Continuing Changes in Consumer Media Consumption Behaviors

Today's Wall Street Journal carried two rather complementary articles.

One of the three page-one columns featured an in-depth look at the decline in music CD sales. The mainstay physical delivery vehicle of the music industry has suffered a decline of between 15% and 20% over the past three years.

In referring to the article this morning on CNBC, on-air co-anchor Joe Kernen repeated NBC-Universal's executive, Bob Wright's, comment, to paraphrase, 'losing analog dollars for digital nickels.'

The rise of Apple's iTunes, as well as illegal file sharing services, beginning with Napster, have finally sapped music sales to the point of actually shrinking physical unit and dollar sales.

The moral of this story, of course, is that, when better alternatives arrive, consumers will migrate to completely new delivery models, if the benefits are compelling. And in music, they are.

The second story also features Apple. Walt Mossberg reviewed, very favorably, the new AppleTV device. Without repeating his review, let me just note that he found it very easy and effective to use.

Mossberg commented on Apple's current software as crippling the streaming of video from your PC to your TV, via AppleTV, except for content already stored on your PC, i.e., legitimately bought and stored as resident files. However, he also intimated that it's just a matter of time, and legality, before Apple pushes software upgrades down the 'net to provide for a wider selection of streaming video.

Think, for example, playing streaming video, bought directly from a content producer's site, through your PC, right onto your TV, via AppleTV.

Now, my consulting friend S believes this is going to be a long, hard slog. That it will be many years before a sufficiently large segment of Americans, or other global citizens, forsake their cable subscriptions and broadcast TV, to access video content in this manner.

Take another look at the first part of this post. I've posted on this topic so often, I probably can't find all the cites myself. If you search the blog for keywords like 'appletv,' 'itv,' 'cable,' etc., you will doubtless find many of them. It has taken just three years for the iTunes model to shove physical music delivery downhill so fast, that all the major retail music chains are gone, the current electronics stores are shrinking retail space devoted to music, and the labels themselves are getting worried about survivability.

Now consider how much more immediate and important video is to many consumers. I just watched my younger daughter spend hours this evening watching Disney channel television program reruns on a wireless laptop connection in this hotel in the middle of the Northeast woods.

I don't think it's going to be long at all before a variety of video content producers collaborate with Apple to allow their directly-purchased content to stream down the path I mentioned earlier, hopping from the PC to the TV.

If physical CDs could be toppled in so short a time, how much less time will it take for video to do likewise to broadcast video and cable networks, once the requisite hardware and software are available?