After seeing some demos at CES this year, we feel exactly the same way about Telco TV services. After four or five years of fits and starts, the time has come!
In a recent column we discussed the progress of VDSL and VDSL2, and concluded that – lo and behold – we seem to have finally reached the point where we’ll see some “real” VDSL deployments in U.S. Well, after seeing some demos at CES this year, we feel exactly the same way about Telco TV services. After four or five years of fits and starts, the time has come!
The most impressive demos we saw revolved around SBC’s uVerse entertainment platform, which includes partnerships with Yahoo!, Microsoft, 2Wire and others. This group of partners brings – for the first time – a TV/entertainment package for telco broadband that not only can compete with cable multiple system operators (MSO) offers, but which in many ways goes beyond what most cable companies are providing their customers.
One big key here is integration. For example, SBC’s DSL/satellite TV service provides a degree of integration in the set top box that’s light years beyond what we’ve seen previously. The 2Wire set top box used for this set-up provides dual HDTV tuners for satellite broadcasts, OTA (over the air) HDTV tuning capabilities, digital video recorder (DVR), and the ability to tune into on-demand video and audio sent through the DSL IP connection.
This set top box is the first we’ve seen from the telco side to marry the broadcast and Internet in a single unit – combining hardware integration with a unified software/interface approach. So it’s not just a single piece of hardware that reduces the telco’s supply chain requirements – it’s a truly integrated system that lets customers “see” content on the Internet, within the service provider’s network and from broadcast sources as one single and uninterrupted expanse of entertainment.
For example, SBC’s customers can seamlessly roam from satellite TV stations to OTA broadcast stations to recorded DVR content to Yahoo!’s Launch online music and videos, and even to local content like stored photos and music. The transition between broadcast and Internet – which usually requires a complete mode shift (whether it be changing devices or at least changing to a completely different interface) – is seamless in the 2Wire system.
There’s also tight integration on the services side, – with SBC’s partner Yahoo!’s portal providing visibility into the set top from anywhere on the Internet. For example, the system lets a subscriber go into their My Yahoo! portal and interactively program the DVR by simply selecting programs in the online program guide. SBC, Yahoo! and 2Wire have effectively blurred the line between broadcast and Internet, and at the same time they’ve used the network to erase – or at least minimize – the concept of distance when it comes to personal entertainment content.
There’s even support – from 2Wire’s hardware and software, though not yet from the service itself – to provide an upstream content flow from the set top out to the user, through SBC’s network and Yahoo!’s portals (similar to Sling Media). There are some digital rights management (DRM) angles to be figured out here, certainly, and also some upstream/end-to-end QoS issues, but technically such a service is ready to be supported. With a carrier like SBC’s extensive access network (think Cingular) and Yahoo!’s pretty much pervasive reach, such a service could offer a real differentiator to that of cable.
As things stand, however, this array of partnerships (SBC with 2Wire, SBC with Yahoo!, etc.) has already impressed us with both the depth and breadth of the offering and with the first rate integration on offer. Not all of this functionality is new: we’ve been writing … for Dummies books for years that talk about making this kind of integration happen. But never before has it been as easy as the one-stop-shopping which uVerse is offering. Not only does it beat what many people have tried to cobble together on their own, (a nice goal, but not the strategic target) – it beats what almost any cable company is currently offering (the real target).
Other telcos – large and small – will no doubt be watching the forward progress of uVerse closely. Verizon’s just announced a similar portal partnership with Yahoo! – no doubt with their FTTH deployment customers in mind. 2Wire, for their part, tells us that integration with the other satellite vendor (DirecTV instead of Echostar) is something they could do quickly as well as outside of U.S. expansion. The pieces are there – fiber, satellite, portals, hardware and software integration. Now it’s just down to the execution.
