Futurists and couch potatoes of tomorrow probably had a pair of "a-ha!" moments this week -- with Disney
- During Tuesday night's conference call, CEO Bob Iger showed flashes of Apple
(NASDAQ:AAPL)fanboi-ism, calling the iPad a "game changer" and a "compelling device."
- WSJ.com ran an article on changes at Disney's ESPN360.com, beefing up the premium streaming site for a relaunch as ESPN3.com in two months.
On their own, neither event is really a surprise.
Of course Iger is going to sing the iPad's praises. In acquiring Pixar, Steve Jobs became Disney's largest individual shareholder. Disney's CEO knows that you won't get very far taking shots at Apple's CEO.
However, Iger's comments went beyond the obligatory gushing.
"The interactivity that it will allow on a portable device with such a high-quality screen is going to enable us to really start developing products that are different than the product that you typically see on an Internet-connected computer or on a television set," he concludes.
Games are interactive by nature, so Iger is really talking about new ways to engage with digital video. Pair that up with the launch of ESPN3.com as Apple rolls out the iPad with 3G connectivity and it's safe to say that this is going to be a huge year at Disney for digital convergence.
In its present form, ESPN360.com is little more than a side project. Internet service providers that are willing to partner with Disney (cough, cough, pay the Mouse) can offer their connected customers access to Disney's live and rebroadcast athletic events.
Whereas tens of thousands of fans streaming ESPN360 concurrently would be a good day, it pales when compared to the millions that are probably watching ESPN itself right now. ESPN3.com may change that, especially since it's hoping to play up the interactive nature of Web-tethered viewers by offering real-time statistics and fantasy games.
If you're following me so far, it's time to connect the dots.
What are the chances of folks paying AT&T $30 a month for iPad connectivity when they're not in Wi-Fi earshot also having subsidized access to the new ESPN3.com? I think those chances are pretty decent -- if Disney doesn't offer it a la carte itself.
So what, then, if the iPad's killer app -- the one that will set itself apart from both the iPhone and MacBook instead of living the life of the forgotten middle child -- is digital video interactivity? If an iPad doesn't just stream the game but allows owners to immerse themselves into the action, the iPad wins. Once folks are pulling up stats, competing on a leader board to correctly guess upcoming plays, or perhaps even managing cameras, the iPad becomes the experience enhancer that everyone will want to own.
The tollbooth awaits
If ESPN3.com is a success, the pressure will be on all cable and access providers to make the site available. However, the real catch here would be if iPad owners are actually willing to pay for direct ESPN3.com access -- either if AT&T isn't willing to foot the bill or if the upgrade option is there for those who buy the cheaper iPad models that require Wi-Fi connectivity.
The mind-set is already there. An iPad owner will be used to shelling out pocket change for music, piecemeal video, and the non-free App Store programs. What's another extra tollbooth or two if the content is worth it? The iPad, with its bigger screen -- relative to the more portable iPod touch and iPhone -- may be to video what iPods have been to music.
If Apple is able to deliver a sizable audience of paying customers who snap up everything from digital books to $0.99 applications, the content makers will flock to the iPad.
Furthermore, Howard Stern is in the final year of his five-year deal with Sirius XM Radio
Sirius XM also offers Backseat TV to subscribers -- beaming Disney, Viacom's
Isn't this a niche waiting to be exploited by the iPad? Boutique subscription plans with select channels are inevitable -- and the iPad has the added advantage of being portable, self-charging, and self-contained.
So go ahead and laugh at the iPad and its poor name. Apple has friends in high places, and that may be enough to turn a seemingly redundant device into the "must-have" purchase of 2010.
Is the iPad going to change the way we consume entertainment or is it a flop waiting to happen? Share your thoughts in the comment box below.
Longtime Fool contributor Rick Munarriz will probably fork over the iPad ransom, despite its shortcomings. He does own shares in Disney and Netflix. He is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. The Fool has a disclosure policy.