The History Of iTV Failures Leading Up To Steve Jobs' Final 'One More Thing…'

Steve Jobs one more thing

Once again, we’re hearing that TV is on the verge of a revolution.

In the last months of his life, Steve Jobs told his biographer Walter Isaacson that he had “finally cracked” TV.

TechCrunch called it Jobs’ final “one more thing,” a reference to the Apple CEO’s dramatic reveal  of the original iPhone.

Google just rolled out the second version of Google TV and announced more than 100 new YouTube channels to distribute through it, and it’s considering rolling out its own pay TV service in Kansas City.

Microsoft announced deals with Comcast and others to bring TV to the Xbox.

There’s only one problem with all these visions: people seem to like TV just like it is.

The proof? For the last 20 years, countless efforts have been made to improve TV by adding something — interactivity, Web access, digital video recording, place shifting, Internet channels.

None of these products has been a smash hit, and most were total failures.

See for yourself…

QUBE, 1977

This was one of the first advanced cable networks, featuring a combination of pay-per-view (new at the time) and regular stations. It was run by Warner Cable and featured a set-top box built by Pioneer.

QUBE launched first in Columbus, Ohio, and after it had rolled out to other cities, QUBE started testing interactive shows in Columbus households. Viewers used a special remote with five buttons to respond to questions.

QUBE was canceled after Warner ran into financial problems. Some viewers were also concerned that Warner was collecting personal data through the system.

Full Service Network, 1994

The first wave of interactive TV really kicked off with this experimental system run by Time-Warner cable, which was rolled out to 4,000 households in Orlando, Florida. Customers could do things like order a Pizza Hut pizza or buy sports highlights from recent games.

Time-Warner CEO Gerald Levin called it 'a turning point for the TV industry.' (Levin would later oversee the disastrous sale of Time-Warner to AOL.)

It was canceled four years later.

Web TV, 1996

This was one of the first companies to promise the Web on your TV screen. The boxes were manufactured by Sony and Philips and cost more than $300, but that seemed like a bargain compared with much more expensive personal computers.

The product launched in 1996 and had some real quirks -- viewers were expected to use a keyboard to type in URLs and sent email. It started off slowly, but Microsoft bought the company for a staggering $425 million in 1997.

Subscriber numbers peaked at under 1 million in the late 1990s. Microsoft rebranded it as MSN TV and released a couple more versions, but eventually the product petered out from lack of interest.

Microsoft TV and its relatives, late 1990s through today

Microsoft has tried to play the interactive TV business from several different angles.

In the 1990s, it tried to provide various Windows CE-based platforms for cable set-top boxes to deliver interactive TV services. The company invested billions in cable companies -- including $1 billion in Comcast and a $5 billion stake in AT&T -- to try and get uptake for these products.

These early platforms were plagued by technical problems and delays, and Microsoft threw them all overboard in the early 2000s and started over again with Foundation Edition. It flopped as well.

Eventually, Microsoft stopped trying to pitch products to cable providers, and instead focused on its Mediaroom IPTV platform, which it sells to telecoms who want to deliver TV programming over data networks. Mediaroom powers AT&T U-Verse, which last reported just over 2 million subscribers. By way of comparison, the largest cable network in the U.S., Comcast, has more than 20 million.

TiVo, 1999

TiVo is widely credited with inventing digital video recording, and some people still talk about 'TiVo-ing' a show when they want to record it.

But the company's invention was eventually incorporated by cable companies into their own set-top boxes, and TiVo has fallen on hard times -- it consistently loses money, and revenue fell in the first six months of 2011 compared with the previous year.

Replay TV, 1999

Replay was introduced at the Consumer Electronics Show in January 1999, the same place where TiVo was introduced.

The service was hurt early on by a copyright suit -- broadcasters thought it was too easy for Replay users to skip commercials. The company was passed among several owners, and in 2005 its then-owner (D&M Holdings) phased the hardware out. Eventually most of the company's assets ended up with DirecTV, and the service was finally canceled for existing customers in September of this year.

UltimateTV, 2000

With the splashy launches of TiVo and Replay TV, digital video recorders suddenly seemed cutting edge. Microsoft had been playing around in the interactive TV space since buying Web TV, so it decided it needed a DVR product as well.

The result, Ultimate TV, launched in partnership with DirecTV. It lasted a couple years before Microsoft shut the division down. The service kept going for a while, but hasn't been updated since 2007.

