Google's privacy policy is changing, or is it?

I really shouldn't be surprised by the reaction to Google's recent announcement of changes to their privacy policy.  Any time the word "privacy" is mentioned in any reference to the internet, the reactions are always strong.  Unfortunately, like so many things related to the internet, too many people are simply unaware and don't understand what exactly is going on.  That leads to a lot of mis-information on the part of the general public, as well as some unfortunate reporting by the media.  Once again, unfortunately through normal media constraints of time and wanting the audience to understand the story, they have not explained the entire change, or lack thereof.

The change Google is making is a simple one.  Right now, if you use Gmail, Google Calendar, Google Plus, Picasa, Youtube or most other google services, each individual one has a different privacy policy and Terms of Service Agreement (ToS).  This leads to a lot of overhead and confusion, because all of those products are provided by one company, but yet each person must agree to different terms to use them.  This means that all of your information in Google is stored in many different buckets.  The Gmail bucket, the calendar bucket, the YouTube bucket, etc.  Each bucket must hold all of your information that you have provided to Google.

Starting March 1, what will change is that instead of having all of your information sitting in several different buckets, it will be kept in one bucket.  Google is aggregating their privacy policies into one (relatively) simple document, and keeping all of your information only once, and in one place.

The majority of the problem people have with this that I have read has been along the lines of not wanting to give more information to Google, and not wanting Google to have that information.  But what most people don't understand is that with these changes, the amount of information Google collects does not change. Google will be collecting exactly the same information that they are today, the only difference is again, it will be stored in one bucket instead of 10.

One thing thet almost no one realizes is that in Google's older terms of service and policies they already say that they can take results from different services and use them to influence their results.  Google keeps archives of their older terms of service documents and people who have more time than I do have gone through them and found that almost every revision has this provision in them.  That means that in terms of how Google uses your data, we can literally say that nothing has changed.  Nothing.  They already had the ability to take information from their different services and interoperate them. The best example of this is that if you search a lot for a band, say Bon Jovi, on Google, when you go to YouTube you may see Bon Jovi music videos as recommended videos.  That is not a bad thing, and Google does this today with your search history.  They take your search history to try to give you more accurate results, and the same goes with YouTube.  Nothing has changed here, and it shouldn't because it is not a bad thing.

The other big thing that many people won't even notice is that this change will allow Google to provide more targeted advertising.  This is where many people seem to be leery of Google's new privacy policy.  But, I've already gone into detail on my thoughts online privacy here.  I encourage everyone to read it becuase I detail a lot about online advertising.  The short version is that targeted advertising is actually better for the consumer and that really, I'd rather see ads about whiskey, not tampons, so bring on the targeted ads.  Yes, this is a way for Google to make more money.  I don't really see a problem with that, since they are a business, and a business is allowed to try to make money.  One thing I stress time and time again is that Google is not a search company.  Google is an advertising company.  It is an important distinction.  Search is what Google was born on, but today search is just one Google product that serves advertising, as nearly all Google products do.  That is what all search engines are today.

This brings me to my last talking point, which has to do with people who are afraid that this could change Google search results, since they can be refined more for the user.  Combined with last weeks' news that Google is going to start adding Google+ search results into search for some users, and there is much fear from people that a true search is dead, that everything is personalized.  While I can see the point of that, the reality is that a pure search hasn't been a reality for many years.  Everything you do is at least somewhat targeted.  Even if you are not logged into google services Google can remember some of your search history on a particular computer through a cookie.  So even if you don't have a google account, if you do all of your Google searching on one computer, your results will become more personalized over time.  Then there is also location tracking.  Google can track your relative location based on the iP address of your computer, and give you results based on where you are.  The best example is that if I want to search for chinese food, I will want it to display results for chinese food restaurants and chains close to me, instead of one in China.  If I wanted chinese food restaurants in China, I'd google "chinese food in China".  Even if you turn on the private browsing mode of your browser so cookies cannot be tracked and used, that location data still exists, and is still used in search results.  And once again, this is not unique to Google.  Any search engine worth using follows these practices, because they have been shown time and time again to improve the user experience in search, and in most cases provide better results.

