Bypassing The Bypassers
As cable operators begin looking at diving into Internet-enabled TV, they face a bevy of choices in choosing the best platform and partners for such a service. Comcast appears to be leaning toward cable-specific partners in this regard, judging by its first Internet-video entertainment trials in Augusta, Ga.
Although Comcast executives have refused to talk about the trial on the record, rumors have surfaced that the operator is working with Pace, Samsung, Intel and Nokia on the hardware; and that SeaChange International is providing the user interface. This is an interesting choice in terms of the kinds of capabilities this brings.
Documents posted with the Federal Communications Commission have indicated the Comcast trials will use the Pace RNG 210 N with four HD tuners. This would suggest the box could serve as more of a gateway for sending content to other devices within the home, including TVs, computers and other screens.
SeaChange has integrated a multi-screen user interface it recently acquired from VividLogic with support for CableCard (security), MoCA (transport), and Tru2way (data management). Furthermore, SeaChange also has been working on the universal Session Resource Manager (uRSM), designed to provide a high quality of service over access, aggregating and edge networks for cable, Internet and wireless infrastructure. The tool also allows operators to set business rules for the different services that tie into the service.
Why Not Google And Apple?
In the short run, it may be tempting to partner with companies like Google and Apple as they grow in popularity, but these companies have developed infrastructure that ignores the cable industry’s existing business models. Google already has proved its willingness to work with operators, and it has worked with AT&T to optimize the Internet TV experience for its service. Although initial responses to the first Google TV, when running over generic broadband infrastructure, were tepid, others reported a better experience on top of AT&T U-verse broadband, owing to the tighter integration with the TV service.
The new Apple TV, on the other hand, has picked up a lot of traction owing to its “magic” user interface; more than a million units have been sold since its launch a few months ago. Thus far, however, Apple has not demonstrated an interest in working with cable operators directly.
While Apple has done a good job at optimizing the user interface and Google has excelled at search, there still is a lot of work to be done regarding integrating these boxes into the value chains cable operators have around pay-per-view, advertising and other premium services. Kurt Scherf, an analyst at Parks Associates, says cablecos might shy away from working with Apple because of pricing issues. And while Google is really good at search, it hasn’t made public any plans for supporting content providers.
Whatever comes out of Augusta is only the beginning, but it is one that leaves the cable industry with many choices to leverage its existing relationships and business models rather than to cannibalize them. “Given Comcast’s large customer base, huge billing relationships, and established relationships with advertisers, this is just the beginning of what Comcast could be doing to offer higher levels of online video that is different from Apple and Google,” adds Scherf.
– George Lawton
