November 13, 2013 – Dramatic shifts in over-the-top players’ multiscreen video service strategies have made it much clearer where the opportunities and threats lie for incumbent pay TV providers and other entities that have a stake in broadband video.
On the one hand, the likelihood that a Silicon Valley giant with deep pockets will become a national competitor in the pay TV business has diminished with pullbacks by Intel, Sony and Google and with Apple’s intentions still in rumor mode. On the other hand, the vast sums pouring into original programming for OTT delivery by Netflix, Amazon, Microsoft and hoards of other online entertainment outlets are increasing pressure on service providers to include such content in their offerings.
With Virgin Media in the U.K. having cut a landmark deal to make Netflix part of its TV lineup and reports that Comcast and Suddenlink Communications in the U.S. are considering similar moves, the dam of resistance against incorporating Web content into the pay TV mix may finally be breaking. Moreover, the wealth of high-quality content emerging online is creating an opportunity for smaller incumbent operators as well as ISPs and mobile companies to think about packaging a premium service that would avoid dealing with traditional channels altogether.
In all cases the question becomes how best to seize these opportunities from a technological standpoint, especially when it comes to enabling a seamless tie-in between OTT and traditional TV content. Capabilities that need to be factored into the technology choices surrounding the various business models now in play are well illustrated by the multiscreen service platform on offer from aioTV, a company backed by UTSTARCOM and Innovacorp that has operated under the radar globally but now is moving to publicize its presence in the North American market.
aioTV has tailored its in-the-cloud middleware and applications support system to suit the needs of all types of service providers, from mobile and smaller fixed broadband entities to Tier 1 incumbent pay TV operators. After making headway abroad with licensing of its highly flexible multiscreen middleware platform, especially in Latin America, the company is now on the verge of signing deals with major players in the U.S., including mobile and pay TV incumbents, according to aioTV CEO Mike Earle.
“The market wasn’t ready for what we were offering when we started four years ago,’ Earle says. “But we’ve been planting seeds with operators as we waited for the hardware to catch up.”
Hardware in the vein of an array of devices ranging from small dongles to OTT sidecars to high-end hybrids with IP capabilities has definitely caught up. As a result, Earle notes, aioTV’s customers can use its middleware and client apps to seamlessly integrate Web-based content into the TV viewing experience, thereby avoiding the cumbersome approaches to switching from one domain to the other that have so far characterized efforts to bring Web content to the TV.
“We provide the tools that allow you to aggregate multiple services in a TV-like experience,” Earle says. “It can be anything from licensed linear pay TV and broadcast programming to unlicensed content curated from the Web. We bring it all to the end user’s device whether it’s a TV, a tablet, a PC or handset with a consistent user experience across all devices.”
While such capabilities are widely touted by suppliers these days, Earle makes the argument that many solutions overlook critical details, starting with maintaining what he considers to be the right balance between what is done in the cloud and what is done at the device end. “We’ve built a set of tools, including ingestion, authentication, metadata management and navigation, that allow operators to manage their services from the cloud,” he says. “But we also recognize that you must be able to provision content on a device-by-device, stream-by-stream basis in conformity with rights policies and monetization opportunities, which requires an ability to manage what is happening at the device level. There’s no asset management system tied to traditional pay TV access that will do that.”
To make this possible aioTV has developed a client player that supports whatever apps are associated with the content suppliers who make up a given distributor’s portfolio of curated Web content. “It’s hard to do everything in the cloud,” Earle says. “We stand up the content providers’ players and, through our middleware, support execution of whatever authentication requirements, DRMs, streaming formats, metadata, applications and modes of monetization are associated with those players.”
When it comes to content that’s available for free distribution, such as much of the video content on YouTube, aioTV embeds the access code in its player to facilitate easy integration of such content into the viewing options on the distributor’s navigation system. The company provides a UI template to support navigation across all the Web content, allowing distributors to skin and brand the UI as they see fit. For operators who have already developed universal navigation systems that can tie pay and Web content together, the aioTV middleware can be decoupled from the aio template and integrated with the operator’s navigation system, Earle notes.
A key development which should help drive service providers’ embrace of Web content is industry concurrence with common authorization and metadata processes recommended by the Open Authentication Technology Committee (OATC), a non-profit industry association of content owners, multi-channel video program distributors (MVPDs), technology companies and system integrators. OATC’s Online Multimedia Authorization Protocol (OMAP), released for comment last year, is a voluntary open standard that defines the architecture, protocols and data formats needed to build and deploy interoperable systems that authorize access to protected media content on any Internet-connected device.
This year the group, whose principal members include CBS Interactive, DirecTV, Cox Communications, Discovery, Disney, Fox Networks, NBC Universal and many other major players, issued its Metadata Feed Recommended Practice document describing a common approach for content providers and distributors to use in describing their content and how it’s used. The idea is to simplify content exchange while ensuring consistent quality and regular updating of metadata via Web services.
aioTV, which Earle says was invited by NBC Universal to join the group and help demonstrate how the new specifications would work on a next-generation platform, has adapted its technology to work with these authorization and metadata processes. “These efforts give me confidence that MVPDs will be able to accelerate their use of Web content and to build monetization processes around individual content owners’ policies and features,” he says.
