Integration Capability is the Winning ‘Gene’ in Technology Evolution

We were recently involved in a pitch to a hotel for an in-room entertainment system that went from straight forward to utterly confusing within two rounds of presentations and demonstrations by all invited vendor parties which ended up paralysing the hotel’s decision making process. What happened? The short answer is: technology chaos.

The problem hoteliers are facing is how to make sense of a today’s Information Systems which are increasingly a chaotic mix of applications, interfaces and operating systems with their respective advantages and disadvantages and are by no means compatible. So which one to go for? Which one is flexible enough to serve hotels’ increasingly complex and continuously changing operating environments?

The answer is surprisingly easy to find with a little research around current mainstream technologies.  But in order to do that, let’s define what mainstream is first: in short, it’s integration capability that results in mass adoption. Similar to Darwin’s evolutionary theory, a technology’s trajectory is largely determined by how much it is able to adapt to changing circumstances, or in other words, its capability to integrate with new and improved technology variations as they appear.

Pushed to the sidelines: Betamax

Of course, technology is not some organism and moves in much faster and more haphazard ways as everyone who remembers the Beta vs VHS technology battle can attest. It can be wholly unpredictable at the cutting edge – think the phenomenal and utterly unpredicted success of the iPad – and entirely predictable at the tail end of consumer adoption (anyone doubted the success of iPad 2 and 3?).

Which brings us back to how we should determine what is and isn’t mainstream technology. There are two parts here that need to work in sync: the front end, or user interface, and the backend, or operating system. And looking at adoption levels of both gives a pretty good insight into what ‘mainstream’ constitutes at this point in time.

At the user interface, the performance of tasks is commonly managed by application software. While application software has always been the link between the operating system and the user (think accounting software, office suites, graphics software etc), it’s mobile Apps that really changed everything. And when Apple opened its platform for app developers and then the AppStore to help iPhone users turn their phone into a mini computer full of apps, that’s when the platform truly became mainstream. Now, as Apple says so aptly on their website, there’s an app for everything. Apple’s application store sells the most apps (not a shocker), carrying over 225,000, with more than 4 billion apps downloaded from Apple alone (the second largest app market – Google’s – doesn’t release comparable figures).

So here it is then: the more open for integration the platform, the more app developers it will attract, which in turn will draw more people to buy the mobile device running that particular platform. The future winners of the technology evolution are likely to be decided by just this openness of integration.  That’s what’s called mainstream.

Looking at the current canon of technologies that are dominating the enterprise and consumer landscapes, Android and Apple, or iOS, appear to be winning the race to becoming the dominant system operating technology standard, specifically for mobile devices, which are increasingly dominating all walks of life.

All of this also matters to hotels of course. Technology as a whole is increasingly pivotal for hotels on all levels, from interior room design to revenue management, so betting on the wrong technology horse may result in some nasty injuries later.

As an example, let’s look at some technologies that are commonly going head to head in in-room technology systems these days: STB-based systems, and those based on thin client-integrated technologies such as XBMC.

If you apply the mainstream test to both, it’s pretty clear that STB is as bona fide mainstream as you can get. XBMC, on the other hand, is a niche product that is used by a handful of customers, has very limited integration compatibility and is consequently very likely to have a finite development path. The latest STBs today are typically based on an HTML5 front end client. XBMC on the other hand is based on their own proprietary thin client, which provides an optimised front end performance but at the considerable price of integration and customisation flexibility. And as STB performance improves, even the front end performance advantage of a thin client will vanish. 

Say hello and wave goodbye: HTML5 has regaled Flash to history

The fact that Adobe sacrificed Flash for HTML5 is an early indicator that HTML5 will prevail and push most others (including XBMC) that have a boutique ecosystem to support its ongoing evolution to the sidelines.

While the current chaos of technology advancements makes it considerably harder than just a few years ago to predict what the next breakthrough consumer device, entertainment delivery platform or social obsession will be, it is clear that for the foreseeable future the delivery mode will be Apps, based on open technologies and accepted by the mass market. So hotels should ensure they decide on a platform that meets these attributes.

Is it the end of the Set Top Box as we know it?

Google managed to send the industry abuzz with chatter about the TV Set Top Box being ‘on its deathbed’ after it emerged the search company would axe the STB business it will inherit from acquiring Motorola for $12.5 billion. While Google’s prime motivation is likely to be that its Android OS is not compatible with current STB chipsets and technologies, the company most certainly can also see that the market for STBs in their current format is in decline.

The question where the STB is heading is an interesting topic that seems to pop up more and more frequently not only when discussing consumer equipment, but also regularly features high on the agenda of hotel IT managers, who may question the necessity of STBs to deliver in-room entertainment in the age of content anywhere and on any device.

It’s a fair question, particularly for someone who needs to make decisions about entertainment equipment that has to last a 5-year lifecycle. 

While there is no denying that the advent of connected devices is starting to seriously challenge the dominance of STBs, to put them on the ‘deathbed’ is in my opinion a little premature. The fact is that their inherent mobility and backward compatibility are yet to give STBs legitimacy and relevance for some time to come. 

Connected TVs are often seen as a prime challenger of the STB. All models more or less provide services including full web browsing, Wi-Fi connectivity, high-resolution graphics, Android apps and even console-quality gaming experiences. But the reality is that connected TVs also still rely on the good old STB – except that it’s inside the TV, rather than attached to it. So from a cost perspective, connected TVs will not necessarily make things cheaper: you either have to pay for an external STB with a casing, or an internal STB without it. The cost of these internal STBs can certainly be driven down to a certain extend due to TV manufacturers’ economies of scale. But they have to be paid for nonetheless.

And what about the content? In the long run it is imaginable that a majority of TV viewers will receive their content from the cloud, i.e. through OTT. But this requires the precondition that all household TVs are connected TVs and run compatible versions of Content Apps for Android, or iOS (if Apple ever comes out with their TV set).  The day may come, but the changeover period will be rather drawn out. It’s similar to the mobile world, where despite the smartphone craze there are still considerable numbers of users preferring to use a mobile just for voice calling and SMS rather than watching video.

A complicating factor for the hospitality industry is that it’s a secondary market for TV panel vendors who primarily target the mass consumer market and their needs and wants. Given that different TV models with different features raise backward compatibility constraints, the STB (or another piece of hardware) is still necessary to provide TV manageability for hotels for some time to come. 

Having said that though, a more interesting trend that we are seeing right now is that the tablet eco-system is starting to invade the STB eco-system.  As tablet chipsets get ever more powerful, and certainly more powerful than STBs, the stage is almost set for tablet technologies to challenge current STB technologies. That’s the philosophy behind AppleTV, whose “STB” is essentially an iPad without touch screen, but with a network port and HDMI interface.  

While you can be forgiven for dreaming about a future where Ethernet renders any hardware obsolete, it realistically will not happen for some years to come. It’s a paradigm shift that will take time to establish itself. 

So the reality is that for the foreseeable future there will be a piece of hardware that is involved in the delivery of content, whether we’ll call it an STB or not. But it currently it looks like that there’s a fair chance that the next generation STB will be a stripped down tablet.