One has to work hard to be in the right consumer frame of mind nowadays.
So that brings up the second problem. Myriads of different TV customers have different views and behaviors. Some fall head long in love with the TV experience and will do anything to feed their habits. They’re a good source of revenue. Other viewers are more cantankerous. They work on getting HDTV free over the air with a good antenna. They refuse to own a DVR and watch old movies on DVDs. There’s a wide variation in TV habits depending on how the customer’s personality affects their loyalty and spending. Any sufficiently complex system will result in wide variations in customer response, unpredictable behavior and the suppression of innovation.
That’s a situation ripe for disruption. If Apple can supply a consistency of vision and also appeal to customers who’ve grown weary and skeptical of the TV industry, the company will be wildly successful. As a result of that success, studio and hollywood executives will slowly draw the conclusion that they must cling to the coattails of the wealthiest corporation in the world. It’s that or go bankrupt.
As we know, the TV studios have been reluctant to do that because they’re terrified that Apple will control their fate and dictate terms, much as the fruity company has with the publishers on the iPad. Even so, the fact that the TV industry cannot and will not compete with itself signals an industry on the verge of a massive disruption.
Watch out when Apple gets it right
One day soon, Apple will put it all together. They’ll discover that magic psychological link that breaks through the weariness and skepticism — the feeling of being forever abused and manipulated. Apple’s ability to marry powerful technology with an optimistic, consistent vision will eventually break the ice for the majority of customers. Marry great software with vision and broadband, and things can happen fast. And then it’ll be game over.
That could be a reliable, eternal iCloud. It could be iTunes built into a high quality HDTV. It could be the introduction of iTunes, subscription funded TV series, not subject to cancellation. It could be an emerging appreciation of iPads and AirPlay as Apple comes to dominate the tablet industry. Toss in some things Apple hasn’t revealed. Maybe all of the above, mixed and matched until the whole is more than the sum of its parts. But you know it’s coming. It’ll be like a fever breaking.