In enabling Web video enhancements to pay TV operators’ offerings, one of the four usage models aioTV touts for its platform, the company is taking advantage of new low-cost set-tops, typically available at $50 each with mass quantity purchases. These devices are meant to complement the existing set-top rather than serving as an alternative conduit for viewing, as is the case with devices like the Roku terminal, Earle notes.
“We’re supporting the notion of a pass-through device which has HDMI input and output so that an operator who wants to offer more linear channels or more VOD or other IP-based content can use our middleware to support a unified experience on the TV screen without interfering with the rendering of the pay TV UI from the installed set-top,” he explains. “The service provider is able to pick from a wide range of CE products we’ve approved to work with our platform. This hardware has to run our code and meet our other requirements for rendering the enhanced services UI and navigation features.”
With its support for authentication and individual content suppliers’ apps, the aioTV platform can also be used to support multiscreen TV Everywhere service, allowing operators to bring the Web content enhancements into the pay TV experience on connected devices. This can be done with or without using the pass-through option, but the latter provides a way for operators to deliver a uniform pay TV/Web content experience across all devices, including all the TV sets in the home.
Earle says aioTV is also talking with traditional OEM suppliers of pay TV set-tops about the possibility of integrating its player and middleware APIs with the pass-through capability, which would eliminate the need for the additional device. He also notes that manufacturers of smart TVs are preparing to introduce the pass-through capability in order to create a unified navigational experience that would enhance the pay TV provider’s service offering with or without that provider’s participation.
So far, CE manufacturers have used their connected TV capabilities to create apps enabling a Web viewing experience that’s completely separate and therefore marginalized from the viewing experience offered by the pay TV UI and service package. Were TV makers able to drive the Web viewing experience along with specialized apps into the pay TV viewing domain, they could pose a challenge to established service providers by promoting apps that leverage IP technology to sell ads, promote e-commerce and control many other facets of the home entertainment experience.
“The old threat, OTT content delivery, has been replaced by a new one, which is the CE manufacturers’ play for control over the living room,” Earle says. “I’ve spoken with two big CE companies who would prefer that the MVPDs (multichannel video programming distributors) stay in place. There’s a low margin for them trying to deliver their own pay TV packages, but if they can wrap value around the pay TV content with enhancements from the Web, that’s a home run for them.”
Along with allowing pay TV providers to get out in front of such maneuvers, the aioTV platform provides a safe, manageable way for SPs to begin the migration to all-IP TV services, Earle notes. “We give them the flexibility to move at whatever pace they want, even down to one channel at a time,” he says. “They don’t have to pull the plug on their QAMs and hope it all works at once. It’s completely non-disruptive at the consumer end, because it’s all coming through the same UI, so the consumer has no idea such a transition is going on.”
Of course, the aioTV platform provides a way for distributors to deliver the complete pay TV payload as well as Web content enhancements over IP, eliminating the need for legacy set-tops altogether. This approach, another one of the four models the platform is designed to support, has been taken by Maxcom, a pay TV operator in Mexico City that has used the aioTV platform to replace Mediaroom, the Microsoft IPTV middleware recently acquired by Ericsson.
A variation on this approach can be found with a U.S. cable company which is contemplating deploying the aioTV platform in conjunction with use of DTAs (digital terminal adapters) to support conversion of the digital streams to analog for viewing on cable-ready analog TV sets. The all-IP pay TV service would allow the operator to use low-cost dongles in lieu of set-tops for households with digital TV sets.
Still another application for the platform involves replacing traditional multichannel pay TV with Web video. This has great appeal both for mobile operators and for Tier 2 and 3 cable and telephone companies who are finding pay TV to be an unsustainable business but still want to offer a branded video service.
“What’s really lighting up for us with this application is the wireless space,” Earle says. “We have imminent deals in the making with major mobile providers who want to provide a compelling video service but have come to look on trying to be virtual MVPDs as a fool’s errand.”
Two models for these providers are emerging, he adds. One applies to carriers who offer unlimited data access as part of the service package, which makes it impractical for them to promote heavy video usage over their cellular networks. Instead, the idea is to use a pass-through box with access to their offering over the in-home Wi-Fi feed from the fixed broadband network. This service enhancement becomes a benefit to cellular customers who may or may not be pay TV subscribers.
Other mobile companies that charge for data usage are looking at aioTV as a way to deliver a Web video package over LTE networks directly to cell phones. Noting LTE providers are moving to enable multicasting, known as LTE broadcast, as a way to reduce bandwidth consumption, Earle says there’s great interest in developing a unique IP-based video experience that works within the constraints of the mobile operating environment. “Our platform adapts to LTE broadcast,” he notes.
As for the smaller fixed service operators who are weighing alternative approaches to traditional pay TV service, Earle says, “We’re hearing a lot from those guys. Using our packaging and curating tools in conjunction with a personalized navigation experience they can brand as a broadband value-add is becoming a compelling alternative to staying the course with pay TV.”