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Cable Technology Feature Article

May 09, 2013

thePlatform: Enabling Cable OTT Today

By Bob Wallace, VP of Content

Obscured by a recent fog of new service teases, overblown rumors and chest thumping proclamations was a relevant business and technology capability from video publishing giant thePlatform (News - Alert) that lets pay-TV providers roll out standalone over-the-top (OTT) subscription video services.

thePlatform recently added OTT subscription services to the number of ways it enables customers to charge for their video assets (purchase, rental and advertising). The company’s MPX video commerce engine component now enables its cableco customers roll out a Netflix-like service that is separate from their traditional pay-TV services.

By supporting this advance in its system, thePlatform, a subsidiary of top U.S. cableco Comcast (News - Alert) Corp., is equipping customers to define the near- and long-term future of TV. But since this capability represents a fairly radical departure from the norm in the U.S. cable TV industry, the huge question is whether or not it will be implemented - and how.

Ready, willing and able?

That’s exactly the question already posed by video visionary Colin Dixon (News - Alert) of nScreen Media, a firm that specializes in technology, media and entertainment. He authored a piece noting that there is traction outside the U.S. and provides a candid assessment of the U.S. market opportunity for standalone subscription OTT services from operators here in the U.S.

For an in-depth analysis and assessment, give Dixon’s piece a read.

thePlatform’s current customer list reads like a who’s who of pay-TV service providers, content owners and broadcasters. Among them are Comcast, Cox, Time Warner Cable, RCN (News - Alert), NBC Sports, USA Network, Oxygen, A& E, BT, CBS Interactive and media conglomerate News Corp.

‘Cord Whatevers’

Given the stark reality that cablecos desperately lack subscription services to young generations who have never subscribed to their pay-TV services, and therefore likely won’t, a standalone OTT service built smartly could potentially fill this void.

However, if it’s offered as a companion service to today’s pay-TV packages, it’s far more likely that these demographics will pay cablecos for broadband Internet and nothing else. Converting these Cord Whatevers requires equal parts intelligent packaging and pricing – perhaps as a high-end access/content service?

I’d be shocked if most cablecos weren’t looking at possible standalone and enhanced OTT subscription services given what thePlatform has enabled them to offer. This visionary video publishing vendor didn’t get to where it is today product and customer-wise by offering capabilities that its client’s didn’t want or wouldn’t use.

Reality check

But before you get excited about a potential array of newer-age services that don’t require traditional pay –TV subscriptions from those operators mentioned above (sorry), remember that just because something is doable doesn’t mean it’s in the best business interests of companies to do it.

Dixon writes, “Until now, U.S. cable companies, and their content partners like HBO and Disney (News - Alert), have had no interest in allowing customers to subscribe online. With 90 percent pay-TV penetration, there seemed to be little to gain, and much to lose, by allowing online subscriptions.”

Enabling technologies and products often outpace their actual market implementation and introduction. But there is some good news here. The expansion of the MPX video commerce engine, as the name implies, provides all that is needed to monetize the additional services that could be delivered, so there’s no worry over the often-missing business element of the equation.

Situation room

And the idea of standalone subscription OTT services is not completely new to cable operators. It’s much more a case of how and when to use the capabilities thePlatform now supports. Cablecos don’t want to cannibalize their pay-TV subscription base, but at the same time, losing thousands of them per quarter to alternative options largely because of price – an ongoing trend and catalyst for TV Everywhere strategies – has execs losing sleep as well.

Here’s Dixon’s snapshot of where things are in the U.S. today: “Some operators even let customers at the lower tiers subscribe separately to the OTT service. Comcast Streampix is an example of such a service. However, in these cases a customer must have a regular pay-TV subscription. The final step will be when a U.S. operator allows a customer to subscribe by credit card online just for the OTT service without having a regular pay-TV subscription.”

Agreed. I can hardly wait. Nor can those tired of the present pay-TV subscription situation who are hoping for an advance on the future of TV now.

Edited by Alisen Downey

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