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Cloud Invasion


Ross M. Miller
Miller Risk Advisors
May 9, 2011

The arrival of the Auvio HD Tuner that I wrote about in March triggered some considerable reshuffling of my bedroom audio/video system. The Auvio is a hefty unit (even if it is mostly filled with air) and together with the Emotiva XDA-1 DAC that led to its purchase, there just was not space for everything in my "equipment rack." The first casualty was an ancient Panasonic VCR, which now resides on a nearby shelf where it can be pressed into service if ever needed to decipher ancient video media. Even without the VCR, the aggregate height of my remaining electronics exceeded the available vertical space by about an inch. The next component to go was my Sony DVP-NC80V DVD changer, an inexpensive unit that I got over five years ago because it was only DVD changer to play MP3 and WAV files from home-burnt DVDs at a time when USB drives were in their expensive infancy. Using all five of its DVD slots gave me vast amounts of MP3 music at a total media cost of about a dollar using loss-leader DVD blanks. Thanks to ever-advancing technology, players have slimmed down considerably and between ever-present USB port and networking capabilities; a multi-disk changer was no longer necessary.

The best unit that I found that would fit in inch or so of remaining space was a Sony Blu-Ray player sold as both the BDP-S570 and BDP-BX57. A good price for a new unit, which lists for around $250, is $130 for a new unit and $100 for a refurbished unit. I bought this unit so that I would be covered when the occasional need to play a Blu-Ray, DVD, CD, or SACD (yes, I have some of those) in the bedroom arose and I did not want to boot up my HP Slimline computer that can play all of them (except for SACD). While I knew that the player came with streaming media capabilities (and both Ethernet and WiFi to connect to them), I did not know just how useful they would be and how often that I would use them. These capabilities constitute another entire set of "apps" that considered together with those in the iPhone/iPad and Android worlds ramp up the threat against Windows.

In an ideal world, the Blu-Ray player would be unnecessary because my Windows-based Slimline computer can, one way or another, do everything it could do and more. The Slimline, however, takes a few minutes to boot up and, like many Windows machines, is not particularly amenable to being put into a sleep state; indeed, it insists on waking up in the middle of the night and ultimately makes enough fan noise to wake me up as well. (I have tried to stop it from doing this, but with very limited success.) The Blu-Ray player boots up super-fast and can be kept on all the time as it is dead quiet when not playing a disc (and only mildly noisy when it is playing one; however, there do appear to be defective units out there that are quite noisy).

The Sony player comes with lots of apps, even if they are not called that. The overall system is known as BRAVIA Internet Video and comes on selected Sony video products, including high-end Blu-ray players and HDTVs. There is no "app store;" one simply gets access to all the video and audio apps that Sony makes available. Sony provides a good selection of apps, far better than my sans Wi-Fi Oppo BDP-83 player that cost about 4 times as much as the Sony (on sale) and whose big advantage is that it plays DVD-A discs (of which I have exactly one) . The Sony has the obligatory Netflix (my Oppo doesn't even have that, and both players are 2010 models) as well as Pandora, Slacker, Amazon, YouTube, Crackle, Hulu Plus and several Sony proprietary channels. Sure, many nice services that are standard on smartphones are missing, such as SiriusXM and tunein (formerly known as Radiotime), but there is certainly enough there to keep one entertained for a long time.

The net effect of the Sony player (and its various kin from competing manufacturers, including the breakthrough Roku box) is that while the ability to play a variety of physical discs is a nice bonus, the real value proposition is the ability to access all that cloud content at a truly bargain price. That the player is inexpensive makes economic sense because Sony gets a cut of all purchases made through the system, so it is the razor and the services are the blades. Still, even without buying any more blades, the razor works just fine. Through sheer luck, the day after I set my player up Amazon rolled out its Prime Instant Video that made thousands of movies and TV shows available for free to Amazon Prime members (of which I am one). Beyond Amazon, there is plentiful free video and music content available through the system, albeit sometimes at the cost of sitting through the occasional commercial and the inconvenience associated with resuming play at a latter time. (DVDs are great because you even months after you have played one, a good player will remember where you left off.)

Like many things, Microsoft actually tried creating an integrated cloud-based media environment first and has failed spectacularly. My aforementioned Slimline computer is technically an HTPC (home theatre PC) that came with a Windows Media Center version of Vista (since upgraded to Windows 7). I used to be a fan of Windows Media Center, which has a user interface that rivals (and likely inspired) the Sony BRAVIA interface and its Sony precursors. The problem is that Windows Media Center has been losing apps over time rather than gaining them. It has none of the groovy apps mentioned above and its XM app, which was not bad, became nonfunctional some time ago as a result of changes necessitated by the merger with Sirius. Windows Media Center does two neat things that the Sony is missing: It has DVR functionally (though not in HD) and a good audio player. The Sony audio player is quite sad. It does not work with popular music servers such as Tversity and it lacks certain basic functionality, such as the ability to do anything with the music queue, including repeat the entire queue or a single track within it.

PCs and traditional media will have their lunches eaten by the likes of phones, pads, and media players. The process is now well under way and is rapidly accelerating. While PCs can get at almost everything on these media appliances through a web browser, the app experience is generally far more convenient and polished than the browser experience. Pads and media players are already starting to merge, all the major media players can be remotely controlled via the iPad (and by various phones as well). It is only a matter of time before true convergence of these technologies is achieved, which is also likely to be about the time they are becoming obsolescent.

My big project for the summer is redoing the way that I teach finance as part of a broader program of changing how I think about finance. My next several commentaries will outline what I am doing in that regard..

Copyright 2011 by Miller Risk Advisors. Permission granted to forward by electronic means and to excerpt or broadcast 250 words or less provided a citation is made to