We are HUGE fans of bringing video to the living room using IP. We talk to existing and potential clients about this each and every day. We have dozens of devices, from the original Apple TVs to new ones, from old Roku’s to the newest ones (which are pretty awesome), Boxee, and most recently, the Google TV. An amazing assortment of devices, each with its strengths and weaknesses.

In experiencing the different plays on “interactive television,” the one thing that I am certain of is that bringing social streams (twitter, flickr, facebook) onto the big screen – especially while watching video with others – is broken. It’s out of place. It distracts from the social experience of television.

As my wife and I watch some of our favorite shows, we each have some sort of computing device open. Perhaps we each have our own laptop open. Or iPad. Or mobile phones [Yeah, our house is sort of crazy like that]. Regardless, each of us is able to interact with a variety of services while we watch the “big screen” together. This is key – my wife would get very frustrated watching my twitter or facebook stream on screen. She would go insane trying to follow my ADHD brain as I bounce through IMDB and Wikipedia trying to track each actor.

If interactive television, however, is to connect my personal device, be it an iPhone, iPad, Android or laptop, together with the programming on screen, than we have a HUGE WINNER. I can follow my own whims while my wife can have her own interactions. However, the social aspect of us watching Glee together remains. We can both sing along. We can laugh. We can pause the video and comment. It is an experience that has been with us for our entire life and is comforting.

A couple of Castfire clients are about to launch products that will incorporate behind the scenes footage and additional video on iPads, iPhones and Android at the same time as it is airing on broadcast. The audience can be fully immersed with not only the broadcast, but can explore additional streams in conjunction. An amazing first step.

The future however, will utilize IP delivery and the processing power of the set top device (or directly in the television) to enable audience members to move content from the “big screen” to their personal device. It will keep “companion” apps in sync with the big screen, pushing relevant information to those who display interest. Want to learn more about that Lexus advertisement? How about being able to open a driving simulator on your own device. Want to purchase that same shirt that the star is wearing? What if the Gap store opened in conjunction on your laptop? Want to find out Tim Lincecum’s stats for pitching to left handed batters? Want to know how your fantasy football league is doing in real time? And on and on and on…

In the near future, the majority of people will carry a touch device with an internet connection. These devices should be leveraged to provide the interactive in interactive television. These devices should be the connection between both the content creators and the advertisers with the audience. These devices will allow us to enjoy the television experience together while connecting to our different circles online.

Television is social; social media is personal. Don’t confuse the two.

It’s been a turbulent ten years for web video. Before the year 2000, we had something that resembled internet video, but thanks to high costs in server hardware and low internet speeds, late 90s web video was relegated to a basic slideshow with radio in the background.

Thanks to broadband penetration in the earlier part of this decade, culminating in YouTube’s meteoric rise to pop culture icon status, 21st century web video feels a lot better than the days of Real. That familiarity with web video has led smart business folks to re-evaluate how they could connect with consumers in the living room. And now, we’re seeing next year as the year where bits start making their jump from computer screens and cellphones, and into your living room.

While savvy video creators have heard convergence claims before, 2011 looks to be different. How? I’d argue everyone in the TV ecosystem is watching how the internet will move into the living room, and some companies— primarily hardware manufacturers— are actually doing something about it.

Two startups I’ve personally been watching with great anticipation are Boxee and Roku. While they’re not the only companies in the mix, but the two represent both ends of the scrappy startup spectrum. In my mind, it seems Roku is taking the tactic of the $20 DVD player and applying it to on-demand content. Right now, you can pick one of these svelte boxes up for $70 and get full HD on-demand access. Boxee, on the other hand, is going for the high end of the market, where a higher priced box ($200 – $230) leads to more available content, and an attempt at unlocking a web-style ecosystem for video.

But let’s be frank: It’s going to be difficult for two startups to make a real dent in the living room. Sure, they’re partnering with content providers to push the envelope, but I’m not convinced that alone, these two guys can change the living room.

Lucky for them, they’re going to be able to draft off of the larger companies coming to play. With larger marketing budgets to educate the consumer, we should start to see consumers understanding the need for internet connected TV experiences, and even making the leap to prefer and purchase them.

Among the companies leading the charge? There’s Samsung, who currently is a client of Castfire. The company is working with Yahoo on the connected TV platform, allowing couch sitters to do things like check the weather, stocks and other basic news information. On the internet side of things, Google’s new Google TV project looks to woo some watchers, and since it’ll be running Android, we could see some mobile-focused developers give a crack at the box too. Oh, and there’s some marginally large company called Apple who has the double whammy of a media focused tablet and an updated Apple TV. That could help a little. Just sayin’.