I hate brining up the term cookies here, because so many people still think cookies are a bad thing, and me saying that Google can track search history through a cookie will not help that.  Cookies are a discussion for another time and place, but I will just say that cookies improve the browsing experience in ways that most people do not know because they, in part, allow web behaviours to be remembered.  We are creatures of habit, and things that allow us to continue that habits are generally good things, but since it is often invisible to us we don't notice the benefit we get.

Before you take the media reports and blow them completely out of proportion, please consider the facts.  Especially when most media reports can't and don't go into the detail necessary to really explain the issue to people (a person pet peeve of mine).  It is easy to criticize and throw our hands up into the air when we hear something that we don't understand, but sounds bad.  Especially when the reality is that almost nothing at all has changed. Literally almost nothing.  However, once again fear of things we don't understand on the internet seems to be ruling the day here, when the reality is much different from the fear.

Can we stop spreading fear over Wifi in schools?

I'm sick and tired of reading stories about groups who think Wifi should be banned from schools. I really hope the only reason we see the is because that particular day is a slow news day.  Even then, the reasoning is so ludacris that I almost don't even know where to begin.

First off, I'm going to apologize in advance if I sound a bit angry and sarcastic here, but it does pretty accurately reflect how this situation is.

The theory behind banning wifi from schools is that the "radiation" from the wifi signal might be harmful to children, and that kids who are in school with wifi are stuck in it for 6+ hours a day, with no way to avoid it.  I use the term radiation loosely, because while it is technically a form of radiation, virtually any type of wireless signal is also radiation.  Radiation is a very negative term, and I think is used in this case in an attempt to scare people.  For many people, the term "radiation" refers to a very dangerous ray that comes from a nuclear power plan, nuclear weapon, or from cancer treatments.  Except for maybe in Japan, the latter, cancer treatment, is the most visible view of radiation.  Radiation kills cancer cells, but also makes people sick, and seeing someone who has been through radiation treatments can be demoralizing, as it makes them even more sick.  I'm not going to call it radiation any more in this post, because I don't want to help promote the negative connotation and attempt to scare people that it implies.

The biggest issue I have with people who are afraid of wifi is a very simple one.  Every second of every single day we are bombarded with other signals which are both mower powerful and widespread, as well as weaker and localized.  Every second of every day.  Wifi is only one type of signal we get.  Over the air TV, radio, microwaves, cordless phones, cell phones, electricity, bluetooth, RF, infared, and my personal favourite in the list: sunlight.

It is a fact that a person absorbs more radiation (broke my own rule, won't do it again) from the sun every year than they do from wifi.  Think about that for a second.  The sun gives off more than wifi does.  the last time I checked, the sun has been in the sky for a very long time, and it looks like we've made out ok since it's been up there.

Then there is every other signal. Can you turn your radio on and get a signal? If you are reading this, the answer is yes, and that means you are getting hit by radio waves right now. Same thing for TV signals.  Those are signals that 99% of the people who will read this are subjected to literally 60 minutes an hour, 24 hours a day, 365 days a year. Last I checked, after 100+ years of the invention of radio, we're still doing ok.

Cell phone signals are similar.  Most of us are subjected to them all the time.  People assume that the cell phone itself is where most of the signal comes from, but they often forget that a cell phone tower is emitting a signal all the time, which you are subject to.

Other signals, like cordless phones, bluetooth, etc are localized, and you aren't subject to them all the time, but it is likely that you are subject to them often.   Another favourite example are the cordless phones.  Cordless phones operate on the same area of the wireless spectrum as wifi, and they are also always on.  And 15+ years of cordless phones later, I still feel ok.

