We don’t do this very often folks, but as a seasonal gift we have made our 2011 Digital Home Predictions report available to everyone, whether a Strategy Analytics client or not. You can download the full report here. A lot of the talk at the moment is about Google’s troubles with its TV offer: there will be little to see at CES after all, much to the annoyance of Google’s many partners no doubt. But this setback should not be seen as a a sign of general malaise in the connected TV industry: Apple has just reported that its TV solution is finally gaining some traction, and we expect continued progress from other key players in the rollout of internet TV to the big screen during 2011. We may even see Facebook moving into this space. Headline number of the year will be tablet revenues, which we predict will exceed netbooks. We also think Apple needs to revamp iTunes to take account of the connected device era, and Nintendo may have to take the plunge and launch the successor to the Wii. We’ll see further innovations in the TV control arena, with touchscreens, phone apps and motion control all featuring more widely. But 3DTV is likely to see only slow progress: sure, people will be buying 3D-enabled sets, but less than 20% will be watching 3D content on them. And one more stat to whet your appetite: more than one billion people worldwide will be using social networks for the first time during 2011. And since you are one of them, please go ahead and read the full report, and any comments and feedback are always appreciated. Best wishes for a peaceful holiday season. David Mercer Client Reading: Profiling the Connected Media Consumer - UK

We hate to say I told you so but as we wrote when Sky Songs was launched little over a year ago, this lacklustre venture into online music was unlikely to succeed from the start.   Originally Sky Songs offered access to four million tracks for download and unlimited streaming in two versions, £6.49 per month (1 £6.49 album or 10 songs per month + unlimited streaming) or £7.99 per month (1 £7.99 album or 15 songs per month + unlimited streaming). In an attempt to boost subscriber uptake, Sky later slashed the price to £5 per month but still failed to gather much interest from consumers. In a statement, Sky Songs said that "regrettably we've not been able to reach a large enough customer base in order for the service to continue". As we suggested in our original assessment of Sky Songs, this uncharacteristically lackluster service from Sky added little of value to consumers and was doomed to fail. Martin  Client Reading: Digital Media Index: Q3 2010

Armour Group, the UK consumer electronics company, was demonstrating its Tip and Tilt Internet Radio at NAB, having introduced it earlier this year at CES. The product features a neat and simple cube design, wifi connectivity, runs on a rechargeable lithium ion battery, and will be available in a range of bright colours when it launches this summer. It can be programmed from a PC to play any four internet radio stations, and these are selected by moving the cube around four of its sides. The remaining two sides – top and bottom – are used to tilt the volume up or down. The device will retail at $99 and £70 and is aimed at expanding the market for internet radio to less technophile segments. Armour was hoping to catch the eye of broadcasters, not just with the Tip and Tilt’s innovative design, but with its potential to lock listeners in to particular radio stations, which the software allows. Broadcasters might be persuaded to subsidise the device if it could only be used to listen to their stations, locking out competitors and increasing their share of the advertising pie. There are several difficulties with this argument. In particular, there must be doubts whether radio listeners would be happy to be prevented from selecting any station they choose. The counter-argument is that restricted content access, a model familiar to other sectors, such as games consoles and pay TV. Our feeling is that if a major station group, such as Global Radio in the UK, subsidised the device to such an extent that it became very low cost, or even free, demand could be sizeable. But the economics would be challenging, even if the broadcast industry was not recovering from a deep advertising recession. We suspect that in high volume the device could be manufactured for $30-40. But a major broadcaster might buy, say, 100,000 units at a cost of $3-4m, and that is not a trivial investment for an industry struggling in challenging times. And would that type of volume really make much impact on advertising ratings? Given Global Radio’s weekly reach, as an example, of more than 18 million listeners, it seems rather doubtful. So we conclude that the Tip and Tilt will likely need to focus on the retail opportunity, and it may find many willing buyers at its low price point. Internet radio is something which has been waiting to break out of its PC prison for many years and this sort of innovation is what is needed to help accelerate that trend. David Mercer Client Reading: Global Audiovisual Market Forecast