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Source: flickr user Elsie esq.

The first week of 2011 isn’t even in the books and already we have a new Smart TV platform.

Maybe this is not too surprising, given that it’s CES week, but LG’s entrance to the space makes, by my count, close to 10 Smart TV/Connected TV app platforms vying for the attention of the both consumers and OEMs (this number could go up quickly after CES).

Seeing the news that LG had announced their own Smart TV platform, I couldn’t help but tweet my belief that it would result in more fragmentation for the space, what with LG throwing in with Google TV, Yahoo, Roku, Vudu and Rovi/DivX, among others. However, noted digital home blogger Alexander Grundner of eHomeUpgrade replied to my tweet by essentially asking, “what’s wrong with choices?”

That’s a great question: Are lots of platforms — and the inevitable fragmentation of the Smart TV/Connected TV space — a good thing or bad thing (or neither) for a nascent market like smart TVs?

To answer that, let’s look at the implications of smart TV platform fragmentation:

Choice: Good and Bad For New Markets

In general, there are upsides to lots of choice in a new market. Innovators can create interesting and valuable features, while developers aren’t limited to a particular platform. Having multiple options also helps a market avoid what can happen if, in the early stages, there are too few platform choices. Lack of choice creates lack of competitive nurturing, which is what happened with Windows Media Center Extender.

But as we’ve seen in the smartphone space, in a market where there are large amounts of development environments, developers will often throw their resources at the one or two biggest opportunities and likely ignore the rest. The inevitable result of this is the likelihood certain platforms will atrophy and possibly die, leaving disenchanted consumers, as well as TV OEMs, in their wake.

The Eventual Push Towards A Smart TV Lingua Franca

Another result from a fragmented market will be the eventual push towards cross-platform development environments and the eventual victory of HTML5. In some ways, HTML5 is the ultimate cross-platform development environment, as it’s a standards-based web environment that will work, conceivably, on any web-connected screen.

But as we’ve seen with the smartphone market, there’s a long way between here and the HTML5-promised land, and there will be opportunistic companies that will provide cross-platform development tools to work across various smart TV platforms. No doubt smart TVs will soon have their answer to Appcelerator, PhoneGap and Appmobi to facilitate write-once/multiple platform apps for TV.

Fragmentation Results in Consolidation

Lastly, another inevitable result of platform fragmentation for the Smart TV market will be the eventual consolidation of the market. This is just beginning now in the smartphone market, with the acquisition of Palm by HP and the atrophy of Limo, where market forces eventually have their way and make it necessary for all players in the ecosystem to make resource-allocation choices. While consolidation of both companies and standards may be seen as reduction in choice by some, this is often a positive development if, as is the case with Palm, it means more a resource-heavy rejuvenation of a platform.

So, to answer Alexander’s question, choice isn’t a bad thing, especially in an early market. However, more choice means more pain down the road, particularly for those platforms (and their customers) that don’t get traction.

But, in the end, that’s what free markets are all about. The more the merrier, at least for a while.

Question of the week