Without getting too much into the science of wireless spectre, which i am by no means an expert on it, signals from wifi are much higher in the spectrum than many signals, the 2.4GHz band and 5GHz band specifically.  Again, without getting into too much of the science, the way that wireless works is that the higher the number, the harder it is for a signal to travel longer distances and pass through walls and penetrate people.  This is why the lower spectrum is much more coveted by cellular providers.  Lower frequencies mean that fewer cell towers need to be built because the signal can travel further and navigate between buildings in downtown cores.  Now, because of this the higher frequencies that wifi operates at are actually better, because they don't penetrate people as easily as a lower frequency does.  If a wireless signal was really dangerous, than a signal from a lower station on the AM radio dial (630MHz for example) would be far more dangerous than a wifi signal since they penetrate walls and people so much more easily.  But again, After 100+ years of radio, I think we're doing ok.

the last bit about the actual wireless spectrum I want to talk about is the most common wifi band, 2.4GHz.  2.4GHz signals are recognized as "unregulated" in the spectrum.  This means that virtually anyone can build any type of wireless device that uses the 2.4GHz band of the spectrum without any kind of government regulation.  This has meant that practically every device you have ever handled that has some kind of wireless feature, be it a wireless controller, toy with a wireless remote, most new wireless remotes, basically anything.  Those all operate on 2.4GHz.  If signals in that band were harmful, would we not have noticed it by now?

The people who are trying to ban Wifi from schools are doing it by trying to make people afraid.  They put the words "radiation" and "our children" in the same sentence, and it makes other people who don't know the science or the facts afraid.  Do we know everything there is to know about how wireless signals work? No.  but 20+ years of using the 2.4GHz spectrum for wireless signals, 100+ years of Radio, and about 4.5 Billion years of the sun being in the sky with no real measurable harm to anything on this planet cannot be ignored.  It is time for these people to stop spreading mis-information and fear and time for not only fact and science, but common sense to prevail.

[link] - Edmonton Journal story

The Rapidly Changing Internet - Online Advertising

The internet.  Probably the greatest invention of the information age.  It is revolutionizing how we do everything.  From communication, to shopping, to consuming information, to advertising, to working, and much more.  Unfortunately the internet is advancing and changing so much that it can be hard to adapt to.  Unfortunately this is leading to some pretty severe growing pains as Governments and agencies, as well as businesses and individuals are all trying to adapt, with varying degrees of success.  The biggest problem is the fear that comes with new technologies.  Those who do not understand or know how new tools and technologies work are more likely to be wary of them, and those people can hold us back.  There are many parts of this that I'm going to touch on, but I want to start with online advertising and how more specifically targeted ads can be the most valuable advertising that there is, and why we should embrace that, not be afraid of it.

I've chosen to talk about advertising first not because it is the obvious first choice, but because it is topical.  Canada's privacy commissioner recently ruled that some types of targeted advertising on the internet violate Canada's privacy laws, and needs to change.  This to me show just how out of touch our privacy commissioner and privacy laws are with the future of communication and media.

Let me start by talking about old media, or traditional, advertising.  I'll mostly be talking about TV advertising, but this still generally applies to other mediums like news print and radio as well.

Traditional advertising has a very simple model.  Companies sell a block of advertising, and all viewers watching at that time will see it.  That may sound like a great method, but it is actually pretty inefficient.  Advertising usually targets only a subset of those people that are watching.  For example, an advertisement for Gillette razors may be very relevant to someone like me, a mid 20's male.  But a 12 year old girl could be watching at the same time, and that commercial has zero value to her.  That means that out of the two of us, the advertisement is only reaching 50% of the audience with the targeted effect.

Now, ratings and demographics play a huge role in traditional advertising.  Higher rated TV shows will have more expensive ad spots because there are more people watching them.  A show like desperate housewives will have more advertisements targeted towards women, because more women than men watch that show.  During Saturday morning cartoons I'm more likely to see ads for toys than I am for R-rated movies.  Traditional media depends heavily on ratings and demographic information, because it can try to target the most appropriate ads at the shows that would have the appropriate audience.  That's why the male 18-34 and female 18-34 are such sought after viewers among networks.  But even with all of the data that they can get, there is still a large part of the audience that will watch an advertisement where it is simply not relevant to them.

