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Chromecast: Big Threats Come in Small Packages?

By John P. Mello Jr. MacNewsWorld ECT News Network
Jul 26, 2013 5:00 AM PT

Google shook up the streaming video world Wednesday when it introduced a US$35 HDMI dongle that allows content to be airmailed from a smartphone, tablet or laptop to a TV.

Chromecast: Big Threats Come in Small Packages?

Called "Chromecast," the unit is already being hailed as a potential streaming set-top box killer.

"It could make the set-top box obsolete," Rob Enderle, president and principal analyst with the Enderle Group, told MacNewsWorld. "It makes the set-top box redundant."

Chromecast lets you connect any TV with an HDMI port with any Android or iOS device, as well as with Google's Chrome browser on a Windows PC or Mac.

Content sent to your TV through Chromecast can be controlled from the device that's "casting" it. You can perform tasks like play and pause content, as well as control the volume of your set. All the while, you can perform other tasks on your device, such as sending email or surfing the Web.

Better TV Interface

Initially, Chromecast will support content from NetFlix and YouTube, as well as movies, TV shows and music from the Google Play store. More content, including the Pandora streaming music service, is expected to be added to the dongle's portfolio.

Chromecast addresses three crying needs in the market, according to Ross Rubin, principal analyst with Reticle Research, a consumer technology advisory firm. Those needs are price, simplicity and size.

"At $35, it's a about a third of what Apple TV costs and significantly less than the basic Roku device," Rubin told MacNewsWorld.

By pricing the device at $35, he continued, cost becomes a non-issue -- not only for one TV but for multiple TVs.

"A problem with devices today that let you stream sources like Netflix is that their interfaces are awkward," Rubin explained. "By using a smartphone, tablet or even a PC with Chromecast, you get to take advantage of the excellent user interface designs that have gone into those devices."

The drawback to that approach, he added, is you have to have one of those devices at hand, while Roku and the like have their own remotes.

Size Matters

Size and portability are also wanting in the market, Rubin continued.

"As small as Roku and Apple TV have become, they're really not pocket-friendly," he continued. "Chromecast is so small you can unplug it from the TV and take it with you when you travel."

While some industry watchers were quick to write epitaphs for set-top streamers after the Chromecast announcement, the device need not be an Apple TV or Roku killer.

"I don't see this necessarily taking share from the market leaders," Jonathan Hurd, a director at the strategy consulting firm Altman Vilandrie, told MacNewsWorld.

"Chromecast is simply about getting video to the TV," he said. "The others have additional value for consumers."

There Will Be Blood

Existing products in the market will feel the impact of Chromecast, said Brett L. Sappington, director of research at Parks Associates.

"Apple TV and Roku will become a little less valuable to consumers because there's a new alternative in the market now," he said. "Any time there's a new alternative, it dilutes the value of the things already in the market."

What Apple TV and Roku have going for them is that they aggregate content, Sappington continued. "Chromecast doesn't aggregate anything. It's just a connection technology."

Chromecast's appeal to consumers is questionable at best, suggested Roku Founder and CEO Anthony Wood.

"There are many of these dongles out in the market, but so far they have not gained consumer adoption because they offer limited content choices and are awkward to use for a variety of reasons," Wood told MacNewsWorld.

"For just $15 more than these dongles -- so for $49 -- consumers can get a Roku player," he pointed out, "which offers a complete streaming experience that provides access to an easy-to-use and made-for-TV UI, nearly 1,000 video and music channels, and many features like content search."

Apple did not respond to a request for comment for this story.

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