October 25, 2011
Cord-Cutting a Double-Edged Sword for Channel Master
For the 15* million households in the United States that do not have a pay-TV service, Channel Master, best known as an antenna manufacturer, has created an over-the-top (OTT) television solution that it plans to launch November 1.
But for Channel Master, OTT is a delicate subject. On the one hand, it wants to sell its new solution to people who don't subscribe to a cable or telco video service. On the other hand, about four years ago, Channel Master was bought by PCT International, a company well-known for making coaxial connectors used by cable service providers.
Its new OTT product - Channel Master TV - is a digital video recorder (DVR) with a dual tuner for both digital channels from broadcasters (ATSC) and clear QAM cable. It has a 320GB hard drive for recording up to 150 hours of standard definition programming or 35 hours of high definition content. In addition, the DVR can connect to the Internet via Wi-Fi. The device works with an antenna, which must be purchased separately. It has a suggested retail price of $399 and can be purchased initially at Fry's, Crutchfield, WalMart.com and directly through Channel Master.
Channel Master has partnered with Walmart to incorporate its Vudu app store and movie service with the DVR. Vudu offers subscription-free VOD service to rent or buy movies for streaming.
"For the 15 million households in the United States that do not have a subscription service, they solely rely on an over-the-air antenna," says Joe Bingochea, vice president/Product Management and Marketing at Channel Master. It's the lower end of market that we've served for the past 60 years."
Bingochea says Channel Master created a sole antenna DVR more than a year ago so customers could record one program while watching another. Consumers requested the company to add an Internet connection, which led to Channel Master TV.
Although Channel Master sells antennas to customers nationwide, Bingochea says there are a lot of customers in the Midwest, especially, who want free broadcast TV, Web content and DVR capability without a monthly subscription.
With its ability to receive clear QAM channels, Channel Master TV is a possible solution for multiple dwelling units (MDUs) that have their own digital modulation system. And Bingochea says subscribers of pay TV services may want the DVR for ancillary TVs to get OTT content and local programming.
Channel Master has been able to capitalize on "all this talk about cord cutting," says Bingochea. "Now it's a hot topic. A lot of consumers call us because they're able to cancel their video subscription." But, he adds, "We don't want to support cord cutting per se. We do make the cords."
*initially reported incorrectly as 50 million