Now, lets look at some of the various online advertising models.  Google, which makes the vast majority of their money each year through advertising, has the simplest, but easiest to understand model.  a company can buy a keyword on Google.  When a user does a search that includes that word, that company's advertisement appears in the search results.  So if I search for "coke" and the coca-cola company has purchased that keyword, I'll see an ad for coca-cola in my search results.  simple, but yet very effective.  It means that only people who are searching for something will see that ad.  If I don't' search for coke, I'll never see a coca-cola ad.  Simple as that.  Google uses keyword advertisements in almost all of its products.  in Gmail, if an email has a phrase relating to coke, a coke ad will appear on the right hand side of the page.  Simple, effective, and un-obtrusive.

Now, our activities can also influence advertisements we receive.  I'm going to use Facebook as the example here, as it is again, the most relevant.  All of the information a person puts into Facebook, whether it is their relationship status, hometown, interests, favourite movies, etc, allow advertisements to be targeted at them.  All of those "like" buttons you see all over the internet now, Facebook collects data on those too.  The goal is to provide you with the most targeted and relevant advertisements possible.  Did you just change your relationship status to engaged?  Well then Facebook will start giving you ads about wedding services.  IF you just got engaged and are female, then you are likely to get an ad for wedding dresses.  If you seem to "like" a lot of news stories relating to the Ford Motor Company, you will see a Ford ad. Like the Edmonton Oilers, you might see an ad for Oilers merchandise.

These types of ads are hugely valuable to companies, because it allows them to provide ads *only* to people that they would be relevant to.  If you are not getting married, there will be no ads for wedding services.  If you don't like coke, no coke ads.  It allow each ad to be so specifically targeted that it does not have to appeal to anyone except the target demographic.  This makes each advertisement more valuable for the both the company selling the ads, as well as the one buying them.

Now, as a consumer, someone looking at ads, I know that I would much rather see an ad that is for something that would actually matter to me.  Don't' get me wrong, if I never saw another advertisement again it would be great.  But since advertising is part of our lives, I really want to see something that matters.  I'd much rather see an ad for razor blades than makeup, for example.  And why would a company want to direct a makeup advertisement towards me?  It makes no sense for them, just as it makes no sense for me.

Now, there is an argument to be made about privacy.  That's a topic I'm going to talk about more later, but my belief is that how these ads are targeted towards me are in ways that are a natural extension of what has been done in the past.  Do you honestly thing that if 20 years ago that if companies could have targeted their advertising in this specific manner they wouldn't have?  the only reason they didn't was because there was no way of knowing.  Now, I'm sure this is true for most people, but I'm not one to hide many of my likes and interests.  It is by no means a secret that I like Coke more than Pepsi.  I will tell people that without a problem, so why should I care if an advertising company knows that.  Sure, that information should be used appropriately, but this is true for any and all information.  All the data is used for is to give me a better experience, which is what I want.

What the privacy commissioner has said is that information about how targeted ads work should be clear and visible to users.  I have no problem with that, as it is something that should be disclosed.  After that, it gets, well, stupid.  The privacy commissioner wants websites to stop using tools that users are "unaware of."  Honestly, that is shortsighted.  There is an argument to be made that if a person "likes" soothing on Facebook that it does actually constitute something that a user actively interacts with, and Facebook has disclosed this.  Things like changing a relationship status in Facebook are less obvious, but I would still argue that Facebook does disclose this as well, and a user has to actively put this information into Facebook.  IF they do not want that, they don't' have to.  When thinking about Google, the privacy commissioner's argument is even more wrong, because it only displays ads directly related to something a user does.

Online tracking of Children is another thing that the privacy commissioner wants stopped. Now, while I can see the argument that a child can't be reasonably expected to understand how all of this works, but what is being asked for is nearly impossible.  Using google as an example, if a 12 year old uses Goole to help with school homework, Google has no way at all of knowing who is making the search, just what the search is for.  The search could be made by a 12 year old, or a 70 year old, and Google would not know the difference.  For other services there are methods to combat at least part of this.  For almost all online services users must be 13 years of age to sign up, and have parents permission.  Now, admittedly this is probably one of the most broken "rules" in existence, but at least it is there.  In an age where companies have very little control over who actually uses their service, it would be impossible to keep one demographic out.