AOLTV, 2000

This set-top box from what was then America's biggest Internet service provider got a big preview at the 2000 CES show in January and launched a few months later. Manufactured by Philips and sold at retailers like Circuit City, AOLTV let users access their AOL services like email and instant messaging, as well browse as the Web, from their TV sets.

It was dead by 2003.

Windows Media centre, 2004

As if it hadn't failed enough at TV already, in 2004 Microsoft launched a special version of Windows XP called Media centre Edition. It let users control media functions, including live TV and digital video recording, with a remote control.

Media centre had some hardcore fans, and Microsoft now includes it in the home editions of all copies of Windows. But it never got broad usage. Recently, Microsoft admitted that only 6% of all Windows 7 users ever opened the Media centre app in Windows 7, and only 25% of those users kept it open for more than 10 minutes.

Slingbox, 2005

This is probably the biggest hit on this list.

The original Slingbox launched in 2005, giving users a way to access their cable feed from remote locations -- you could basically get your home cable TV setup on any computer with an Internet connection. It got a lot of attention, and sold 100,000 units in its first six months -- not bad, although scant compared with hit tech products like the PlayStation 2 or iPhone 4S, which sold more units during their first DAY.

In 2007, EchoStar bought the company for $380 million. Sling Media has since released a lot of other products, like the SlingGuide (which lets users manage their DVR over the Web) and SlingPlayer Mobile, which lets them watch TV on a mobile phone.

Apple TV, 2007

The first version of Apple TV was a small box with a hard drive, but users had to sync it to their computers to get video content on the box. Steve Jobs later called it a 'hobby' and admitted that 'it was not what people wanted.'

A software update in 2008 let users buy iTunes movies directly from the box itself, but there was a pretty small selection available and they didn't go on sale until 30 days after the DVD release.

In 2010, Apple tried again with a smaller box (shown here) that cost only $99 and boasted new features like Netflix integration. But Jobs still referred to it as a 'hobby,' and expressed frustration that the cable TV operators heavily subsidized the market for set top boxes, making it hard for outside companies to compete.

He was right. It'll be fascinating to see how Apple expects to change that.

Roku DVP, 2008

Roku approached the interactive TV market from a clever angle -- it didn't talk about TV at all. Instead the company launched with a device that did one thing well: stream Netflix to your TV.

Over time, Roku updated its product line with very inexpensive models (starting at $49) and gradually added more video content, and now it's got dozens of Internet-based channels. In January, the company passed the one million unit sales mark.

Google TV (first edition), 2010

Google got into the TV game last year with Google TV, a software stack based on Android that gave users a way to search for video content across television and the Internet.

But the interface was too complicated and didn't feel like TV, and the devices flopped -- Logitech had more returns than sales in the first quarter of 2011. It didn't help that Sony built a Google TV with an insanely complicated remote control (shown here).

Now Google's giving it another shot with a completely redesigned set of software and new content on YouTube that feeds into it.

Boxee Box, 2010

Boxee started as a free open-source software app for viewing video on a PC (similar to Windows Media centre, but without the Microsoft intellectual property). Later, a private company took the software and put it into something called the Boxee Box, which attaches to a regular TV and lets users watch Internet video on that TV (similar to Google TV, but without the Google intellectual property).

Initial sales were 'stronger than expected,' and the company now expects to sell 100,000 units in 2011. By way of comparison, Microsoft's Kinect sold more than 100,000 units per DAY when it launched.

BONUS: Winky Dink And You, 1954

This CBS show was reportedly praised by Bill Gates as the first interactive TV program. Kids would attach a 'magic drawing screen,' which was actually a big sheet of plastic, to the TV. At some point in the program, the hero would get stuck in an impossible situation, and the viewers would 'draw' them out of trouble -- like by drawing a bridge over a river -- using special crayons sold for the show.

Parents got upset when kids drew directly on the TV, and were worried that they'd get hurt by sitting too close to the screen. It went off the air in 1957, but was revived in syndication in the 1960s and later updated in the 1990s.

So what actually works?

So what does it take to sell users a device that connects to their TV?

It has to offer a large store of exclusive entertainment content that can't be obtained anywhere else. And it has to be simple to set up and use.

The best examples are video players (VHS followed by DVD and now Blu-ray) and game consoles. None of those products promised better TV. They simply used the TV set as a screen for entertainment content that wasn't available anywhere else.

The only way to reinvent TV may be to ignore it completely and give people something better that just happens to use the TV as a screen.

Speaking of game consoles, can you guess which one sold more than 300,000 units per day on launch?

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