What Chromecast Taught Us
6 minutes
Smaller or Bigger? The Phone and the Living Room Go to War
A few years ago, many tech leaders declared mobile internet the gateway to the next era of the web: whoever won on mobile first would get a ticket to the next age of prosperity. Xiaomi founder Lei Jun’s sales topping 13 billion yuan seemed to prove the point. Yet while most manufacturers rushed into mobile, some companies went in the opposite direction and looked toward the living room—a space people had long forgotten.
Trying to pull people from their phones back into the living room seemed as awkward as China’s Spring Festival Gala. Families and friends should gather, of course, but the show itself is not always compelling enough to bring them together.
As Lenovo’s “smart desktop” and LeTV’s “super TV” stumbled, Google’s Chromecast arrived like a dream solution. It sold out within days of launch and seemed to offer a new turn in the battle between “small” and “big.”
Chromecast is essentially a signal receiver, about the size of a USB stick. It instantly sends photos and other media from a phone, tablet, or computer to a television for a better viewing experience. Even more important, its $35 price was hard to refuse. As soon as it launched, Chromecast was hailed as a “living-room revolutionary.”
It is too early to say who will win, but Chromecast showed the living room’s huge commercial potential. It moved beyond the hardware monopoly represented by products like the smart desktop and super TV, using a kind of “universe-shift” to win the first skirmish in the living-room war with a small device.
Choose for Yourself or Accept What You’re Given? Content Wins
Devices like Chromecast highlight the decline of traditional television. The reasons are that it is not mobile and offers little choice: viewers can only get particular content in a particular place at a particular time. In an internet age that increasingly values user choice, this one-way experience feels deeply “unfree.”
Money is scarce in this era; information certainly is not.
With so much information available, do users really need so many choices? Do they need to choose among irrelevant things? Internet companies like Google, with vast storage and user data, can analyze online behavior and come to know users better than they know themselves.
The $35 price and convenient size are only part of Chromecast’s success. For users, Chromecast offers access to the whole world. It directly supported four apps: Netflix, YouTube, Google Play, and the Chrome browser. The first three offered huge libraries of video and other media, making them direct content channels. Before Chromecast launched, Google had already invested hundreds of millions of dollars in buying and producing competitive original programs for YouTube. In May that year, YouTube also introduced a paid subscription service for premium film and television. It is easy to imagine these video businesses bringing Google massive online-ad revenue in the future.
Chromecast taught hardware startups a vivid lesson: never foolishly expect to make money from hardware alone. The next generation of smart devices depends on services and traffic.