I really do believe that the type of targeted advertising we see on the internet today is the best kind of advertising ever seen.  It may seem a little off putting at first to think about an advertisement directed solely at an individual instead of a group of people, but this allows for a much better experience.  Just because it is new, does not make it bad for us.  I would argue that Google and Facebook have revolutionized advertising in ways that the TV networks could have only dreamed of 20 years ago.  Just as technology enables us as users to do more today than ever before, it allows the same thing to companies.  They should not be punished for using the tools at their disposal to create the best possible experience for a user simply because our laws are outdated and cannot keep up with said technologies.  That type of fear will only hold us back, not move us forward.  It doesn't mean that there is no privacy; There are things I choose not to share on the internet.  But if I'm willing share it, I want it to be used to give me a better experience.  That is why it is there. The future of advertising is here now.  In fact, it has been here for a few years.  The companies that embrace it, like Google, are doing immensely well.  Last time I checked Google was making more money than I can really comprehend through advertising sales.  This is not going away, and those that fight it and try to stop it like the Privacy Commissioner's office has will be exposed as outdated as they are, and will be left behind.

[Read] - Privacy Commissioner sets new guidelines for online ads

CRTC rules against Usage Based Billing

The CRTC has made a very important, and surprising, ruling on the state of usage based billing on wholesale ISP's in Canada.  While this actually won't affect most people reading this, it is a pretty important and precedent setting ruling.  The most surprising thing about the ruling? The fact that it is actually pro-consumer, not pro-big business.

UPDATED: see the bottom of the post for an update

To keep it simple, the CRTC has ruled that Bell cannot charge wholesale ISP's based on how much data moves through the network.  Bell can, however, charge based on speed of the connection.  As a quick reminder, wholesale ISP's are smaller, often local ISPs that do not have their own network.  They lease space from large ISP's such as Bell, and resell that service to consumers.  So while this ruling does not affect the consumer directly, this will have an impact in the long run.

I made the point months ago that charging wholesale ISP's, or even regular users, on a usage based billing system that puts a limit on how much data a user can download each month makes zero sense.  I won't go back into it, but you can find the previous posts from January 2011 and on on this site that will explain all of it.  The nuts and bolts are that the true cost to the ISP is not how much data moves through a connection, but how fast the connection actually is.  Data is a nearly infinite resource; I'm creating data typing this post right now.  But how fast you can get that data is limited, and it does cost ISP's more to offer faster connections.

In a nutshell, with this ruling are that the CRTC has seen the truth to this argument, and has said that Bell can charge wholesale ISP's more for a bigger, faster connection, but not for how much data moves through.  This is a very fair ruling as it does reflect the true cost of internet service.  Wholesale ISP's should be charged more to lease more bandwidth (the actually term for the speed of the connection) from Bell, as that really is where the cost is.  I don't think you'll find many rational arguments against that, as it is fair for everyone.

Why this is important is that it is precedent setting.  Since Bell can't do it, It will be nearly impossible for Rogers, Telus or Shaw to charge wholesale ISP's on usage based billing now as well.  It also means that there is a stronger argument for the general consumer should not be subject to usage based billing.  If large ISP's can't do it for their wholesale customers, why should the general consumer face that type of restriction.  I have always been a proponent of this, and this does give another bullet in the chamber for the groups that are lobbying for it.

The last thing I will say is that I'm very surprised at the ruling, in a good way.  The CRTC very rarely makes consumer friendly rulings of this magnitude.  Traditionally it has catered to larger businesses.  This ruling helps small businesses the most, but will have a long term positive impact on the state of internet and content delivery in Canada.  There are many CRTC rules which I think are so anti-consumer they hurt more than they help (simulcasting sports broadcasting is my favourite example), but this ruling is a surprising breath of fresh air, and a very welcome one.

UPDATE: Since the posting of this article some new news and clarifications have come out.  I have also included links to the original article, as well as the two new articles for this update below.

