Jan 26

LAS VEGAS–Yahoo’s Connected TV, its widget framework for TVs, is a low-cost way to bring Internet content to televisions. Yahoo’s TV widgets don’t give you the full Internet flexibility of a product like Google TV, but Yahoo Connected TV is cheap to build: it’s available with a $250 22-inch Vizio set, for example. We first saw this platform at CES 2009, but for 2011 Yahoo is adding some features and partners to the initiative, including a standalone set-top manufacturer, D-Link.

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The biggest new feature is content-aware technology. The Connected TV platform now knows what you’re watching on your TV, and can overlay widget content that’s directly related to it, like stats for sports viewers, interactive games for kids’ shows, and “buy now” links for shopping broadcasts. It’s somewhat cool in that it works not just with live content but with streamed or recorded content as well: The Connected TV software listens to the audio signature of what you’re playing and uses that to match it with widget content that it then delivers over broadband. So you can get the full interactive experience even for month-old shows on your Tivo.

At CES, Yahoo announced a half-dozen partners that are experimenting with content-aware apps for the platform: networks Showtime, ABC, CBS (CNET’s parent company), and HSN, and advertisers Ford and Mattel.

D-Link plans to launch a set-top box for Yahoo Connected TV in the first half of 2011.

(Credit: Rafe Needleman/CNET) Yahoo and D-Link were also showing the first standalone Yahoo Connected TV set-top box, an as-yet unnamed, unpriced–but “under $200…hopefully much under”–box that can add Connected TV capabilities to any television set. It joins D-Link’s other set-top boxes, the Boxee box for content delivery and a WiDi box for showing computer content.

I’d say that if the D-Link box sells for more than $49 it’s not going to go far, because it doesn’t actually deliver much in the way of new content. And while it does deliver a type of information and interactivity that isn’t available any other way, for only $59 consumers can get a Roku device that will open up whole new worlds of content for their television sets. There is potential in the Yahoo Connected TV platform, but there’s also a chicken-and-egg issue for content creators. The more the capability is a freebie in TV hardware, the more valuable it becomes as a content and advertising platform. The platform might work better as a software appendage on a TiVo or cable company DVR.

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