Verizon Communications is about to open up its new Widget Bazaar to third-party developers to create an "app store" for its Fios TV service in a move that could forever change how people watch TV.
Verizon first announced the Widget Bazaar just a couple of weeks ago. Initially, the company described it as a storefront for new widgets or applications developed by Verizon partners for its Fios TV customers. At the time, Verizon executives downplayed the possibility of a sprawling Widget Bazaar teeming with thousands of applications developed by third parties.
But now Verizon is making it clear that the company has much bigger ambitions for the Fios TV app store, which includes opening its APIs and software development kit to third-party software developers. It also plans to create a process for approving those applications. And like the VCast app store, which was announced last week for new wireless applications, Verizon plans to allow developers to charge for their applications, and it will provide hooks into the company's billing systems so that developers can charge for their applications.
"From the beginning we said we wanted Fios to be a platform for innovation," Verizon CIO Shaygan Kheradpir said. "So we are not limiting innovation to any particular circle of developers. But we are taking things one step at a time. And we will start with applications from our partners, and then we'll move toward opening it up to third-party developers."
Details of how applications will be approved haven't been revealed, but it's likely the business arrangement for the Widget Bazaar will be similar to that of the newly announced VCast app store, which means that developers will likely keep 70 percent of revenue from their applications, while giving 30 percent to Verizon. This is the same ratio Apple uses in divvying up revenue for its popular iTunes App Store.
Kheradpir said Verizon will provide more details in the fourth quarter when it makes the Widget Bazaar developer SDK available.
Enhancing TV viewing
The first two applications created for the new Widget Bazaar were for the social-networking applications, Twitter and Facebook. Kheradpir wouldn't share usage numbers, but he said he has been surprised by the quick uptake in usage over the past couple of weeks. And already the company is evolving the applications based on subscriber feedback. For example, when the widgets launched, Fios TV subscribers were only able to read and access only basic information through the Twitter and Facebook services. But as of this past weekend, users are now able to post updates both on Twitter and Facebook.
Even as the company adds more functionality to the existing Widget services, Kheradpir said the company is being careful not to re-create the Web experience on the TV. This is a lesson that Verizon and others marching down the IPTV path have learned from Microsoft's early WebTV efforts in the late 1990s.
WebTV, which came with a keyboard, allowed people to surf the Net on their TVs. But Kheradpir argued that "surfing" isn't exactly what people want to do when they're sitting in front of their TVs.
"People don't necessarily want a full browser on their TV," he explained. "TV viewing is still very much a sitting back experience. And what people really want is a service that is relevant to the TV viewing experience and also provides a simple interface with one click access."
Kheradpir said that Verizon is not trying to completely change the act of watching TV, but instead the company is looking to enhance the TV viewing experience. He thinks that Verizon can do this by providing interactive applications that are contextually relevant to users and the media they are consuming.
This means allowing Twitter subscribes to view in real time Tweets about the TV shows or live events they're watching. The way it works is that the screen is split into two sections. And on one side a small window plays the video, while on the other side of the screen, the tweets fill up the screen.
On a personal note, Kheradpir said he found that linking Twitter to his Fios TV service actually improved his experience of watching the Academy Awards. The new Fios TV Twitter widget was being beta tested when the live awards ceremony aired in February.
"Awards shows like the Oscars can be really boring," he said. "But when I could watch it with the live Twitter feed, it was really funny. When Danny Boyle (director of the award winning movie "Slumdog Millionaire") took the stage, everyone started Tweeting, "Why is Rudy Guiliani up there?' I hadn't thought about it, but then I realized he does look a lot like Guiliani. It was really funny."
Kheradpir, who says he now relies on Twitter for breaking news updates, also said that Twitter on Fios allows people to be engaged in the discussion right from their couch. Instead of viewers being talked at by newscasters and others on TV, they can now contribute to the dialogue and discussion. And if their views are insightful, the Twitter community rewards them by re-tweeting their comments.
It shouldn't come as a big surprise that people would want to be more engaged while watching TV. Over the past decade since the Microsoft WebTV experiment came and went, the Internet itself has turned into a much more interactive medium. News stories posted on the Web encourage reader feedback with "Talk Back" sections. People have created their own blogs to share their views. User-generated video sites like YouTube have exploded. And now social-networking platforms like Facebook and Twitter allow people to easily link to other items on the Web and share their views on various topics.
And as people become increasingly more mobile, these tools have moved to cell phones, allowing people to remain engaged and interact with one another on the go.
But Kheradpir also believes that creating new applications for the TV is also about leveraging the big, expensive flat-screen HDTVs that people have in their living rooms. And he believes that for many people, sharing their digital content on the biggest screen they own makes sense.
"I've been shocked at the number of Fios TV subscribers who are streaming pictures from their Facebook pages onto their TVs in the past two weeks," he said. "But it's obvious when you think about why people want to look at pictures from Facebook on the living room screen. It is the biggest and best screen in the house."
Kheradpir added that these screens are the most underutilized technology in the home today. And he is probably right. With many digital cameras offering picture quality of 10 megapixels or more, it makes sense to view those photos on the largest screen possible.
For more than a year, Verizon has been offering Fios TV subscribers the ability to access their digital pictures and music stored on home PCs on TVs anywhere in the house. But now the company is allowing subscribers to also view their home videos on TVs throughout the home. And they will soon be able to attach any device with an SD memory card, like a digital camera or a cell phone, to also view and share pictures, video, and music throughout the home.
Using these basic capabilities in the Fios TV platform, Kheradpir said he envisions developers creating all kinds of new applications. For example, he said a new application could be created that allows people to stream Internet radio while syncing a picture slide show from a laptop or BlackBerry phone.
Kheradpir said the opportunity for developers to create new applications that take advantage of these capabilities is huge. As of the end of the second quarter of 2009, Verizon reported it had more than 2.5 million Verizon Fios TV subscribers. And because most people have multiple TVs in their home, this translates to about 8 million TV screens that developers can access through their applications, he said.
While he couldn't provide too many details since the SDK won't be available until later this year, he did say that Verizon has already created a Web site, code.verizon.com, where developers can go to share ideas and offer suggestions. It will be through this Web site that the SDK will be released, and it will also be the place where developers can submit their applications for approval on the Widget Bazaar.
He also said that the company plans to offer an online simulator to allow developers unable to access the Fios service because they're not located in Verizon's Fios territory to test their applications.
While Verizon's cable competitors are also leveraging their IP networks to offer new services to their subscribers, so far, no one else has opened its network to third party software developers. Still, Verizon is by no means the only company dabbling in widgets for the TV.
The most well-known competitor in this areas is Yahoo with its TV Widgets platform. Yahoo has partnered with HDTV and Blu-ray player manufactures to get its widget technology embedded in the hardware. Some of the manufacturers it's working with include LG, Samsung, Sony and Vizio. Using these TVs or Blu-ray players, users can get access to content from Netflix, Twitter, and Flickr through the Yahoo TV Widgets.
But Kheradpir doesn't seem worried about Yahoo or others who embed technology into consumer electronics products. He said that Verizon's value is in offering its subscribers a total solution.
"Our job is to make it as easy as possible for consumers to consume the applications or services they want to use," he said. "We make it simple."