The Canadian Association of Internet Providers (can no one come up with better names for these types of organizations?) has come out against the ruling, saying that it will drive up costs for consumers who subscribe to those wholesale ISP's, since those who want faster connections will likely have to pay more.  Now, this actually may be true, but then that will make those ISP's and customers of those ISP's on a similar playing field that customers on Bell, Rogers, Telus and Shaw are.   They may even be in a better position because there does not have to be a data limit on their plans, like the larger ISP's have chosen to impliment.

The rhetoric is quite funny.  The large ISP's are unhappy because they wanted to implement usage based billing on the smaller ISP's in an effort to make more money.  Small ISP's are unhappy because they don't like the prospect of having to pay more to the larger ISP's in any way.  Usually, when both sides of the business are unhappy, that is generally a good thing for the consumer.  I know that there is a possibility that a consumer using a small ISP will have to pay a bit more, however the deal remains fair to all sides, and does accurately reflect the real cost of delivering internet.

There has also been an update on exactly how the wholesale ISP's will have to pay for their connection speed.  According to Ars Technica, the Large ISP's will have two methods to charge the wholesale providers.  They can either charge a flat rate, or force the small ISP to pay up front at the beginning of the month for however much capacity they want/need for that month.  That is something I personally don't like, because having to pay ahead of time will lead to guess work.  If the ISP pays for too much capacity, they will pay for more than what they need and end up paying more than they need to.  If they buy too little, it will cause congestion for their customers and slow down their internet.  this is not a good situation for the wholesale ISP's and one that they are likely going to have a difficult time handling.  You will likely see them having to pay for far more than what they usually need on a given month, especially in the beginning, to ensure there is no drop off in capacity.  what I would have liked to have seen is for the wholesale ISP's use what they need in a given month, and then pay the large ISP's the appropriate amount. No more, no less.  This would have been a much more fair deal for those small wholesale ISPs.

[read] - CRTC offers compromise on usage based billing (CBC)

[read] - CRTC ruling may boost prices (CBC)

[read] - Canadian regulators ditch usage based billing for independent ISP's

Shaw Launches Movie Club, badly.

Today Shaw launched a new product aimed squarely at Netflix called Movie Club.  Movie Club is very similar to Netflix in that for a flat monty fee users have access to a library of video content that they can watch.  Movie Club itself is an interesting product, but this article is going to focus more on the Shaw's launch of the product today. I'll be frank.  Shaw fumbled the ball on this one, really badly.  A lot of the good talk about Shaw since the restructuring of their Internet plans has been hurt by how this launch was handled, and it is sad to see.

Confusion started literally minutes after the launch of Movie Club.  Shaw put out a news release, and several news publications put articles up on their respective websites about the new service. Even US based Ars Technica and Tech News Today ran with the story (though Tech News Today was able to correct the story at the end, thanks to a live chat room audience).  The reason for this is that the initial reports were that Shaw was going to deliver this service both to set top boxes and through the Internet, but that the delivery though the internet would not count against data caps on user's accounts.

Let me stop and say that again.  The initial reports were that delivery of Movie Club through the Internet would not count against a data cap.

I will stop you there again, because that is not true. But I will get back to that in a second.

Needless to say, the Internet kind of blew up at this.  Net neutrality proponents slammed the move, and many people got very upset at the fact that Shaw seemed to be putting in a plan that gave them an unfair advantage over a service like Netflix.

Then, came the "clarifications."  Shaw's official twitter accounts, Shaw employees speaking on Twitter, Facebook, and Internet forums on behalf of Shaw immediately came running to the public to say "No no no no."  It was clarified to me, along with everyone else, that watching content on Movie Club on a TV through a set top box via the Video On Demand interface would not count against a user's data cap, as the content is transmitted through the traditional QAM cable TV system that VOD content moves through.  Watching content through a computer or other device via Wifi goes through the Internet, and will count against a user's cap.  Shaw employees and PR spent most of the afternoon doing damage control, and trying to get the accurate information out there.  Several news publications put out new stories with clarifications, and Ars Technica updated their story (albeit much later than I would have liked).

