Cognitive Networks’ Forecasts for ACR Penetration in Smart TVs Depend on Upgrading Sets in the Field

Cognitive Networks confirmed that its real-time data service is the automatic content recognition (ACR) technology adopted by LG for its smart TV platform (CED Aug 16 p1). LG is the first to adopt Cognitive’s solution, based on the cloud-based Engage service that provides real-time event triggers to application providers. The technology operates in the background of a program, such as Showtime’s Homeland, and provides intelligent synchronization between the “graphics plane and the video plane,” said Cognitive CEO Michael Collette, on a media tour in New York.

Creative content in a program’s app is done by the content provider , with Cognitive delivering a notice and triggering path to load the app, Collette told us. In the past, a smart TV had video and audio data, but “it didn’t have any awareness of what it was displaying,” he said. The ACR platform detects what’s displaying on TV “second by second” and allows viewers to take action, he said. Consumers can opt in or out, Collette told us, demonstrating interactive content from The Big Bang Theory. Using Cognitive technology in a smart TV environment, content providers can develop live audience opinion polls and trivia contests, enable live tweeting, allow users to interact with reality shows in real time and enable customized ads and offers based on content, he said.

Collette discussed some of the interactive applications the ACR technology enables for commercial use. In one example, the company used its technology to determine the Internet Protocol address of a household and fed that to Google Maps to find the pizza shops nearest the home. “We brought the map back in real time so we could show the viewer” the pizza delivery store nearest them, he said. Taking it a step further using the technology, which operates in HTML5, shown was a clickable list of nearby pizza restaurants that allowed users to set up a Skype session between the viewer’s mobile phone and the restaurant. “It’s all easy to do because you're in a Web-connected standard application space,” he said. Ads are locally targeted with users getting customized lists based on their location, he said. Another test app placed a Little Caesars button in the corner of the screen asking viewers if they want to complete an order on a phone or tablet.

That brings up the line between a smart TV and a smart mobile device and whether there’s a need for an interactive TV at all in the second-screen world. Some consumers will prefer to order on a tablet, Collette said, “and some consumers won’t have a tablet.” Collette envisions a division based on “relatively simple point-and-click apps on the primary screen” and “extensive functionality” on the second screen when “deeper engagement” is called for. He predicted several years of “trial and error” on the TV side as app developers adjust to the medium. TV remote controls are also becoming more suited to interactivity, with keyboards or special features, he said, citing LG’s Magic Remote with motion and point-and-click features suited to navigation around a webpage on a TV screen.

Cognitive’s cloud-based technology “grabs pixels” as they pass through a TV’s video buffer and sends those “fingerprints” to the cloud to identify what a TV is showing at any given time. When an event is triggered based on content and time codes tied to a specific show such as Homeland, the Homeland app is loaded into the HTML5 graphics plane on the TV, which then displays both the TV signal and runs the app. Collette said Cognitive’s technology in the TV is “almost undetectable,” using “well below” 1 percent of a TV’s processing power.

Over time, interactive TV technology will become more robust and sophisticated, Collette said, including delivering dual-stream video and video over broadband and broadcast simultaneously. An ACR feature that could be enabled by simultaneous streams is a “start over” app that enables viewers to start a program over if they have missed the first few minutes. A content provider would need a broadband version of the episode to enable the feature, he said.

Being able to handle multiple tasks at the same time will push feature advances on core smart TV chipsets, he said. Collette cited previous unsuccessful attempts at interactive TV, including Canoe Ventures’ attempt to launch a cable industry-based interactive TV service. The consortium, whose members include Comcast, Time Warner Cable, Bright House, Cox, Charter and Cablevision, scrapped the interactive TV plan last year (CED Feb 23/12 p7) to focus instead on VOD and TV Everywhere ad technology. “At the end of the day, they couldn’t get decent functionality that would run on all set-top boxes so you could have national content or ads,” Collette said.

Collette, who at one time worked for OpenTV, said the industry’s early attempts at interactive TV involved “trying to run a very limited software platform on a very limited device.” The end result looked like early “Casio watch graphics -- very limited graphics capabilities,” he said. “When a dull, 8-bit graphic” popped up while consumers were watching a high-resolution HD program, the quality difference was jarring to viewers, he said. Using HTML5, graphics running on the Cognitive platform present a look that’s contemporary, he said. “It’s every bit as good as what you'll see on digital media platforms."

Consumers opt in to the ACR agreement when setting up the TV as part of an acceptance of general terms and service and privacy policies. Consumers can opt out of ACR through the settings menu of a TV later if they choose, Collette said. Cognitive doesn’t collect personally identifiable information, Collette said. “We don’t know who the TV owner is.” On consumers who voice privacy concerns about smart TVs, he said, “Why did you buy a smart TV? You bought a smart TV to do new and cool and fun things.” He showed an app developed by Visible World for a promo spot that asks viewers if they would like to set a reminder to watch an upcoming show. People who want to be reminded click yes using the Cognitive technology, and when the show airs at its scheduled time, an alert prompts the viewer that it’s about to come on. He conceded that as connectivity becomes increasingly prevalent as a standard feature on TVs, many consumers will buy a smart TV “because it was on sale at Costco.” If they then choose to connect it to the Internet, “you opted in to the smart TV experience,” he said.

Cognitive software is embedded in LG smart TVs, except for the company’s Google TVs. Two other TV makers with Cognitive software will be announced at CES, Collette said. Six manufacturers account for 97 percent of smart TV volume, he said, citing LG, Panasonic, Samsung, Sharp, Sony and Vizio. All six of those companies are in various stages of deploying ACR, he said, noting that some are with Cognitive competitors. By next year, Collette expects to see more “reach” for ACR within the smart TV base. “There’s no point in deploying ACR unless you deploy it on all the models of your TVs because it’s all about reach,” he said. Cognitive can field-upgrade TVs back to 2012 models, he said.

Last fall, Collette said at the TV of Tomorrow conference in New York that he expected the installed ACR market to reach 10.5 million in 2013. He has since scaled back that number to 7 million. “I thought that all six manufacturers would be in the market by this time,” Collette said. And getting to the 7 million number depends on one of Cognitive’s two unannounced customers field-deploying the technology in existing sets going back to 2012, he said. The 2012 TV model year sports TVs with the adequate processing power to support the technology, he said.