The document outlines Google TV's business model, focusing on its integration of television with internet capabilities through partnerships and strategic alliances with companies like Intel, Sony, and Logitech. It highlights the value proposition to customers through bundled content, personalized search, and a user-friendly interface for accessing television, applications, and games. Additionally, the document discusses advertising opportunities and revenue capture strategies through the Google TV ad platform and YouTube channels, emphasizing Google TV's aim to create a multi-sided platform that enhances user engagement and network effects.

1. Business Model
Karthik Leong Kong Fee Duan Jinglong Qing JinJian

2. Outline
1. Introduction : What is Google TV
2. Customers / Value Proposition
• Television
• Applications and Games
3. Strategic Alliances & Complementary Services
• YouTube Channels
• Google TV Ads
4. Value Capture
5. Strategic Control / Network Effects

3. What is Google TV
• Platform with Android OS integrated
with Chrome browser to create web-
enabled, interactive TV overlay on top of
existing TV
• Can switch between TV (cable and
satellite) and web
• co-developed by Google, Intel, Sony
and Logitech. Sony TV
• incorporated into set-top box eg.
Logitech to connect to existing TV or
built-in directly to TV eg. Sony TV
• NBC, ABC, CBS and Hulu blocked
Google TV from accessing their content Logitech - Revue Remote Control

4. Existing TV Value Chain
Basic Package
Pay TV / Premium TV Subscribers
Channels
- A la carte
Movie Studios Cable, Satellite,
Telcos
Accessed on TV
Pay Per View (91% of US households)
Accessed online
(30% of US households)
TV Networks
Over The Top (OTT)
Aggregator
(Quality of Service not
Guaranteed – depends on
Broadband Connection)

5. New Google TV Value Chain/Network
TV Contents
TV Customers
Google TV:
Contents Convergence (Web Search)
• Search both internet, TV programming and Android
TV apps installed on Google TV to find shows
Online Contents

6. Value Proposition
Television

7. Types of Customers
Google TV Device Customers
• Customers who purchased Google TV from device
manufacturers eg. Logitech or Sony
• Search and watch internet or TV contents
• Run applications and games on Android
Advertisers
• Advertisers for Web Search on Google TV (AdWords) – in
future; keep interface simple for early adopters now
• Google TV Ad (New Complementary Service; AdWords
platform)
Google TV Device Manufacturers
• consoles and TV manufacturers with built-in Google TV
Apps and Games Developers on Google TV

8. Value Propositions
Google TV Device Customers
• Bundles contents from TV and web – Choose from program listing or
search for entertainment on demand
• search algorithms profile behaviour based on keywords to predict
relevant contents (Personalized Contents)
• Android Applications / Games eg. Social applications for live
discussions on the program
• Access to free contents online eg. YouTube or low cost online
subscription (eg. Netflix - $7.99 per month compared to $60 per month
for cable / satellite subscription) on the big TV Screen

9. Value Proposition
Applications & Games

10. Google TV
Value Proposition (Game players)
• Flash support inbuilt – Existing HTML5 and Flash games requires no change
to run on Google TV (Network Externality)
• Touch screen consoles for games.
• Familiar platform attracts more developers
• More creative games
• Platform also supports API for Games with better graphics and
Sound quality
• D-pad More interesting social games
Better living room entertainment
• HD Graphics
• Sound Support

11. Google TV
Value Proposition (App Users)
• More free apps in android compared
to apple IOS.
• User friendly and need of the hour
apps supported – NBA scores,
news feeds
• Support for social networking apps
like facebook and twitter
• Affordable price of the device (99$) compared to tablets and smart phones
Typically for early adopters who just want to try new apps.
• Specialized apps -> Optimized only for google TV.

12. Google TV
Value Proposition (Games & Apps
Developers)
• The brand name Google
• Android Platform – Ease of use and
familiarity
• Google TV gaining momentum recently.
• Familiarity of the development platform and availability of the development
kit.
• Reduced time to learn and
master the technology.
(Android Programming)

13. Strategic Alliances
Complementary Services

14. Strategic Alliances –
Complementary Services
[1] YouTube Channels (Partners with Media / Production Co.)
Google TV blocked by:
Major TV Networks: NBC, ABC, CBS
Online Content Co. : Hulu
-> Limits effectiveness of Google TV Search
Google partners with media / production co. -> create original programming
on YouTube channels
- alternative to cable TV on internet
- initially 100 channels but eventually targeting millions of channels
(compared to 100s for cable / satellite TV) on Web
- wide variety of interests -> Infinite contents (Long Tail in TV programming)
[2] Google TV Ad (Partners with Satellite / Cable / TV Service Co.)
Create in-roads to TV advertising
- Broker placement of advertisements on TV and online programs

15. Partnerships with Media Co. –
YouTube Channels
• Channels will receive programming from dozens
of media / production co. and online video
creators
• each channel will contain hrs of programming
• Channels are free for users supported by
advertisers
• Media / Production Co. receive as much as 55%
of ad revenues after cost paid to producers

16. Partnerships with Content Aggregators –
Google TV Ad
Steps:
1. Logon to Google TV Ad Self Service
Portal: Choose Network, Day/Time,
Program for Ad to appear (local or
national)
2. Set Maximum Budget
3. Highest bid will be shown (Auction
Model)
4. Pay by Cost Per Thousand
Impressions (CPM)
5. Google provide report on cable TV set
top box impressions and audience
tuning behaviour Network Program
Day/Time
Google Ad Creation Marketplace -
industry professionals provide script Guidance on target audience
writing, editing, production, and (demographics)
voice-over at affordable package cost