So what happened? How did Shaw allow such confusion to happen on this launch?  I've done a lot of reading on the various news articles, and Shaw's news release for Movie Club, and the confusion comes from two simple things.

• The CEO was quoted as saying that on your box or online, this will not have any impact on your capacity or usage.
• The news release from Shaw had no indication one way or the other whether this would affect the data cap.

Now, with a quote from the CEO saying one thing, and a news release not disputing that, journalists ran with the idea that all Movie Club content would not count against the data cap. If I were working for one of the many publications that put articles out, I would have done the exact same thing given the information available to me at the time.  Could this be a case of a CEO being mis-quoted? Possibly.  But what is likely is that he just got a fact wrong, or just misunderstood a question.  either way he made a mistake.  Those things happen from time to time.  Engadget has a feature called "C-E-Oh no he didn't" that catalogs tech company CEO's that make mistakes, and it can be quite entertaining.  This is another one of those cases, and unfortunately for Shaw, it kind of blew up in their face.

To Shaw's credit, their PR team worked very hard all day to try to get the correct information out, to clarify to angry customers what the truth was, and to work with news media to get new or updated articles posted.  Unfortunately in most cases where mistakes are made, it takes 10x the amount of effort to fix them, and that is what Shaw faced today.  The net neutrality people might no longer be mad at them, but a new group of people are mad and accusing them of lying, trying to spread mis-information, and confusing people.  It only takes a quick look on Twitter, Facebook, or even Google+ now to see the anger at Shaw over the confusion on this launch.  The Shaw PR team was put in a difficult situation in which there was no way for them to come out in a good way.  i applaud the PR team for doing what they could to try to clean up a pretty nasty mess that was left behind for them.

This confusion during the launch has really masked the actual product they are trying to get off the ground. I've written almost 900 words to this point and I haven't even talked about the actual product that is Movie Club.  That is not a good thing for Shaw, at all.  I should have spent the last 900 words talking about the product, now how they fumbled the launch, and that is unfortunate.

As a quick recap of the above, in case it was still missed in there, Shaw Movie Club will not count against the data cap if being watched through a Shaw set top box via the Video On Demand interface.  Movie club will, like all content, count against the cap if watched through any Internet connected device like a computer or mobile device.

Now, onto the actual product itself, 997 words in.

Movie Club is a subscription service, much like Netflix.  I had actually heard about this service during the Shaw customer consultation sessions earlier this year.  The Shaw representatives there told us that they did have a video subscription service in the works, and that it was being considered as something that would be more valuable than Netflix, because they could deliver it through their existing Video On Demand service and not have it count against a user's data cap.  They stressed that while they probably could not match the volume of movies and TV that Netflix offers to customers, they wanted to focus on quality and getting newer blockbuster movies onto their service before Netflix could. They seemed very excited at this project that they were working on, that has now become Movie Club, but had asked us not to talk much, if at all about it because it was a product still in development and things could change before they launch, if they ever even did launch it. Today, that project finally saw the light of day, and Movie Club was launched. Unfortunately, it simply does not compare to what Netflix has to offer.

To start, Movie Club is a $12/month service, and that is for Standard Definition content only.  Movie Club HD will be launching "later this summer" and will be an additional $5/month, for a total of $17/month to watch HD content. Netflix is $8/month for the entire service, including all HD content.  That means that Movie Club is at a huge disadvantage out of the gate being $4 or $9 more expensive than Netflix. So, if Movie Club is going to be more expensive, it had better be beating Netflix on Movie selection.  However, a quick trip to the Movie club section of vod.shaw.ca shows a total of 139 movies available for streaming.  I don't have an exact number for the Netflix library, but needless to say it is significantly more than that.