Realistically, we’re in a phase where all of these technologies are going to be in the marketplace, they’re barely going to interoperate, and it’s going to be somewhat of a confusing time to be a content producer. That’s actually a good thing. After the hardware has done its survival of the fittest thing, and we start to see some consumer consensus, content creators will have better access to the living room, in ways they’d never thought of before.

While I’d love to place bets on who’s going to win, realistically nobody actually knows for certain. But even though there’s no clear winner, that’s not a good reason to sit on the sidelines. With all of the companies out there gathering data, trying new ideas, and iterating on the traditional living room experience, we’re going to see more progress than before with understanding how people want (and don’t want) their living room to change. 2011 is the year to sow seeds. Start planting in 2011 so you’ll see a plentiful harvest later on. I’m not saying to invest lots of money in all these technologies, but I do think having a presence on these devices shouldn’t cost an arm and a leg. It might take a content deal or two, but how much would it take for you to know the future?

If you’ve got the resources, be everywhere. If you don’t, at least pick one and start learning. Even though I’m not convinced next year is the breakout year for TV connected to the internet, I do think it’ll be the year that a lot of people experience it for the first time. And for you, that means it’s your chance to innovate and create the market you’ll be playing in for the foreseeable future.

Business Insider has a chart that shows an amazing amount of growth for TV viewers on DVR’s and Mobile devices:

We continue to see the same amount of growth on those devices across our customer base. While flash delivery of web video continues to be a large portion of delivery, delivery for iPhone, Android, Tivo, Roku and Vudu are growing rapidly. We expect this growth to only accelerate over the coming 12-18 months as these platforms increase their install base and platforms like Yahoo Widgets begin taking hold in the living room.

Yesterday, iTunes published their Best of 2007 Podcast, ranked, we assume, by the number of subscribers to the feed. As iTunes is pretty stingy with their stats, one must assume they used that metric as there is no mention of editorial selection.

They broke the list into two categories, New This Year and Classics, with sub categories of audio and video. I agree completely with Chris Albrecht in his commentary at NewTeeVee:

It’s amusing to think of The Onion as “new” and Ask a Ninja as “classic,” but whatever, both make me laugh. And while it’s obvious that both of those podcasts carry an established audience, it’d be nice to know how Apple’s editorial choices match up with the popular choice, but the company’s pretty stingy with stats, listing only the top podcast of the day.

I am a details guy and was intrigued to do further analysis.

Classics: Video

*While Vintage Toon Cast is Indie, their content is public domain cartoon classics. A bit of a mix!

Production reflects Main Stream Media, "Professional" production (Revision 3, DECA, Next New Networks, etc), or Independent.  This is not to say that an Indie property is not professional, rather, it still maintains the 2 people and a camcorder upbringing!  Ads are reported as Online, Offline (downloadable media), Both or None. Hosting is my best guess (after some digging) as to what company, if any, is hosting/publishing the content (hey – we’re a publishing company and I’m interested).

My analysis of ads is only from the past couple of episodes and not over the past year. It does not take into account any of use of non video ads (banners, text, etc) or associated monetization (DVD sales, t-shirts, etc).

For hosting, there are sometimes multiple entries.  For instance, Cool Hunting Video is hosted by Brightcove for flash delivery (online) and on Amazon’s S3 for their downloadable media. I am not wizard enough to tell if there is an additional CMS or publishing system for the self hosted and left it as ‘Self’.

For the Classics, there is quite a spread between Indie, MSM and Pro productions, with Indie pulling a 50% share. 70% of the top ten are using advertising, in one way or another, to support the property. What is interesting in this breakdown, however, is that this is generated by iTunes and only capturing downloadable media and not online plays. Therefore, the monetization for this ranking drops to 50% for the properties.

New This Year: Video

Definitions from Classics apply to the New category.

What is interesting is the definite shift of Indie production to Pro/MSM for new properties. It dropped from 50% in the Classics to 10% in the New category. One conclusion can be that the "Classics" (I guess that is something over a year old!), were founded with a couple of people, a passion and a camcorder. 2007 is the year that production companies and MSM have gone after this segment.  It also makes sense that the newer properties are not monetized as well as the Classics as they are still building audiences and developing ad strategies.

Most important, and not reflected in the analysis above, content is still king. After seeing some of the episodes, I immediately subscribed and look forward to catching up with back episodes. There is a ton of funny, insightful and educational content in these 20 properties. Kudos to everyone involved.

Sampling this content makes me question my Comcast bill for cable that I pay every month!