17. Value Proposition – Advertisers
Google TV Ad
• Google Analytics
- guidance on audience demographics
- stats of the impressions / tuning behaviour
• Google Ad Creation Marketplace – caters to all budgets
• Advertisers set maximum budget
- transparent bidding mechanism
• Only pay when advertisements are watched
• For online + TV programs

18. Value Proposition – Content Aggregators
Google TV Ad
• Partnerships with Dish Network,
DirectTV, Verizon FiOS TV, EchoStar
and Astound Cable for Google TV
Ads
• Auction model ensures they get
the most advertising dollars for
their programs
• monetize more programming
(transparent bidding mechanism ->
more bids for all programs
advertising space)

19. Value Capture

20. Industry Architectures
- Value Chain
Content Content Content User
End User
Creation Packaging Distribution Interface
Traditional
Hollywood Broadcast Broadcast TV TV Viewers/
Studios Networks Stations Consumers
Independent Cable Cable
Producers Networks MSO’s
Changes/Additions
User Google TV Google TV TV Viewers/
Generated Consumers
Content The Internet PC

21. Industry Architectures
- Value Network
Internet Value Network
Multisided Advertisers
Market Search Users (e.g., Online Store)
Search Advertising - AdWords
5
3
1

22. Industry Architectures
- Value Network
Internet Value Network
AdWords/AdSense
Multisided Website visitors Online Stores
Market
Content
Providers

23. Industry Architectures
- Value Network
Movie/ Video
Today’s Model Makers
Cable operators Content Providers
(Comcast, Time Warner) (HBO, ESPN)
Subscribers Advertisers
(End-user)
Satellite TV Broadcasters
(NBC, CBS)
Both TV
Internet TV’s Model
and Web
Movie/ Video sites.
Makers (Except:
Content Providers NBC,
Internet (HBO, ESPN) CBS,
Service ABC
Providers TV Broadcasters Web Sites)
Internet TV (CNBC, CBS)
Subscribers TV or Set‐top (Google TV) Advertisers
(End-user) Manufacturers
Video Service Provider
(Netflix, Youtube)
Cable operators
(Comcast, Time Application/Game
Warner) Providers

24. Money Flow within the Architecture
A
TV Broadcasters
Internet (NBC, CBS)
D
Service V
Providers E
(AT&T, Premium Content
Comcast) R
Google TV/ Providers
Google TV (HBO, ESPN) T
Subscribers TV or Set‐top Ad I
(End-user) Online Video Service
Manufacturers S
(Netflix, Youtube)
E
R
Application/ Game S
Cable / Satellite Developers
operators
(Comcast, Time
Warner) Movie/ Video
Producers

25. Value Capture
TV Broadcasters Video Application/ TV/
Google TV/ Movie/ Video
& Content Service
Google TV Ad Game Set-top
Producers providers Providers providers Manufactures
Sale of Sale of
Advertising Products Advertising Advertising Advertising
products
Advertising
Revenue from Advertising Sale of
Subscription Subscription applications
Google TV Ad
Commission from
the sale of
applications

26. Strategic Control

27. Multi-sided Platform
TV/Set-top box
(Sony, Logitec)
Google TV
Content
Advertisers (Android OS) providers
Peripherals Apps/games S/W
End-users
(remote control) (apps/games developers)
• Control key interface standards
• Create network effects
• Develop complementary assets

28. Control Interface Standards
TV/Set-top box
• TV/Set-top box manufacturers
(Sony, Logitec) – Android Open ADK (Accessory
Development Kit)
ADK
• Apps/Games developers
Google TV
– Android Open API (Application
(Android OS) Programming Interface)
Android Ecosystem API, Chrome Web Store,
Android Market
– Chrome Web Store & Android
Peripherals Apps/games S/W Market
(apps /games
(remote control) developers) • Peripherals
– Remote control by Android
Upgrades, Chrome Web Phones & Tablets
Store, Android Market
• Users
End-users
– OS upgrades, Chrome Web
Store & Android Market

29. Create Network Effects
• Partnership with
Cable Co.
– Cable Co.
– Satellite Providers
End-users
Satellite – TV networks
providers
– OTT aggregators
• Draw on pool of
App/game TV – Advertisers (Adword
developers networks platform)
– App/game developers
OTT • Device manufacturer
Advertisers
aggregators
– Free license for Google TV

30. Develop Complementary Assets
• Complements produced by complementors
– Contents, Ads, Apps/games
• Complements developed within Google
– data centers – servers and network
– Google TV Ad for both online and TV contents (pending
patent application): analytics for tracking and reporting
impressions of ads
– YouTube Channels: millions channels available online
– Brand name & reputation

31. Summary
Google TV
• searches contents online and on TV
• Android market and Chrome Web Store – Apps and Games
Complementary Services through Strategic Alliances
• Google TV Ads brokers placements of ads on online and TV programs
• YouTube Channels generate millions of channels online
Value Capture
• Advertising – Google TV Search (Adwords platform) – in future
• Advertising – Google TV Ad (Adwords platform)
• Advertising – YouTube Channels
• Revenue from Apps and Games
Strategic Control / Network Effects
• Interface Standards
• Network Effects – users, apps / games developers, advertisers, partners,
device manufacturers
• Complementary Assets

32. What Google could do
Value Proposition to TV consumers:
• User Interface – Explore more user friendly ways of searching apart
from keyboard eg. Android voice search
Strategic Alliances:
• More partnerships eg. with movies studios to make contents available
on the web to coincide with DVD release
Value Capture:
• Enough advertising dollars to fund millions of YouTube Channels?
-> monetize contents of minority interest directly ie. paid service
Network Effects:
• Merge Android and Chrome Web Store into one single platform
-> more network effects from apps and games developers and
advertisers

33. The End
Q&A