But again, Shaw's word to us months ago was that their service would aim to go for quality more than quantity.  A quick look through the 139 titles currently available include many recent titles that are not available on Netflix in Canada, like Burlesque, The Blind Side, The Tourist, and Fast & Furious.  There are also many older moves that are both available, and not available on Netflix at this time.  There are definitely movies on the service that I would like to watch, some movies that I've never seen, but for me personally, I don't think that it is worth the price.  I honestly would not sign up for a SD service at this point.  I have a 47" HDTV and the though of paying $12/month to watch SD movies on it when I can pay $8 to watch HD movies simply does not make sense to me.  Would I pay $17/month for the HD content?  Again, probably not, because I can get many more movies in HD for less than half the price.  Sure, I can't watch Transformers: Revenge of the Fallen on Netflix, but I'm fairly sure that I can find 9-10 other movies that I'm perfectly content watching for less money.  What it comes down to is that for me to want to pay more for Movie Club than I do for Netflix, Shaw has to provide me with a very high number of movies that I want to watch right now that I can't get on Netflix.  And personally for me, they aren't even close.  Shaw does say that they are committed to adding new content every month, but that does not help the fact that right now, today, there are only 139 titles to choose from. Right now Shaw does not have the quantity to match Netflix, nor do they have a high enough number of quality titles to justify the price.

Does that mean it will stay this way forever? I hope not.  I really do think that a market does exist for newer movies on streaming services.  But Shaw's problem is that Netflix is desperately trying to get there as well.  If Shaw wants Movie Club to have any chance of success they either need to get a lot of newer (under 1 year old) blockbuster movies on there very soon, or drop the price significantly.  I think that people might pay a higher price to watch movies they can't see anywhere else, especialy if Shaw can swing a deal to get some movies on to Movie Club that aren't even available on Blu-ray or DVD yet. But as it stands right now; Shaw does does not have a competitive product.

Now, for all the confusion over the actual content delivery and whether or not it counts against a data cap, the fact that users can watch content as much as they want through a set top box and not have it count against a dat cap is one of the things that I actually do think is good about the product.  It is a value-add that Netflix quite frankly cannot match, and a good one at that. Many people have pointed out to me that doing that may get Shaw a visit from the competition bureau, and I think they are right.  But I also do not think that there is a problem.  If the story had been true that Shaw was providing the internet streaming and not having it count against their data cap, then there would have been serious anti-competitive issues.  But Shaw is offering an internet based service that is exactly the same as Netflix, with a value-add of the set top box delivery.  Shaw is not trying to make Netflix worse and less valuable than their product, they are trying to make their product better and more valuable than Netflix.  That is a very important, if a bit subtle, distinction that people need to understand.  You can do anything you want to make your service better as long as it does not purposely make someone else's worse.

the last thing I want to talk about is something I touched on a bit earlier.  Shaw launched Movie Club today in SD only.  In 2011, when HDTV's are commonplace, that is simply unacceptable.  I can't even begin to say how much that move does not make sense to me.  With the promise of the (more expensive) Movie Club HD service coming "later this summer" it would have made more sense to me to wait to launch the service until the HD portion was ready.  There is quite honestly no way I will even consider getting Movie Club in SD when it's main focus is on delivering newer movies, which are filmed specifically for HD, and do not look nearly as good in SD.  If I want to watch Transformers, I will be doing it via some method that will let me watch it in HD, which Shaw does not offer today.

To say that Shaw fumbled the ball today would be an understatement.  From communication issues early in the day, to actually launching at a product that is in many ways inferior to some of it's main competition, to launching without HD; Shaw made a mess of this product launch.  Could Shaw rebound from this and make a good product?  Absolutely.  Like I said.  I do think that there is a market for a "premium" streaming service.  However Shaw needs to get there before Netflix can do it cheaper if they want any chance of success, and they need to do it quickly.  It may be a bit unfair, but we live in a world where news moves fast, and in many cases the first impression is everything.  Shaw has left a very bad first impression here, and if not fixed quickly, they risk having the product slip into irrelevance before it even gets off the ground.  The product launched poorly today but it still launched. And because of that, the clock is ticking.  Can Shaw fix it before the time runs out? We'll see.

[Read] - Shaw Movie Club Press release (PDF link)

[Read] - Original Calgary Herald Article

[Read] - Montreal Gazette article with clarification

[Read] - Ars Technica article, original with update

[Read] - Shaw Facebook discussion thread.

[Read] - Shaw info twitter account.